Establishment of the Manufacturing Subsidiary August 10, 1998 SHIONOGI&CO.,LTD. On August 3, 1998, Shionogi & Co., Ltd. (Shionogi) established a wholly owned subsidiary named Bushu Pharmaceuticals Ltd. in Saitama, to manufacture pharmaceutical products. This is Shionogi's first plant in the Kanto district of Japan, and Shionogi will start operation on January 1, 1999. Shionogi purchased the plant including the land, building and equipment from Novartis Pharma KK(NPKK). The facility was renovated in 1992, and is capable of the total production of solid formulations. It also has a factory automation that makes it possible to operate for long hours. In Shionogi, the necessity of investment to renew existing 4 plants has been recognized. In addition, as all packaging plants are concentrated in the Kansai area, it has been discussed the importance of having such a plant in the Kanto area from risk diversification viewpoint. On the other hand, NPKK has been hoping to sell the facility to consolidate two existing plants into one. This acquisition took place as a result of a coincidence of both parties' interests. As the situation which pharmaceutical companies in Japan face is getting harder, Shionogi has decided to manufacture not only products of Shionogi and NPKK but ones contracted out from other companies. For the time being, Shionogi is planning to produce a total of 30 items. Taking its high productivity and ability to comply with new GMP regulations into account, Shionogi believes that it can supply customers with high quality products. ■Profile of the new company in Saitama Corporate Name Bushu Pharmaceuticals Ltd. Location 1, Takeno, Ohji, Kawasaki, Saitama, Japan Date of Incorporation August 3, 1998 (Start of Operation: January 1, 1999) Capital 10 million Japanese Yen President Tomiyasu Hirachi Number of Employees 100 (Anticipated)