3SBio Inc. (NSDQ: SSRX)joined the parade of China biopharmas reporting sharply higherrevenues. In the first quarter of 2008, 3SBio saw its sales jump 57% to55.5 million RMB ($7.9 million). Gross profit climbed 56% to 50.6million RMB ($7.2 million). However, net income did not keep pace,rising a much smaller 22% to 14.2 million RMB ($2 million).

Apparently, 3SBio spent a lot of money to create the increase inrevenues, because the cause for the shortfall in net income was higherspending in the sales, marketing and distribution category. This itemclimbed 65% to 25.6 million RMB (US$3.7 million), a figure thatrepresents 46% of the company’s revenues. In the battle betweenpromoting revenues or profits, 3SBio came down heavily on the side ofrevenues, and net income suffered as a result.

3SBio has two products that produce the preponderance of its sales:

• injectable recombinant human erythropoietin [EPO] products,collectively branded ...

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