October 24 -- Shanghai Modern Pharmaceutical (600420) said its subsidiary, Shanghai Modern Hasen (Shangqiu) Pharmaceutical, plans to invest 277 million yuan to build a production base in Shangqiu, Henan province, for the manufacture of basic drugs, reports yicai.com, citing a company filing. 

Construction of the base will take three years, and the company projects to recover the investment in 6.37 years.

Modern Hasen (Shangqiu) has a registered capital of 15 million yuan and produces 154 types of drugs. Its major products include small-volume injections, oral solid dosage forms, and special chemical pharmaceutical ingredients. The existing capacity of Modern Hasen (Shangqiu) could not keep up with market demand.

According to the filing, Modern Pharma will inject 50 million yuan into a wholly-owned subsidiary, Shanghai Modern Pharmaceutical Haimen, to ensure the smooth implementation of its projects.

The company’s board authorized the management team to invest up to 70 million yuan worth of idle funds on low-risk short-term financial products.