News Release

Yamanouchi Pharmaceutical Co., Ltd.

Shenyang Yamanouchi Pharmaceutical Completes New Factory

May 8, 1997

Shenyang Yamanouchi Pharmaceutical Co., Ltd.(President: Isao Kishi), a subsidiary of Yamanouchi Pharmaceutical Co., Ltd. (President and CEO: Masayoshi Onoda), has completed construction of a new factory in the Shenyang Economic and Technology Development Zone in China. On May 8, Shenyang Mayor Mu Sui Xin, Japanese consulate Shigeo Yamato, and about 200 other guests attended an opening ceremony for the factory.

The 70,000-square-meter factory site houses a three-story ferroconcrete building with state-of-the-art facilities capable of producing up to 30 million solid formulation oral tablets per month. The building also includes a logistics center with storage capacity of approximately 1,200 square meters and an office and welfare facility of some 1,800 square meters. Groundbreaking took place in March 1995, and construction costs amounted to approximately 2.2 billion yen. The plant complies with Good Manufacturing Practice (GMP) standards for pharmaceutical production management and quality control as well as ISO 9002 international quality control standards. This cutting-edge factory was built with ample provision for drainage, waste disposal, and other environmental preservation considerations.

Established in October 1994, Shenyang Yamanouchi Pharmaceutical is a joint venture of Yamanouchi and Shenyang No. 1 Pharmaceutical Manufacturing Factory (Director: Zhang Lian Gang). The company already produces josamycin, an antibiotic; nicardipine, a calcium antagonist; famotidine, an H2 antagonist; tamsulosin, a treatment for functional symptoms of benign prostatic hyperplasia; and two other products at an existing facility. Moreover, Shenyang Yamanouchi Pharmaceutical boasts a sales network covering Shenyang, the location of the head office, and Beijing, Shanghai, Guangzhou, Dalian, Tianjin, Wuhan, Chengdu, Nanjing, Hangzhou, and 10 other metropolitan areas while maintaining a force of approximately 60 medical representatives carrying out marketing activities.

Shenyang Yamanouchi Pharmaceutical plans to launch a steady stream of new Yamanouchi-developed drugs. The joint venture currently employs 200 people and aims to increase its workforce to 300 and achieve annual net sales of 3.0 billion yen in 2000.

Yamanouchi is working to establish a global operating structure based in Asia, Europe, and North America as a medium- and long-term strategy and is gradually bolstering its operations in Asia. In Taiwan, the joint venture Taiwan Yamanouchi Pharmaceutical Co., Ltd., and the parent company's Taipei Branch have already established their own sales network, while Korea Yamanouchi Pharmaceutical Co., Ltd., and the parent company's Seoul Office operate an independent marketing system in South Korea. Yamanouchi Pharmaceutical is pursuing expansion in the Philippines, Indonesia, Thailand, and other countries in Southeast Asia.

The completion of the new factory and the start of full-scale production and sales activities in China are expected to provide further impetus for carrying out Yamanouchi's business strategies in Asia.