Dragon Pharmaceuticals Inc. announced today that it will proceed with a private placement of up to 4,000,000 units at US$2.00 per unit for total gross proceeds of up to US$8.0 million. Each unit consists of one Common Share in the Company and one Warrant to purchase an additional one-half Common Share at US$2.00 for a period of two years. A finder’s fee will be payable in conjunction with this financing.

The proceeds of this financing will be used to provide working capital and to expand the production capacity of the Company’s EPO manufacturing facility in Nanjing, China. This additional capacity will be required to meet anticipated product orders resulting from registrations of the Company’s lead product, EPO, in a number of international territories. The proceeds will also be used to fund the development of Dragon’s follow-on generic products, which include TPO, G-CSF and Insulin.

About Dragon Pharmaceuticals Inc. D
ragon Pharmaceuticals Inc. is an international biopharmaceutical corporation engaged in the discovery, development and commercialization of genetically engineered human proteins for therapeutic use. Based on its proprietary protein expression technology, Dragon has become one of the world’s lowest cost producers of Erythropoietin (EPO) – a breakthrough drug that has revolutionized the treatment of anemia. Dragon is now applying its platform technology to the development of other generic therapeutic proteins as well as to novel protein drugs with worldwide patent potential.

Dragon Pharmaceuticals Inc. is pleased to announce that it has entered into a marketing and licensing agreement with Jelfa S.A. of Poland for the distribution of Erythropoietin (EPO), a blood growth protein used to treat anemia, in Central and Eastern Europe and the Commonwealth of Independent States (“CIS”).

The agreement grants Jelfa, the second largest pharmaceutical company in Poland, an exclusive license to sell Dragon’s EPO across 23 countries in Central and Eastern Europe and the CIS. Jelfa will also be responsible for obtaining all product registration and marketing approvals from the appropriate regulatory authorities.

The regulatory dossier for Dragon’s EPO will be submitted initially to the Polish regulatory authorities for marketing approval. Regulatory submissions will be filed in the remaining territories subsequent to receipt of approval in Poland. Dragon and Jelfa management anticipate that the regulatory submission to Polish authorities will be filed during May 2001 and that product sales in Poland will commence in early 2002.

Dragon’s proprietary protein expression technology produces substantially higher yields of EPO with a lower cost per dose than that of the world’s leading EPO manufacturers. Dragon and Jelfa management anticipate that the significantly lower price of Dragon’s product will provide a commanding competitive advantage in the territories covered by this agreement.

According to audited IMS Health Data figures, the 1999 world market for EPO was US$4.3 billion, 80% of which was based on sales to North America and the European Union. Market penetration of EPO in countries outside North America and the European Union has been severely limited because of the high cost of currently available product. Dragon expects that the introduction of affordably priced EPO will stimulate a substantial increase in the volume of EPO consumed by these highly price conscious markets.

About Dragon Pharmaceuticals Inc.

Dragon Pharmaceuticals is an international biopharmaceutical corporation engaged in the development and commercialization of generic as well as novel and patentable therapeutics. Based on its proprietary protein expression technology, Dragon has become one of the world’s lowest cost producers of Erythropoietin (EPO), and is in the process of applying its platform technology to a pipeline of additional products.

Dragon Pharmaceuticals Inc. is pleased to announce that it has been granted regulatory approval from the Chinese State Drug Administration (SDA) to enter Phase II clinical trials for two additional applications of the company’s lead product Erythropoietin (EPO).

The efficacy of Dragon’s EPO, which stimulates the production of red blood cells, will be evaluated in surgical patients who wish to avoid, or are not candidates for, transfusion of human donor-sourced blood and also in cancer patients with anemia resulting from either radiation or chemotherapy.

The clinical trial in surgical patients was initiated in December 2000, while the clinical trial in cancer patients is scheduled to begin in February 2001. Dragon expects to complete both Phase II trials by the end of 2001 and then immediately apply for SDA approval to market EPO in China for these additional indications.

“Currently, treatment for patients with anemia due to chronic renal failure is the only SDA-approved application for EPO in China. Dragon Pharmaceuticals now intends to pioneer the approval of additional applications for EPO,” said Dragon President and CEO, Dr. Longbin Liu. “Once we receive SDA approval, we will be well positioned to extend EPO registration into our established distribution channels.”

Dragon has built a distribution base of 530 hospitals across China, representing 75% of hospitals with renal dialysis facilities. International product orders have, to date, been placed by distributors in Brazil, Egypt, and Malaysia. The Company is currently in the process of establishing product registrations and distributor agreements across Southeast Asia, the Middle East, Latin America and Eastern Europe.

According to IMS estimates, the 1999 North American sales of proprietary manufacturer-produced EPO for surgical and cancer related uses was $1.2 billion. Sales of EPO to countries outside of North America and the European Union for these indications have been severely limited to date primarily because of the high cost of proprietary product.

The PRC Ministry of Health estimates that approximately 20 million surgical procedures are performed annually in China in which the patient is likely to require a blood transfusion. In addition, up to 2 million cancer patients in China per year receive chemotherapy or radiation therapy that puts them at risk of developing anemia.

About Dragon Pharmaceuticals Inc. Dragon Pharmaceuticals is an international biopharmaceutical corporation engaged in the development and commercialization of generic as well as novel and patentable therapeutics. Based on its proprietary protein expression technology, Dragon has become one of the world’s lowest cost producers of Erythropoietin (EPO), and is in the process of applying its platform technology to a pipeline of additional products.

Dragon Pharmaceuticals Inc. is pleased to announce that it has appointed Ms. Rita Jervis as VP Corporate Development. Ms. Jervis will be responsible for leading the company’s strategic planning, business development, and investor relations initiatives.

Ms. Jervis brings to her position 14 years of planning and operations experience in the biotechnology sector. In her position as President of Jervis Associates, a management consulting firm established in 1991 to provide interim executive and consulting services to emerging health sector companies, Ms. Jervis has held numerous executive and managing director positions in R&D, contract research, and venture capital firms. In addition, Ms. Jervis recently served as Executive Director of the B.C. Biotechnology Alliance and, prior to establishing Jervis Associates, held project and marketing management positions with QLT Inc. (Nasdaq: QLTI, TSE: QLT)

Dragon Pharmaceuticals also announced today that it has received approval from Standard & Poor’s to trade in 35 U.S. states under the Blue Sky rules and regulations. Dragon’s company listing was published in the January 2, 2001 edition of the Standard & Poor’s Corporation Records, a recognized securities manual widely relied upon by investment officers, pension fund managers, registered representatives, and other financial service professionals to facilitate secondary market trading.

About Dragon Pharmaceuticals Inc.
Dragon Pharmaceuticals is an international biopharmaceutical corporation engaged in the discovery, development and marketing of therapies for infectious diseases, cancer, and cardiovascular diseases. Using proprietary protein expression technology, Dragon has become one of the world’s lowest cost producers of EPO (Erythropoietin), and is currently in the process of applying its technology to six additional generic drugs. Dragon intends to become a leading biotechnology company by delivering generic drugs at affordable prices as well as by developing and commercializing proprietary drugs with worldwide patent potential.

Dragon Pharmaceuticals is pleased to announce a number of significant developments in its international marketing of Erythropoietin (“EPO”) since its last international marketing update on October 6, 2000.

Itaca Laboratories, Ltd., of Brazil, a licensee and distributor of the Company’s EPO has filed all requisite documents with Brazilian health authorities for the registration of EPO. Itaca subsequently placed an order for $1.3 million of EPO.

Pursuant to the license and distribution agreement signed in the fall of 2000, Duopharma (M) SDN BHD of Malaysia sent a team to the Company’s production facility in Nanjing, China to be trained in Quality Assurance and Quality Control procedures. These procedures will be used by Duopharma staff to complete local vialing of the Company’s bulk EPO. Duopharma subsequently placed an order for 60 million units of purified bulk EPO for their pilot production. The EPO will be used to complete a medium scale multicentric clinical trial for anemia associated with chronic renal failure in dialysis patients in February.

The Company has also made significant progress toward the signing of a license and distribution agreement with a major pharmaceutical company in Egypt. The Egyptian company has ordered 6,000 vials of EPO for use in phase three multicentric clinical trials to demonstrate efficacy in the treatment of anemia in patients with chronic renal failure. The trials will be completed at the University of Cairo and two of the major hemodialysis centers in Egypt and are scheduled for completion in June. They will include a minimum of 60 patients. The close of the clinical trials will greatly assist in achieving registration of the Company’s EPO throughout the Middle East.

About Dragon Pharmaceuticals Inc. Dragon Pharmaceuticals is an international biopharmaceutical corporation engaged in the discovery, development, and marketing of therapies for infectious diseases, cancer, and cardiovascular diseases. Using proprietary protein expression technology, Dragon has become one of the world’s lowest cost producers of EPO (Erythropoietin), and is currently in the process of applying its technology to six additional generic drugs. Dragon intends to become a leading biotechnology company by delivering generic drugs at affordable prices as well as by developing and commercializing proprietary drugs with worldwide patent potential.

Dragon Pharmaceuticals Inc. has recently signed licensing agreements with three overseas pharmaceutical companies, gaining the Company a foothold in both Latin America and Southeast Asia.

In August the company signed a license and distribution agreement with Duopharma (M) SDN BHD, of Malaysia, granting Duopharma rights to market the Company¡¦s flagship recombinant Erythropoietin for injection (epoetin-alfa) in the ASEAN member nations of Brunei, Myanmar, Thailand, Malaysia, Laos, Thailand, The Philippines, Vietnam, Cambodia, and Indonesia.

The Company has concluded negotiations that led to the signing of a license and distribution agreement with Itaca Laboratories, Ltd., of Brazil. The agreement gives Itaca the rights to market and distribute the Company¡¦s epoetin-alfa within the MERCOSUR economic pact member nations of Brazil, Argentina, Paraguay, Chile, Uruguay, and the Dominican Republic.

Both Duopharma and Itaca are regional pharmaceutical companies, with aggressive marketing and sales strategies and networks of clinical representation. These companies also carry product lines that compliment Dragon¡¦s EPO and drugs under development. The Latin American and Southeast Asian markets represent potential for Dragon, as the exorbitant cost of biotech medications has prevented the majority of patients from benefiting from Erythropoietin therapy.

The company has also successfully finished negotiations with Yoo & Yoo BioTech Co. Ltd., of South Korea, leading to an agreement for Yoo & Yoo to import, market, and distribute the Company¡¦s products in South and North Korea. Yoo & Yoo was founded by Dr. Tae-Aun Yoo two years ago, and is among the very first Korean company to focus solely on the formation of biotech business. Dr. Yoo has more than 20 years experience in the pharmaceutical industry, and formed Yoo & Yoo after leaving his post as head of regulatory affairs at Korea¡¦s Boryung Biopharma.

Dragon Pharmaceuticals Inc. is pleased to announce that the Board of Directors has approved the extension of the Company’s outstanding common share purchase warrants for a period of 2 months. The exercise price remains at $2.50 and the warrants may be exercised until March 1st, 2001.

Dragon Pharmaceuticals is an international biopharmaceutical corporation engaged in the discovery, development and marketing of therapies for infectious diseases, cancer, and cardiovascular diseases. On the basis of its proprietary protein expression technology, Dragon has become one of the world’s lowest cost producers of EPO (Erythropoietin), a blood growth factor used to treat anemia. The 1999 world market for EPO was estimated at US $4.8 billion, with sales expected to grow at a rate of 20 – 25% annually. Dragon is currently in the process of applying its proprietary technology to a number of additional generic drugs.

The Company is pleased to announce that The State Drug Administration (SDA) of China (China¡¦s equivalent to the FDA in the United States) has recently granted a certificate of Good Manufacturing Practices (GMP) to Dragon¡¦s subsidiary Huaxin Pharmaceutical and Bioengineering Co. Ltd., following an inspection of Huaxin¡¦s plant in July of this year.

The GMP certificate is one of the key documents allowing Dragon to successfully register and gain approval for its drugs in overseas markets. The certificate, which was granted only after an exhaustive inspection by SDA authorities, is one of the first granted under the more stringent World Health Organization guidelines. To date, only a small fraction of plants in China have successfully passed GMP certification under the new regulations.

Such an inspection normally focuses not only on a plant¡¦s physical properties, but also on the thoroughness of its documented procedures for sanitation and manufacturing. Additionally, the individual qualifications of all staff were scrutinized to insure that key personnel meet criteria for education and professional experience.

The Company is also pleased to announce revenues of US$797,127 from the sale of Erythropoietin in China for the second quarter of 2000, representing 21% increase over revenues during the first quarter of 2000. During the second quarter the company recorded sales of 75,049 units. The Company incurred a net loss of US$184,540 for the same period.

The Company is pleased to announce revenues of US$817,500 from the sale of Erythropoietin in China for the first quarter of 2000. During the first quarter the Company recorded sales of 58,870 units, representing an increase of 60% over sales and revenues in the last quarter of 1999.

Dragon is currently in the late stages of negotiation with a major Middle Eastern pharmaceutical company for the licensing for sales and distribution of NingHongXin? rHu Erythropoietin. The Middle Eastern company has taken delivery of a large lot of sample Erythropoietin and will begin a small-scale phase II clinical trial for chronic renal failure patients undergoing hemodialysis.

The Company is also working to assemble a dossier of materials for an additional prospective licensee for registration in South East Asia, who is likely to opt for local elaboration of Dragon¡¦s rHu Erythropoietin. Dragon is also in the early stage of negotiations with a North African partner for the licensing for sales and distribution of rHu Erythropoietin in a number of African countries. Three Latin American pharmaceutical companies are also currently examining prospects for similar agreements.

Dragon Pharmaceuticals, the largest EPO producer in China, is currently a leading biotech company focusing on the research, development, production, and marketing of biodrugs.

Dragon Pharmaceuticals Inc. is pleased to announce that Nanjing Huaxin Biotech Co., Ltd. has acquired co-development rights to a Pichia yeast culture system for the production of TPO from Kelong Industrial Co., Ltd, a Chinese company.

Dragon holds a 75% equity interest in Nanjing Huaxin. TPO is a blood growth factor that stimulates the production of platelets that are required in the process of haemostasis (i.e. blood coagulation), which is a critical process in blood clotting and wound healing.

Amgen and Genentech are developing TPO in North America, with Amgen using an E. coli bacterial system (and then modifying the protein for human use using PEG technology) and Genentech using a CHO cell culture. The Genentech technology was sold to Pharmacia-Upjohn, where it has entered Phase III clinical trials.

Huaxin has developed a Pichia yeast system which is expected to have a higher yield than the mammalian CHO cell line. Pre-clinical and animal studies that are required in China for permission to start human clinical trials have been completed. Since a yeast culture system for TPO has not been utilized anywhere in the world, Dragon’s TPO could be categorized as a Class I new drug in China by the State Bureau of Drug Administration. If a new drug license is granted, Dragon will enjoy exclusive marketing rights on TPO produced from a yeast culture system for 15 years in China. The Company plans to utilize its existing production facilities at Nanjing Huaxin and anticipates that its TPO product could be ready for marketing within two years.

Dragon Pharmaceuticals, the largest EPO producer in China, is currently a leading biotech company focusing on the research, development, production, and marketing of biodrugs throughout China.