Viva Biotech and Langhua Pharmaceutical Reached the Strategic Acquisition Agreement, Accelerating the Escalation of the Service Chain of Innovative Drug Industry

SHANGHAI, Aug. 9, 2020 /PRNewswire/ -- On August 9th, 2020, Viva Biotech (Shanghai) Co., Ltd. (hereinafter referred to as "Viva Biotech" or "The Company") entered into the Share Purchase Agreement pursuant to which Viva Biotech agreed to acquire and the Vendors agreed to collectively sell 80% of the equity interest in Zhejiang Langhua Pharmaceutical Co., Ltd (hereinafter referred to as "Langhua Pharmaceutical"), at the Consideration of RMB 2,560 million. The synergy between Viva Biotech and Langhua Pharmaceutical, in areas of R&D, design and manufacturing of global pharmaceutical market is brought about by the acquisition. It is of great strategic significance for The Company to conduct vertical integration and expansion into CDMO (Contract R&D and Production Organization) business, and establish a comprehensive one-stop drug services platform.

Viva Biotech's mission is to become the cradle for promising biotechnology startups around the world. We operates a world leading structure-based drug discovery platform, providing structure-based drug discovery services to biotechnology and pharmaceutical customers worldwide for their preclinical stage innovative drug development through CFS (cash-for-service) model, as well as providing investment and incubation service to high potential biotech start-ups through EFS (equity-for service) model. Langhua Pharmaceutical is an integrated and comprehensive drug R&D and manufacturing company, striving to become the preferred Contract Development & Manufacturing Organization (CDMO) partner of its clients, including numerous multi-national pharmaceutical companies worldwide. Langhua Pharmaceutical is mainly focusing on Active Pharmaceutical Ingredients ("APIs"), intermediates production and CDMO projects. It was ranked as one of the Most Promising Pharmaceutical Companies (最具成長力企業) under the 2017 Award for Top 100 Internationalized Pharmaceutical Companies (醫藥國際化百強企業). It has obtained GMP certification from National Medical Products Administration (NMPA), official certification from the U.S. Food and Drug Administration (FDA), the European Directorate for the Quality of Medicines (EDQM) and World Health Organization (WHO) as well as the Pharmaceutical Supply Chain Initiative (PSCI).

The acquisition will enable The Company to acquire an established CDMO platform with solid track record and reputation, and expand the diversity and geographical coverage of customer groups. Through more comprehensive end-to-end services, CDMO business will help The Company to extend the existing and potential customer groups, effectively enhancing the income stream, enabling the future high-speed growth service demand of portfolio companies under EFS model, and expanding the portfolio of potential incubation projects. Based on the existing core advantages, Viva Biotech will further strengthen and expand the drug research, design and manufacturing capacity by investing more high-quality talents and facilities, including but not limited to expanding its CMC capacity and integrating its operation with the existing business of The Company. Through providing more abundant and high-quality services, The Company aims to improve the market competitiveness, so as to gain a position which allows prospective clients, including both startup biotech companies and multi-national pharmaceutical companies, to select The Company as their priority partner for comprehensive outsourcing services.

Dr. Mao Chen Cheney, the Chairman and CEO of Viva Biotech said, "The strategic acquisition agreement we made with Langhua Pharmaceutical will effectively improve the integrated service capability in new drug R&D and overall competitiveness for both sides. We have steady confidence towards the business prospects and potential future growth of Langhua Pharmaceutical. In the future, Viva Biotech will continue to take advantage of our existing technology platforms, world-class drug discovery talents and client synergy, to continue to expand further downstream towards later stage drug development through strategic cooperation, investment, and M&A. Our partners and clients can benefit from improved operational efficiency and platform capacity. We will accelerate the vertical integration of innovative drug service chain, and help our customers and portfolio companies to better develop and commercialize their products."

Mr. Mengchun Shan, Chairman of Langhua Pharmaceutical said, "The strategic acquisition agreement that reached with Viva Biotech marks an important moment in the development of Langhua Pharmaceutical. Our rich accumulation in the field of CDMO will show a good synergistic effect with the leading technological of Viva Biotech in the field of innovative drug discovery. In the future, we will continue to provide clients with more comprehensive drug development services. Driven by the innovation and cultivated by differentiated competitive advantages, Langhua Pharmaceutical aims to become the most valuable and innovating API supplier and the clients' preferred CDMO partner."

The EGM will be convened for the Shareholders to consider and, if though fit, to approve among other matters, the acquisition. After completion of the acquisition, Langhua Pharmaceutical will serve as the enlarged group's sole CDMO platform for small molecule drugs and advanced intermediate, being responsible for the operation related to the development, optimization and commercialization of small molecule drugs and intermediate.

About Viva Biotech

Viva Biotech operates a leading structure-based, integrated drug discovery platform, providing drug discovery services to biotechnology and pharmaceutical customers worldwide. Viva Biotech actively combines conventional cash-for-service (CFS) and unique equity-for-service (EFS) approaches to realize a combination of short and long term innovation-driven returns. CFS covers the full spectrum of its customers' needs for early-stage drug discovery, including target protein expression and structure research, hit screening, lead optimization, and drug candidate determination. As of December 31st, 2019, Viva Biotech has served 438 pharmaceutical customers worldwide, worked on over 1,200 independent drug targets, delivered approximately over 13,700 protein structures, and incubated/invested 46 early-stage biotech startups.

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About Langhua Pharmaceutical

Established in 1986, Zhejiang Langhua Pharmaceutical Co., Ltd is a comprehensive manufacturing enterprises focusing on API and intermediates production and CDMO projects. In addition to be considered as national High-Technology enterprises in China, Langhua has solid quality system. Since 2006, Langhua has passed the site audit and inspection from different authorities like CFDA, USFDA, WHO, EDQM and ANVISA. Meantime Langhua has been accepted by many prestigious multiple-national pharmaceutical companies, working as APIs supplier and CDMO partner. All the APIs products were listed on the GMP certificate. Focusing on the International market, Langhua aims to become the most valuable and innovating API supplier and the clients' preferred CDMO partner.

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