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DCP, a leading international private equity firm, announced that it has reached an agreement to acquire a 9% stake in A-share listed Tonghua Dongbao Pharmaceutical Co., Ltd. ("Tonghua Dongbao" or "Company") from Dongbao Industrial Group Limited ("Dongbao Group"), for a consideration of approximately US$283 million. As part of the agreement, DCP will nominate representatives to join Tonghua Dongbao's Board of Directors and will work closely with Dongbao Group and the Company's management team to contribute to its future growth and development.

Tonghua Dongbao is a leading healthcare company in China with a pioneering market position in diabetes care. From its foundation as the first Chinese company to develop and market recombinant human insulin for the treatment of diabetes in 1998, the Company has expanded its product portfolio through a focused R&D program, built leading production capabilities and established an extensive sales network to serve medical institutions and doctors who treat millions of diabetic patients nationwide. A market leader in recombinant human insulin today, Tonghua Dongbao has built up a comprehensive product pipeline to fuel its future growth, including its recently approved insulin glargine and products at late clinical stage such as its insulin aspart and GLP-1 products.

China has the world's largest number of people with diabetes – an estimated 120 million diabetic patients as of 2019 according to the International Diabetes Federation (IDF). Despite increased public awareness of diabetes and other chronic diseases, there are still significant unmet medical needs within the broader Chinese healthcare system. As the Chinese government and public health organizations invest significant efforts and resources to improve the overall diabetes management standards, leading diabetes-focused companies like Tonghua Dongbao are expected to benefit from this market tailwind.

Jiahong Li, Chairman of Dongbao Group said: "We are delighted to partner with DCP. The DCP team has an excellent long-term investment track record in China and has nurtured many industry leading companies in the past. The strategic investment from DCP will help Tonghua Dongbao further institutionalize its shareholder base, improve its governance structure and management incentive system. Dongbao Group looks forward to working with DCP and other shareholders to bring the Company to the next level."

"DCP is very excited to become a strategic partner of Tonghua Dongbao," said David Liu, Executive Chairman of DCP. "As a pioneer and market leader in China's diabetes treatment space, Tonghua Dongbao has an outstanding management team and strong R&D and production capabilities. We are highly confident in Tonghua Dongbao's long-term growth potential and will fully leverage our resources and expertise to work closely with the management team to accelerate the Company's development."

Chunsheng Leng, Chairman and CEO of Tonghua Dongbao said: "We are excited to have DCP as our strategic investor. The cooperation between Dongbao Group, our controlling shareholder, and DCP is a win-win partnership. We look forward to working with DCP on various initiatives, such as operational improvements, M&A, and international development. Tonghua Dongbao will continue to focus on its core business in diabetes treatment, further strengthen the product pipeline, and create value for all our shareholders."

"The development of Dongbao Group and Tonghua Dongbao over the past 30 years has been an enormous success. We are deeply impressed by Tonghua Dongbao's outstanding management team and look forward to working with them on the value creation ahead." said Wayne Wang, Managing Director of DCP.