Many of these agreements, which are for a term of one year, were signed with several of the company’s top 10 distributors from 2007. Newly engaged distributors include Sichuan Kelun Medicine & Trade and Zhejiang Huadong Medicine.
Based upon the results of 2007’s agreements, and expected results from the new agreements, the management believes that all of the 2008 distribution agreements have the potential to generate over an aggregate of $10 million in product orders, which would represent a 20% increase over the results received from 2007’s distribution agreements.
The distribution agreements cover 27 existing products from 2007’s agreements and one newly launched drug, the Azithromycin dispersible tablet, which is used for upper and lower respiratory tract infections and other bacterial infections in the skin and reproductive system. However, the company’s two products, Arpu Shuangxin oral liquid and Ginkgo Mihuan oral liquid, along with any other new drugs that the company launches during 2008 are not included in these distribution agreements.