China-based Lansen Pharmaceutical Holdings Ltd. agreed to pay 26 million Chinese yuan to Neptunus Medicine Co. Ltd. as part of a settlement agreement.
In a litigation, Neptunus alleged that it suffered certain losses due to the use of ginkgo extract supplied by Lansen unit Ningbo Liwah Pharmaceutical Co. Ltd.
In September, the Shenzhen Intermediate People's Court of the People's Republic of China ruled in favor of Neptunus.
Under the settlement agreement, Ningbo Liwah will pay 26 million Chinese yuan, after setting off account receivables of about 4.3 million yuan due from Neptunus, in two installments.
Ningbo Liwah agreed to pay the first installment of 15.6 million yuan by Jan. 31, 2018, and the second installment of 10.4 million yuan within six from the date of the settlement agreement.
Lansen said the compensation will be reflected in the profit and loss accounts of financial year 2017 but expects it to have a minimum impact on the group's cashflow.
As of Dec. 26, US$1 was equivalent to 6.54 yuan.