A traditional Chinese herb known for its staggering ability to stem bleeding is expected to become a pillar supporting the medical industry's expansion in Southwest China's Yunnan Province.

This transition owes a great deal to the modernization efforts of a local medicine manufacturer.

The rare herb, sanqi or Panax Notoginseng, has been developed by the Kunming Shenghuo Pharmaceutical Co using modern techniques.

A plant with a greyish, cone-shaped root that is abundant in Yunnan, sanqi has been used in China since ancient times.

Li Shizhen (1518-1593), a Chinese pharmacologist of the Ming Dynasty (1368-1644), said in his Compendium of Materia Medic that sanqi is used mainly as a treatment to stem bleeding, disperse blood, and to relieve pain and injuries caused by a sharp knife or sword.

There is a Chinese saying that "When it comes to stopping people from bleeding, sanqi is worth more than its weight in gold."

But with its proven efficacy and glorious past, modern makers of traditional Chinese medicine have faced the question of how to modernize the production process and manufacture products that meet the convenience and quality requirements of domestic and overseas customers.

Lan Guihua, president of the Shenghuo company, worked out the following prescription: Make traditional Chinese medicine in line with the quality control regime of Western medicine production system.

Lan's prescription has received funds with the result that Shenghuo has upgraded from a private company launched in 1997 to a leading pharmaceutical manufacturer in Yunnan.

The company was among the first in the land-locked Southwest region to implement the strict good manufacturing practice (GMP) standard.

To improve its production infrastructure, the company introduced advanced pharmaceutical equipment including whole sets of soft gel capsule production machinery from GIC of the United States and packaging machines from Germany.

In 1999, State-owned company Yunnan Weinilun Group invested 30.6 million yuan (US$3.7 million) in Lan's venture, taking a 51 percent stake.

The investment made Shenghuo the first private high-tech pharmaceutical manufacturer in Yunnan with a State firm as a shareholder.

One of the best-known products of Shenghuo is "xuesaitong" soft gel capsule (brand name "lixuwang"), which was certified as National New Traditional Chinese Medicine.

Among its many functions, the capsule helps promote blood circulation to remove blood stasis, stem bleeding, relieve swelling and alleviate pain.

It has become a favorite choice of people with various kinds of bleeding due to trauma and blood-stasis syndrome.

In 2000, "xuesaitong" and other Shenghuo products were mainly sold on Chinese markets.

The following year, Shenghuo was able to export its products to a host of foreign countries including Japan, Canada and Malaysia, generating sales of several million dollars, according to Lan.

Shenghuo's development coincides with the provincial government's policy of stepping up the development of its pharmaceutical industry by combining its rich abundance of natural herbs with modern technology, Lan said.

The Chinese Government has set a national target of revamping the traditional Chinese medicine industry, which offers unique treatments for various diseases.

Last year, Lan's company saw a great leap forward.

With support from the former State Development Planning Commission, Shenghuo completed a national-level, high-tech industrial project to make medical and cosmetic products from sanqi.

The project went into trial operation last year, helping Shenghuo chalk up sales of 80 million yuan (US$9.6 million) in 2002, according to Lan.

The project will greatly augment Shenghuo's ability to produce top quality sanqi-related products to serve the ever-increasing demand at home and abroad, he said.

With the implementation of the project, the company expects to realize sales of 300 million yuan (US$36 million) by the end of 2005, when exports will hit US$10 million, Lan said.