1281696--3/31/2006--BEIJING_MED_PHARM

related topics

{operation, international, foreign}

{regulation, change, law}

{control, financial, internal}

{stock, price, operating}

{product, market, service}

{stock, price, share}

{acquisition, growth, future}

{cost, regulation, environmental}

{customer, product, revenue}

{operation, natural, condition}

{debt, indebtedness, cash}

{provision, law, control}

{investment, property, distribution}

{regulation, government, change}

{personnel, key, retain}

{product, candidate, development}

{product, liability, claim}

Risks Relating to Our Business We have a history of operating losses and anticipate that we will continue to incur losses for the foreseeable future. We may be unable to acquire, or may be delayed in acquiring, Rongheng. We may be unsuccessful in our strategy of expanding our product portfolio, acquiring complementary businesses or integrating acquired businesses. We may continue to experience delays in product introduction and marketing or We may be unable to compete successfully against new and existing competitors. If we fail to increase our brand recognition, we may face difficulty in obtaining new customers and business partners. Our operating results may fluctuate as a result of factors beyond our control. We may be unable to obtain additional capital when necessary and on terms that We may be unsuccessful in attracting or retaining key sales, marketing and other personnel. We may be unable to manage our growth effectively. We only offer products and services related to pharmaceuticals and, if demand for these products and services decreases, or if competition increases, we will have no other ways to Our business strategy to use our marketing arm to create demand for products that we will offer exclusively through a distribution arm may fail. Because we only recently became subject to the reporting requirements of the Exchange Act, we have no experience attempting to comply with public company obligations. Attempting to comply with these requirements will increase our costs and require additional management resources and we still may fail to comply. If we are unable to satisfy the regulatory requirements relating to internal controls, or if our internal controls over financial reporting are not effective, our stock price could decline. We are a holding company with no operations of our own and depend on our Risks Relating to Doing Business in China We face increased risks of doing business due to the extent of our operations Fluctuations in the Chinese Renminbi could adversely affect our results of Government control of currency conversion could adversely affect our operations The ability of our Chinese operating subsidiaries to pay dividends may be restricted due to our corporate structure. We may be restricted in our ability to transfer funds to our Chinese operating subsidiaries, which may restrict our ability to act in response to changing China s economic, political and social conditions, and its government policies, could adversely affect our business. A slow-down of the Chinese economy could adversely affect our growth and The legal system in China has inherent uncertainties that could limit the legal We have limited business insurance coverage in China. Any future outbreak of health epidemics, such as Severe Acute Respiratory Syndrome, or SARS, Asian Influenza, or Asian Bird Flu, or any other epidemic in China could have a material adverse effect on our business operations, financial condition and results of operations. Risks Relating to Pharmaceutical Distribution in China and Wanwei The absence of express laws and regulations in China regarding foreign investment in China s pharmaceutical distribution sector may cause uncertainty. Wanwei may be unable to obtain renewals of necessary pharmaceutical distribution permits. Price control regulations may decrease our profitability. The bidding process with respect to the purchase of pharmaceutical products may lead to reduced revenue. If the medicines Wanwei distributes are replaced by other medicines or are removed from China s Insurance Catalogue in the future, Wanwei s revenue may Risks Relating to Our Common Stock Sales of substantial amounts of our common stock in the public market could depress the market price of our common stock. If the ownership of our common stock continues to be highly concentrated, it may prevent you and other stockholders from influencing corporate decisions, such as significant corporate transactions and the election and replacement or removal of directors and management, and may also result in conflicts of interest that could cause our stock price to Our common stock may experience extreme price and volume fluctuations, which could lead to costly litigation for us and make an investment in us less As a stock quoted on the OTCBB, our common stock, which is deemed to be penny stock, currently has limited liquidity.

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1281696--3/31/2006--BEIJING_MED_PHARM_CORP