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Simcere Pharmaceutical Group Reports Preliminary Unaudited Second Quarter 2011 Results
Date:8/9/2011

f total revenue, research and development expenses increased to 7.3% for the second quarter of 2011 from 5.7% for the same period in 2010. For the first six months of 2011, research and development expenses totaled RMB82.7 million (US$12.8 million), compared to RMB61.8 million for the same period in 2010.

Sales, marketing and distribution expenses for the second quarter of 2011 were RMB288.9 million (US$44.6 million), which represented a decrease of 9.7% from RMB319.9 million for the same period in 2010. As a percentage of total revenue, sales, marketing and distribution expenses decreased to 52.9% for the second quarter of 2011 from 58.8% for the same period in 2010. This decrease was due primarily to the strengthened budget control and efficiency improvement on marketing activities. For the first six months of 2011, sales, marketing and distribution expenses were RMB553.2 million (US$85.5 million), which represented a decrease of 0.6% from RMB556.8 million for the same period in 2010.

General and administrative expenses were RMB74.7 million (US$11.5 million) for the second quarter of 2011, which represented an increase of 27.3% from RMB58.6 million for the same period in 2010. As a percentage of total revenue, general and administrative expenses increased to 13.7% for the second quarter of 2011 from 10.8% for the same period in 2010. This increase was due primarily to the increased salary expenses and legal fees incurred for establishing a joint venture with Merck & Co., Inc.. For the first six months of 2011, general and administrative expenses were RMB142.8 million (US$22.1 million), which represented an increase of 13.4% from RMB125.9 million for the same period in 2010.

Share-based compensation expenses, which were allocated to research and development expenses, sales, marketing and distribution expenses, and general and administrative
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SOURCE Simcere Pharmaceutical Group
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