Press Release: Renhuang Pharmaceuticals Signs Letter of Intent to Acquire Herbal Medicine Extraction Company

Renhuang Pharmaceuticals Signs Letter of Intent to Acquire Herbal Medicine Extraction Company Renhuang Pharmaceuticals, Inc., a leading provider of natural health care products in the People's Republic of China (PRC), announced today its signing of a Letter of Intent to acquire a local private company, a subsidiary of Yerui Pharmaceutical Co. Ltd., Qingyang Extracting Factory, located in Yanshou Town, Harbin, China, that is primarily engaged in the business of producing herbal extracts from raw herbal plants - the intermediate material for Chinese herbal medicine. The acquisition is expected to at least double the Company's current herbal extraction capacity and substantially lower overall production cost. The Company anticipates the signing of the final acquisition agreement to occur within a week. The Company's current herbal extraction capabilities supply only part of its needs for herbal extracts to make finished medicines, while the rest has to be fulfilled by outside parties at a higher material cost than in-house extraction. The company being acquired is located close to herbal planting farms, has easy access to herbal raw materials, and has the ability to process raw herbal plants including Acanthopanax for making Siberian Ginseng derived products, Isatis for making Ban Lan Gen, and Schisandra chinensis for making other traditional herbal medicines. This new acquisition not only expands the Company's manufacturing capabilities to satisfy the fast growing needs for its products, but also significantly reduces its overall production cost. Commenting on the acquisition, Renhuang's Chairman Mr. Li, Shaoming said, "This acquisition fits very well with Renhuang's growth strategy and will allow us to double our extraction capacity and reduce production cost. One of the Company's long-term goals is to become the largest manufacturing, R&D, and supply base, setting the standards for herbal extracts and providing the standardized extracts and ingredients for our own various herbal nutraceuticals and natural medicinal products as well as for other third-party manufacturers. We will disclose the financial terms of the transaction upon the signing of the definitive agreement, which we anticipate to occur within days." About Renhuang Pharmaceuticals, Inc.: Renhuang Pharmaceuticals is a leading bio-pharmaceutical company located in Harbin in the Heilongjiang Province in Northeast China. Renhuang is primarily engaged in the research, production, and sales of bio-pharmaceutical products in Mainland China. The Company's main products are Siberian ginseng, shark liver oil and several other traditional medical products. It is estimated that 70% of China's natural supply of Siberian Ginseng is currently controlled by the Company. The company also anticipates approval within six to nine months by State Food and Drug Administration ("SFDA") for up to five of its new Monoclonal Antibody Reagent Box series products. These products are 60% more reliable than those from its competitors and also adhere to "Good Manufacturing Practices", or "GMP". Moreover, the company is in the process of building its own immune system research and development function. Overall, the company is able to achieve significant cost savings compared to most of its competitors, who purchase their raw materials from third parties. Over 2000 sales agents are employed in seventy sales centers across twenty-four districts and cover over 50% of the greater China area and 80% of its population, including the most populous and developed Eastern China. The Company employs over 50 people in its R&D department, a number of which are well recognized and respected pharmaceutical professors and research scientists from National Navy Pharmaceutical Research Center, Beijing Ellionbio Research Center and other well known institutions. State of the art research and production facilities using the latest technologies are currently used by the Company's scientists to develop new and innovative areas, including antiseptic and immune system products and Diagnostic kits. RHGP-G Safe Harbor Statement This press release contains certain statements that may include 'forward-looking statements' as defined in the Securities Act of 1933, and the Securities Exchange Act of 1934. All statements, other than statements of historical facts, included herein are 'forward-looking statements.' Although the Company believes that the expectations reflected in these forward-looking statements are reasonable, they do involve assumptions, risks and uncertainties, and these expectations may prove to be incorrect. You should not place undue reliance on these forward-looking statements, which speak only as of the date of this press release. The Company's actual results could differ materially from those anticipated in these forward-looking statements as a result of a variety of factors, including those discussed in the Company's periodic reports that are filed with and available from the Securities and Exchange Commission. All forward-looking statements attributable to the Company or persons acting on its behalf are expressly qualified in their entirety by these factors. Other than as required under the securities laws, the Company does not assume a duty to update these forward-looking statements.

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