KRKA, d. d., Novo mesto

Krka entered as a minority owner into two private companies in China

With the signing of contracts for increase in capital, Krka, d. d., Novo mesto entered as a minority owner into two private companies in China. These are Zhejiang Menovo Pharmaceuticals Co., Ltd. from the city of Shangju and Anhui Menovo Pharmaceuticals Co., Ltd. from the city of Guangde.

With an investment of USD 794,000 in each company, Krka acquired an ownership share of 7.5% in each company. Co-owners of the companies are foreign companies that started to invest into pharmaceutical and chemical manufacturing years ago. The contracts were signed on 23 June 2008.

Krka has been cooperating with both companies in the field of contract synthesis of key chemicals and intermediates. In accordance with long-term strategic plans, Krka acquired the ownership of the companies because it needs additional chemical synthesis capacities over the long term. With this step Krka ensured above all a competitive supply of quality key chemicals and intermediates for the production of active pharmaceutical ingredients and products in Slovenia.

About Zhejiang Menovo Pharmaceuticals Co., Ltd. and Anhui Menovo Pharmaceuticals Co., Ltd.:

The companies were founded several years ago in special industrial development zones in fast developing east provinces of Shanghai. Their principal activity is chemical manufacturing, which is adapted to demanding industry standards of Krka's key markets. The total annual sales of both companies amount to USD 30 million. The development of the companies is based on competitive advantages. These are the result of systematic establishment of the development conditions in pharmaceutical and chemical industry in China, which are highly educated personnel, excellent energy supply and transport infrastructure, and modern internationally competitive regulatory environment from ecology to taxation. Krka wants to exploit these competitive advantages to ensure suitable manufacturing capacities for its own pharmaceutical ingredients.

Date: 23. 6. 2008