Universe Pharmaceuticals Inc. (UPC) stock prices were down by 3.93% as of the market closing on June 29th, 2021, bringing the price down to USD$2.93 at the end of the trading day. Subsequent after-market fluctuations have seen the stock surge by 17.23%, bringing it up to USD$3.47.
Collaboration with Kitanihon
May 25th, 2021 saw the company announce having entered into a letter of intent for strategic cooperation with Kitanihon Pharmaceutical. UPC plans to strategically collaborate with a Japanese company that specializes in the research, development, manufacturing, and distribution of healthcare products.
Details of the LOI
As per the LOI, the partnership will seek to establish a flagship store on global.jd.com, which is a popular e-commerce platform in China that offers imported products. UPC will operate the flagship store and sell Kitanihon’s products as an exclusive distributor. Distribution of KP’s products will span Chinese and Southeast Asian markets through respective international e-commerce channels, with the aim of fostering growth opportunities for both companies.
Furthermore, UPC and KP have agreed to collaborate on the establishing of a medical product research and development center, which will be named Universe Hanhe Medical Research Institute Co., Ltd. Scaffolding by favorable policy treatment from the Chinese government, UPC will make use of its R&D capacity and medicinal resources, while KP will utilize its quality control standards and advanced technologies. Together the two will pool resources towards the development of expanding their portfolio of medical products.
Joint Venture Facility
According to the LOI, the achievement of specific strategic goals will lead to the collaborative construction of a manufacturing facility in accordance with the market access requirements from Japan’s Pharmaceutical and Medical Devices Agency (PMDA). The companies will collaborate to ensure the facility will be recognized as a qualified foreign manufacturer of pharmaceutical products, as well as facilitate PMDA certification as a Chinese medicine brand.
UPC is a pharmaceutical producer and distributor in China that specializes in traditional Chinese medicine derivative products. Its target consumer audience is the elderly, with the aim of addressing physical conditions through the aging process and to facilitate the promotion of their general well-being. With the company’s products being sold in 30 provinces in China, it also distributes and sells biomedical drugs, medical instruments, Traditional Chinese Medicine Pieces, and dietary supplements manufactured by third-party pharmaceutical companies.
Future Outlook for UPC
Armed with the expanded pool of resources from its ongoing partnership, UPC is poised to capitalize on the opportunities afforded to it and continue its trajectory of success. Current and potential investors are hopeful that management will continue to leverage the resources at their disposal to facilitate significant and sustained increases in shareholder value.