China Aoxing Pharmaceutical Co Inc said it has received approval from the State Food and Drug Administration (SFDA) for a clinical study of codeine phosphate for use in cold and flu medicines.

The company will begin the 300-patient clinical study in the third quarter, and the research is expected to be completed in early 2008.

Aoxing, which specializes in pain management products, is one of only two drug makers developing this medicine in China.

In China, cold and flu medicines earned about 625 million US dollars in sales last year, with the market expected to grow at an annual rate of 20 percent over the next few years.