Failed shotgun marriage leads down path to drugs and ruin

ON MARCH 27, more than 40 heavily armed police, their guns loaded, burst into one of China's biggest pharmaceutical plants, ordered the shutting down of production and arrested the workers and seven top managers.

Their target was a workshop making ketamine, a drug invented in the United States in the 1960s and widely used as a sedative in the Vietnam War, with a price on the black market of up to US$16 million a tonne.

Now, nearly four months later, four of the seven managers remain in police custody and three are out on bail.

The factory, the Taiyuan Pharmaceutical Company, in the capital of central China's Shanxi province, remains closed. With debts of nearly 200 million yuan (about HK$187.44 million) and its 5,000 workers without pay, nobody knows what to do with it.

This is the story of how a state factory, set up with help from the Soviet Union in the 1950s, was forced to make a deal with a prominent drug dealer in order to survive, as recounted by the latest issue of Xinwen Zhoukan (News Magazine).

Founded as one of the four biggest pharmaceutical plants in China, it was one of the 156 priority projects established with Soviet help. For 40 years, it had a distinguished record in research and development and produced more than 250 kinds of drugs.