Company Profile

Introduction

Goldshield is a profitable, marketing-led, emerging British pharmaceutical and healthcare company. Growth has been rapid and achieved both organically and through astute product acquisition. The Group has grown to its present size with equity funding of only £1.8 million up to 31 March 1998 having commenced trading in 1991. Goldshield’s turnover for the year ended March 31, 2006 was £ 80million.

The Directors believe that this growth has been driven principally by the Group's marketing skills, customer focus, product ranges and developments, financial controls and extensive staff training. Goldshield aims to service a much broader segment of the pharmaceutical and healthcare markets than many similarly sized pharmaceutical companies. It sells ethical (prescription) pharmaceuticals, non-prescription medicines, vitamins, minerals and supplements and a wide range of other healthcare products. To service its customers' needs from the highly regulated to the consumer driven markets, Goldshield operates as two divisions, the Pharmaceutical Division and the Healthcare Division.

Goldshield chooses to market products which match its rigorous marketing and financial return criteria. Product licences and brands, where appropriate, are acquired or, increasingly, developed internally. The Directors consider that opportunities exist to acquire further products and develop product line extensions and new chemical entities which meet the Group's investment criteria.

Pharmaceutical Products

The provision of prescription medicines is supported by a marketing and sales department, a medical and regulatory department, a recently established research and development facility and an operations department which manages the outsourcing of manufacturing.

The growth of the these products has resulted principally from the Directors' policy of acquiring the UK and Irish rights to marketed products with growth potential with the intention that these would generate cash flow to finance further acquisitions and product development programmes. The acquired products have been supplemented, where appropriate, by product line extensions which the Directors consider has led to cost effective and low risk organic growth.

The majority of the products marketed are for the treatment or prevention of chronic or recurrent illnesses. Goldshield does not concentrate on any particular therapeutic area. However, it currently markets products which address indications in three of the largest chronic disease areas: cardiovascular diseases, central nervous system disorders and musculoskeletal conditions. The Group currently markets a portfolio of 43 pharmaceutical products based on 28 different active compounds all of which are sold under the Group's brands.

The Directors believe that growth has been and will continue to be achieved through the Group's marketing-led approach and its ability to offer a wide range of products. The Directors' intentionis therefore to maintain future growth through the pursuit of strategies relating to:

• Product acquisition;
• Product research and development; and
• Marketing and sales.

Healthcare Products

The concentration is on the provision of OTC healthcare products. The Division comprises a marketing department, a data entry and call centre, which is common to both the Pharmaceutical and Healthcare Divisions, a product development department and an operations department which manages the outsourcing of manufacturing.

Almost all growth in the Healthcare area has been organic. This is largely due to the time and cost involved in bringing new internally developed healthcare products to the market being significantly lower than those for pharmaceutical products. This has allowed the Healthcare Division's product range to grow rapidly.

The Directors' objectives are to continue to expand the portfolio of healthcare products, both in market sectors where the Group is already prominent and in those where it does not yet have an established market presence.

Currently, the products are principally sold via mail order. It is the Directors' intention to increase the use of multiple channels of distribution and therefore each product range will be tailored accordingly.

Currently, the product portfolio covers six of the major healthcare categories: ''vitamins, minerals and supplements'', analgesics, skin care, herbal medicines, cough and cold remedies and slimming aids and offers 421 individual product lines.

The Directors believe that this product portfolio growth has been and will continue to be achieved through the Group's focus on its customers, its marketing-led approach and its ability to offer a wide range of products with a common brand identity.