* Aiming to develop the [genetically recombined albumin] for the second time in the

   world
* Joint R&D of the [genetically recombined albumin] with the ranking 1st life science

   group in China
* Possible stable supply of safe [albumin] to intercept the possibility of virus infection

   by 100%
* Preparation of a chance of mutual growth with joint R&D between the R&D leaders in

   the life science fielding Korea and China

SK chemicals(CEO and vice chairman, Chang-Geun Kim) announced that it had made a contract for the joint development of the [genetically recombined albumin](hereinafter ‘recombined albumin’) with NCPC(CEO, Changxing), the biggest pharmaceutical firm in China, in Shijiazhuang city, Hebei province, China on December 13, 2007.

Albumin, a kind of protein in human body, which has been extracted from human blood so far, has not only been exposed to a risk of virus infection but has also been accompanied by a lot of difficulty in stable product supply due to rise in supply prices pursuant to shortage of blood ingredients.

R&D for mass production of [recombined albumin] using a genetic recombination technology has actively proceeded throughout the world since 2000 in order to solve such a problem fundamentally and to replace the blood extracted albumin.

Currently, Japanese Mitsubishi Pharmaceuticals is expecting final license approval by succeeding in the development of [recombined albumin] for the first time in the world, and Chinese NCPC is also currently preparing for the production of products for clinical tests by finishing pre-clinical tests and is preparing production facilities with a view to acquiring license from Chinese government in 2010.

So, SK chemicals, a major albumin manufacturer in Korea, has made a contract for the joint development of [recombined albumin] with NCPC in order to strengthen R&D in the bio-part and to realize more positive globalization based on its ability in R&D in which it has invested more than 15% of annual revenue.

If SK chemicals and NCPC succeeded in the development of [recombined albumin] after finishing clinical tests, more than 30 billion won a year in domestic areas only would be expected because they could not only reduce loss to patients pursuant to the rise in the manufacture cost of albumin due to the worsening of global blood supply but could also supply safe albumin stably by intercepting the possibility of virus infection to blood.

Changxing, CEO of NCPC, said, “both companies have something in common that they are medical R&D leaders in their country(R&D budget compared to revenue: 15% for SK chemicals and 5% for NCPC),” and expressed, “it will be possible to maximize a synergistic effect between both companies’ research centers during future co-development of new medicines based on such a common point.”

Seung-Gwon Shin, CEO in life science sector of SK chemicals, also said, “I am pleased that SK chemicals can share its R&D ability of the highest level in Korea with the biggest pharmaceutical firm in China,” and expressed, “I believe that this tie-up will be a chance of mutual growth through competition in a favorable sense between Korea and China in the life science sector as well.”

NCPC, established in 1953, is the biggest pharmaceutical firm in China with a total of 18,500 employees (450 persons of professional research manpower and 1,000 or more persons of marketing manpower), 7 billion RMB(about 910 billion won) of revenue in 2006, 29 affiliates and 16 joint ventures, as the holding company of Chinese NCPC group.

Holding the best new medicine development ability in Korea such as Sunpla, the 1st new medicine in Korea, Joins, the 1st new medicine from natural substances, Mvix, the 13th new medicine in Korea, etc., the SK chemicals is investing R&D costs of the highest level by focusing on the development of new medicines with high global competitiveness, and is also concentrating on the development of biological new medicines by taking a chance of merging IN2GEN, a R&D professional enterprise, recently.