China Biologic Receives Approval to Purchase Raw Materials

China Biologic Products, Inc. CBPO ("China Biologic" or the "Company"), a leading fully integrated plasma-based biopharmaceutical company in China, today announced that its subsidiary, Guizhou Taibang Biological Products Co., Ltd. ("Guizhou Taibang"), has received a one-time special approval from the China Food and Drug Administration (the "CFDA") to purchase up to approximately 143 tonnes of source plasma and plasma pastes from Xinjiang Deyuan Bioengineering Co., Ltd. ("Xinjiang Deyuan") for a total consideration of up to approximately RMB139 million (approximately US$22.4 million) pursuant to certain agreements entered into between Guizhou Taibang and Xinjiang Deyuan. Source plasma and plasma pastes are raw materials for producing human albumin and intravenous immunoglobulin ("IVIG") products. These raw materials are expected to be delivered during the second quarter of 2015, and the final purchase volume is contingent upon the Company's quality inspection of these raw materials. The Company expects that the final products made from such purchased raw materials will be released to market in 2015 and 2016. Mr. David (Xiaoying) Gao, Chairman and Chief Executive Officer of China Biologic, commented, "With the CFDA's special approval, this plasma purchase presents a unique growth opportunity for China Biologic in the near term. The additional supply of source plasma and plasma pastes, which represents over 20% of our current annual collection volume, will enable us to significantly improve the production utilization rate of our Guizhou production facility and better meet the growing demand for plasma products, including the highly sought-after IVIG, in tier-one cities in China. We anticipate that this purchase will have a meaningful positive impact on our top and bottom line growth over the next two years." "While the cost for these materials is moderately higher than the cost of materials from our collection stations, this transaction provides immediate access to a substantial volume of raw materials and complements our plasma collection growth strategy. We will continue to focus on expanding our collection capacity to ensure sustainable supply growth to meet the increasing market demand for plasma-based products in China," concluded Mr. Gao.