SOURCE: China Aoxing Pharmaceutical Corp.

October 31, 2006 10:09 ET

China Aoxing Pharmaceutical Corp. Begins Product Manufacture

NEW YORK, NY -- (MARKET WIRE) -- October 31, 2006 -- China Aoxing Pharmaceutical Corp. ("Aoxing") (OTCBB: CAXG) announced that it has formally begun manufacturing of its medicinal products.

The first drug to go into production is a tradition Chinese medicine called Shuanghuanglian. Manufactured in capsule form, this drug is primarily used to treat symptoms of the common cold including fever, cough, and throat irritation. Shuanghuanglian is the top seller in the common cold market. For the first half of 2005, Shuanghuanglian held a 13.2% market share among all medicine combating the common cold.

The Company estimates the common cold to be the single most occurring illness within the population, which is to say that about one billion people will be afflicted annually in China. With average costs of $15 to $20 RMB spent each time, the market is roughly $15 to $20 billion RMB or approximately $1.82 billion to $2.44 billion US annually.

Hebei Aoxing Pharmaceutical Group is a corporation organized under the laws of the People's Republic of China that has developed a patented manufacturing process for a variety of generic analgesic drugs, including Oxycodone, Pholcodine, Naloxone, and Tilidine. Aoxing is one of only a handful of companies in China to be granted the license to manufacture these drugs and is working closely with the Chinese government to assure their availability throughout China. China Aoxing Pharmaceutical Corp. acquired Aoxing in a reverse merger transaction in March of 2006.

This news release contains forward-looking statements as defined by the Private Securities Litigation Reform Act of 1995. Forward-looking statements include statements concerning plans, objectives, goals, strategies, future events or performance, and underlying assumptions and other statements that are other than statements of historical facts. These statements are subject to uncertainties and risks including, but not limited to, product and service demand and acceptance, changes in technology, economic conditions, the impact of competition and pricing, government regulation, and other risks contained in statements filed from time to time with the Securities and Exchange Commission. All such 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. In addition, the company disclaims any obligation to update any forward-looking statements to reflect events or circumstances after the date hereof.

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    John C. Leo