China SFDA approves new production line for NeoStem's Suzhau Erye

There was good news for USA-based NeoStem (NYSE Amex: NBS) yesterday, as China’s medicines regulator approved a production facility for its majority-owned subsidiary Suzhou Erye Pharmaceutical which will ease capacity constraints for the group.

NeoStem, an international biopharmaceutical company with product and service revenues, global research and development capabilities and operations in three distinct business units - US adult stem cells, China adult stem cells and China pharmaceuticals, said that Erye has received approval from the State Food and Drug Administration (SFDA) in China for its sixth major production line which is responsible for the production of over 20 finished pharmaceutical products, 80% of which are on the National Insurance Drug List.

The combined production lines now certified by the SFDA are six of eight planned and were responsible for around 99% of Erye’s 2010 revenues. In 2010, Erye reported full year sales of close to $70 million, generating approximately $10 million in earnings. Erye reported sales of over $18 million for first-quarter 2011. This represents an increase of 15% versus the same period a year ago and 43% versus the same period two years ago. More importantly, the capacity constraints associated with Erye operating out of its former facility have been removed.