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3SBio Inc. Announces Second Quarter 2008 Results
Date:8/12/2008

2007, while revenue from our in-licensed Iron Sucrose supplement was RMB2.1 million (US$0.3 million), representing an increase of 255.9% over the second quarter 2007.

Gross Profit. Gross profit increased 38.9% to RMB54.3 million (US$7.9 million) for the second quarter 2008 from RMB39.1 million in the second quarter 2007. Gross margin was 91.1% in the second quarter 2008, marginally increasing from 90.8% in the second quarter 2007.

Operating Expenses. Total operating expenses increased by 54.3% to RMB39.1 (US$5.7 million) in the second quarter 2008 from RMB25.3 million in the second quarter of 2007 primarily due to increases in sales, marketing and distribution expense and general and administrative expense, and to a lesser extent due to an increase in research and development expense.

Research and development expense, representing 5.1% of total net revenues, increased by 62.0% to RMB3.0 million (US$0.4 million) in the second quarter 2008 from RMB1.9 million, representing 4.4% of total net revenues, in the second quarter 2007. This increase was mainly due to expenses associated with our anti-TNF mAb and HPV vaccine programs.

Sales, marketing and distribution expense, representing 44.6% of total net revenues, increased by 31.9% to RMB26.6 million (US$3.9 million) in the second quarter 2008 from RMB20.1 million, representing 46.8% of total net revenues, in the second quarter 2007 as a result of increased personnel, conference, promotional and advertising costs in line with the expansion of our sales force, marketing activities and geographical network in China.

General and administrative expense, representing 15.9% of total net revenues, increased by 186.2% to RMB9.5 million (US$1.4 million) in the second quarter 2008 from RMB3.3 million, representing 7.7% of total net revenues, in the second quarter 2007. This increase was primarily a result of increases in personnel costs and professional fees associated with on-going efforts to imp
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SOURCE 3SBio Inc.
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