NANJING, China, May 17, 2006 /PRNewswire-FirstCall/ -- China Biopharmaceuticals Holdings, Inc. ("CBH"), a leading Chinese pharmaceutical company focused on the development, manufacturing and distribution of innovative drugs in China, today announced the signing of a conditional agreement to purchase all of the shares in RACP Pharmaceutical Holdings Ltd. ("RACP"), and its wholly owned subsidiaries, including Shenyang Enshi Pharmaceutical Co., Ltd. ("Enshi"), from RimAsia Capital Partners L.P. ("RimAsia").

Commenting on the agreement, Chris Peng Mao, CBH CEO, stated, "I am very happy to announce the signing of this agreement, which will give CBH 100% ownership interest in Shenyang Enshi Pharmaceutical, a leading manufacturer and distributor of pharmaceutical products in China. The integration of Enshi, with reported 2005 revenues of approximately $11 million and net income of $5.1 million, into the CBH Group will not only further bolster our already robust production and distribution capabilities, but will enhance our operational and financial profile.

"This transaction reflects our commitment to maximizing shareholder value through a focused strategy of scientific and operational leadership, opportunistic participation in market consolidation, and continued expansion of product and service offerings. Seizing this step-change opportunity marks significant progress towards building CBH into the leading fully-integrated pharmaceutical group in China."

Additional Details of the Agreement:

The aggregate amount of acquisition related consideration and other payouts is approximately $16 million, including $11,500,000 in assumed liabilities of RACP, $550,000 cash payment and the assumption of RACP's existing obligations to issue 12,000,000 warrant shares which will upon assumption result in an obligation of CBH to issue 12,000,000 common shares of CBH to the holders of the RACP Warrants upon the future exercise of the RACP Warrants at the exercise price of $1.375.