MELBOURNE--17 Jul--MediaNet International - AsiaNet/InfoQuest Narhex Life Sciences Ltd (NLS) today confirmed that negotiations have beensubstantially completed for a joint venture with Shaanxi Dacheng International Trade Co. Ltd, China (Dacheng) to jointly fund clinical trials in China of Narhex's anti-HIV/AIDS drug, DG17. “This joint venture, and the benefits it will provide, is a significant step forward for us in the commercial development of DG17,” said Director of Narhex Chinese Operations Mr Peter Nash. “We believe the Narhex joint venture is the first to undertake the development of a Class 1 new drug in China, and as a result it may receive substantial government support,” Nash said today. Following registration of the joint venture, Narhex will immediately apply to the State Food and Drug Administration of China (SFDA) for permission to carry out Phase 2 and Phase 3 clinical trials of DG17. “With government figures showing that there are more than 640,000 current cases of HIV-infected persons in China, we believe we will be able to recruit and conduct these trials relatively easily and quickly,” Nash said. “They will be designed and supervised by people with global industry credibility to meet international clinical trial standards.” The joint venture also heralds an exciting development for Narhex’s recentlyacquired Swedish subsidiary, Cavidi AB. The Chinese Government has recentlytaken a more active approach to ensure that all infected patients requiring therapy are treated, and Narhex believes that as a result of this government initiative, the market for Cavidi's HIV diagnostic products, especially itslow-cost HIV viral load assay kit, could be substantial. A training team from the Burnet Institute in Melbourne, with extensive experience with the Cavidi assays, has traveled to China and completed a program to educate and train key Chinese scientists in the use of the Cavidi test kits. Nash is optimistic that sales of Cavidi products will follow. “Once the Cavidi assay method has been properly evaluated and our staff trained, we can apply for registration of the products with the SFDA. Once approved, we believe that there will be widespread uptake of the products for the monitoring of HIV treatments throughout China.” Narhex remains well funded to achieve its goal of becoming an internationally recognized company developing and distributing HIV/AIDS therapeutics anddiagnostics. About Dacheng; Dacheng, formerly China Shaanxi Machinery Import/Export Corporation, was a branch of the huge CMC conglomerate, the Chinese government’s largest import/export group. In 2000 the Chinese Government directed that large inefficient organizations throughout the country were to cease subsidizing inefficient branches. With this mandate CMC restructured, giving its branches complete autonomy and delivering the assets of each branch to the existing employees as shares. The liberated branches were then left to their own devices to either fail or prosper depending on the skill and commitment of their employees. Dacheng, which was one such regional entity, was registered as a private company in 2001. At the time of formation its turnover was US$30,000,000 per annum. Last year (2005), annual turnover had doubled to over US$60,000,000 and it has continued to grow rapidly since then with turnover expected to exceed US$100 million in the current year. Dacheng’s experience and business and governmental contacts assure the joint venture will enjoy the co-operation and assistance from State, Provincial and Local government departments, the Ministry of Health, the Chinese State Food and Drug Administration (SFDA), and most importantly, from China’s world recognized HIV/AIDS specialist physicians. About Narhex Life Sciences Narhex Life Sciences Limited (ASX: NLS) is an Australian biotech company which is developing an anti-HIV protease inhibitor prodrug, DG17. Narhex has recently established a wholly-owned Swedish subsidiary, Cavidi AB, which is marketing a low-cost, low-technology test kit which measures the amount of HIV in plasma (HIV "viral load"), a measurement which is virtually essential for treating patients with HIV infection. For more information about Narhex, visit www.narhex.com or contact: Prof John Mills Managing Director Narhex Life Sciences Limited Ph: +61-419-877-472 SOURCE: Narhex Life Sciences --Distributed by AsiaNet ( www.asianetnews.net )--