First China Pharma Targets Major South China Expansion With LOI to Acquire Large Regional Pharmaceutical Distributor

March 15, 2011 |

4 min read

HONG KONG--(Marketwire - March 15, 2011) - First China Pharmaceutical Group, Inc. (OTCBB: FCPG) (“First China” or the “Company”) wishes to advise that effective March 10th, it has signed a Letter of Intent for the acquisition of 100% of the interests of Shenzhen Ming He Tang Pharmaceutical Co., Ltd. (“Min He Tang”) of Shenzhen City, Guangdong Province.

Ming He Tang was founded in 2002 and is firmly focused on the distribution of pharmaceutical products in the south China marketplace The company offers approximately 2500 drug varieties delivered to over 886 primary customers. Sales revenue for 2009 and 2010 are reported as RMB 90,000,000 (US$13.8 million) and RMB 110,000,000 (US$16.9 million).

The relationship with Ming He Tang would open a significant opportunity for First China as expansion into south China is considered a huge leap forward in the Company’s aims. Prior to the onset of negotiations, strategic planning had not targeted south China until a future date, mainly due to the highly mature state of the marketplace in the southern provinces. However, Ming He Tang is well known and respected throughout its region and offers immediate access to a very firm business foundation and existing large distribution network throughout Guangdong Province.

First China Pharmaceutical’s CEO Mr. Zhen Jiang Wang comments, “To acquire Ming He Tang would significantly and dramatically launch brand awareness of First China throughout the entire south China region. News of this magnitude would also penetrate media awareness on a national level and continue to build our brand positioning as a rapidly growing force in the industry. The signing of this LOI is an excellent and auspicious start to 2011.”

The proposed transaction will use commercially reasonable efforts to execute a definitive agreement as quickly as practicable and the Definitive Agreement shall contain customary representation and warranties, covenants and indemnification provisions.

Details of the company’s business, finances, appointments and agreements can be found as part of the Company’s continuous public disclosure as a reporting issuer under the Securities Exchange Act of 1934 filed with the Securities and Exchange Commission’s (“SEC”) EDGAR database.

About First China Pharmaceutical Group, Inc. (OTCBB: FCPG)
First China Pharmaceutical Group, Inc. aims to develop a high growth pharmaceutical distribution company generating significant revenue from the sale of healthcare products in China. As part of its business strategy, the Company has acquired the assets of Kun Ming Xin Yuan Tang Pharmacies Co. Ltd. (XYT), which includes a strategic advantage over its competitors as it is believed to be one of a limited number of pharmaceutical distribution companies in Yunnan Province that has obtained government approval to fulfill orders over the internet. First China Pharmaceutical Group plans to continue the rapid growth of the company from its current position as a provider of approximately 5,000 drugs to more than 4,700 pharmacies, hospitals and clinics in China’s Yunnan Province. For more information visit: www.firstchinapharma.com

Notice Regarding Forward-Looking Statements
This news release contains “forward-looking statements” as that term is defined in Section 27A of the United States Securities Act of 1933, as amended and Section 21E of the Securities Exchange Act of 1934, as amended. Statements in this press release which are not purely historical are forward-looking statements and include any statements regarding beliefs, plans, expectations or intentions regarding the future. Such forward-looking statements include, among other things, regulatory incentives, the development of new business opportunities, and projected costs, revenue, profits and results operations. Actual results could differ from those projected in any forward-looking statements due to numerous factors. Such factors include, among others, the inherent uncertainties associated with new projects and development stage companies. These forward-looking statements are made as of the date of this news release, and we assume no obligation to update the forward-looking statements, or to update the reasons why actual results could differ from those projected in the forward-looking statements. Although we believe that any beliefs, plans, expectations and intentions contained in this press release are reasonable, there can be no assurance that any such beliefs, plans, expectations or intentions will prove to be accurate. Investors should consult all of the information set forth herein and should also refer to the risk factors disclosure outlined in our annual report on Form 10-K for the most recent fiscal year, our quarterly reports on Form 10-Q and other periodic reports filed from time-to-time with the Securities and Exchange Commission.

ON BEHALF OF THE BOARD
First China Pharmaceutical Group, Inc.
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Zhen Jiang Wang
Chairman and CEO