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3SBio Inc. Announces Unaudited Fourth Quarter and Full Year 2009 Results
Date:2/11/2010

SHENYANG, China, Feb. 11 /PRNewswire-Asia/ -- 3SBio Inc. ( SSRX) ("3SBio" or "the Company"), a leading China-based biotechnology company focused on researching, developing, manufacturing and marketing biopharmaceutical products, today announced its unaudited financial results for the fourth quarter and full year ended December 31, 2009.

    Full Year 2009 Financial Highlights:
    -- Total net revenues in 2009 increased by 30.3% year-over-year to
       RMB316.9 million (US$46.4 million) compared to RMB243.2 million
       (US$35.7 million) in 2008.
    -- Non-GAAP operating income in 2009 increased by 52.3% year-over-year to
       RMB90.9 million (US$13.3 million) and GAAP operating income increased
       by 76.6% to RMB84.4 million (US$12.4 million).
    -- Non-GAAP net income in 2009 increased by 20.3% year-over-year to
       RMB90.3 million (US$13.2 million). GAAP net income increased by 111.0%
       year-over-year to RMB83.4 million (US$12.2 million).
    -- Non-GAAP net income per American Depositary Share (ADS) on a
       fully-diluted basis in 2009 was RMB4.18 (US$0.61) compared with RMB3.46
       (US$0.51) in 2008. GAAP net income per ADS on a fully-diluted basis in
       2009 was RMB3.87 (US$0.57) compared with RMB1.82 (US$0.27) in 2008.


    Fourth Quarter 2009 Financial Highlights:
    -- Total net revenues increased by 23.7% over the fourth quarter of 2008
       to RMB74.3 million (US$10.9 million).
    -- Non-GAAP operating income was RMB13.5 million (US$2.0 million), an
       increase of RMB7.4 million (US$1.1 million) over the fourth quarter of
       2008. GAAP operating income was RMB9.9 million (US$1.5 million),
       compared to an operating loss of RMB2.3 million (US$0.3 million) in the
       fourth quarter of 2008.
    -- Non-GAAP net income was RMB14.4 million (US$2.1 million), an increase
       of RMB3.2 million (US$0.5 million) over the fourth quarter of 2008 on a
       non-GAAP basis. GAAP net income was RMB13.7 million (US$2.0 million),
       compared to a net loss of RMB1.5 million (US$0.2 million) in the fourth
       quarter of 2008.
    -- Non-GAAP net income per ADS on a fully-diluted basis was RMB0.66
       (US$0.10) for the fourth quarter of 2009 compared with RMB0.52 (US$0.08)
       for the fourth quarter of 2008. GAAP net income per ADS on a
       fully-diluted basis was RMB0.63 (US$0.09) compared with a net loss of
       RMB0.07 (US$0.01) for the fourth quarter of 2008.


    Full Year 2009 Business Highlights
    -- EPIAO, the Company's flagship injectable recombinant human
       erythropoietin (EPO) product, demonstrated strong growth with net
       revenue in 2009 rising 26.9% to RMB196.1 million (US$28.7 million),
       compared to RMB154.6 million (US$22.7 million) in 2008.
    -- Net revenues for TPIAO, the Company's novel recombinant human
       thrombopoietin (TPO) product, increased by 32.7% to RMB89.7 million
       (US$13.1 million) in 2009, compared to RMB67.6 million (US$9.9 million)
       in 2008.
    -- Export revenue increased 59.4%, accounting for 4.2% of total revenue in
       2009, compared to 3.4% in 2008. Eleven new registration certificates
       from eight countries were granted in 2009. TPIAO was approved in the
       Philippines, the first market outside of China.
    -- Work continues with the SFDA to secure regulatory approval of the three
       Phase III applications currently under review: 36,000 IU dosage
       formulation of EPIAO, NuLeusin and a TPIAO label extension for the
       treatment of idiopathic thrombocytopenic purpura (ITP).


    Events Subsequent to December 31, 2009
    -- An application for a registration trial for Feraheme was submitted to
       the State Food and Drug Administration (SFDA). Feraheme is a new
       generation IV iron therapy licensed through a strategic partnership
       with AMAG Pharmaceuticals.
    -- A collaboration and license agreement was signed with Panacor
       Bioscience to develop and commercialize Nephoxil(R), a differentiated
       iron-based phosphate binder that is not polymer-based and free of
       aluminum, lanthanum and calcium for the treatment for hyperphosphatemia
       in CKD patients.
    -- A strategic alliance was formed with Ascentage Pharma Group Corporation
       Ltd. to research, develop and commercialize best-in-class targeted
       cancer therapeutics focusing on programmed cell death, or apoptosis.
       The alliance represents 3SBio's key strategic initiative to develop a
       novel pipeline in cancer therapeutics.
    -- Construction of the new EPIAO and TPIAO manufacturing plant in Shenyang
       was completed and work is underway on the application to the SFDA for
       Good Manufacturing Practice (GMP) certification.
    -- 3SBio submitted an application to the SFDA to conduct Phase I clinical
       trials for NuPIAO, the Company's second generation EPO product.

Dr. Jing Lou, chief executive officer of 3SBio, commented: "3SBio again delivered strong operating and financial performance in our third consecutive year since going public in early 2007. We are very pleased with our new strategic partnerships which we believe will provide an innovative platform for the future development of our product pipeline. We will also continue to invest in our internal R&D programs, including NuPIAO, our second generation EPO product. With construction of our Shenyang plant completed, we will now focus on seeking China GMP certification and validation as the next stage of our strategy to satisfy the growing demand in China for high quality, cost-effective oncology and nephrology treatments. Given the strong demand outlook for our core products, we anticipate achieving a 2010 total net revenue target of between US$56 million to US$58 million, representing approximately a 20-25% increase over 2009."

Full Year Ended December 31, 2009 Unaudited Financial Results

Net revenues. Net revenues for 2009 increased by 30.3% to RMB316.9 million (US$46.4 million), from RMB243.2 million (US$35.7 million) in 2008. The increase was primarily attributable to increased sales from our EPIAO and TPIAO products, underpinned by continued strong demand in the oncology and nephrology markets.

Net revenues from EPIAO in 2009 increased by 26.9% to RMB196.1 million (US$28.7 million) from RMB154.6 million (US$22.7 million) in 2008. Net revenues from TPIAO in 2009 increased by 32.7% to RMB89.7 million (US$13.1 million) from RMB67.6 million (US$9.9 million) in 2008. In addition, revenue from our export business was RMB13.2 million (US$1.9 million), representing an increase of 59.4% over 2008, while revenue from IV Iron Sucrose was RMB10.7 million (US$1.6 million), representing an increase of 53.4% over 2008.

Gross profit. Gross profit for 2009 increased by 31.7% to RMB291.7 million (US$42.7 million) compared to RMB221.5 million (US$32.5 million) in 2008. Gross margin for 2009 increased to 92.0% compared to 91.1% in 2008.

Operating expenses. Non-GAAP operating expenses were RMB201.3 million (US$29.5 million) for 2009, an increase of 24.1% from RMB162.1 million (US$23.8 million) in 2008. GAAP operating expenses were RMB207.3 million (US$30.4 million) for 2009, an increase of 19.3% from RMB173.7 million (US$25.5 million) in 2008.

    -- Research and development ("R&D") costs. Non-GAAP R&D costs for 2009
       were RMB18.2 million (US$2.7 million), or 5.7% of net revenue, compared
       to RMB15.0 million (US$2.2 million), or 6.2% of net revenue in 2008.
       GAAP R&D costs for 2009 were RMB19.4 million (US$2.8 million), or 6.1%
       of net revenue, compared to RMB22.5 million (US$3.3 million), or 9.2%
       of net revenue in 2008.
    -- Sales, marketing and distribution expenses. Non-GAAP sales, marketing
       and distribution expenses for 2009 were RMB151.1 million
       (US$22.1 million), or 47.7% of net revenue, compared to RMB118.8million
       (US$17.4 million), or 48.8% of net revenue in 2008. GAAP sales,
       marketing and distribution expenses for 2009 were RMB151.7 million
       (US$22.2 million), or 47.9% of net revenue, compared to
       RMB119.8 million (US$17.6 million), or 49.2% of net revenue in 2008.
    -- General and administrative expenses. Non-GAAP general and
       administrative expenses for 2009 were RMB32.0 million (US$4.7 million),
       or 10.1% of net revenue, compared to RMB28.4 million (US$4.2 million),
       or 11.7% of net revenue in 2008. GAAP general and administrative
       expenses for 2009 were RMB36.2 million (US$5.3 million), or 11.4% of
       net revenue, compared to RMB31.5 million (US$4.6 million), or 12.9% of
       net revenue in 2008.

Operating income. Non-GAAP operating income increased by 52.3% to RMB90.9 million (US$13.3 million), compared to RMB59.7 million (US$8.8 million) in 2008. GAAP operating income for 2009 increased by 76.6% to RMB84.4 million (US$12.4 million), compared to RMB47.8 million (US$7.0 million) in 2008. Non-GAAP operating margin for 2009 was 28.7%, compared to 24.6% in 2008. GAAP operating margin for 2009 was 26.6%, compared to 19.6% in 2008.

Net income. Non-GAAP net income for 2009 increased by 20.3% to RMB90.3 million (US$13.2 million) compared with RMB75.0 million (US$11.0 million) in 2008. Non-GAAP net margin for 2009 was 28.5% as compared to 30.8% in 2008. Non-GAAP net income per ADS for 2009 increased to RMB4.18 (US$0.61) from RMB3.46 (US$0.51) in 2008.

GAAP net income for 2009 increased by 111.0% to RMB83.4 million (US$12.2 million) compared with RMB39.5 million (US$5.8 million) in 2008. GAAP net margin for 2009 was 26.3% as compared to 16.3% in 2008. GAAP net income per ADS on a fully-diluted basis for 2009 increased to RMB3.87 (US$0.57) from RMB1.82 (US$0.27) in 2008.

Cash and cash equivalents / Time deposits. 3SBio had positive operating cash flow of RMB87.7 million (US$12.9 million) for the year ended December 31, 2009 and as of December 31, 2009, had cash, cash equivalents, restricted cash and time deposits of RMB740.5 million (US$108.5 million), a 1.0% increase from RMB733.0 million (US$107.4 million) as of December 31, 2008.

Three Months Ended December 31, 2009 Unaudited Financial Results

Net revenues. Net revenues increased by 23.7% to RMB74.3 million (US$10.9 million) for the fourth quarter of 2009 from RMB60.1 million (US$8.8 million) for the same period in 2008. This increase was largely due to continued strong sales of EPIAO and TPIAO which grew by 15.8% and 27.4%, respectively, over the same period in 2008. TPIAO remained 3SBio's second largest revenue contributor in the quarter, accounting for 28.1% of total net revenues. Export sales increased by 255.7% to RMB4.1 million (US$0.6 million), and revenues from IV Iron Sucrose rose 12.2% to RMB2.0 million (US$0.3 million).

Gross profit. As a result of continued sales growth from key products, gross profit for the fourth quarter of 2009 increased by 25.0% to RMB68.0 million (US$10.0 million) from RMB54.4 million (US$8.0 million) for the same period in 2008. Gross margins increased to 91.6% for the fourth quarter of 2009 from 90.6% for the same period in 2008.

Operating expenses. Non-GAAP operating expenses were RMB54.7 million (US$8.0 million) for the fourth quarter of 2009, an increase of 12.9% from RMB48.5 million (US$7.1 million) for the same period in 2008. GAAP operating expenses were RMB58.1 million (US$8.5 million) for the fourth quarter of 2009, an increase of 2.4% from RMB56.7 million (US$8.3 million) for the same period in 2008.

    -- Research and development ("R&D") costs. Non-GAAP R&D costs for the
       fourth quarter of 2009 were RMB4.3 million (US$0.6 million), or 5.7% of
       net revenue, compared to RMB5.3 million (US$0.8 million), or 8.9% of
       net revenue, for the same period in 2008. GAAP R&D costs for the fourth
       quarter of 2009 were RMB5.1 million (US$0.7 million), or 6.9% of net
       revenue, compared to RMB12.4 million (US$1.8 million), or 20.7% of net
       revenue, for the same period in 2008.
    -- Sales, marketing and distribution expenses. Non-GAAP sales, marketing
       and distribution expenses for the fourth quarter of 2009 were
       RMB40.8 million (US$6.0 million), or 55.0% of net revenue, compared to
       RMB38.0 million (US$5.6 million), or 63.3% of net revenue, for the same
       period in 2008. GAAP sales, marketing and distribution expenses for the
       fourth quarter of 2009 were RMB40.9 million (US$6.0 million), or 55.1%
       of net revenue, compared to RMB38.3 million (US$5.6 million), or 63.8%
       of net revenue, for the same period in 2008.
    -- General and administrative expenses. Non-GAAP general and
       administrative expenses for the fourth quarter of 2009 were
       RMB9.7 million (US$1.4 million), or 13.0% of net revenue, compared to
       RMB5.1 million (US$0.8 million), or 8.5% of net revenue for the same
       period in 2008. GAAP general and administrative expenses for the fourth
       quarter of 2009 were RMB12.1 million (US$1.8 million), or 16.2% of net
       revenue, compared to RMB6.0 million (US$0.9 million), or 9.9% of net
       revenue for the same period in 2008.

Operating income. Non-GAAP operating income for the fourth quarter of 2009 grew by 122.5% to RMB13.5 million (US$2.0 million), compared to RMB6.1 million (US$0.9 million) in the fourth quarter of 2008. GAAP operating income was RMB9.9 million (US$1.5 million) for the fourth quarter of 2009, an increase of 12.2 million (US$1.8 million) from an operating loss of RMB2.3 million (US$0.3 million) for the same period in 2008. Non-GAAP operating margin was 18.2% for the fourth quarter of 2009, as compared to 10.1% in the same period in 2008. GAAP operating margin for the fourth quarter of 2009 was 13.4% as compared to -3.8% for the same period in 2008.

Interest income. The Company recorded net interest income of RMB2.4 million (US$0.3 million) for the fourth quarter of 2009, compared to RMB5.9 million (US$0.9 million) for the same period in 2008. This was largely due to a declining interest rate environment.

Net income. Non-GAAP net income for the fourth quarter of 2009 was RMB14.5 million (US$2.1 million), 28.0% higher than non-GAAP net income of RMB11.3 million (US$1.7 million) for the same period in 2008. Non-GAAP net income per ADS on a fully-diluted basis for the fourth quarter of 2009 increased to RMB0.66 (US$0.10) from RMB0.52 (US$0.08) for the same period in 2008. Non-GAAP net margin for the fourth quarter of 2009 was 19.5% as compared to 18.8% for the same period in 2008.

GAAP net income was RMB13.7 million (US$2.0 million) for the fourth quarter of 2009, an increase of RMB15.1 million over a net loss of RMB1.5 million (US$0.2 million) for the same period in 2008. GAAP net income per ADS on a fully-diluted basis for the fourth quarter of 2009 increased to RMB0.63 (US$0.09) from a loss of RMB0.07 (US$0.01) for the same period in 2008. GAAP net margin for the fourth quarter of 2009 was 18.4% as compared to -2.4% for the same period in 2008.

2010 Full Year Guidance and Selected Company Objectives

Based on current market and operating conditions and the following goals, the Company's total net revenue target for the full year 2010 is between US$56 million to US$58 million, an estimated year-over-year increase of approximately 20% to 25%. Other operating objectives include:

    -- Initiate Feraheme registration trial in China, pending SFDA approval.
    -- Continue to work with the SFDA to secure regulatory approval of the
       three new product programs: 36,000 IU dosage formulation of EPIAO,
       Nuleusin and TPIAO label extension for the treatment of ITP.
    -- Complete validation of the new plant and obtain GMP certification from
       the SFDA.
    -- Explore global biosimilar opportunities and initiate the approval
       process in selected developed markets.
    -- Continue to pursue external strategic partnerships that leverage our
       balance sheet and strong nephrology and oncology franchises.

Conference Call

3SBio's senior management will host a conference call at 5:00 am (Pacific) / 8:00 am (Eastern) / 9:00 pm (Beijing/Hong Kong) on February 12, 2010 to discuss its 2009 fourth quarter and annual financial results and recent business activity. The conference call may be accessed using the dial-in numbers below:

    Conference ID: 52340276
    Local dial-in:
     China - landline 800-819-0121
     China - mobile   400-620-8038
    International toll-free dial-in:
     Hong Kong        800930346
     United Kingdom   080-8234-6646
     United States    1-866-519-4004
    International toll dial-in: +65-6735-7955

A telephone replay will be available two hours after the call until February 20, 2010 at:

    Replay - Conference ID: 52340276
    International dial-in:  +61-2-8235-5000
    United States dial-in:  1-866-214-5335

Webcast

A live webcast of conference will be available on the investor relations page of 3SBio's website at http://bbs.3sbio.com/en/News/xinvestors.aspx and at http://tinyurl.com/3Sbio4Q09 . A replay of the webcast will be available within one hour after the conclusion of the call.

Non-GAAP Financial Measures: Reconciliation of GAAP to Non-GAAP

To supplement the Company's financial information presented in accordance with generally accepted accounting principles ("GAAP"), the Company has utilized some non-GAAP financial measures to provide investors and management with supplemental measures that facilitate comparisons of operating performance and trends with prior and future operating performance, and that may not otherwise be apparent on a GAAP basis. These non-GAAP financial measures include non-GAAP cost of revenue, non-GAAP gross profit, non-GAAP operating expenses, non-GAAP operating income, non-GAAP net income, non-GAAP net income per share, and non-GAAP net income per ADS. These measures may be different from non-GAAP financial measures used by other companies. The presentation of this financial information, which is not prepared under any comprehensive set of accounting rules or principals, is not intended to be considered in isolation or as a substitute for the financial information prepared and presented in accordance with GAAP. Non-GAAP measures have limitations in that they do not reflect all of the amounts associated with the Company's results of operations as determined in accordance with GAAP. These measures should only be used to evaluate the Company's results of operations in conjunction with the corresponding GAAP measures. Please see the attached reconciliation of GAAP to non-GAAP for an explanation of the amounts excluded to arrive at non-GAAP financial measures for the three-month periods ended December 31, 2009 and December 31, 2008 and for the full year ended December 31, 2009 and December 31, 2008.

Statement Regarding Unaudited Financial Information

The unaudited financial information set forth above is preliminary and subject to adjustments and modifications. The audited financial statements and related notes are to be included in the Company's annual report on Form 20-F for the year ending December 31, 2009. Adjustments and modifications to the financial statements may be identified during the course of the audit work, which could result in significant differences from this preliminary unaudited financial information.

Currency Convenience Translation

For the convenience of readers, certain RMB amounts have been translated into US dollars at the rate of RMB6.8259 to US$1.00, the noon buying rate for US dollars in effect on December 31, 2009 as set forth in the H.10 statistical release of the U.S. Federal Reserve Board. A rate of 6.8225 was used for comparative purposes as of December 31, 2008, which was the noon buying rate for US dollars on that date for cable transfers of RMB per US dollar as certified for customs purposes by the Federal Reserve Bank of New York.

About 3SBio Inc.

3SBio Inc. is a leading, fully integrated biotechnology company focused on researching, developing, manufacturing and marketing biopharmaceutical products, primarily in China. For more information, please visit 3SBio on the web at http://www.3sbio.com .

Safe Harbor Statement

Certain statements in the disclosures of 3SBio, Inc. (the "Company" or "3SBio") with respect to the fourth quarter and the year of 2009 ("Disclosures") that are not purely historical in nature may constitute "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. The Disclosures include the press release, the conference call and any accompanying materials, and any other information issued, released or publicized by the Company with respect to the fourth quarter and the year of 2009.

These forward-looking statements address activities, events, conditions, or developments that we currently expect or anticipate may occur in the future, and include, but may not be limited to, discussions and statements regarding revenue guidance, product development, timing of plant construction completion, testing and certification, impact of the government policies and regulations, regulatory approval process, production capacity, capital expense estimate, future operations, investment portfolio management, and future strategies. Forward-looking statements can be identified by such terminology as "believe," "expect," "plans," "strategy," "potential", "prospects," "forecast," "estimate," "project," "anticipate," "aim," "will" or "would", "may" or "might", and words, phrases, expressions, and usages of similar meaning or substance or the negative of such words, phrases, expressions and usages.

Forward-looking statements are based on management's current assumptions, beliefs, expectations, and projections, in light of the information currently available to it, and actual results, performances, or achievements could differ materially from those implied or expressed by the forward-looking statements. Among the factors that could cause 3SBio's actual results to differ from what the Company currently anticipates may include competition from other domestic and foreign pharmaceutical companies; the expected market growth for pharmaceutical products in China; market acceptance of 3SBio products; expected hospital or patient demand for our products; the completion of 3SBio's ongoing clinical trials as planned; receipt and timing of regulatory approvals for 3SBio's new products and uses; 3SBio's ability to expand its production, sales and distribution network and other aspects of its operations; its ability to effectively protect its intellectual property; changes in the healthcare industry in China, including changes in the healthcare policies and regulations of the PRC government and changes in the healthcare insurance sector in the PRC; and fluctuations in general economic and business conditions in China.

For additional information on factors identified above and other risk factors, uncertainties and assumptions that may affect 3SBio's business, financial conditions and results of operations, please refer to the Company's filings with the Securities and Exchange Commission at www.sec.gov, and, in particular, "Introduction - Cautionary Statement concerning Forward Looking Statements," Item 3.D "Risk Factors," Item 5. "Operating and Financial Review and Prospects," and other applicable discussions in 3SBio's annual report on Form 20-F for the year ended December 31, 2008.

All the statements in the Disclosures speak as of the date of the initial release, even if subsequently made available on the 3SBio website or otherwise. 3SBio undertakes no obligation to update or revise these forward-looking statements, whether as a result of new information, subsequent events or otherwise, after the date of this press release.

    For further information, please contact:

    3SBio Inc.
     Bo Tan
     Chief Financial Officer
     Tel:   +86-24-2581-1820
     Email: ir@3SBio.com

     Tom Folinsbee
     Director of Investor Relations
     Tel:   +852-8191-6991
     Email: ir@3SBio.com



                           3SBio Inc. and subsidiaries
                           Consolidated balance sheets
                            (expressed in thousands)

                                            December     December   December
                                            31, 2008     31, 2009   31, 2009
                                              RMB          RMB         US$
    Assets                                             (unaudited)(unaudited)
    Current assets
    Cash and cash equivalents                439,237      262,767     38,496
    Restricted cash                               --        9,300(1)   1,362
    Time deposits with financial
     institutions                            293,809      468,451     68,628
    Accounts receivable, less allowance
     for doubtful accounts:
    December 31, 2008 - RMB4,503;
     December 31, 2009 - RMB2,915(US$427)     48,927       54,661      8,008
    Notes receivable                          24,840       31,265      4,580
    Inventories                                7,748       15,406      2,257
    Prepaid expenses and other
     receivables                               8,249        8,705      1,275
    Deferred tax assets                        1,802        2,079        305
    Total current assets                     824,612      852,634    124,911
    Available-for-sale securities             26,700       11,407      1,671
    Property, plant and equipment, net        78,185      165,120     24,190
    Lease prepayments                          8,894        8,541      1,251
    Non-current deposits                       8,521       10,067      1,475
    Intangible assets, net                     5,225        4,125        604
    Deferred tax assets                          781        1,567        230
    Total assets                             952,918    1,053,461    154,332
    Liabilities
    Current liabilities
    Accounts payable                           1,939        2,736        401
    Deferred grant income                        374          374         55
    Accrued expenses and other payables       25,273       33,421      4,896
    Income tax payable                         1,256        1,914        280
    Other current liabilities                     57           --         --
    Total current liabilities                 28,899       38,445      5,632
    Deferred grant income                      3,152        2,778        407
    Other liabilities                            472           --         --
    Total liabilities                         32,523       41,223      6,039
    Commitments and contingencies                 --           --         --
    Shareholders' equity
    Share capital -ordinary shares
     US$0.0001 par value, 500,000,000
     shares authorized, 150,575,955 and
     150,641,461 issued and outstanding
     as of December 31, 2008 and 2009,
     respectively.                               121          121         18
    Additional paid-in capital               908,377      915,267    134,087
    Accumulated other comprehensive loss    (102,126)    (100,608)   (14,740)
    Retained earnings                        114,023      197,458     28,928
    To Total shareholders' equity            920,395    1,012,238    148,293
    Total liabilities and shareholders'
     equity                                  952,918    1,053,461    154,332


    Note:

    (1) Restricted cash balance represents cash bank balances as of
        December 31, 2009 that are temporarily restricted from use due to the
        incorporation process of Liaoning Sunshine Development Limited Company.
        The restriction will be removed once the incorporation process is
        completed.




                           3SBio Inc. and subsidiaries
                        Consolidated statements of income
     (expressed in thousands, except per share , per ADS and other share and
                                    ADS data)
    Three Months Ended December 31,2009

                      GAAP         GAAP    Adjustment    Non-GAAP     Non-GAAP
                       RMB          US$        RMB        RMB          US$

    Net Revenues:  (unaudited)  (unaudited)(unaudited)(unaudited)  (unaudited)
    EPIAO              45,531        6,670       --       45,531        6,670
    TPIAO              20,859        3,056       --       20,859        3,056
    Intefen             1,334          195       --        1,334          195
    Inleusin              441           65       --          441           65
    Iron sulcrose       2,015          295       --        2,015          295
    Export              4,083          598       --        4,083          598
    Others                 13            2       --           13            2
    Total net
     revenues          74,276       10,881       --       74,276       10,881
    Cost of
     revenues          (6,246)        (915)     191(1)    (6,055)        (887)
    Gross profit       68,030        9,966       --       68,221        9,994
    Operating
     expenses
    Research and
     development
     costs             (5,102)        (747)     850(1)    (4,252)        (623)
    Sales,
     marketing
     and
     distribution
     expenses         (40,937)      (5,997)     106(1)   (40,831)      (5,982)
    General and
     administrative
     expenses         (12,058)      (1,767)   2,402(1)    (9,656)      (1,415)
    Total
     operating
     expenses         (58,097)      (8,511)              (54,739)      (8,020)
    Operating
     income             9,933        1,455                13,482        1,974
    Other income
     /(expenses),
     net
    Interest
     income             2,369          347       --        2,369          347
    Grant income          393           58       --          393           58
    Others                132           19       --          132           19
    Total other
     income, net        2,894          424                 2,894          424
    Income before
     income tax
     expense           12,827        1,879                16,376        2,398
    Income tax
     benefit /
     (expense)            823          121   (2,750)(2)   (1,927)        (282)
    Net income         13,650        2,000                14,449        2,116
    Net income
     per share:
    Basic and
     diluted             0.09         0.01                  0.09         0.01
    Basic
     weighted
     average
     number of
     shares
     outstanding  150,628,974  150,628,974           150,628,974  150,628,974
    Effect of
     dilutive
     potential
     shares         2,057,801    2,057,801             2,057,801    2,057,801
    Diluted
     weighted
     average
     number of
     shares
     outstanding  152,686,775  152,686,775           152,686,775  152,686,775
    Net income
     per ADS:
    Basic and
     diluted             0.63         0.09                  0.66         0.10
    Basic
     weighted
     average
     number of
     ADSs
     outstanding   21,518,425   21,518,425            21,518,425   21,518,425
    Effect of
     dilutive
     potential
     ADSs             293,972      293,972               293,972      293,972
    Diluted
     weighted
     average
     number of
     ADSs
     Outstanding   21,812,397   21,812,397            21,812,397   21,812,397


    Notes to reconciliation of our GAAP statements of income to our non-GAAP
    statements of income:

    (1). To exclude share-based compensation expenses.
    (2). To exclude income tax effect on written-off accounts receivable
         caused by the dissolution of Beijing Sunshine




                             3SBio Inc. and subsidiaries
                        Consolidated statements of income
    (expressed in thousands, except per share, per ADS and other share and ADS
                                      data)
    Three Months Ended December 31,2008

                      GAAP         GAAP   Adjustment    Non-GAAP     Non-GAAP
                       RMB          US$        RMB        RMB          US$

    Net Revenues:  (unaudited)  (unaudited)(unaudited)(unaudited)  (unaudited)
    EPIAO              39,326        5,764       --       39,326        5,764
    TPIAO              16,373        2,400       --       16,373        2,400
    Intefen             1,199          176       --        1,199          176
    Inleusin              209           31       --          209           31
    Iron sulcrose       1,796          263       --        1,796          263
    Export              1,148          168       --        1,148          168
    Others                 13            2       --           13            2
    Total net
     revenues          60,064        8,804                60,064        8,804
    Cost of
     revenues          (5,622)        (824)     110(1)    (5,512)        (808)
    Gross profit       54,442        7,980                54,552        7,996
    Operating
     expenses
    Research and
     development
     costs            (12,439)      (1,823)   7,110(2)    (5,329)        (781)
    Sales,
     marketing
     and
     distribution
     expenses         (38,337)      (5,619)     309(1)   (38,028)      (5,574)
    General and
     administrative
     expenses          (5,960)        (874)     825(1)    (5,135)        (753)
    Total
     operating
     expenses         (56,736)      (8,316)              (48,492)      (7,108)
    Operating
     income /
     (loss)            (2,294)        (336)                6,060          888
    Other income
     /(expenses),
     net
    Interest
     income             5,916          867       --        5,916          867
    Grant income          107           16       --          107           16
    Impairment
     loss on
     available-
     for-sale
     securities        (4,391)        (644)   4,391(3)        --           --
    Others               (716)        (105)      --         (716)        (105)
    Total other
     income, net          916          134                 5,307          778
    Income /
     (loss)
     before
     income tax
     expense           (1,378)        (202)               11,367        1,666
    Income tax
     expense             (457)         (67)      --         (457)         (67)
    Net income /
     (loss)            (1,835)        (269)               10,910        1,599
    Less: net
     loss
     attributable
     to
     noncontrolling
     interest             377           55       --          377           55
    Net income /
     (loss)
     attributable
     to the
     equity
     holders of
     the parent        (1,458)        (214)               11,287        1,654
    Net income /
    (loss) per share
     attributable to
     the equity
     holders of the
     parent:
    Basic and
     diluted            (0.01)        0.00                  0.08         0.01
    Basic
     weighted
     average
     number of
     shares
     Outstanding  150,575,955  150,575,955           150,575,955  150,575,955
    Effect of
     dilutive
     potential
     shares                --           --                10,500       10,500
    Diluted
     weighted
     average
     number of
     shares
     Outstanding  150,575,955  150,575,955           150,586,455  150,586,455
    Net income /
    (loss) per ADS
     attributable
     to the equity
     holders of
     the parent:
    Basic and
     diluted            (0.07)       (0.01)                 0.52         0.08
    Basic
     weighted
     average
     number of
     ADSs
     Outstanding   21,510,851   21,510,851            21,510,851   21,510,851
    Effect of
     dilutive
     potential
     ADSs                  --           --                 1,500        1,500
    Diluted
     weighted
     average
     number of
     ADSs
     Outstanding   21,510,851   21,510,851            21,512,351   21,512,351


    Notes to reconciliation of our GAAP statements of income to non-GAAP
    statements of income:

    (1). To exclude share-based compensation expenses.
    (2). To exclude one-time upfront payment for license fee of RMB6,948,000
         and share-based compensation expense of RMB162,000 for R&D staff.
    (3). To exclude the impairment loss on available-for-sale securities.



                           3SBio Inc. and subsidiaries
                        Consolidated statements of income
    (expressed in thousands, except per share, per ADS and other share and ADS
                                      data)
    Full Year Ended December 31,2009

                      GAAP         GAAP    Adjustment  Non-GAAP     Non-GAAP
                       RMB          US$        RMB        RMB          US$
    Net Revenues:  (unaudited)  (unaudited)(unaudited)(unaudited)  (unaudited)
    EPIAO             196,080       28,726       --      196,080       28,726
    TPIAO              89,679       13,138       --       89,679       13,138
    Intefen             5,522          809       --        5,522          809
    Inleusin            1,607          235       --        1,607          235
    Iron sulcrose      10,715        1,570       --       10,715        1,570
    Export             13,216        1,936       --       13,216        1,936
    Others                101           15       --          101           15
    Total net
     revenues         316,920       46,429       --      316,920       46,429
    Cost of
     revenues         (25,236)      (3,697)     556(1)   (24,680)      (3,616)
    Gross profit      291,684       42,732       --      292,240       42,813
    Operating
     expenses
    Research and
     development
     costs            (19,427)      (2,846)   1,216(1)   (18,211)      (2,668)
    Sales,
     marketing
     and
     distribution
     expenses        (151,679)     (22,221)     577(1)  (151,102)     (22,137)
    General and
     administrative
     expenses         (36,195)      (5,303)   4,210(1)   (31,985)      (4,686)
    Total
     operating
     expenses        (207,301)     (30,370)             (201,298)     (29,491)
    Operating
     income            84,383       12,362                90,942       13,322
    Other income
     /(expenses),
     net
    Interest
     income            11,532        1,689       --       11,532        1,689
    Grant income          674           99       --          674           99
    Net realized
     gain on
     available-
     for-sale
     securities         1,611          236   (1,611)(2)       --           --
    Impairment
     loss on
     available-
     for-sale
     securities        (4,624)        (677)   4,624(2)        --           --
    Others              1,595          234       --        1,595          234
    Total other
     income, net       10,788        1,581                13,801        2,022
    Income before
     income tax
     expense           95,171       13,943       --      104,743       15,344
    Income tax
     expense          (11,736)      (1,719)  (2,750)(3)  (14,486)      (2,122)
    Net income         83,435       12,224                90,257       13,222
    Net income
     per share:
    Basic and
     diluted             0.55         0.08                  0.60         0.09
    Basic
     weighted
     average
     number of
     shares
     outstanding  150,606,317  150,606,317           150,606,317  150,606,317
    Effect of
     dilutive
     potential
     shares           427,875      427,875               427,875      427,875
    Diluted
     weighted
     average
     number of
     shares
     outstanding  151,034,192  151,034,192           151,034,192  151,034,192
    Net income
     per ADS:
    Basic and
     diluted             3.87         0.57                  4.18         0.61
    Basic
     weighted
     average
     number of
     ADSs
     outstanding   21,515,188   21,515,188            21,515,188   21,515,188
    Effect of
     dilutive
     potential
     ADSs              61,125       61,125                61,125       61,125
    Diluted
     weighted
     average
     number of
     ADSs
     outstanding   21,576,313   21,576,313            21,576,313   21,576,313


    Notes to reconciliation of our GAAP statements of income to non-GAAP
    statements of income:

    (1). To exclude share-based compensation expenses .
    (2). To exclude the impact caused by the impairment and/or disposal of
         available-for-sale securities.
    (3). To exclude income tax effect on written-off accounts receivable
         caused by the dissolution of Beijing Sunshine.




                           3SBio Inc. and subsidiaries
                        Consolidated statements of income
    (expressed in thousands, except per share, per ADS and other share and ADS
                                      data)
    Full Year Ended December 31,2008
                      GAAP         GAAP   Adjustment    Non-GAAP     Non-GAAP
                       RMB          US$        RMB        RMB          US$
    Net Revenues:  (unaudited)  (unaudited)(unaudited)(unaudited)  (unaudited)
    EPIAO             154,570       22,656       --      154,570       22,656
    TPIAO              67,585        9,906       --       67,585        9,906
    Intefen             4,989          731       --        4,989          731
    Inleusin              773          113       --          773          113
    Iron sulcrose       6,984        1,024       --        6,984        1,024
    Export              8,289        1,215       --        8,289        1,215
    Others                 55            8       --           55            8
    Total net
     revenues         243,245       35,653               243,245       35,653
    Cost of
     revenues         (21,741)      (3,187)     370(1)   (21,371)      (3,132)
    Gross profit      221,504       32,466               221,874       32,521
    Operating
     expenses
    Research and
     development
     costs            (22,477)      (3,295)   7,469(2)   (15,008)      (2,200)
    Sales,
     marketing
     and
     distribution
     expenses        (119,778)     (17,556)   1,000(1)  (118,778)     (17,410)
    General and
     administrative
     expenses         (31,458)      (4,611)   3,097(1)   (28,361)      (4,157)
    Total
     operating
     expenses        (173,713)     (25,462)             (162,147)     (23,767)
    Operating
     income            47,791        7,004                59,727        8,754
    Other income
     /(expenses),
     net
    Interest
     income            23,953        3,511       --       23,953        3,511
    Grant income          388           57       --          388           57
    Net realized
     loss on
     available-
     for-sale
     securities       (18,995)      (2,784)  19,144(3)       149           22
    Impairment
     loss on
     available-
     for-sale
     securities        (4,391)        (644)   4,391(3)        --           --
    Others              1,896          278       --        1,896          278
    Total other
     income, net        2,851          418                26,386        3,868
    Income before
     income tax
     expense           50,642        7,422                86,113       12,622
    Income tax
     expense          (11,649)      (1,707)      --      (11,649)      (1,707)
    Net income         38,993        5,715                74,464       10,915
    Less: net
     income
     attributable
     to
     noncontrolling
     interests            549           80       --          549           80
    Net income
     attributable
     to the
     equity
     holders of
     the parent        39,542        5,795                75,013       10,995
    Net income per
     share
     attributable
     to the equity
     holders of
     the parent:
    Basic and
     diluted             0.26         0.04                  0.49         0.07
    Basic
     weighted
     average
     number of
     shares
     outstanding  151,655,631  151,655,631           151,655,631  151,655,631
    Effect of
     dilutive
     potential
     shares            57,118       57,118                57,118       57,118
    Diluted
     weighted
     average
     number of
     shares
     outstanding  151,712,749  151,712,749           151,712,749  151,712,749
    Net income
     per ADS
     attributable
     to the equity
     holders of
     the parent:
    Basic and
     diluted             1.82         0.27                  3.46         0.51
    Basic
     weighted
     average
     number of
     ADSs
     outstanding   21,665,090   21,665,090            21,665,090   21,665,090
    Effect of
     dilutive
     potential
     ADSs               8,160        8,160                 8,160        8,160
    Diluted
     weighted
     average
     number of
     ADSs
     outstanding   21,673,250   21,673,250            21,673,250   21,673,250


    Notes to reconciliation of our GAAP statements of income to our non-GAAP
    statements of income:

    (1). To exclude share-based compensation expenses .
    (2). To exclude one-time upfront payment for license fee of RMB6,948,000
         and share-based compensation expense of  RMB521,000 for R&D staff.
    (3). To exclude the impact caused by the impairment and/or disposal of
         available-for-sale securities.

SOURCE 3SBio Inc.

RELATED LINKS
http://www.3sbio.com

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SOURCE 3SBio Inc.
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Related biology technology :

1. 3SBio Inc. to Present at the UBS Global Life Sciences Conference
2. 3SBio Inc. to Hold Annual General Meeting
3. 3SBio Inc. Schedules 2007 Third Quarter Earnings Release On Tuesday, November 13, 2007
4. 3SBio Inc. To Present at the 19th Annual Piper Jaffray Health Care Conference
5. 3SBio Inc. Announces Appointment of Kevin Sow Peng Teo as Chief Financial Officer
6. 3SBio Inc. to Present at the Merrill Lynch Global Pharmaceutical, Biotechnology and Medical Device Conference
7. 3SBio Inc. Schedules 2007 Fourth Quarter and Full Year Earnings Release on Wednesday, February 20, 2008
8. 3SBio Inc. Announces Change to the Board of Directors
9. 3SBio Inc. Announces Unaudited Fourth Quarter and Fiscal Year 2007 Results
10. 3SBio Inc. Announces Promotion of David Chen as Chief Operating Officer
11. 3SBio Inc. Approves Share Repurchase Program
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