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Tcp's exclusive interview with skystar bio-pharmaceuticalsdirector by ferujkll sdff
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Tcp's exclusive interview with skystar bio-pharmaceuticalsdirector |
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Business,Business News,Business Opportunities
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The price of pork – China"s staple meat product –is up 43% on the same time last year amid rising demand and asupply shortage following a recent outbreak of the pig diseaseblue-ear, which has already caused the death of 18,000 pigs thisyear. Skystar Bio-Pharmaceuticals (OTC BB: SKBI) Director Wen Weitells Amy Cheung of The China Perspective how the blue-ear outbreakis good news for the company. The China Perspective: Skystar recently received approval from theMinistry of Agriculture (MOA) to begin producing 36 new veterinarymedicines, including three drugs targeting blue-ear disease. Whatdo the approvals mean for the company, and do you have any otherproducts in the pipeline for approval? Wen Wei: The average gross margin for these newly approved veterinarymedicines, which include 14 western medicines and 22 traditionalChinese medicines, is expected to be above 50%. The approvalsincrease the total number of Skystar"s veterinary medicinesto over 70.
We also just received 10 more new product approvals on June 20,including trraditional Chinese medicine and western medicines inthe form of tablets, powders and injections. Eight additionalapprovals from the MOA are likely to arrive in the coming few days. In 2007, we expect a total of 100 new product approvals. Dependingon our research and development progress, we expect 20 to 30 newproduct approvals can be obtained in 2008.
TCP: Can you tell us more about your new bio-pharmaceuticalfacilities? WW: Skystar"s new bio-pharmaceutical facilities cover 14,000square meters, of which 4,700 square meters are dedicated tovaccines, 4,300 square meters to veterinary medicines and 1,000square meters to animal testing. The veterinary medicinesproduction facilities, which have met or exceeded GoodManufacturing Practice (GMP) Certification Standards and havereceived GMP Certification from the Chinese government, havealready started production. The vaccines and animal testing facilities are still underconstruction, but they are expected to be completed by the end ofthis year and will obtain GMP certification then. TCP: One of the reasons for the recent pork shortage is an outbreakof the pig disease know as blue-ear, which has already caused thedeath of 18,000 pigs this year. Is this a friend or foe toSkystar"s business? WW: First, I"d like to emphasize that blue-ear disease is onlyone of the reasons for the recent pork shortage.
However, thedisease has caused the death of 18,000 pigs, and there is currentlyno effective prescription that can cure the disease. The only thingfarmers can do is to prevent pigs from picking up infections. However, Skystar now has 3 types of traditional Chinese medicinesin the forms of vaccines that can prevent blue-ear disease, and wealso offer western vaccines that can prevent blue-ear disease andother illnesses. In a way, the pork shortage is good news forSkystar as it boosts the markets demand for our products and thusincreases our sale. The market has reacted very positively towardsour products.
TCP: Can you tell us more about your sales and distributionnetwork, which covers 27 provinces and regions as well as Vietnamand Taiwan? What is your plan to expand to new markets? WW: We currently have 400 mainland sale agents and we plan to growthis number to 600. Our sales strategy is to penetrate into townand county level where most farmers are located, push direct salesto end users and to bring our products directly to our customers.We also obtained new distributor contracts at the 2007 China StockBreeding and Forage Industry Expo in Ningbo, and these are expectedto expand Skystar's geographic presence and deepen the company'spenetration in its existing markets. We believe our sales strategycan further boost our sales revenues in 2007. Skystar exported Xylan Probiotics to Taiwan and then to Europethrough a trade company located in Qingdao.
Skystar is the OEMprovider for this trade company. We also exported Animal FeedAdditives to Vienam through a dealer located in China. Our sales network now operates on a county level covering locationsthat we did not before but we still plan to expand to new marketsof high livestock farming destiny. We will launch advertising andpromotional campaigns in these areas to make ourselves known tofarmers.
We are also moving to Tibet and Qihai province, wherethere is a high concentration of horse, sheep and cattle farming. TCP: Are counterfeit drugs a problem for Skystar? WW: Skystar products have not yet encountered any problems regardingcounterfeiting. The MOA has decided to crack down on existing fakedrugs in the market, and one of the measures it is taking is toraise the GMP threshold in terms of manufacturing and management.As all veterinary manufacturing needs to obtain GMP certification,we expect industry consolidation in the next few years under thesecircumstances. TCP: What is your forecast for Skystar"s growth this year?What are the growth drivers? WW: Our growth drivers this year are twofold. First of all, despitedeclining numbers of pigs in the first quarter, we expectsignificant increases in the number in the second half, meaninggreater demand for our products.
One of the reasons for thepredicted increase is that the government offers subsidizes tosupport the animal farming industry. The government now offers aRMB50 subsidy per pig to maintain the number of pigs at 600million. The government also aims to maintain the total number ofchickens at 14 billion. Therefore, we believe domestic animalfarming is a market of great potential.
Second, our products range from western vaccines to traditionalChinese remedies covering the entire lifespan of animals. Thisgives Skystar a definite competitive advantage. We expect we will grow faster in 2007 than in 2006, when we postedUS$12.9 million (RMB100 millions) in full-year revenues and anincrease in the overall gross profit margin at 50%. TCP: Do you have any plans to go public? WW: Skystar was listed on the OTCBB (Over The Counter Bulletin Board)since 2005, but we want to upgrade to a national exchange such asthe New York Stock Exchange or NASDAQ. However, we do not have aconcrete timeframe at the moment. I am a professional writer from Luggage Cart, which contains a great deal of information about cabin trolley bags , utility cart folding, welcome to visit!
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