On 31 Dec., 2014, Shanghai Higher People's Court declared that Yifan Xinfu Pharmaceutical Co., Ltd.  (Yifan Xinfu) won over the D-calcium pantothenate infringement case between Yifan Xinfu and Shandong Xinfa Pharmaceutical Co., Ltd. (Xinfa Pharmaceutical) with the following verdict:

On one hand, Xinfa Pharmaceutical shall stop using the techniques that infringed on Yifan Xinfu's privileges: the technical index, production methods and keys, exceptional condition treatments, technical information recorded in the 5000T-Calcium Pantothenate production process owned by Yifan Xinfu in the technique of production of D-calcium pantothenate with microbe enzymatic method.

On the other hand, Xinfa Pharmaceutical, Jiang Honghai, Ma Jifeng shall pay Yifan Xinfu a financial loss of USD1.47 million (RMB9 million) and other expenses of USD16,34 thousand (RMB100 thousand) within 10 days after the verdict takes effect.  

Actually, the case has a history of about seven years:

1.       On 3 Dec., 2007, Yifan Xinfu brought a lawsuit to the Hangzhou Intermediate People's Court demanding that Xinfa Pharmaceutical shall be investigated for legal responsibility for its patent infringement.

2.       On 21 May, 2012, Shanghai First Intermediate People's Court convicted in the first instance that Xinfa Pharmaceutical shall stop infringing upon Yifan Xinfu’s business secrets and pay USD5.17 million (RMB31.65 million) for Yifan Xinfu.

3.       On 5 June, 2012, Xinfa Pharmaceutical appealed to Shanghai Higher People's Court. The second instance was held on 3 July, 2014 and it was declared that Yifan Xinfu won the case on 31 Dec., 2014.

According to CCM’s investigation, the major manufacturers of D-calcium pantothenate in China are Xinfa Pharmaceutical, Yifan Xinfu and Shandong Huachen Biology Science Co., Ltd. (Shandong Huachen) with a capacity of 7,000 t/a, 8,000 t/a and 2,000 t/a respectively in 2013. According to public data, as one of the enterprises with the largest product varieties, Xinfa Pharmaceutical mainly produces vitamin B1, vitamin B2, D-calcium pantothenate, vitamin B6, vitamin B9, vitamin D3, etc., among which D-calcium pantothenate and vitamin B9 are Xinfa Pharmaceutical’s major sources of revenue, and the products are mainly exported to Europe and the US, the Southeast Asia, the Middle East, etc.

As Xinfa Pharmaceutical accounts for 70%-80% of the total D-calcium pantothenate exports. Insiders believe that after Xinfa Pharmaceutical lost the case, some of Xinfa Pharmaceutical's clients overseas may suspend purchasing to avoid law and operating risks, which, however, may significantly improve Yifan Xinfu’s revenue and profit. Nevertheless, the actual influence on this industry is still up to the execution of the courts’ result and the clients’ choice.

About CCM:

CCM is the leading market intelligence provider for China’s agriculture, chemicals, food & ingredients and life science markets. Founded in 2001, CCM offers a range of data and content solutions, from price and trade data to industry newsletters and customized market research reports. Our clients include Monsanto, DuPont, Shell, Bayer, and Syngenta. CCM is a brand of Kcomber Inc.

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