April 26, 2006
Asahi Kasei Medical Co., Ltd.
Asahi Kasei Pharma Corp.

Expansion of polysulfone-membrane dialyzer assembly plant in China
Asahi Kasei Medical, Japan´s largest dialyzer manufacturer, will construct a second assembly line for APS™ polysulfone-membrane dialyzers at its plant in Hangzhou, Zhejiang, China, with completion scheduled for May 2007. The new line will double capacity at the plant to over 7 million modules/year, and raise total capacity for APS™ dialyzers to 20 million modules/year.

The first assembly line at the plant in China began operating in November 2005, complementing an assembly plant with capacity for 13 million APS™ modules/year in Oita, Japan. The decision to add a second line in China is based on a confirmation that the quality, performance, and safety of product assembled in China match those of product assembled in Japan, and the establishment of a high level of productivity in the Chinese operation.

The expanded plant in China will enhance Asahi Kasei Medical´s capacity to maintain supply in the event of an unplanned interruption, and will provide an optimum base from which to serve China, Southeast Asia, the Middle East, and other developing markets. To better serve the Chinese market, Asahi Kasei Medical is also scheduled to establish a sales subsidiary in China in autumn 2006.

The market for dialyzers, also called artificial kidneys, is growing steadily in Japan and throughout the world, as the number of hemodialysis patients increases and facilities for hemodialysis therapy become increasingly available. Demand growth is particularly strong for polysulfone-membrane dialyzers, due to their exceptional performance and biocompatibility.

The new assembly line is part of an ongoing program of R&D and plant investments to heighten the trust and satisfaction of the hemodialysis community, to advance Japan´s world-leading hemodialysis technology, and ultimately to contribute to the quality of life for hemodialysis patients.

Essentials of the new APS™ dialyzer assembly line
Location: Hangzhou, Zhejiang, China
Groundbreaking: May 2006
Start-up: May 2007
Capacity: ≈3.6 million modules/year
Ownership structure: Wholly owned subsidiary of Asahi Kasei Medical
Investment: ≈¥2 billion

Asahi Kasei Medical corporate profile
President: Yasuyuki Yoshida
Establishment: July 1974
Paid-in capital: ¥800 million
Shareholding: 100% by Asahi Kasei Pharma
Head office: Tokyo, Japan
Production facilities:
  Nobeoka - production of hollow-fiber dialyzer membrane and other products
Oita - assembly of dialyzers and blood filters
Employees: 1,700 (as of Dec. 31, 2005)
Sales: ¥37.6 billion (year ended March 2005)
Main products:
  Dialyzers, leukoreduction filters for transfusion, blood purification products, Planova™ virus removal filters

Dialyzer business overview
No. of chronic dialysis patients (as of Dec. 31, 2004):
  Japan - 250 thousand (incl. peritoneal dialysis)*
Worldwide - 1.3 million (incl. Japan)†
Dialyzer market scale (2005):†
  Japan - 37 million modules
Worldwide - 120 million modules
Asahi Kasei Medical market share (2005):†
  Japan - 36% (ranked No. 1)
Worldwide - 18% (ranked No. 2)
Principal dialyzer manufacturers:
  Japan - Asahi Kasei Medical Co., Ltd., Nipro Corp., Fresenius-Kawasumi Co., Ltd., Toray Medical Co., Ltd., Kuraray Medical Inc., Nikkiso Co., Ltd.
Overseas - Fresenius Medical Care AG (Germany), Gambro AB (Sweden)

* Data from the Japanese Society for Dialysis Therapy
† Asahi Kasei Medical estimate


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