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60% Increase in EPO Sales for First Quarter

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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.

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