its website titled “NDRC commenced appraisal on the pricing of the pharmaceutical products newly admitted to the Insurance Catalogue; investigations into pharmaceutical companies which substantially increased the prices of their pharmaceutical products that have been admitted to the Insurance Catalogue” (《國家發展改革委已啟動新進醫保目錄藥品核價工作，對企業在醫保目錄公佈前後的漲價行為從嚴核查》). We have only one key in-licensed product, Deanxit, which was newly admitted to the Insurance Catalogue in 2009. For the three years ended 31 December 2007, 2008 and 2009 and the six months ended 30 June 2010, our sales of Deanxit amounted to US\$26.1 million, US\$36.7 million, US\$44.5 million and US\$26.0 million, respectively, accounting for 50.5%, 50.6%, 46.1% and 42.5% of our total turnover in the respective periods. We are not aware of any substantial increase in the retail prices of Deanxit in 2009 immediately prior to or soon after its admission to the Insurance Catalogue in 2009. On 2 July 2010, the NDRC issued a press release on its website announcing an investigation into the prices of about 900 types of pharmaceutical products from more than 900 manufacturers, which are either newly admitted to the Insurance Catalogue or are subject to price ceilings. The Drug Price Review Centre of the NDRC published a list of manufacturers and pharmaceutical products subject to price investigations. One of our key in-license products, GanFuLe, and its Hunan-based manufacturer were named on this list. For the three years ended 31 December 2007, 2008 and 2009 and the six months ended 30 June 2010, our sales of GanFuLe amounted to US\$2.6 million, US\$3.9 million, US\$4.8 million and US\$2.0 million, respectively, accounting for 5.0%, 5.4%, 5.0% and 3.3% of our total revenue in the respective periods. The price investigation by the NDRC may not necessarily lead to a lowering of GanFuLe’s retail price ceiling. Given GanFuLe’s minimal contribution to our total turnover, even if the investigations result in the lowering of GanFuLe’s retail price ceiling and our selling price is negatively impacted, we believe that this will not have a material adverse impact on our business and profitability.

Save as disclosed above, as at the Latest Practicable Date, we had not received any notification nor are we aware of any price investigation by the NDRC against any of our key in-licensed products. However, we cannot assure you that we or any of our other key in-licensed products will not be subject to any price investigations or other investigations carried out by any PRC governmental bodies. Please refer to the risk factor headed “Our ability to set or raise the prices of our products which are included in the Insurance Catalogue is limited by price control measures imposed by the PRC government. If any of these measures is further tightened or any retail price ceiling is significantly lowered, our business and profitability may be adversely affected” in the section headed “Risk Factors” in this prospectus for further details.

# OUR COMPETITIVE STRENGTHS

We believe that the following competitive strengths position us well for continued growth:

# We are the largest pharmaceutical service company providing marketing, promotion and sale services in China for specialty pharmaceutical companies, and we benefit from economies of scale.

According to the Frost & Sullivan Report, we are the largest pharmaceutical service company providing marketing, promotion and sale services for prescription pharmaceutical products in China, and we operate the largest third-party promotion platform in China in terms of hospital coverage, therapeutic focus and number of salespeople. We maintained our lead in sales over our competitors in the three years from 2007 to 2009. We have a growing professional and experienced marketing, promotion and sales team of over 950 employees covering 30 provinces, 97% of the provincial capitals and 86% of prefecture level cities in China. Our marketing, promotion and sales team grew from approximately 550 staff at the end of 2007 to 702, 750 and over 950 in 2008, 2009 and at the end of July 2010, respectively. In addition, we have the largest third-party marketing and sales network, covering close to 6,000 hospitals, including 91.5% of class-three hospitals and 34.6%