Under the agreement, Basin Industrial, a wholly-owned subsidiary of Hong Kong based Advance Pharmaceutical Co (APC), will fund the manufacturing and marketing of products in China, Hong Kong, Korea and Japan.
The initiative will be named Alpha AP Inc (AAP) and will house its main headquarters in Hong Kong. It is the intention of the parties involved to take the joint venture public on the Hong Kong Stock Exchange.
AlphaRx, which is entering the agreement through its wholly-owned subsidiary AlphaRx International Holdings, will provide three topical products to the joint venture, to be marketed under the APC brand. In addition to its 50% equity in the joint venture, AlphaRx will receive a 5% royalty from the gross sales attributable to the project. The company will also receive a one-time licensing fee of $10 million from the agreement, contingent upon completion of its Hong Kong public stock offering.