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Lotus Pharmaceuticals (OTCBB: LTUS) has begun construction of nine-storey building complex the will provide offices, R&D, production, and storage. The new facility is being built on the grounds of its existing production facility in Beijing. Lotus said that interim production of the drugs to be produced in the new building will continue with contract manufacturers.
Zhongyi Liu, CEO of Lotus, said the company expects GMP certification of the facility by December. He went on to state the company predicts $150 million of revenues in the first year that the new facility is fully operational, though he did not specify which year that will be.
That would be a huge jump in sales for Lotus, which has reported just $40 million in revenues for the first nine months of 2009.Lotus produces prescription drugs and also distributes drugs for other manufacturers. Its sales network extends to 30 provinces in the PRC. The company ended its Q3 with just $2.6 million in cash. The company did not disclose any details of how it is financing the new building.
In July 2008, Lotus announced plans to build a manufacturing plant in Inner Mongolia, through its Liang Fang Pharmaceutical subsidiary. The land cost $15.5 million and the manufacturing facility was estimated to cost an additional $49 million, including equipment.
By February 2009, that project had grown into a larger pharmaceutical park, still in Inner Mongolia. Lotus would reserve a part of the park for its own manufacturing needs and sell off the remainder. The price tag for the land involved in this project was $26 million. Presumably, the new Beijing-sited facility, now under construction, takes the place of these once-envisioned projects.
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