Guangxi Lingfeng Pharmaceutical (GLP), founded in 1975 and organized under the laws of China, specializes in manufacturing and distribution of plant-based medicines in China.
Over the past 30 years, GLP has developed a valuable product portfolio aimed at pediatrics, gynecopathy and the treatment of digestive and respiratory system illnesses.
The purchase price of approximately $25 million consists of approximately $20 million in cash and 1,200,000 shares of restricted common stock of American Oriental Bioengineering (AOB).
The acquisition is designed to extend AOB’s product line into the area of women’s health and create synergies between GLP’s Jinji series of drugs aimed to treat gynecological inflammations, such as endometritis, annexitis, and AOB’s Cease Enuresis product line for the treatment of bedwetting and nighttime urination, primarily targeted at pregnant and post-pregnant women.
GLP has a portfolio of 70 products and operates a distribution network based in Beijing, which extends across China, with a particularly strong presence in Southern China where AOB has yet to establish a significant distribution network.
“GLP is an established and proven manufacturer of plant-based pharmaceuticals with a valuable brand, an extensive distribution network and the opportunity to capitalize on their under-utilized product portfolio,” said Tony Liu, Chairman and CEO of AOB. “The Jinji Series of gynecological products will contribute to AOB’s position in women’s health products, which is a large and rapidly growing market in China.”
Mr Liu continued, “AOB expects to leverage GLP’s proprietary product portfolio to improve the breadth of our product offerings. GLP also delivers strength in distribution in southern China where AOB has historically been under-represented.”