Dragon Announces Update on Business Strategy

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Dragon Pharmaceuticals Inc. (OTC BB: DRUG; TSX: DDD) today announced that it has undertaken to reevaluate its corporate strategy following the appointment of Dr. Alexander Wick as President in October 2002. A clear focus on strengthening Dragon’s sales capacity has been decided by the company’s Executive Committee.

“Over the last four years Dragon has established a solid foundation for initiating strong revenue growth. The company has gained extensive expertise in the production of high quality proteins, which has enabled us to capture a significant portion of the Chinese EPO market.” said Dr. Wick. “We now have acquired in depth knowledge and experience in the drug approval procedures with the Chinese State Drug Administration (“SDA? and are able to minimize the cost of operations by conducting product development, clinical trials to support SDA approval, and production in China. As we built our international sales, we have become proficient with the regulatory process in these markets by partnering with established pharmaceutical companies possessing efficient regulatory and marketing expertise.?p> ?003 is going to be an important milestone in Dragon’s corporate history. Based on the new business strategies as well as the continued competitive advantages that we enjoy in China, we are confident that the company will achieve profitability this year” said Dr. Wick. “In addition to profitable EPO sales, one of the other long term blue sky potentials for Dragon relies upon the successful outcome of our research partners?ability to develop new applications for our EPO and to demonstrate the therapeutic validity of these new indications.”

In 2003 Dragon will benefit significantly from its biotechnology experience and regulatory expertise.

1. Expanding Erythropoietin opportunities:

• The company is finalizing product registration and approval of its EPO for surgery and cancer chemotherapy use in China. New dosage strengths will become available following these approvals.
• Dragon will continue to actively pursue the market opportunities in the highly prospective bulk EPO market. Year 2002 marked a remarkable breakthrough for Dragon when the company successfully entered the bulk EPO market for drug research and development purposes. The company recorded a $3.7 million order from a well established pharmaceutical company for research and development last year.
• Successful completion of product registrations and the subsequent launch of EPO in several additional markets are expected. Dragon has partnered with 14 international licensees for the distribution of EPO throughout Central and Eastern Europe, Asia, Latin America, Africa and the Middle East.
• The development of a slow release formulation of our EPO in collaboration with the Swedish firm Bohus BioTech AB is actively being pursued.

2. In-licensing International Products into China:

In 2003, Dragon is undertaking steps to in-license several high-potential third party pharmaceutical products and market through its own sales channels in China. Dragon will capitalize on the efficiencies of the SDA’s clinical trial and regulatory drug approval system by seeking product approvals in China for international pharmaceutical companies.

3. Out-licensing Chinese Products to International Markets:

Dragon will add other Chinese pharmaceutical products to its international distribution network by using its combined regulatory and marketing expertise for approvals.

“To build on our momentum we will further enhance the management team and secure more valuable product lines. Based on the new opportunities, as well as the continued competitive advantages that we enjoy in China, we are confident that the company will achieve our goals this year.” said, Dr. Wick, “Dragon will enjoy a tremendous long-term potential by developing new EPO applications with other research partners.”

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