Biopharm Asia Inc. (GREY:BFAR)

NEW YORK, NY and TONGHUA, CHINA--(Marketwire - Apr 3, 2012) - Biopharm Asia, Inc. (PINKSHEETS: BFAR) announced a status update regarding restated financial results of 2008, 2009 and 2010. As the restatement process is not yet complete, the Company delayed in filing its 10-K, which was due on March 31, 2012, for the fiscal year ending on December 31, 2011. The Board of Directors made the restatement process a critical priority; management retained additional accounting staff to work with the Company's outside consultant and auditor to complete the requisite bookkeeping and associated statement preparation. However, the Company has not set a timetable for completion of this evaluation process and there can be no assurances that this review will result in any action.

The Company's shares are presently listed on the Pink Sheets segment. Although no longer required by the SEC, the Company intends to file the Form 10 and the accompanying audited financial statements after completion of the audits for the fiscal year ended December 31, 2011 and restatement of previous three years.

Additionally, the Company intends to submit a Form 2-11 with a Market Maker for the purpose of sponsoring its quotation on the Financial Industry Regulatory Authority (FINRA) - OTC Markets QB (OTCQB). The Company intends to file its Form 2-11 after the filing of the Form 10. Upon receipt of comments from FINRA, and submission of the Company's responses, FINRA may include the Company's symbol for quotation on the OTCQB. There can be no assurance, however, that the Company will be successful in obtaining the approval from FINRA and be able to trade on the OTC Markets.

NEW YORK, NY and TONGHUA, CHINA--(Marketwire - Jan 26, 2012) - BioPharm Asia, Inc. (PINKSHEETS: BFAR) (the "Company") announced today that the company entered into an agreement to acquire Xiamen Tongji Hospital, a privately owned gynecology, obstetrics center based in Fujian province, China, for an undisclosed amount. Upon completion of the acquisition, BioPharm Asia will be responsible for the daily operation of the medical center. The deal is contingent upon approval from the Ministry of Commerce and is expected to close in the first quarter of 2012.

Tongji Hospital is a 300 patient bed hospital. Founded in 1993, with a well-echeloned staff structure, it offers a full range of gynecology services at a convenient geographic location. The acquisition of Xiamen Tongji Hospital accelerates BioPharm Asia's strategy, which aims to increase the accessibility of patient care for big cities with underserved, growing affluent middle class in China.

"BioPharm Asia continues to invest in the key emerging markets such as Xiamen where the combination of growing populations and increasing income are driving demand and expectations for better healthcare treatment," said Xiayang Hu, president of BioPharm Asia, Inc. "Our new acquisition further underscores our intention to serve the health needs of Xiamen patients through our specialized services and, increasingly, high-quality branded generic treatments that are locally produced to global standards."

"As China's economy has continuously made stride in recent history, a rising middle class with greater spending power demands higher quality of healthcare, but the truth is that they don't have many alternatives to choose. The company's new marketing plans should be able to make inroads with increasingly health-conscious urban customers."

Third Quarter 2011 Financial Highlights:

 

• Revenue in the third quarter of 2011 rose to $47.2 million, an increase of $2.5 million, or 5.6%, over last year's comparable period revenue of $44.7 million.
• Gross profit in the third quarter was $14.6 million, an increase of $1.7 million or 13%, as compared to the $12.9 million for the same period in 2010.
• Net income increased to $6.9 million, compared to $6.5 million in the third quarter of 2010.
• Fully diluted earnings per share for the quarter increased to $0.138 from $0.13 in the prior year period.

On March 25, 2011, China Northern Pharmacy Holding Group Limited, a wholly-owned subsidiary of BioPharm Asia, Inc. (the “Company”), entered into an agreement to transfer all of the outstanding shares of its subsidiary Tonghua S&T Medical & Pharmacy Company Limited (“PHARMACY”) and its subsidiary Yunnan Silin Pharmaceutical Company Limited (“Silin”) to City Well International Limited for RMB 200 million, or approximately $30.5 million, based upon prevailing exchange rates.

PHARMACY is an operating company engaged in drug logistics and distribution in the People’s Republic of China (“PRC”) which as of December 31, 2010 owned and operated 360 retail drug stores. In addition, PHARMACY owns 100% of Silin, a PRC company which is engaged in the sale of medicine products to hospitals and pharmacy shops.

Management of PHARMACY and Silin had expressed displeasure at being a public company and the Company determined that it was in the interests of the Company’s shareholders to consummate the sale as described herein rather than continue the dispute with the disgruntled management and, potentially, lose the entire value of the operations of PHARMACY and Silin without receiving any compensation. It is anticipated that the closing of the transfer will occur on or before April 1, 2011.

Management of the Company will seek to apply the net proceeds of the transaction to the acquisition of one or more new businesses.

NEW YORK & TONGHUA, China--(BUSINESS WIRE)--BioPharm Asia, Inc. announced today that it is negotiating to acquire a controlling interest in Hubei Holley Zhengyuan Pharmaceutical Company Limited ("HBHLZY").

HBHLZY, founded in November, 2004, is a wholesale distributor of pharmaceutical products, located at the CBD of Wuhan city, Hubei province. HBHLZY’s facilities consist of packaging equipment and a logistical management system. HBHLZY sells 4580 types of products, from 652 suppliers in China and in particular, Hubei province. HBHLZY also acts as a sales agent for over 2000 types of products, including products from Shenzhen SanJiu Pharmaceutical Co., Ltd. and Shenzhen Zhijun Pharmaceutical Co., Ltd.

GeoTeam Note: The fact that BFAR may be able to fetch $30.5 million for some of its operating subs may illicit investor trust in management which could lead to an increase in BFAR shares to around $0.52 (proven cash per share based on proposed sale - short term debt per share of $0.10).  We still need more information/terms on the proposed acquisition of Hubei Holley Zhengyuan Pharmaceutical. BFAR seems worth a shot at these levels.

On February 14, 2011, the Company engaged Acquavella, Chiarelli, Shuster, Berkower & Co. LLP, as its registered independent public accountants for the fiscal year ended December 31, 2010. The decision to engage Acquavella, Chiarelli, Shuster, Berkower & Co. LLP was approved by the Board of Directors of the Company on February 14, 2011.

On January 30, 2011, Chun Rong Xiong, age 42, was elected Chief Financial Officer of BioPharm Asia, Inc.

From February 2003 to January 2011, Ms Xiong was finance manager of Dong Guan Bencao Medicine Co., Ltd. From September 1998 to February 2003, she was a senior consultant with Dong Hai Accounting Firm. From 1995 June to September 1998, she served as an accounting supervisor in Kangmei Pharmaceutical Co., Ltd. From July 1992 to June 1995, she was a cost accountant in Hua Zhong medicine Co. ltd.

Ms. Xiong received a B.S. degree (major in accounting) from Xi’an Finance University (PR. China).

We believe that our available funds and cash flows generated from operations will be sufficient to meet our anticipated ongoing operating needs for the next twelve months. However it is possible that the Company might need to raise additional capital in order to fund the Company’s expansion plans.

BFAR commented on the following highlights of the company's 2010 third quarter:

• Revenue in the third quarter of 2010 rose to $44.7 million, an increase of $18.1 million, or 68%, over last year’s comparable period revenue of $26.6 million.
• Gross profit in the third quarter was $12.9 million, an increase of $2.5 million or 24%, as compared to the $10.4 million for the same period in 2009.
• Net income increased to $6.5 million, compared to $4.8 million in the third quarter of 2009.
• Fully diluted earnings per share for the quarter increased to $0.13 from $0.10 in the prior year period.

BioPharm’s newly appointed Chief Financial Officer, Ms. Ruiying Dong, said, “I am pleased to report that BioPharm Asia has continued its outstanding results in the third quarter of 2010. We look forward to realizing further solid operating results in future quarters, especially from our herbal planting segment’s upcoming harvest. The Company is continuing to develop its expansion plans to exploit vertical integration benefits, and is responding to the opportunities resulting from China’s expanded healthcare reform policies. While we are quite optimistic about our future, we remain focused on our product costs and operational expenses.”

On November 8, 2010, Jianxiong Liu resigned as Chief Financial Officer of BioPharm Asia, Inc. On November 10, 2010, Ruiying Dong, age 34, was elected Chief Financial Officer of BioPharm Asia, Inc.

BioPharm’s Chief Financial Officer, Mr. Wenzhong Qin, said, “On behalf of BioPharm Asia, I am pleased to share these results with you and to extend our deep appreciation for your support of our Company. Biopharm Asia has experienced rapid growth over the last year, and has become a recognized provider in China’s herbal industry. We are committed to our core vision: providing healthy herbs and curative medicines to our customers, with higher quality, faster delivery and better service.” Mr. Wenzhong Qin continued, “Our business and profit have grown significantly in first quarter of 2010, and we will continue to focus on expanding our distribution and retail businesses. Additionally, we regard research and development in the drug manufacturing segment as key to the Company’s competitiveness and we plan to further strengthen our position by providing the best herbal products in China. BioPharm Asia is well positioned to benefit from China’s rapid growth and an increasing focus on health care and healthy living.”

Our business is subject to seasonal variations in demand. In particular, traditional retail seasonality affects the sales of certain pharmaceuticals and other non-pharmaceutical products. Sales of our pharmaceutical products benefit in the fourth quarter from the winter cold and flu season, and are lower in the first quarter of each year because Chinese New Year falls into the first quarter of each year and our customers generally pay fewer visits to drugstores during this period. In addition, sales of some health and beauty products are driven, to some extent, by seasonal purchasing patterns and seasonal product changes. Failure to manage the increased sales effectively in the high sale season, and to manage increases in inventory in anticipation of sales increases could have a material adverse effect on our financial condition, results of operations and cash flow.

The GeoTeam® will be taking a closer look at BFAR due to the following commentary in recent press releases:

 “Our new ticker symbol, which is a better reflection of our company’s true identity, not only marks the completion of our capital restructuring process that included our initial listing earlier this year, but also signifies the initial stages of our efforts to communicate our investment story to a broader and more sophisticated mix of retail and institutional investors.

We are looking forward to being able to shortly launch an aggressive investor relations program that will help us achieve a higher stock market profile as well as greater visibility that is highlighted by our history of double-digit growth in both revenues and earnings.” 

Source: Business Wire (August 28, 2009)

"BioPharm Asia continued to report no long-term debt outstanding as of June 30, 2009. It said it expects to meet its funding needs for the next twelve months out of continuing operations, though it did not rule out the need for additional capital to finance its expansion plans."

 “The second quarter of 2009 marked a significant milestone as well as continued progress for this company. In May, we completed our listing into the U.S. equity markets.  We have managed this important transition while maintaining our robust financial condition and expanding our retail operations.

Further, we consider our second quarter financial results, including a 22.0% increase in revenues and a 27.5% increase in net income, to be especially impressive during one of the weakest seasons for our herb business. Our opportunistic retail expansion strategy is well on-track, and we believe that we now have the financial resources to maintain a strong rate of growth.”

Source: Business Wire (August 14, 2009)

“The second quarter of 2009 marked a significant milestone as well as continued progress for this company,” said BioPharm Asia’s Chief Executive Officer, Mr. Rogers Yin. “In May, we completed our listing into the U.S. equity markets under the trading symbol DOMR – which will shortly be changed to a symbol better reflecting our corporate identity. We have managed this important transition while maintaining our robust financial condition and expanding our retail operations. Further, we consider our second quarter financial results, including a 22.0% increase in revenues and a 27.5% increase in net income, to be especially impressive during one of the weakest seasons for our herb business. Our opportunistic retail expansion strategy is well on-track, and we believe that we now have the financial resources to maintain a strong rate of growth.”