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Biostar Pharmaceuticals, Inc. Reports Record Revenues and Earnings for 2008

NEW YORK, April 7 /PRNewswire-Asia-FirstCall/ -- Biostar Pharmaceuticals, Inc. ("Biostar" or the "Company") (OTC Bulletin Board: BSPM) today reported financial results for the 12 months ended December 31, 2008.

    Highlights for Year Ended December 31, 2008:

    -- Total net sales for the year were $33.9 million, up from $15.9 million
       for 2007.
    -- Net Income for the year increased 69% to $6,690,542 as compared to
       $3,963,524 in 2007.
    -- Completed acquisition of 8.6 acres land in Xi'an.  Construction of
       on-site raw material processing plant to commence in Q2.
    -- Launched the China Hepatitis Internet Hospital
       ( ), a multi-purpose site providing quality care,
       products and support to patients afflicted with hepatitis.


The Company reported revenue of $33,910,922 for the year ended December 31, 2008 as compared to $15,887,486 for 2007. Net Income for 2008 was $6,690,542, or $0.22 per share on a fully diluted basis, versus $3,963,524 and $0.19 per share, respectively, for 2007.

This increase in revenue and net income reflects an increase in sales of all five of Biostar's State Food and Drug Administration ("SFDA") approved drugs, most notably the Xin Aoxing Oleanolic Acid Capsule, the only SFDA- approved, over-the-counter (OTC) treatment for hepatitis B. The increase in sales is also attributed to the continued implementation of the Company's "Blue Sea" project, which markets products directly to consumers in rural China through retail pharmacies at higher retail prices. Domestic PRC customers account for 100% of Biostar's sales.

Ronghua Wang, Chairman and Chief Executive Officer of the Company, stated, "I am quite pleased with the Company's performance in 2008. Our targeted marketing programs and strategic pricing increases resulted in the doubling of revenues on existing products. We continue to strengthen our sales and marketing efforts, particularly for high-demand products such as our Oleanlic Acid Capsule. With the only SFDA-approved OTC product, and an estimated 120 million hepatitis B patients in China, we believe this product, in conjunction with the other products and services offered through our China Hepatitis Internet Hospital represents a substantial opportunity for Biostar."

Mr. Wang went on to say, "We were also successful in initiating a number of projects which will serve as a foundation for our continued growth in the future. Most recently we received permits to begin construction on a new raw materials processing facility. This is a critical step in enabling us to reduce our cost of goods while improving the quality of our products going forward. We expect to reap the benefits from this processing facility starting by the end of this year, with the future anticipated benefits being very significant."

                          BIOSTAR PHARMACEUTICALS, INC.

                                                             Year Ended
                                                             December 31,
                                                         2008           2007

    Sales, net                                    $33,910,922    $15,887,486

    Cost of sales                                  14,059,343      5,224,556

    Gross profit                                   19,851,579     10,662,930

    Selling, general and
     administrative expenses                       12,089,937      5,817,167

    Income from operations                          7,761,642      4,845,763

    Other Income (Expense)
      Interest income                                   2,911          3,492
      Interest expense                                (40,615)       (60,292)
      Other                                                 6            (33)
      Foreign exchange loss                                --         (3,970)
    Total other Income (Expense)                      (37,698)       (60,803)

    Income before income taxes                      7,723,944      4,784,960

    Provision for income taxes                      1,033,402        821,436

    Net income                                     $6,690,542     $3,963,524

    Deemed dividend from beneficial conversion
     feature of Series A preferred stock           (1,462,240)            --

    Net income applicable to common
     shareholders                                  $5,228,302     $3,963,524

    Net income per common share
      Basic                                             $0.23          $0.20
      Diluted                                           $0.22          $0.19

    Weighted average common shares
      Basic                                        22,369,434     20,220,037
      Diluted                                      23,257,470     20,858,278

                          BIOSTAR PHARMACEUTICALS, INC.
                           CONSOLIDATED BALANCE SHEETS

                                                  December 31,   December 31,
                                                         2008           2007

    Current Assets
      Cash and cash equivalents                      $758,316     $2,286,419
      Accounts receivable                          11,700,841      4,123,135
      Inventories                                     315,745        207,895
      Prepaid expenses and other receivables        2,926,505         18,225
        Total Current Assets                       15,701,407      6,635,674

    Property and equipment, net                     5,930,467      6,206,994

    Intangible assets, net                          7,365,765      7,404,011

        Total Assets                              $28,997,639    $20,246,679


    Current Liabilities
      Accounts payable and accrued expenses        $2,191,976       $537,780
      Customer advances                             2,592,250      2,412,846
      Short-term bank loan                                 --        519,544
      Value-added tax payable                         527,103        298,032
      Income tax payable                              413,205        187,089
        Total Current Liabilities                   5,724,534      3,955,291


    Stockholders' Equity
      Series A, convertible preferred stock,
       $0.001 par value, 5,000,000 shares
       authorized, 0 and 72,500 shares issued
       and outstanding at December 31, 2008
       and 2007                                            --        725,000
      Undesignated preferred stock, $.001 par
       value, 5,000,000 shares authorized,
       none issued and outstanding                         --             --
      Common stock, $.001 par value, 100,000,000
       shares authorized, 23,240,899 shares
       issued and outstanding at December 31,
       2008 and 2007                                   23,241         22,152
      Additional paid-in capital                   10,430,168      8,244,017
      Statutory reserves                            1,585,383        902,113
      Retained earnings                            10,996,655      6,451,623
      Accumulated other comprehensive
       income (loss)                                  237,658        (53,517)
        Total Stockholders' Equity                 23,273,105     16,291,388

        Total Liabilities and
         Stockholders' Equity                     $28,997,639    $20,246,679


BioStar Pharmaceuticals, Inc., through its wholly-owned subsidiary in China, develops, manufactures and markets pharmaceutical and medical nutrient products for a variety of diseases and conditions. The Company's most popular product is its Xin Ao Xing Oleanolic Acid Capsule, an over-the-counter ("OTC") medicine for Chronic hepatitis B, a disease affecting approximately 10% of the Chinese population. In addition to its hepatitis product, BioStar manufactures two broad-based OTC products, two prescription-based pharmaceuticals and ten nutrients. The Company has adopted international standards and is in the process of applying for three patents.

Safe Harbor

Certain statements in this release concerning our future growth prospects are forward-looking statements, within the meaning of Section 27A of the U.S. Securities Act of 1933, as amended, and Section 21E of the U.S. Securities Exchange Act of 1934, as amended, which involve a number of risks and uncertainties that could cause actual results to differ materially from those in such forward-looking statements. The risks and uncertainties relating to these statements include, but are not limited to, risks and uncertainties regarding the success of our investments, risks and uncertainties regarding fluctuations in earnings, our ability to sustain our previous levels of profitability including on account of our ability to manage growth, intense competition, wage increases in China, our ability to attract and retain highly skilled professionals, time and cost overruns on fixed-price, fixed-time frame contracts, client concentration, our ability to successfully complete and integrate potential acquisitions, withdrawal of governmental fiscal incentives, political instability and regional conflicts and legal restrictions on raising capital or acquiring companies outside China. Additional risks that could affect our future operating results are more fully described in our United States Securities and Exchange Commission filings including our S-1 dated June 27, 2008, our Quarterly Report on Form 10-Q for the quarter ended September 30, 2008, our 10-K for the year ended December 31, 2008, and other recent filings. These filings are available at We may, from time to time, make additional written and oral forward-looking statements, including statements contained in our filings with the Securities and Exchange Commission and our reports to shareholders. We do not undertake to update any forward-looking statements that may be made from time to time by or on our behalf.

    For More Information on Biostar Pharmaceuticals,

    Visit the websites at:

    Email requests to:

     +1-866-374-1957 (US)
     +86-029-3368-6638 (China)

SOURCE Biostar Pharmaceuticals, Inc.
Copyright©2009 PR Newswire.
All rights reserved

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