Side Letter dated June 2, 2008



 Exhibit 10.7 
 CHINA NUOKANG BIO-PHARMACEUTICAL PTY 
 (incorporated in
the Cayman Islands) 
 PERSONAL AND CONFIDENTIAL 
 June 2, 2008 
 Sequoia Capital China Growth Fund I, L.P. 
 Suite 2215 
 Two Pacific Place 
 88 Queensway 
 Hong Kong 
 HBM BioMed China Limited 
 Centennial Tower, 3rd Floor 
 2454 West Bay Road 
 Grand Cayman, Cayman Islands

 Side Letter 
 Dear Sirs 
 Reference is made to the Preference A Shares Purchase Agreement (the “Purchase Agreement”) dated
December 20, 2007, by and among China Nuokang Bio-Pharmaceutical Pty (the “Company”), Mr. Xue Baizhong, Sequoia Capital China Growth Fund I, L.P. and HBM BioMed China Limited (collectively, the
“Purchasers”). 
 In connection with the Purchase Agreement, an Investors’ Rights Agreement dated December 20, 2007
was also entered into by and among the Company, the Purchasers and certain other parties therein. 
 This side letter (the “Side
Letter”) is to confirm the replacement of Section 3.1(a) of the Investors’ Rights Agreement with the following sentence in its entirety: 
  

	 	3.1	Performance Linked Valuation Adjustment  

  

	 	(a)	If the Company’s U.S. GAAP audited net income for the fiscal year ending December 31, 2008, adding back certain extraordinary items, including, without
limitation, charges and expenses arising from the Company’s Preference A Shares financing and any future equity investments, issuance of any equity incentives to any employees or consultants, and disposition or acquisition of any assets or
business (any such adding-back, an “Adjustment”) is less than US$9,500,000 (the “Actual FY08 Net Income”), the Investors’ ownership percentage shall increase in the same proportion the net income decreases, but
with a 25% (inclusive) upper limit, i.e., The Ownership After Adjustment = 21.28% * Min[US$9,500,000/Actual FY2008 Net Income, 125%]. Notwithstanding the foregoing, no Adjustment shall be made without the prior written approval of the
Investors holding at least a majority of the Registrable Securities. The Company shall then issue to the Investors, in proportion to the number of Preference A Shares held by them, new Preference A Shares at no cost equal to the difference between
the Investors’ Preference A Shares and the number of Preference A Shares which the total purchase price paid by the Investors as the consideration for the Preference A Shares pursuant to the Purchase Agreement would have purchased based on the
Actual FY08 Net Income (such newly issued Preference A Shares, the “Performance Linked Valuation Adjustment Shares”). 

  

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 By signing below, you agree with the foregoing change to the Investors’ Rights Agreement subject to the
other terms and conditions set forth herein. You acknowledge that the Investors’ Rights Agreement is subsisting and is in full force and effect in accordance with its terms and conditions subject to the foregoing change. 
 Please note that this Side Letter is exclusively for the information of the Company, the Purchasers and other parties in the Purchase Agreement and the
Investors’ Rights Agreement, and may not be disclosed to any third party or circulated or referred to publicly without our prior written consent. This Side Letter may be executed in any number of counterparts, each of which when executed will
be an original, and all of which, when taken together, will constitute one agreement. Delivery of an executed counterpart of a signature page of this Side Letter by facsimile transmission will be effective as delivery of a manually executed
counterpart hereof. A person who is not a party to this Side Letter has no right to enforce any of terms in this Side Letter. 
 This letter
will be governed by and construed in accordance with the laws of the State of California, without giving effect to principles of conflicts of laws. 
 [Remainder of page intentionally left blank] 
  

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 Please confirm that the foregoing is in accordance with your understanding by signing and returning to us
the enclosed copy of this letter, which will become a binding agreement upon our receipt. 
  

			
	Very truly yours,
	
	CHINA NUOKANG BIO-PHARMACEUTICAL PTY
		
	 By:
	 	 /s/ Baizhong XUE

		 	Authorized Signatory

  

			
	 ACCEPTED AND AGREED

	 AS OF JUNE 2, 2008

	
	SEQUOIA CAPITAL CHINA GROWTH FUND I, L.P.
		
	By:	 	 /s/ Jimmy Wong

	Name:	 	Jimmy Wong
	Title:	 	Authorized Signatory
	
	HBM BIOMED CHINA LIMITED
		
	By:	 	 /s/ John Arnold

	Name:	 	John Arnold
	Title:	 	Director