China Health Holding Acquires Majority Stake in Beijing Boran Pharmaceutical

Strategic Acquisition Increases Pharmaceutical Drug Pipeline, GMP Approved Manufacturing and R&D Capabilities

LAS VEGAS, February 02, 2007 /PRNewswire-FirstCall/ -- China Health Holding, Inc., a development stage company with the goal of becoming a leading developer, manufacturer, marketer and distributor of pharmaceutical drugs and dietary supplements in China and worldwide, today announced that it has executed a definitive agreement to acquire a majority interest in Beijing Boran Pharmaceutical Co. Ltd..

Under the agreement, subject to closing conditions including due diligence and approval by both parties, China Health will acquire 65% of the total issued and outstanding capital stock of Beijing Boran, giving it control over the following Beijing Boran assets:

    - New pharmaceutical manufacturing facilities in Beijing, certified for

      Good Manufacturing Practices (GMP) by the China State Food and Drug

      Administration (China-SFDA)

    - Thirty-one China-SFDA certified pharmaceutical drugs

    - Two Chinese patents held by Beijing Boran

    - Land and production facilities covering approximately 8.8 acres real

      estate properties in Beijing.

    - An extensive hospital and drugstore distribution channel within China

    - The agreement also gives China Health exclusive first refusal rights of

      acquisition up to the date that the transaction becomes final.

    - The agreement is contingent upon the Beijing Boran Pharmaceutical

      transaction being completed on the first business day after the closing

      conditions are met or waived, or on a date agreed upon by the parties.

As consideration, China Health will pay Beijing Boran shareholders $3 million in cash at closing, based on Beijing Boran meeting the total revenue targets of approximately $4.12 million in the year ended December 31, 2006 and approximately $3.86 million in the year ended December 31, 2005, both as audited under U.S. generally accepted accounting practices (GAAP). The payment is also based on Beijing Boran's total target asset value of approximately $7.53 million on December 31, 2006, likewise audited under GAAP.

China Health will keep aside for the $800,000 as a security deposit, to be released to Beijing Boran upon the completion of the audit if it is determined that Beijing Boran has met with the targeted audited revenue of Beijing Boran and the targeted audited assets of Beijing Boran.

Julianna Lu, Founder and CEO of China Health Holding, commented: "The acquisition contemplated by this agreement with Beijing Boran Pharmaceutical is the latest in a series of recent steps that China Health has taken to execute its ambitious comprehensive growth strategy. Through this and other transactions, we are in the process of building a powerful network of established China-SFDA-certified pharmaceutical drug manufacturing facilities along with extensive hospital and drugstore distribution channels in China. We intend also to have an enhanced pipeline of hundreds of China-SFDA certified pharmaceutical drugs."." This acquisition marks a key milestone in our effort to create a leading pharmaceutical company. The market for Traditional Chinese Medicine, or TCM, is growing rapidly in China and worldwide as consumers increasingly rely on cost-effective, non-toxic natural pharmaceutical products. China Health will continue to grow by acquiring companies that give us competitive advantage and scale in the natural medicinal and pharmaceutical industry within China and worldwide."

According to China's Ministry of Health, the TCM industry accounted for more than a quarter of China's overall medical industry which total earnings were US$12 billion in 2005. China exported a record US$830 million worth of traditional medicines to 164 countries and regions in 2005. Ms. Lu also noted that the Company continues to explore acquisitions in China's pharmaceutical industry that allow it to expand TCM based pharmaceutical drug offerings and distribution capabilities while increasing overall revenue and profitability.

In addition to the pending Beijing Boran acquisition, China Health has announced several other pending or completed acquisitions of China-based pharmaceutical companies in recent months. It has executed binding letters of intent to acquire 51% or more of Shaanxi Wanan Pharmaceutical Co. Ltd., Xi'An Chunhui Pharmaceutical and Henan Tiankang Pharmaceutical Co. Ltd. All these letters give it exclusive first refusal rights of acquisition. It has also executed definitive agreements for acquiring 100% of the assets of Xi'An Meichen Pharmaceutical Co. Ltd., 60% of Henan Furen Huaiqingtang Pharmaceutical Co. Ltd. and 100% of Shaanxi Mei Chen Pharmaceutical, Ltd. It has signed a letter of intent with WangJing Hospital and the WangJing Hospital of China Academy of Chinese Medical Sciences, to develop the China International University of Traditional Chinese Medicine and the University Hospital for Traditional Chinese Medical Sciences.

In the next 12 to 24 months, China Health Holding plans to complete further acquisitions and transactions with pharmaceutical companies in China and worldwide, bringing its total assets to approximately US$100 million. Annual gross revenue is projected to approximately reach US$100 million, with an annual net income of US$10-15 million approximately.

About Beijing Boran Pharmaceutical

Beijing Boran Pharmaceutical Co. Ltd. was established in 2002 as a private pharmaceutical company in Beijing, People's Republic of China. It engages in the businesses of developing, manufacturing and marketing various herbal-based pharmaceuticals drugs. Currently Beijing Boran has approximately 260 employees. It owns a total of 31 China-SFDA certified herbal-based pharmaceutical drugs and two patents (Nos. CN1660403 and CN1833675A) granted by the Chinese government. It has 12 new drugs being processed for further China-SFDA approval as new pharmaceutical drugs, and it has one pending patent application.

Beijing Boran also owns approximately 6.1 acres of land in Beijing, as well as a new 117,800-square-foot (2.7-acre) China-SFDA certified pharmaceutical GMP facility with the capacity to produce herbal and chemical drugs in a number of forms. It has exclusive first-refusal rights to use and purchase approximately 11.5 additional acres of land and 98,800 square feet (2.3 acres) of building space at fixed prices from Beijing authorities. In addition, it owns 80% of Beijing Xiangwei Herbal Medicinal Co. Ltd.

About China Health Holding

China Health Holding, Inc. is a development stage company with the goal of becoming a leading developer, manufacturer, marketer and distributor of pharmaceutical products and dietary supplements in China and worldwide. It has extensive expertise in the field of traditional Chinese medicine and the Chinese pharmaceutical industry. Its immediate goal is the profitable penetration of the growing global and China pharmaceutical industry and market through acquisitions of major pharmaceutical companies in the People's Republic of China and worldwide. Its long-term plans include the development of a pharmaceutical drug pipeline and technology based on its knowledge of traditional Chinese medicine and the pharmaceutical industry in the People's Republic of China.

The company has two wholly-owned subsidiaries: (i) China Health World Pharmaceutical Corporation, which will develop, manufacture and commercialize natural medications for diseases and conditions related to diabetes, cardiovascular disease and neurological disorders; and (ii) China Health World Trade Corporation, which will develop China Health's retail/franchise infrastructure along with worldwide branding, multimedia marketing and multi- channel distribution to global customers and markets.

China Health owns the exclusive worldwide rights to a total of 134 proprietary natural herbal medicinal products/formulas in two natural herbal medicinal product lines: King of Herbs and Taoist Medicinal. Please visit http://www.chinahealthholding.com for the Company's profile.

Safe Harbor Statement: To the extent that statements in the press release are not strictly historical, including statements as to revenue projections, business strategy, outlook, objectives, future milestones, plans, intentions, goals, future financial conditions, future collaboration agreements, the success of the Company's development, events conditioned on stockholder or other approval, or otherwise as to future events, such statements are forward looking, all forward-looking statements, whether written or oral, and whether made by or on behalf of the Company, are expressly qualified by the cautionary statements and any other cautionary statements, which may accompany the forward-looking statements, and are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. The forward-looking statements contained in this release are subject to certain risks and uncertainties that could cause actual results to differ materially from the statements made. Other important factors that could cause actual results to differ materially include the following: business conditions and the amount of growth in the Company's industry and general economy; competitive factors; ability to attract and retain personnel; the price of the Company's stock; and the risk factors set forth from time to time in the Company's SEC reports, including but not limited to its annual report on Form 10-KSB; its quarterly reports on Forms 10-QSB; and any reports on Form 8-K. In addition, the company disclaims any obligation to update or correct any forward-looking statements in all of the Company's press releases to reflect events or circumstances after the date hereof.

China Health Holding, Inc.

CONTACT: Mr. Yu, XiaoFei, Executive Director/Vice President, CorporateDevelopment, +1-604-608-6788, or +1-877-883-0979, or 86-10-1314-696-8838(Beijing China), or ; or in the United States,and North America, Investor Relations International (Los Angeles), HarisTajyar, Managing Partner, +1-818-382-9702; or in China, HongKong, Asia andRest of World, Mr. Rory Macpherson, Senior Associate of Ogilvy PublicRelations Worldwide, +86-10-8520-6553, or info@chinahealthholding.com rory.macpherson@ogilvy.com

Web site: http://www.chinahealthholding.com/

Ticker Symbol: (NASDAQ-OTCBB:CHHH)

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Posted: February 2007


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