Sihuan News Release

Sihuan’s subsidiary appointed sole distributorfor high-quality nutritional drug

- Shenzhen Sihuan wins rights to distribute amino acid drug, a product manufactured with superior raw materials from Japan

Shenzhen Sihuan on target to meet profit guarantee of not less than RMB16 m for FY08

Deal reflects the Group’s continual efforts to source premium products to add to further growth

SINGAPORE, 9 July 2008 FOR IMMEDIATE RELEASE Mainboard-listed Sihuan Pharmaceutical Holdings Group Ltd. (Sihuan, the Group, 四环医药控股集团有限公司), a leading manufacturer of cardiocerebral vascular (CV) drugs in the PRC, announced that wholly owned Shenzhen Sihuan Pharmaceutical Co. Ltd. (Shenzhen Sihuan) has secured the exclusive rights to distribute a high-quality amino acid injection in the PRC for a period of five years.

Named Luoanming (洛安命), the nutritional drug is used to enhance the recovery of patients after injury or surgery. Luoanming is purer than alternatives sold in the market as it is made from superior raw materials imported directly from Japan and Western countries. It also possesses higher efficacy than cheaper rival substitutes such as glucose infusions. Currently, there are no similar products whose raw materials are sourced from overseas.

Sihuan’s Executive Chairman and Chief Executive Officer (CEO), Dr Che Fengsheng (车冯升), said: “The shortage of blood supply in the PRC has led to a huge demand for amino acid pharmaceutical products. This nutritional drug segment in the PRC market is fairly sizeable, being worth at about RMB1.3 billion, and it is expected to grow at a healthy rate.

Under its experienced and discerning management, Shenzhen Sihuan has identified Luoanming as a premium product with which to make its initial forays into this profitable market segment.“In PRC, patients are opting for better quality, yet affordable products. Given Luoanming’s superior product quality, coupled with Sihuan’s extensive distribution capabilities and established reputation as a leading pharmaceutical company, we are confident of unlocking full potential in China. We believe we can obtain selling prices and margins that reflect its strong attributes.”The Group acquired Shenzhen Sihuan in October 2007 for RMB60 million. This company is engaged in the marketing and distribution of own-brand and third-party pharmaceutical products in the PRC, through a network of 29 sales offices and 1,067 distributors.

Dr Che added: “The acquisition of Shenzhen Sihuan has not only increased the depth ofour distribution, but also widened our product mix. Under the leadership of our deputy chairman, Dr Guo Wei Cheng, Shenzhen Sihuan is able to ride on Sihuan’s growing reputation to add new products and extend customer reach. It is on target to meet the profit guarantee of not less than RMB16 million for FY08.”

This announcement follows Sihuan’s recent purchase of a 45% stake in Beijing Purenhong,a major distributor of pharmaceutical products to 130 hospitals in Beijing. With bothShenzhen Sihuan and Beijing Purenhong in its fold, the Group will be able to generateeven greater demand for both its CV and non-CV drugs and further entrench its positionwithin the PRC.