May 7, 2007
Asahi Kasei Medical Co., Ltd.
Asahi Kasei Pharma Corp.

Chinese marketing and sales subsidiary for medical devices
Asahi Kasei Medical (AM) will establish a subsidiary in Hangzhou, Zhejiang, China to expand marketing and sales of dialyzers, also called artificial kidneys, in the Chinese market. The new subsidiary, Asahi Kasei Medical Trading (Hangzhou) Co., Ltd. (AMH), is scheduled to begin operation in June 2007.

AM is Japan's largest and the world's second largest dialyzer producer, with its dialyzers sold in over sixty countries throughout the world. Its dialyzers have been sold in China since 1991, with local partners handling distribution and sales agency. The establishment of AMH as a dedicated subsidiary to serve the Chinese market will enable AM to better meet growing demand for dialyzers with timely response to local market dynamics and an expanding distribution network directed toward growth.

In November 2005 AM completed the construction of a dialyzer assembly plant in Hangzhou, Zhejiang, China, to help meet growing demand world-wide for polysulfone-membrane dialyzers. Importation to Japan of dialyzers assembled at the Chinese plant began in spring 2006, and a second assembly line at the plant is under construction to double capacity by June 2007. Application has been filed for the necessary regulatory approval for dialyzers assembled there to be sold in China. With this approval, the Chinese assembly plant will serve to supply dialyzers to markets both in China and elsewhere throughout the world.

Once its dialyzer-related business is established, AMH will expand operations to include the marketing and sale of therapeutic apheresis products and other medical devices in AM's product lineup. AMH is the third overseas subsidiary for medical device marketing and sales; Asahi Kasei Medical America Inc. serves the North American market and Asahi Kasei Medical Europe GmbH serves the European market. The three subsidiaries will play a key role in AM's strategic global expansion of business, with AMH in particular being a vital element in advancing market leadership in Asia.

AMH corporate profile
  Name: Asahi Kasei Medical Trading (Hangzhou) Co., Ltd.
  Location: Hangzhou, Zhejiang, China
  Paid-in capital: US$300,000
  Shareholding: 100% by Asahi Kasei Medical
  Establishment: September 2006
  Start-up schedule: June 2007
  Business line:
    Marketing and sale of dialyzers, to be expanded to include other medical devices
  Sales target: ¥400 million in FY 2007, ¥1.1 billion in FY 2010
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
    China - assembly of dialyzers
  Employees: Approx. 1,700 (as of Mar. 31, 2006)
  Sales: ¥40.1 billion (year ended March 2006)
  Main products:
    Dialyzers, therapeutic apheresis products, leukoreduction filters for transfusion, Planova™ virus removal filters
Dialyzer business overview
  No. of chronic dialysis patients (as of Dec. 31, 2005):
    Japan - 260 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 (2006):†
    Japan - 37% (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)
* According to the Japanese Society for Dialysis Therapy
† Asahi Kasei Medical estimate


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