© 2005 The Generics Group AG November 2005 SGAI Tech Ltd Partnering a Hong Kong company to capture the opportunities in China Dr Tim Moore CEO

© 2005 The Generics Group AG SGAI’s goal: realising innovative products efficiently with low risk Understand, create & detailed design Manufacture Common design & manufacture outsourcing method New paradigm - transparent link up Outsource Understand, create & detailed design Manufacture EuropeChina Increase efficiency, reduce risk & time to market, keep innovation Realising innovation

© 2005 The Generics Group AG Who are we? Design & development company for break through products based in Hong Kong Links Cambridge, Hong Kong and China A joint venture between Cambridge-based Scientific Generics and Hong Kong based Automatic International Follows a period of project-based co-operation Focus on: medical devices, industrial, high-end consumer, telecoms Combines Scientific Generics’ renowned product innovation & development skills with AI’s quality focused, highly efficient manufacturing resources Realising innovation

© 2005 The Generics Group AG Hong Kong - realise maximum value from China at a low risk Design & development Why Hong Kong? Has knowledge based economy - secure IP - one country two systems Excellent quality of designers, managers & facilities Very close to Shenzhen region for low cost manufacture Reducing the risks Practical control of IP from Hong Kong Project management: highly qualified managers to directly assist with transfer to manufacture Integrated web-based project plans People Western / Hong Kong educated All speak fluent English, Cantonese & Mandarin Great team players Our partner AML Quality at its core Technically excellent Medical device producer 35 years experience Well respected in the region and globally Realising innovation

© 2005 The Generics Group AG The business model SGAI Tech Ltd is based in Hong Kong with two share holders: AML and Scientific Generics Ltd SGAI is the child of both parents Scientific Generics provides technical innovation and marketing capability while AML provides manufacturing and cultural knowledge to build an effective team CEO is from the UK COO is from Hong Kong Team is either Hong Kong or Chinese in nationality Depending upon the project: Design & development completed in Hong Kong, or SGAI team manages disperse design & development teams in China Services: Advisory Services - advice for fees Design and Build Product Producer Proximity manufacture Realising innovation

© 2005 The Generics Group AG Opportunities in China and Hong Kong Through Hong Kong, China provides SGAI with both inward & outward market opportunities: Outward opportunities: Low cost, high quality labour force Reduction in product development time scales Flexible manufacturing - high quality and low volume manufacture Large design teams Inward opportunities (Chinese): Development of IP Western market knowledge and inclusive design Inward opportunities (Western): Proximity manufacturing - local Chinese customers Design for Chinese markets Chinese market advice and supplier finding service Hong Kong has always been and will continue to be a trading gateway Realising innovation

© 2005 The Generics Group AG Practical tips Plan for Intellectual property protection Both practical and legal Be flexible in your business model Negotiation never stops The future means more than the past Clear communication To all members of the team Clear and transparent management Be mindful of health issues Plan accordingly Hong Kong is a good “cultural break” Good understanding of products and concepts Some Western clients dislike of being in China... The Hong Kong agencies are invaluable Realising innovation

© 2005 The Generics Group AG Summary Hong Kong is important for protecting and managing intellectual property when realising products in China Hong Kong gives you flexibility Hong Kong’s movement to a knowledge-based economy is very attractive Realising innovation