Sealand Sino-Hong Kong Cooperation: Chinese Patent Medicine Goes International

In view of the pressing problems of an ageing population, stressful work life and the constant onset of severe diseases, Shanghai Xinkang Pharmaceutical Factory, which specialises in researching and manufacturing anti-cancer medicine and various health products, last year joined forces with the Hong Kong-based Sealand Enterprises Ltd. to establish a joint venture company. The aim of the joint venture is to develop Chinese pharmaceutical products and market them via the Hong Kong platform to an international market.

Founded in 1992, Shanghai Xinkang Pharmaceutical Factory is a state-owned enterprise wholly owned by Shanghai Normal University. It specialises in transforming scientific research results into medicine and healthcare products. In particular, its Coriolus Versicolor (commonly known as Yunzhi) products, such as “Coriolus Versicolor PSP”, are very popular among users.

“Coriolus Versicolor PSP” has been granted the Chinese national invention patent since 1987. However, strong overseas demand for the product has prompted Shanghai Xinkang Pharmaceutical Factory to acquire and restructure Sealand Enterprises Ltd. so that medicine and other health products may be sold via Hong Kong to an international market.

“To make better use of the advantages of Mainland and Hong Kong enterprises, we adopted the joint venture business model,” explained Jane Lai, Managing Director of Sealand Enterprises. Since joint ventures are relatively rare in the pharmaceutical sector, there was no precedent. Fortunately, Ms Lai has had extensive experience in managing many joint venture projects for multinational organisations before joining Sealand Enterprises.

Currently, the two companies have a division of labour by profession. Shanghai Xinkang Pharmaceutical Factory, the parent company, focuses on the research and development of Chinese medicine, while Sealand Enterprises concentrates on marketing and promotion. “Hong Kong is our principal target market and a platform to go international,” Ms Lai said.

Familiar with cross-border trading, Ms Lai explained that Hong Kong’s sound legal system coupled with other regulatory measures has earned buyers’ confidence. She believes that another advantage very important in the pharmaceutical industry is “in comparison to the Chinese mainland, Hong Kong’s free flow of information allows people to always get hold of first-hand information.”

At its inception, Sealand Enterprises employed less than 10 staff in Hong Kong. They are specialists, familiar with government operations and the relevant rules and regulations related to the patent application for Chinese medicine. Looking ahead, Sealand Enterprises plans to relocate certain production operations to Hong Kong, because “the ‘Made in Hong Kong’ brand assures foreign investors’ confidence.”
www.sealand-hk.com