NewCap Partners, Inc. - Private Investment Bankers

-Japanese and Chinese Biotech Companies Combine to Increase R&D Productivity and Market Opportunity

TOKYO and SHANGHAI, June 20, 2005 GNI Ltd. and Shanghai Genomics announced today that the two companies have completed a merger. NewCap Partners, Inc. (www.newcap.com) served as Shanghai Genomics' investment advisor for the transaction. GNI concurrently raised a private equity round of financing of over $13M led by Nomura, Healthcare Partners and several other U.S. and Japanese private equity firms.

The merger delivers several benefits, most notably from Shanghai Genomics' Western-quality discovery research, preclinical development, and contract research services to facilitate cost-efficient drug development, faster revenue generation and, ultimately, profitability for the united company.

Moreover, the merger will combine drug development technologies that will streamline GNI's discovery, preclinical and clinical programs. GNI will also leverage U.K. and Japanese derived, high-value drug targets and molecules and benefit from the efficiency and speed of Chinese preclinical and clinical development.

The combined company will have a research staff of over 80 employees (20 Ph.D.) in Japan, China and the United Kingdom, several drug candidates in clinical and pre-clinical development, and rapidly growing collaboration revenues from U.S., European and Japanese pharmaceutical companies outsourcing biological R&D to China.

Dr. Christopher Savoie will serve as CEO of GNI, Dr. Ying Luo as the Company's President, and Dr. Jun Wu will become CSO. Both Luo and Wu will join the GNI board.

"GNI has the right business and financial model for Asian life sciences at the right time," said Richard Parkinson, a principal with Healthcare Partners. "With its combined technology, clinical development, growing collaboration revenues and access to the Japanese financial markets we expect GNI to become a driving force for innovation, growth and industry consolidation in Japan, China and greater Asia."

"This was a logical business step for both our companies," said Dr. Savoie, "GNI and Shanghai Genomics have been working together over a year in a successful drug development collaboration. As our work progressed, it became clear that a combined company would be better positioned to achieve our R&D and business objectives. This is but the first step of our aggressive growth strategy for becoming a major global pharmaceutical company based in Asia."

"China has seen double-digit growth in the healthcare market and will become the fifth largest pharmaceutical market in the world. Combined with GNI, we are better positioned to take advantage of this historic opportunity," said Dr. Luo.

GNI Ltd. is a global pharmaceutical development group with offices in Japan, the U.K. and the United States. GNI develops therapeutic pharmaceutical products internally and in collaboration with other pharmaceutical companies through gene regulatory networks and systems pharmacology techniques based on gene regulatory network research at the University of Cambridge (Cambridge, UK), Kyushu University and the University of Tokyo in Japan.

GNI's founders pioneered the use of gene regulatory network maps in microbes and in humans to identify effective pharmaceutical molecules in the genome. The Company currently has internal development programs in infectious disease, cardiovascular disease, inflammation and cancer (anti-tumor) indications.

Shanghai Genomics is a Chinese biopharmaceutical company that develops novel therapeutics for the treatment of fibrosis, infectious disease, and cancer. Its integrated drug discovery platform includes signaling pathway mapping, gene expression profile studies, protein expression and purification, animal modeling, medicinal chemistry, and bioinformatics, and has enabled the rapid develop of a rich product pipeline. This month China's SFDA approved the IND for its anti-fibrosis lead compound.

Drs. Ying Luo and Jun Wu, the Company's founders, received their graduate training and worked at well-known U.S. companies before returning to China to start Shanghai Genomics. The Company occupies a brand new 3,000 square meters building (one of the most modern laboratory facilities in China) located in Shanghai's prestigious Zhangjiang Hi-Tech Park. International media such as the Wall Street Journal and Forbes Magazine has covered the founding story of Shanghai Genomics.

Steven V. Yoder
GET THE WORD OUT COMMUNICATIONS
537 Jones Street, #2436
San Francisco, CA 94102
415-294-4133 ph/fax
www.getslightlyfamous.com

NEWS

<< Back to News Releases

GNI Ltd. and Shanghai Genomics Merge


	NEWS

	<< Back to News Releases GNI Ltd. and Shanghai Genomics Merge -Japanese and Chinese Biotech Companies Combine to Increase R&D Productivity and Market Opportunity TOKYO and SHANGHAI, June 20, 2005 GNI Ltd. and Shanghai Genomics announced today that the two companies have completed a merger. NewCap Partners, Inc. (www.newcap.com) served as Shanghai Genomics' investment advisor for the transaction. GNI concurrently raised a private equity round of financing of over $13M led by Nomura, Healthcare Partners and several other U.S. and Japanese private equity firms. The merger delivers several benefits, most notably from Shanghai Genomics' Western-quality discovery research, preclinical development, and contract research services to facilitate cost-efficient drug development, faster revenue generation and, ultimately, profitability for the united company. Moreover, the merger will combine drug development technologies that will streamline GNI's discovery, preclinical and clinical programs. GNI will also leverage U.K. and Japanese derived, high-value drug targets and molecules and benefit from the efficiency and speed of Chinese preclinical and clinical development. The combined company will have a research staff of over 80 employees (20 Ph.D.) in Japan, China and the United Kingdom, several drug candidates in clinical and pre-clinical development, and rapidly growing collaboration revenues from U.S., European and Japanese pharmaceutical companies outsourcing biological R&D to China. Dr. Christopher Savoie will serve as CEO of GNI, Dr. Ying Luo as the Company's President, and Dr. Jun Wu will become CSO. Both Luo and Wu will join the GNI board. "GNI has the right business and financial model for Asian life sciences at the right time," said Richard Parkinson, a principal with Healthcare Partners. "With its combined technology, clinical development, growing collaboration revenues and access to the Japanese financial markets we expect GNI to become a driving force for innovation, growth and industry consolidation in Japan, China and greater Asia." "This was a logical business step for both our companies," said Dr. Savoie, "GNI and Shanghai Genomics have been working together over a year in a successful drug development collaboration. As our work progressed, it became clear that a combined company would be better positioned to achieve our R&D and business objectives. This is but the first step of our aggressive growth strategy for becoming a major global pharmaceutical company based in Asia." "China has seen double-digit growth in the healthcare market and will become the fifth largest pharmaceutical market in the world. Combined with GNI, we are better positioned to take advantage of this historic opportunity," said Dr. Luo. About GNI Ltd. GNI Ltd. is a global pharmaceutical development group with offices in Japan, the U.K. and the United States. GNI develops therapeutic pharmaceutical products internally and in collaboration with other pharmaceutical companies through gene regulatory networks and systems pharmacology techniques based on gene regulatory network research at the University of Cambridge (Cambridge, UK), Kyushu University and the University of Tokyo in Japan. GNI's founders pioneered the use of gene regulatory network maps in microbes and in humans to identify effective pharmaceutical molecules in the genome. The Company currently has internal development programs in infectious disease, cardiovascular disease, inflammation and cancer (anti-tumor) indications. For further information please visit: http://www.gene-networks.com About Shanghai Genomics Shanghai Genomics is a Chinese biopharmaceutical company that develops novel therapeutics for the treatment of fibrosis, infectious disease, and cancer. Its integrated drug discovery platform includes signaling pathway mapping, gene expression profile studies, protein expression and purification, animal modeling, medicinal chemistry, and bioinformatics, and has enabled the rapid develop of a rich product pipeline. This month China's SFDA approved the IND for its anti-fibrosis lead compound. Drs. Ying Luo and Jun Wu, the Company's founders, received their graduate training and worked at well-known U.S. companies before returning to China to start Shanghai Genomics. The Company occupies a brand new 3,000 square meters building (one of the most modern laboratory facilities in China) located in Shanghai's prestigious Zhangjiang Hi-Tech Park. International media such as the Wall Street Journal and Forbes Magazine has covered the founding story of Shanghai Genomics. For further information please visit: http://shanghaigenomics.com/ Contact: Steven V. Yoder GET THE WORD OUT COMMUNICATIONS 537 Jones Street, #2436 San Francisco, CA 94102 415-294-4133 ph/fax www.getslightlyfamous.com Carol Cherkis, Ph.D GNI, Ltd. 560 S. Winchester Blvd. - Ste. 500 San Jose, CA 95128 Tel: 408-572-5567 Fax: 408-572-5561 www.gene-networks.com