Jan. 19, 2007 (China Knowledge) – Harbin Pharmaceutical Group Holdings plans to raise US$150 million from its IPO on the Hong Kong Stock Exchange this year, sources told the South China Morning Post.

Harbin Pharmaceutical and its owner Warburg Pincus declined to confirm the market rumor.

Already listed in Shanghai, the Mainland drugmaker that is partly owned by private equity firm Warburg Pincus makes drugs like penicillin and cephalosporin. Its shares has risen 34% this year.

China's hospitals have a reputation of prescribing the most expensive medicines instead of cheaper alternatives that are just as effective. Recognizing this problem, the National Development and Reform Commission (NDRC) launched an investigation into the production costs and actual retail prices of drugs in December 2005.

The Chinese government decided last year that the prices of 99 variants of antimicrobial drugs in the country will be lowered by an average of 30% in order to make them more affordable for Chinese citizens who have been complaining of rising healthcare costs.