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Dehaier Medical Chairman and CEO Issues Letter to Shareholders
Date:4/25/2011

f our third party distribution portfolio, we won a $2 million medical device distribution bid for a new rural healthcare construction project supported by China Development Bank Corp, through which we will collaborate with Philips Medical Systems, Olympus Corporation of Japan and others to supply newly-built medical facilities with state-of-the-art equipment. This equipment will be used to provide the rural population with a higher standard of care through improved facilities and technology.

While the professional medical device market is substantial, we believe the greatest untapped potential, both domestically and internationally, lies with our homecare products, and we are keenly focused on the ongoing expansion of this line of products. Our full-year homecare product sales increased by over 300% compared with 2009, and continued growing as a percentage of our total sales.

We believe the homecare market will remain strong for the foreseeable future and are committed to capturing greater market share as it continues to mature. In addition to leveraging our strong dealer, distributor and hospital network, where we have built a great deal of brand equity as a result of our professional medical devices, we are employing non-traditional marketing tools to reach out directly to potential homecare customers.

During 2010, we opened 12 Customer Experience Centers (CECs), which provide patients and medical professionals a convenient way to experience our products and services in a safe, comfortable environment, designed to reduce the stress associated with beginning such treatments. These CECs have been popular with potential customers, and we plan to open an additional 20 Centers by the end of 2011, giving Dehaier a direct presence in many of China's key geographic areas.

Market Dynamics and Strategic Growth The healthcare market in China is poised for significant growth as a result of increasing government investment in improving t
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SOURCE Dehaier Medical Systems Ltd.
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