Medipost said Monday that it had terminated the establishment of a joint venture, Shandong Orlife Pharmaceutical, in China as its local partner did not fulfill the contract as agreed.

Medipost signed an agreement to establish a joint firm with a Chinese biotech company to market Cartistem, its stem cell treatment for knee osteoarthritis, in China. The two companies agreed to build a manufacturing plant and receive approval from China’s National Medical Products Administration to conduct clinical trials.

However, as the local partner in China did not carry out the terms and delayed obtaining Chinese licenses within the time agreed upon in the contract, Medipost notified that it would cancel the partnership to establish the joint company.

“We have continuously called for our local partner to proceed as agreed upon the contract with good faith, but our partner did not fulfill its duty, which caused a setback for Cartistem’s entry into China,” a Medipost official said. “We have withdrawn all rights related to the Cartistem business and terminated the partnership.”

The official added that Medipost plans to modify its business plan and choose a reliable partner with enough experience and networks in China to enter the market as soon as possible.