UNITED
      STATES


SECURITIES
      AND EXCHANGE COMMISSION


Washington,
      DC 20549




FORM
        10-KSB








(Mark
      One)


x
            Annual
                Report under Section 13 or 15 (d) of The Securities Exchange Act
                of
                1934For
                the fiscal year ended December 31, 2007o
            Transition
                Report under Section 14 or 15 (d) of The Securities Exchange Act
                of
                1934For
                the transition period from _________ to
                __________.





**SINOBIOMED
      INC.**


(Exact
      name of registrant as specified in its charter)





Delaware
            
            333-128399
            
            20-1945139(State
                or other
            
            (Commission
                File No.)
            
            (I.R.S.
                Employerjurisdiction
            
            
            
            Identification
                No.)of
                Company )





**Lane
      4705, No. 58, North Yang Gao Rd.**


**Pudong
      New Area Shanghai, China 201206**


**(Address
      of principal executive offices, including Zip Code)**





**Registrant’s
      telephone number, including area code: 011-86-21-58546923**





**N/A**


**(Former
      name or former address, if changed since last report)**




Securities
      registered under Section 12 (b) of the Exchange Act: None





Securities
      registered under Section 12 (g) of the Exchange Act: Common Stock, $0.0001
      par
      value.





Check
      whether the issuer is not required to file reports pursuant to Section 13 or
      15(d) of the Exchange Act: o





Check
      whether the issuer (1) filed all reports required to be filed by Section 13
      or
      15 (d) of the Exchange Act during the past twelve months (or for such shorter
      period that the registrant was required to file such reports), and (2) has
      been
      subject to such filing requirements for the past 90 days:    Yes
x
      No o









Indicate
      by check mark whether the registrant is an accelerated filer (as defined in
      Rule
      12b-2 of the Exchange Act).  Yes
o
      No x





Check
      if
      there is no disclosure of delinquent filers in response to Item 405 of
      Regulation S-B is not contained in this form, and no disclosure will be
      contained, to the best of registrant’s knowledge, in definitive proxy or
      information statements incorporated by reference in Part III of the Form 10-KSB
      or any amendment to this Form 10-KSB.  o





Indicate
      by check mark whether the registrant is a shell company (as defined in Rule
      12b-2 of the Exchange Act.)  Yes
o
      No x





State
      issuer’s revenues for its most recent fiscal year: $1,255,694 for the year ended
      December 31, 2007.





The
      aggregate market value of the voting and non-voting shares of common equity
      held
      by non-affiliates of the Registrant as of April 11, 2008 was 86,312,086 shares
      X
      $0.45 per share = $38,840,438.





The
      number of outstanding shares of the registrant’s Common Stock, $0.0001 par
      value, as of April 11, 2008 was 131,422,086 shares.




Transitional
      Small Business Disclosure Format:   Yes
o
      No x




ii




**Table
      Of Contents**




**Part
                  I**
              
              **1**Item
                  1.
              Description
                  Of Business
              1Item
                  2.
              Description
                  Of Property
              18Item
                  3.
              Legal
                  Proceedings
              18Item
                  4.
              Submission
                  Of Matters To A Vote Of Security Holders
              19**Part
                  II**
              
              **21**Item
                  5.
              Market
                  For Common Equity And Related Stockholder Matters
              21Item
                  6.
              Management’s
                  Discussion And Analysis Or Plan Of Operation
              25Item
                  7.
              Financial
                  Statements
              29Item
                  8.
              Changes
                  In And Disagreements With Accountants On Accounting And Financial
                  Disclosure
              30Item
                  8a.
              Controls
                  And Procedures
              31Item
                  8b.
              Other
                  Information
              31**Part
                  III**
              
              **32**Item
                  9.
              Directors,
                  Executive Officers, Promoters, Control Persons And Corporate Governance;
                  Compliance With Section 16(A) Of The Exchange Act
              32Item
                  10.
              Executive
                  Compensation
              36Item
                  11.
              Security
                  Ownership Of Certain Beneficial Owners And Management And Related
                  Stockholder Matters
              41Item
                  12.
              Certain
                  Relationships And Related Transactions
              44Item
                  13.
              Exhibits
              45Item
                  14.
              Principal
                  Accountant Fees And Services
              48**SIGNATURES**
              **50**Exhibit
                  Index
              51




iii




USE
      OF
      NAMES




In
      this
      annual report, the terms “Sinobiomed”, “Company”, “we”, or “our”, unless the
      context otherwise requires, mean Sinobiomed Inc. and its subsidiaries.




CAUTIONARY
      STATEMENT REGARDING FORWARD-LOOKING STATEMENTS




This
      annual report on Form 10-KSB and other reports that we file with the SEC contain
      statements that are considered forward-looking statements. Forward-looking
      statements give the Company’s current expectations, plans, objectives,
      assumptions or forecasts of future events. All statements other than statements
      of current or historical fact contained in this annual report, including
      statements regarding the Company’s future financial position, business strategy,
      budgets, projected costs and plans and objectives of management for future
      operations, are forward-looking statements. In some cases, you can identify
      forward-looking statements by terminology such as “anticipate,” “estimate,”
“plans,” “potential,” “projects,” “ongoing,” “expects,” “management believes,”
“we believe,” “we intend,” and similar expressions. These statements are based
      on the Company’s current plans and are subject to risks and uncertainties, and
      as such the Company’s actual future activities and results of operations may be
      materially different from those set forth in the forward looking statements.
      Any
      or all of the forward-looking statements in this annual report may turn out
      to
      be inaccurate and as such, you should not place undue reliance on these
      forward-looking statements. The Company has based these forward-looking
      statements largely on its current expectations and projections about future
      events and financial trends that it believes may affect its financial condition,
      results of operations, business strategy and financial needs. The
      forward-looking statements can be affected by inaccurate assumptions or by
      known
      or unknown risks, uncertainties and assumptions due to a number of factors,
      including:




·
            dependence
                on key personnel;




·
            competitive
                factors;




·
            degree
                of success of research and development
                programs




·
            the
                operation of our business; and




·
            general
                economic conditions in the United States and
                China




These
      forward-looking statements speak only as of the date on which they are made,
      and
      except to the extent required by federal securities laws, we undertake no
      obligation to update any forward-looking statements to reflect events or
      circumstances after the date on which the statement is made or to reflect the
      occurrence of unanticipated events. In addition, we cannot assess the impact
      of
      each factor on our business or the extent to which any factor, or combination
      of
      factors, may cause actual results to differ materially from those contained
      in
      any forward-looking statements. All subsequent written and oral forward-looking
      statements attributable to the Company or persons acting on its behalf are
      expressly qualified in their entirety by the cautionary statements contained
      in
      this annual report.




iv




**Part
      I**




***Item
      1. Description Of Business***




**Prior
      Operational History**




Sinobiomed
      Inc., (hereafter the "Company") was incorporated under the name CDoor Corp.
      in
      Delaware on November 18, 2004.  The Company was a development stage Company
      and currently owns one United States patent (patent No. 5,074,073) (the
      "Patent") for a "Car Door Safety Feature Device". The Patent is a safety feature
      related to the development of an injury-preventing system for doors of
      automobiles comprising a radiation emitter for emitting electromagnetic
      radiation, detectors for detecting the electromagnetic radiation thus preventing
      car doors from closing on a persons' hand, finger or leg. The Company's
      principal business plan was to develop a prototype of the Patent and then
      manufacture and market the product and/or seek third party entities interested
      in licensing the rights to manufacture and market the safety
      system.




In
      December 2004, the Company acquired the Patent related to the development of
      an
      injury-preventing system for automobiles comprising a radiation emitter for
      emitting electromagnetic radiation, detectors for detecting the electromagnetic
      radiation and an electronic control circuit which is designed to sense any
      disruption in the impingement of the electromagnetic radiation on the detectors.
      The system is located to monitor the space normally occupied by an automobile
      door. When impingement of the electromagnetic radiation on the detectors is
      disrupted, as by the placement of a person's hand in the space normally occupied
      by the automobile door, the electrical circuit activates a mechanical device,
      for example a solenoid, which places a small rubber rod in the path of the
      closing door, causing the door to bounce off the rod without closing, avoiding
      injury to the hand of the person.




On
      December 14, 2004, the Company acquired the rights to United States Patent
      No.
      5,074,073 from Asher Zwebner, the patent owner. Mr. Zwebner was a Director,
      officer and stockholder of the Company. The Patent was granted to Asher Zwebner
      by the United States Patent and Trademark Office on December 24, 1991, and
      is
      scheduled to expire on December 24, 2008. As consideration for such assignment,
      the Company has agreed to pay Mr. Zwebner 10% of all royalties we receive from
      the sale and marketing of the Company’s product.




**Recent
      Corporate Developments and Change of Business**




On
      October 16, 2006, Mr. Ka Yu, Mr. Lavi Krasney and Mr. Asher Zwebner entered
      into
      stock purchase agreements (the "Stock Purchase Agreement") whereby Mr. Yu will
      acquire in aggregate 2,000,000 (pre forward stock split) shares of Common Stock
      of the Company from Mr. Krasney and Mr. Zwebner at $0.225 per share for a total
      of purchase price of $450,000.









The
      Stock
      Purchase Agreements were closed on November 2, 2006.  Mr. Ka Yu directly
      owned 2,000,000 (pre forward stock split) shares of Common Stock of the Company
      after the close, which constituted approximately 66% of the issued and
      outstanding capital stock of the Company as of November 2, 2006.  In
      addition, Mr. Yu was appointed as a director as well as the President, CEO,
      CFO,
      Secretary and Treasurer of the Company on October 31, 2006.




In
      accordance with the Stock Purchase Agreements and related Escrow Agreements,
      Mr.
      Lavi Krasney and Mr. Asher Zwebner resigned as officers and directors of the
      Company at or prior to closing.




On
      December 28, 2006, Mr. Ka Yu resigned as the Chief Financial Officer of CDoor
      Corp. (the “Company”), without having any disagreement with the Company on any
      matter relating to the Company’s operations, policies or practices.




Effective
      December 28, 2006, the Board of Directors of the Company accepted the
      resignation of Mr. Ka Yu as the Chief Financial Officer of the Company and
      appointed Mr. Asher Zwebner as the new Chief Financial Officer of the Company
      and to remain the Chief Financial Officer until the next annual general meeting
      of the Company or until his successor is elected or appointed.




The
      Company determined to change its business plan from the development of the
      Car
      Door Safety Feature Patent and began focusing around the Chinese
      biopharmaceutical industry.




On
      January 12, 2007, the Company completed a Share Purchase Agreement, dated
      December 21, 2006, entered into between the Company, Wanxin Bio-Technology
      Limited (“Wanxin”) and all the shareholders of Wanxin (the “Share Purchase
      Agreement”) whereby the Company acquired 100% of the issued and outstanding
      shares in the capital of Wanxin (the “Wanxin Capital”), through the issuance of
      1,750,000 (pre forward stock split) shares of common stock of the Company in
      aggregate to the shareholders of Wanxin on a pro rata basis in accordance with
      each Wanxin shareholders’ percentage of ownership in Wanxin.




Wanxin
      is
      the sole shareholder of Manhing Enterprises Limited, a company organized under
      the laws of Hong Kong, and Manhing Enterprises Limited is the registered owner
      of 82% of the capital of Shanghai Wanxing Bio-pharmaceuticals Co., Ltd.  In
      addition, Shanghai Wanxing Bio-pharmaceuticals Co., Ltd. is the registered
      owner
      of 50.33% of the capital of Shanghai Wanxing Bio-science Cosmetic Co.,
      Ltd.




On
      August
      6, 2007, the Company through its 82% owned subsidiary, Shanghai Wanxing
      Bio-pharmaceuticals Co., Ltd. (“Shanghai Wanxing”), entered into a formal equity
      transfer contract (the “Equity Transfer Contract”) with the equity owners of
      Suzhou Boai Medical Development Co., Ltd. (“Suzhou Boai”), a pharmaceutical
      distribution company organized under the laws of the P.R. China, to acquire
      90%
      of the equity in Suzhou Boai in exchange for the payment of a transfer fee
      (the
“Transfer Fee”) to the equity owners of Suzhou Boai.





Under
      the
      Equity Transfer Contract, all the equity owners of Suzhou Boai were to transfer
      all of their equity to Shanghai Wanxing, except for one equity owner who was
      to
      retain a 10% interest, in exchange for an aggregate Transfer Fee of RMB18
      million (approximately USD$2.4 million).




2




The
      Transfer Fee, the final determination of which was subject to a due diligence
      report, was to be two times the authorized capital of Suzhou Boai (RMB18
      million, or approx. USD$2,400,000.00). Shanghai Wanxing was to pay: (i) 30%
      of
      the Transfer Fee (RMB5.4 million, or approx. USD$720,000) three days after
      signing the Equity Transfer Contract, which was already paid as of August 7,
      2007; (ii) 55% of the Transfer Fee (RMB9.9 million, or approx. USD$1,320,000)
      one week after registration of the equity alteration; and (iii) 15% of the
      Transfer Fee (RMB2.7 million, or approx. USD$360,000) a half year after
      registration of the equity alteration. After receiving 30% of the Transfer
      Fee,
      which was already paid, the equity owners of Suzhou Boai were responsible for
      obtaining government administrative approval and registering the equity
      alteration.





The
      foregoing description of the Equity Transfer Contract does not purport to be
      complete and is qualified in its entirety by reference to the Equity Transfer
      Contract, which was attached as Exhibit 10.1 to the Form 8-K filed on August
      10,
      2007, which is incorporated herein by reference.





On
      August
      6, 2007, the Equity Transfer Contract entered into the actual fulfillment
      period. The due diligence report prepared for Suzhou Boai revealed that the
      total net assets of Suzhou Boai were only RMB 6.8 million instead of RMB 7.5
      million as required and subject to possible further deductions, and the
      Company’s auditors also confirmed the total net assets of Suzhou Boai were
      considerably less than RMB 7.5 million. This reduced total net assets level
      gave
      rise to a divergence on Suzhou Boai’s total net assets amount while in the
      fulfillment stage and Shanghai Wanxing decided to continue with the acquisition
      with the understanding that Shanghai Wanxing and Suzhou Boai would continue
      to
      negotiate a reduced Transfer Fee in good faith due to the reduced total net
      assets level.





After
      repeated negotiations, Shanghai Wanxing and Suzhou Boai’s former equity owners
      could not agree on a reduced Transfer Fee and on January 22, 2008, the parties
      to the Equity Transfer Contract decided to rescind such agreement while in
      the
      fulfillment stage and executed a Cancellation Agreement of the Stock Transfer
      Agreement (the “Cancellation Agreement”), whereby the parties agreed to resolve
      their disputes by having Shanghai Wanxing transfer the 90% registered capital
      back to its original status with the former owners, and the former owners
      returning to Shanghai Wanxing RMB 2.8 million of the RMB 5.4 million already
      paid.





As
      of
      February 3, 2008, Suzhou Boai and the former owners have returned the full
      RMB
      2.8 million to Shanghai Wanxing as agreed under the Cancellation
      Agreement.





The
      foregoing description of the Cancellation Agreement of the Stock Transfer
      Agreement does not purport to be complete and is qualified in its entirety
      by
      reference to the Cancellation Agreement of the Stock Transfer Agreement, which
      was attached as Exhibit 10.1 to the Form 8-K/A-2 filed on March 31, 2008, which
      is incorporated herein by reference.





3




**Overview
      of** **Shanghai
      Wanxing**




Shanghai
      Wanxing Bio-pharmaceuticals Co., Ltd. (“Shanghai Wanxing”) is a
      Chinese developer of genetically engineered recombinant protein drugs and
      vaccines. Based in Shanghai, Shanghai Wanxing currently has 10 products approved
      or in development: three on the market, four in clinical trials and three in
      R&D. Shanghai Wanxing’s products respond to a wide range of diseases,
      including malaria and hepatitis. Malaria, which threatens more than 2 billion
      people globally, kills more than a million people a year - most of them
      children. In Africa, malaria causes the death of a child every 30 seconds.
      Hepatitis is endemic in China, with 80% of its 1.3 billion people likely to
      be
      infected at some point in their lives. Some 2.4 million cases are reported
      each
      year.




**COMPANY
      PRODUCTS**





***Products***





**Products
      on Market**





Wanferon/Wanferin,
      recombinant human interferon for treating hepatitis B hepatitis C, viral
      infections and other conditions.





Leflunomide,
      a drug for the treatment of rheumatoid arthritis.





Recombinant
      Acidic Fibroblast Growth Factor (rh-aFGF), a patented bio-product that treats
      diabetic ulcers and burns and supports recovery from plastic surgery.





**Products
      in Clinical Trials**





Recombinant
      Malaria Vaccine (PfCP-2.9), a patented bio-product is expected to enter Phase
      IIb trial to be conducted in Thialand in summer 2008 .





Recombinant
      Batroxobin (rBAT), the world’s first batroxobin synthesized through gene
      recombination, prevents and treats surgical bleeding. Natural batroxobin,
      extracted from snake venom, is the world’s most prescribed biological
      anti-bleeding agent, but also has a high production cost and safety concerns.
      A
      patented bio-product, rBAT is in Phase IIb Clinical Trial at eight hospitals
      in
      China.





Recombinant
      Human Stem Cell Factor (SCF), a patent-applied-for bio-product in Phase I
      Clinical Trial that facilitates recovery of blood cell regeneration following
      radio-chemotherapy treatment in patients with malignant tumors. Phase I Clinical
      Trial is expected to be completed in July 2008.





Ethelphazine,
      a patent-applied-for anti-tumor drug is in Phase III Clinical Trial which is
      expected to be completed by the end of 2008.





**Products
      in Research and Development**





Recombinant
      Hepato regeneration Factor, a patented bio-product, is expected to be used
      as
      treatment for acute liver failure.




4




Recombinant
      Human Type 1 Kallikrein, is expected to be a treatment for peripheral vascular
      disorders, prevention of blood clots and thrombosis.





Recombinant
      Human Urinary Trypsin Inhibitor, is expected to be a treatment of acute
      pancreatitis.





**Compensation
      of Directors and Officers of Shanghai Wanxing**





Board
      members that do not hold an executive officer position or a manager position
      in
      Shanghai Wanxing do not receive salary or other payments as Shanghai Wanxing
      is
      not currently generating any profits.





Annual
      salaries for General Manager and Deputy General Managers are between 150,000
      to
      300,000 RMB (approx. US$18,750 to US$37,500). Half of the salary is paid monthly
      and the other half is paid at the end of the year subject to an annual
      review.





Senior
      management, including executive officers, are paid on the 20 th of every
      month according to their positions, academic titles, education and
      achievements.





Shanghai
      Wanxing does not currently pay any year-end bonuses or dividends or other forms
      of award. It is anticipated that all upper management will be paid based on
      an
      annual salary system and year-end award.




**RISK
      FACTORS**




An
      investment in the Company has a high degree of risk. Before you invest you
      should carefully consider the risks and uncertainties described below and the
      other information in this Annual Report. If any of the following risks actually
      occur, our business, operating results and financial condition could be harmed
      and the value of our stock could go down.




***We
      have had losses and such losses may continue, which may negatively impact our
      ability to achieve our business objectives.***




For
      the
      fiscal year ended December 31, 2007 we had a net loss of $6,669,420 and an
      accumulated deficit of $30,761,870 since our inception. There can be no
      assurance that future operations will be profitable. Revenues and profits,
      if
      any, will depend upon various factors, including the future profitability of
      our
      operating entity Shanghai Wanxing.




***Our
      common stock is subject to the “penny stock” rules of the SEC and the trading
      market in our securities is limited, which makes transactions in our stock
      cumbersome and may reduce the value of an investment in our
      stock.***




The
      Securities and Exchange Commission has adopted Rule 15g-9 which establishes
      the
      definition of a “penny stock,” for the purposes relevant to us, as any equity
      security that has a market price of less than $5.00 per share or with an
      exercise price of less than $5.00 per share, subject to certain exceptions.
      For
      any transaction involving a penny stock, unless exempt, the rules
      require:




5




·
            that
                a broker or dealer approve a person’s account for transactions in penny
                stocks; and




·
            the
                broker or dealer receive from the investor a written agreement to
                the
                transaction, setting forth the identity and quantity of the penny
                stock to
                be purchased.




In
      order
      to approve a person’s account for transactions in penny stocks, the broker or
      dealer must:




·
            obtain
                financial information and investment experience objectives of the
                person;
                and




·
            make
                a reasonable determination that the transactions in penny stocks
                are
                suitable for that person and the person has sufficient knowledge
                and
                experience in financial matters to be capable of evaluating the risks
                of
                transactions in penny stocks.




The
      broker or dealer must also deliver, prior to any transaction in a penny stock,
      a
      disclosure schedule prescribed by the Commission relating to the penny stock
      market, which, in highlight form:




·
            sets
                forth the basis on which the broker or dealer made the suitability
                determination; and




·
            that
                the broker or dealer received a signed, written agreement from the
                investor prior to the transaction.




Generally,
      brokers may be less willing to execute transactions in securities subject to
      the
“penny stock” rules. This may make it more difficult for investors to dispose of
      our common stock and cause a decline in the market value of our
      stock.




Disclosure
      also has to be made about the risks of investing in penny stocks in both public
      offerings and in secondary trading and about the commissions payable to both
      the
      broker-dealer and the registered representative, current quotations for the
      securities and the rights and remedies available to an investor in cases of
      fraud in penny stock transactions. Finally, monthly statements have to be sent
      disclosing recent price information for the penny stock held in the account
      and
      information on the limited market in penny stocks.




***Because
      we do not intend to pay any cash dividends on our shares of common stock, our
      stockholders will not be able to receive a return on their shares unless they
      sell them.***




We
      intend
      to retain any future earnings to finance the development and expansion of our
      business. We do not anticipate paying any cash dividends on our Common Stock
      in
      the foreseeable future. Unless we pay dividends, our stockholders will not
      be
      able to receive a return on their shares unless they sell them.




***Risks
      Related to Our Newly Acquired Business***




***We
      have a history of operating losses and may never be profitable.***




Biopharmaceutical
      product development is a highly speculative undertaking and involves a
      substantial degree of risk. Shanghai Wanxing has incurred substantial losses
      since its inception, and it expects to continue to incur losses for the
      foreseeable future. The losses have resulted principally from research and
      development costs and selling, general and administrative expenses. Shanghai
      Wanxing expects to incur additional operating losses in the future if its sales
      do not increase or if its expenses grow. The losses have had, and are expected
      to continue to have, an adverse impact on working capital, total assets,
      stockholders’ equity and cash flow. Shanghai Wanxing and Sinobiomed cannot
      assure you that we will ever become profitable, or, even if we become
      profitable, that we would be able to sustain or increase our profitability.




6




***We
      will need additional capital to expand the production capacity for our existing
      products, to continue development of our product pipeline and to market existing
      and future products on a large scale, and we cannot guarantee that we will
      find
      adequate sources of capital in the future.***




We
      will
      need to raise further funds from the capital markets to finance expenditures
      for
      equipment, intellectual property asset acquisitions, to expand the production
      capacity for our existing products, to continue the development and
      commercialization of our product candidates and for other corporate purposes.
      We
      will need to undertake significant future financings for the following reasons:




·
            To
                proceed with the research and development of other vaccine products,
                including clinical testing relating to new
                products;




·
            To
                develop or acquire other product candidates, technologies or other
                lines
                of business;




·
            To
                establish and expand manufacturing
                capabilities;




·
            To
                commercialize our products, including the marketing and distribution
                of
                new and existing products;




·
            To
                protect our intellectual property;




·
            To
                seek and obtain regulatory approvals;
                and




·
            To
                finance general and administrative and research activities that are
                not
                related to specific products under
                development.




In
      the
      past, Shanghai Wanxing funded most of its research and development and other
      expenditures through grants and debt financing. We intend to raise additional
      funds in the near future because our current operating and capital resources
      are
      insufficient to meet future requirements.




If
      we
      raise additional funds by issuing equity securities, it will result in further
      dilution to our existing shareholders, because the shares may be sold at a
      time
      when the market price is low, and because shares issued in equity financing
      will
      normally be sold at a discount to the current market price. Unforeseen problems,
      including materially negative developments relating to, among other things,
      product sales, new product rollouts, clinical trials, research and development
      programs, our strategic relationships, our intellectual property, litigation,
      regulatory issues in our industry, the Chinese market generally or in general
      economic conditions, could interfere with our ability to raise additional equity
      capital or materially adversely affect the terms upon which such funding is
      available. If we raise additional funds by issuing debt securities, these debt
      securities would have rights, preferences and privileges senior to those of
      holders of our common shares, and the terms of the debt securities issued could
      impose significant restrictions on our operations. If we raise additional funds
      through collaborations and licensing arrangements, we might be required to
      relinquish significant rights to certain of our technologies, marketing
      territories, product candidates or products that we would otherwise seek to
      develop or commercialize ourselves, or be required to grant licenses on terms
      that are not favorable to us.




7




We
      do not
      know whether additional financing will be available to us on commercially
      acceptable terms when needed. If adequate funds are not available or are not
      available on commercially acceptable terms, we may need to downsize or suspend
      some or all of our operations and may be unable to continue developing our
      products. In any such event, our ability to bring a product to market and obtain
      revenues could be delayed, competitors could develop products sooner than us,
      and we could be forced to relinquish rights to technologies, products or
      potential products.




***We
      currently have limited revenue sources and a reduction in revenues of our
      existing products would cause our revenues to decline and could materially
      harm
      our business.***




Shanghai
      Wanxing generates a significant portion of its revenues from sales of its
      Wanferon/Wanferin products. We expect that sales of Wanferon/Wanferin will
      continue to comprise a substantial portion of our revenues in the near future.
      A
      decrease in Wanferon/Wanferin sales would most likely have an adverse affect
      on
      our financial results. Shanghai Wanxing also generates a significant portion
      of
      its revenues from sales of its Leflunomide product, and is involved in a dispute
      with the company which manufactures the product under license. Should this
      dispute not be resolved, we may not realize further sales of the Leflunomide
      product. .




***If
      we are unable to successfully compete in the highly competitive biotechnology
      industry, our business could be harmed.***




We
      operate in a highly competitive environment, and the competition is expected
      to
      increase. Competitors include large pharmaceutical and biotechnology companies
      and academic research institutions, in each case both within and outside China.
      Some of these competitors, particularly large pharmaceutical and biotechnology
      companies, have greater resources than us. New competitors may also enter into
      the markets where we currently compete. Accordingly, even if we are successful
      in launching a product, we may find that a competitive product dominates the
      market for any number of reasons, including:




·
            The
                possibility that the competitor may have launched its product
                first;




·
            The
                competitor may have greater access to certain raw
                materials;




·
            The
                competitor may have more efficient manufacturing
                processes;




·
            The
                competitor may have greater marketing capabilities; or




·
            The
                competitive product may have therapeutic or other
                advantages.




The
      technologies applied by our competitors and us are rapidly evolving, and new
      developments frequently result in price competition and product obsolescence.
      In
      addition, we may be impacted by competition from generic forms of our products,
      substitute products or imports of products from lower priced markets.




8




***We
      are controlled by a small number of shareholders and their affiliated entities
      and their interests may not be aligned with the interests of our other
      shareholders.***




Our
      directors and executive officers and their affiliates collectively control
      approximately 34% of our outstanding common shares as of March 31, 2008. These
      stockholders, if they act together, will be able to influence our management
      and
      affairs and all matters requiring stockholder approval, including the election
      of directors and approval of significant corporate transactions. The
      concentration of ownership of these shareholders may discourage, delay or
      prevent a change in control of our company, which could deprive our shareholders
      of an opportunity to receive a premium for their shares as part of a sale of
      our
      company and might reduce the price of our common shares. These actions may
      be
      taken even if they are opposed by our other shareholders. In cases where the
      interests of our significant shareholders are aligned and they vote together,
      these shareholders may also have the power to prevent or cause a change in
      control. In addition, these shareholders could divert business opportunities
      from us to themselves or others.




***We
      could be subject to costly and time-consuming product liability actions.***




We
      manufacture recombinant protein drugs and vaccines that are injected into
      individuals to treat and protect against infectious illnesses. A failure of
      our
      products to function as anticipated, whether as a result of the design of these
      products, unanticipated health consequences or side effects, or misuse or
      mishandling by third parties of such products or because of faulty or
      contaminated supplies, could result in injury and as a result subject us to
      product liability lawsuits. Claims also could be based on failure to immunize
      as
      anticipated. Any product liability claim brought against us, with or without
      merit, could have a material adverse effect on us. Even a meritless or
      unsuccessful product liability claim could be time consuming, expensive to
      defend, and could result in the diversion of management’s attention from
      managing our core business or result in associated negative publicity.




Our
      business exposes us to potential product liability risks that are inherent
      in
      the testing, manufacturing and marketing of biopharmaceutical products. But
      we
      cannot be certain that we will be able to maintain adequate product liability
      insurance at a reasonable cost. In addition, we have no clinical trial insurance
      for our clinical trials except for our Malaria vaccine clinical trials because
      such coverage is not available in mainland China. Any insurance coverage we
      do
      have may not be sufficient to satisfy any liability resulting from product
      liability claims. A successful product liability claim or series of claims
      could
      have a material adverse impact on our business, financial condition and results
      of operations.




***We
      depend on our key personnel, the loss of whom would adversely affect our
      operations. If we fail to attract and retain the talent required for our
      business, our business will be materially harmed.***




We
      are a
      small company with approximately 146 full-time employees as of December 31,
      2007, and we depend to a great extent on principal members of our management
      and
      scientific staff. If we lose the services of any key personnel, in particular,
      Mr. Ban-Jun Yang, our President and Chief Executive Officer, it could
      significantly impede the achievement of our research and development objectives
      and delay our product development programs and the approval and
      commercialization of our product candidates. We do not currently have any key
      man life insurance policies. We have entered into employment agreements with
      our
      senior staff. The employment agreements do not ensure that we may be able to
      retain the services of our executive officers for an indefinite period of time
      in the future. In addition, recruiting and retaining qualified scientific,
      technical and managerial personnel and research partners will be critical to
      our
      success. Competition among biopharmaceutical and biotechnology companies for
      qualified employees in China is intense and turnover rates are high. There
      is
      currently a shortage of employees in China with expertise in our areas of
      research and clinical and regulatory affairs, and this shortage is likely to
      continue. We may not be able to retain existing personnel or attract and retain
      qualified staff in the future. If we fail to hire and retain personnel in key
      positions, we may be unable to develop or commercialize our product candidates
      in a timely manner.




9




***We
      may encounter difficulties in managing our growth, which could adversely affect
      our results of operations.***




We
      have
      experienced a period of rapid and substantial growth that has taken place and,
      if such growth continues, it will continue to place a strain on our
      administrative and operational infrastructure. If we are unable to manage this
      growth effectively, our business, results of operations or financial condition
      may be materially and adversely affected. Our ability to manage our operations
      and growth effectively requires us to continue to improve our operational,
      financial and management controls, reporting systems and procedures and hiring
      programs. We may not be able to successfully implement these required
      improvements.




***Risks
      Related To Government Regulation***




***We
      can only sell products that have received regulatory approval and many factors
      affect our ability to obtain such approvals.***




Pre-clinical
      and clinical trials of our products, and the manufacturing and marketing of
      our
      technologies, are subject to extensive, costly and rigorous regulation by
      governmental authorities in the People’s Republic of China (“PRC”) and in other
      countries. Even if we complete preclinical and clinical trials successfully,
      we
      may not be able to obtain applicable regulatory approvals. We cannot market
      any
      product candidate until we have both completed our clinical trials and obtained
      the necessary regulatory approvals for that product candidate.




Conducting
      clinical trials and obtaining regulatory approvals are uncertain, time consuming
      and expensive processes. The process of obtaining required regulatory approvals
      from the China State Food and Drug Administration (the China “SFDA”), and other
      regulatory authorities often takes many years to complete and can vary
      significantly based on the type, complexity and novelty of the product
      candidates.




There
      can
      be no assurance that all of the clinical trials pertaining to our recombinant
      protein drugs and vaccines in development will be completed within the time
      frames anticipated by us. We could encounter difficulties in enrolling such
      recombinant protein drugs and vaccines for trials or encounter setbacks during
      the conduct of trials that result in delays or trial cancellation. Data obtained
      from preclinical and clinical studies are subject to varying interpretations
      that could delay, limit or prevent regulatory approval, and failure to observe
      regulatory requirements or inadequate manufacturing processes are examples
      of
      other problems that could prevent approval. In addition, we may encounter delays
      or rejections in the event of additional government regulations from future
      legislation, administrative action or changes in China SFDA policy or if
      unforeseen health risks become an issue with the participants of clinical
      trials. Clinical trials may also fail at any stage of testing. Results of early
      trials frequently do not predict results of later trials, and acceptable results
      in early trials may not be repeated. For these reasons, we do not know whether
      regulatory authorities will grant approval for any of our product candidates
      in
      the future.




10




Delays
      in
      obtaining China SFDA or foreign approvals of our products could result in
      substantial additional costs and adversely affect our ability to compete with
      other companies. Even if regulatory approval is ultimately granted, there can
      be
      no assurance that we can maintain the approval or that the approval will not
      be
      withdrawn. Any approval received may also restrict the intended use and
      marketing of the product we want to commercialize.




Outside
      the PRC, our ability to market any of our potential products is contingent
      upon
      receiving marketing authorizations from the appropriate regulatory authorities.
      These foreign regulatory approval processes include all of the risks associated
      with the China SFDA approval process described above and may include additional
      risks.




***We
      may not be able to comply with applicable good manufacturing practice
      requirements and other regulatory requirements, which could have a material
      adverse affect on our business, financial condition and results of operations.***




We
      are
      required to comply with applicable good manufacturing practice regulations,
      which include requirements relating to quality control and quality assurance
      as
      well as corresponding maintenance, record-keeping and documentation standards.
      Manufacturing facilities must be approved by governmental authorities before
      we
      can use them to commercially manufacture our products and are subject to
      inspection by regulatory agencies.




If
      we
      fail to comply with applicable regulatory requirements, including following
      any
      product approval, we may be subject to sanctions, including:




·
            Fines;




·
            Product
                recalls or seizure;




·
            Injunctions;




·
            Refusal
                of regulatory agencies to review pending market approval applications
                or
                supplements to approval
                applications;




·
            Total
                or partial suspension of
                production;




·
            Civil
                penalties;




·
            Withdrawals
                of previously approved marketing applications;
                or




·
            Criminal
                prosecution.




11




***RisksRelated
      To Our Intellectual Property***




***If
      we are unable to protect our intellectual property, we may not be able to
      operate our business profitably.***




Our
      success depends, in part, on our ability to protect our proprietary
      technologies. We try to protect the technology that we consider important to
      our
      business by filing PRC patent applications and relying on trade secret and
      pharmaceutical regulatory protection.




In
      addition to patents, we rely on trade secrets and proprietary know-how to
      protect our intellectual property. We have entered into confidentiality
      agreements (which include, in the case of employees, non-competition provisions)
      with the majority of our employees and all the advisors. These agreements
      provide that all confidential information developed or made known to the
      individual during the course of the individual’s relationship with us is to be
      kept confidential and not disclosed to third parties except in specific
      circumstances. In the case of our employees, the agreements provide that all
      of
      the technology which is conceived by the individual during the course of
      employment is our exclusive property. These agreements may not provide
      meaningful protection or adequate remedies in the event of unauthorized use
      or
      disclosure of our proprietary information. In addition, it is possible that
      third parties could independently develop proprietary information and techniques
      substantially similar to ours or otherwise gain access to our trade secrets.




We
      cannot
      assure you that our current or potential competitors, many of which have
      substantial resources and may have made substantive investments in competing
      technologies, do not have and will not develop, products that compete directly
      with our products despite our intellectual property rights.




Intellectual
      property rights and confidentiality protections in China may not be as effective
      as in the United States or other countries. For example, implementation and
      enforcement of PRC intellectual property-related laws have historically been
      deficient and ineffective and may be hampered by corruption and local
      protectionism. Policing unauthorized use of proprietary technology is difficult
      and expensive, and we might need to resort to litigation to enforce or defend
      patents issued to us or to determine the enforceability, scope and validity
      of
      our proprietary rights or those of others. The experience and capabilities
      of
      PRC courts in handling intellectual property litigation varies, and outcomes
      are
      unpredictable. Further, such litigation may require significant expenditure
      of
      cash and management efforts and could harm our business, financial condition
      and
      results of operations. An adverse determination in any such litigation could
      materially impair our intellectual property rights and may harm our business,
      prospects and reputation.




***We
      may depend on market exclusivity for certain of our products, which will afford
      us less protection than patents.***




Assuming
      regulatory approvals are obtained, our ability to successfully commercialize
      certain drugs may depend on the availability of market exclusivity under PRC
      law, which provides protection for certain new products. Under the PRC’s former
      Regulation on the Protection of New Pharmaceuticals and Technology Transfer,
      new
      drugs were afforded exclusivity protection of six, eight or twelve years,
      depending on the category of the drug in question. During the protection period,
      the China SFDA would not accept third parties’ applications for manufacturing
      the drug under protection.




12




After
      China joined the WTO in 2001, the government amended and implemented many laws
      and regulations in the area of pharmaceuticals. Currently, the Drug
      Administration Law, Implementing Regulations on Drug Administration and Drug
      Registration Regulation are the primary laws and regulations governing the
      exclusive protection regime for new drugs.




The
      Implementing Regulations on Drug Administration provide that the China SFDA
      may
      establish a monitoring period for up to five years for certain new drugs to
      monitor the safety of these products. During the monitoring period, the China
      SFDA will not accept third parties’ application for manufacturing or importing
      the same drug. The China SFDA’s regulations provide that the monitoring period
      shall be 3, 4 or 5 years. The China SFDA determines the availability and length
      of the monitoring period depending on the approval conditions of the same or
      similar drugs in China and in overseas markets. According to the Regulations
      on
      the Drug Registration promulgated by the China SFDA in 2005, in case there
      is
      more than one application for the same new drug pending, after the issuance
      of
      the first production license afforded with a monitoring period, the other
      co-pending applications should be rejected unless a clinical trial application
      has been approved.




***If
      our products infringe the intellectual property rights of third parties, we
      may
      incur substantial liabilities, and we may be unable to sell these products.***




Our
      commercial success depends significantly on our ability to operate without
      infringing the patents and other proprietary rights of third parties. Patent
      applications are maintained incognito until their publication 18 months from
      the
      filing date. The publication of discoveries in the scientific or patent
      literature frequently occurs substantially later than the date on which the
      underlying discoveries were made and patent applications are filed. China,
      similar to many other countries, adopts the first-to-file system under which
      whoever first files a patent application (instead of the one who makes first
      actual discoveries) will be awarded a patent. Even after reasonable
      investigation we may not know with certainty whether we have infringed upon
      a
      third-party’s patent because such third-party may have filed a patent
      application without our knowledge while we are still developing that product.
      If
      a third-party claims that we infringe upon its proprietary rights, any of the
      following may occur:




·
            We
                may become involved in time-consuming and expensive litigation, even
                if
                the claim is without merit;




·
            We
                may become liable for substantial damages for past infringement if
                a court
                decides that our technology infringes upon a competitor’s
                patent;




·
            A
                court may prohibit us from selling or licensing our product without
                a
                license from the patent holder, which may not be available on commercially
                acceptable terms, if at all, or which may require us to pay substantial
                royalties or grant cross licenses to our patents,
                and




·
            We
                may have to reformulate our product so that it does not infringe
                upon
                others’ patent rights, which may not be possible or could be very
                expensive and time-consuming.




If
      any of
      these events occurs, our business will suffer and the market price of our common
      shares could decline.




13




***The
      success of our business may depend on licensing biologics from, and entering
      into collaboration arrangements with, third parties. We cannot be certain that
      our licensing or collaboration efforts will succeed or that we will realize
      any
      revenue from them.***




The
      success of our business strategy may be, in part, dependent on our ability
      to
      enter into licensing and collaboration arrangements and to manage effectively
      the resulting relationships.




Our
      ability to enter into agreements with commercial partners depends in part on
      our
      ability to convince them of the value of our technology and know-how. This
      may
      require substantial time and effort on our part. While we anticipate expending
      substantial funds and management effort, we cannot assure you that strategic
      relationships will result or that we will be able to negotiate additional
      strategic agreements in the future on acceptable terms, if at all. Furthermore,
      we may incur significant financial commitments to collaborators in connection
      with potential licenses and sponsored research agreements. In addition, we
      may
      not be able to control the areas of responsibility undertaken by our strategic
      partners and may be adversely affected should these partners prove unable to
      carry a product candidate forward to full commercialization or should they
      lose
      interest in dedicating the necessary resources toward developing any such
      product quickly.




Third
      parties may terminate our licensing and other strategic arrangements if we
      do
      not perform as required under these arrangements. Generally, we expect that
      agreements for rights to develop technologies will require us to exercise
      diligence in bringing product candidates to market and may require us to make
      milestone and royalty payments that, in some instances, could be substantial.
      Our failure to exercise the required diligence or make any required milestone
      or
      royalty payments could result in the termination of the relevant license
      agreement, which could have a material adverse effect on us and our operations.
      In addition, these third parties may also breach or terminate their agreements
      with us or otherwise fail to conduct their activities in connection with our
      relationships in a timely manner. If we or our partners terminate or breach
      any
      of our licenses or relationships, we:




·
            May
                lose our rights to develop and market our product
                candidates;




·
            May
                lose trade secret protection for our product
                candidates;




·
            May
                experience significant delays in the development or commercialization
                of
                our product candidates;




·
            May
                not be able to obtain any other licenses on acceptable terms, if
                at all;
                and




·
            May
                incur liability for damages.




Licensing
      arrangements and strategic relationships in our industry can be very complex,
      particularly with respect to intellectual property rights. Disputes may arise
      in
      the future regarding ownership rights to technology developed by or with other
      parties. These and other possible disagreements between us and third parties
      with respect to our licenses or our strategic relationships could lead to delays
      in the research, development, manufacture and commercialization of our product
      candidates. These disputes could also result in litigation or arbitration,
      both
      of which are time-consuming and expensive. These third parties also may pursue
      alternative technologies or product candidates either on their own or in
      strategic relationships with others in direct competition with us.




14




***Any
      cessation or suspension of our collaborations with scientific advisors and
      academic institutions may increase our costs in research and development and
      lengthen our new vaccines/drugs development process and lower our efficiency
      in
      new products development.***




We
      work
      with scientific advisors and academic collaborators who assist us in our
      research and development efforts. We generally benefit considerably from the
      resources, technology and experience such academic collaboration may bring
      us.
      Any cessation or suspension of our collaborations with scientific advisors
      and
      academic institutions may increase our costs in research and development and
      lengthen our new vaccines development process and lower our efficiency in new
      products development.




***Risks
      Related To Doing Business in China***




***Adverse
      changes in political, economic and other policies of the Chinese government
      could have a material adverse effect on the overall economic growth of China,
      which could reduce the demand for our products and materially and adversely
      affect our competitive position.***




All
      of
      our business operations are conducted in China, and all of our sales are
      currently made in China. Accordingly, our business, financial condition, results
      of operations and prospects are affected significantly by economic, political
      and legal developments in China. The Chinese economy differs from the economies
      of most developed countries in many respects, including:




·
            The
                extent of government involvement;




·
            The
                level of development;




·
            The
                growth rate;




·
            The
                control of foreign exchange;




·
            The
                allocation of resources;




·
            An
                evolving regulatory system; and




·
            Lack
                of sufficient transparency in the regulatory
                process.




While
      the
      Chinese economy has experienced significant growth in the past 20 years, growth
      has been uneven, both geographically and among various sectors of the economy.
      The Chinese government has implemented various measures to encourage economic
      growth and guide the allocation of resources. Some of these measures benefit
      the
      overall Chinese economy, but may also have a negative effect on us. For example,
      our financial condition and results of operations may be adversely affected
      by
      government control over capital investments or changes in tax regulations that
      are applicable to us.




The
      Chinese economy has been transitioning from a planned economy to a more
      market-oriented economy. Although in recent years the Chinese government has
      implemented measures emphasizing the utilization of market forces for economic
      reform, the reduction of state ownership of productive assets and the
      establishment of sound corporate governance in business enterprises, a
      substantial portion of the productive assets in China is still owned by the
      Chinese government. The continued control of these assets and other aspects
      of
      the national economy by the Chinese government could materially and adversely
      affect our business. The Chinese government also exercises significant control
      over Chinese economic growth through the allocation of resources, controlling
      payment of foreign currency-denominated obligations, setting monetary policy
      and
      providing preferential treatment to particular industries or companies. Efforts
      by the Chinese government to slow the pace of growth of the Chinese economy
      could result in decreased expenditures by hospitals and other users of our
      products, which in turn could reduce demand for our products.




15




Moreover,
      the political relationship between the United States, Europe, or other Asian
      nations and China is subject to sudden fluctuation and periodic tension. Changes
      in political conditions in China and changes in the state of foreign relations
      are difficult to predict and could adversely affect our operations or cause
      our
      products to become less attractive. This could lead to a decline in our
      profitability.




Any
      adverse change in the economic conditions or government policies in China could
      have a material adverse effect on overall economic growth and the level of
      healthcare investments and expenditures in China, which in turn could lead
      to a
      reduction in demand for our products and consequently have a material adverse
      effect on our businesses.




***Future
      changes in laws, regulations or enforcement policies in China could adversely
      affect our business.***




Laws,
      regulations and enforcement policies in China, including those regulating our
      business, are evolving and subject to future change. Future changes in laws,
      regulations or administrative interpretations, or stricter enforcement policies
      by the Chinese government, could impose more stringent requirements on us,
      including fines or other penalties. Changes in applicable laws and regulations
      may also increase our operating costs. Compliance with such requirements could
      impose substantial additional costs or otherwise have a material adverse effect
      on our business, financial condition and results of operations. These changes
      may relax some requirements, which could be beneficial to our competitors or
      could lower market entry barriers and increase competition. Further, regulatory
      agencies in China may periodically, and sometimes abruptly, change their
      enforcement practice. Therefore, prior enforcement activity, or lack of
      enforcement activity, is not necessarily predictive of future actions. Any
      enforcement actions against us could have a material and adverse effect on
      us
      and the market price of our common shares. In addition, any litigation or
      governmental investigation or enforcement proceedings in China may be protracted
      and may result in substantial cost and diversion of resources and management
      attention, negative publicity, damage to our reputation and decline in the
      price
      of our common shares.




***Fluctuation
      in the value of the Chinese currency may have a material adverse effect on
      your
      investment.***




The
      value
      of the Chinese currency, the Renminbi yuan, against the U.S. dollar and other
      currencies may fluctuate and is affected by, among other things, changes in
      China’s political and economic conditions. The conversion of Renminbi yuan into
      foreign currencies, including U.S. dollars, has historically been set by the
      People’s Bank of China. On July 21, 2005, the PRC government changed its policy
      of pegging the value of the Renminbi yuan to the U.S. dollar. Under the new
      policy, the Renminbi yuan is permitted to fluctuate within a band against a
      basket of certain foreign currencies. This change in policy resulted initially
      in an approximately 2.0% appreciation in the value of the Renminbi yuan against
      the U.S. dollar. Since the adoption of this new policy, the value of Renminbi
      yuan against the U.S. dollar has fluctuated on a daily basis within narrow
      ranges, but overall has continued to strengthen against the U.S. dollar. There
      remains significant international pressure on the PRC government to further
      liberalize its currency policy, which could result in a further and more
      significant appreciation or depreciation in the value of the Renminbi yuan
      against the U.S. dollar. Any significant revaluation of the Renminbi yuan may
      have a material adverse effect on our revenues and financial condition, and
      the
      value of, and any dividends payable on, our common shares in foreign currency
      terms. For example, to the extent that we need to convert U.S. dollars into
      Renminbi yuan for our operations, appreciation of the Renminbi yuan against
      the
      U.S. dollar would reduce the Renminbi yuan amount we receive from the
      conversion. Conversely, if we decide to convert our Renminbi yuan into U.S.
      dollars for the purpose of making dividend payments on our common shares or
      for
      other business purposes, appreciation of the U.S. dollar against the Renminbi
      yuan would reduce the U.S. dollar amount available to us.




16




**Transfer
      Agent**




We
      have
      engaged Nevada Agency and Trust Company as our stock transfer agent. Nevada
      Agency and Trust Company is located at 50 West Liberty Street, Reno, Nevada
      89501.




**Available
      Information**




The
      Company’s website is www.sinobiomed.com ,
      where
      information about the Company may be reviewed and obtained. In addition, the
      Company’s filings with the Securities and Exchange Commission (“SEC”) may be
      accessed at the internet address of the SEC, which is http://www.sec.gov. Also,
      the public may read and copy any materials that the Company files with at the
      SEC’s Public Reference Room at 100 F Street, N.E., Room 1580 Washington, D.C.
      20549. The public may obtain information on the operation of the Public
      Reference Room by calling the SEC at 1-800-SEC-0330.




**Material
      Agreements of Shanghai Wanxing**




All
      of
      the information in the Company’s Form 8-K/A-1 filed with the SEC on January 16,
      2007, under the section titled “Material Agreements” from page 21 to 27 is
      incorporated herein by reference.




**Loan
      Obligations** **of Shanghai Wanxing**




Shanghai
      Wanxing has the following loans outstanding:





·
            China
                Construction Bank in the amount of RMB 14,300,000 (about $1,958,000)
                plus
                accrued interest of RMB 6,236,563;


·
            Shenzhen
                Development Bank in the amount of RMB 5,600,000 (about $767,000)
                plus
                accrued interest of RMB 3,833,968;


·
            Industrial
                Bank in the amount of RMB 24,800,061 (about $3,395,000) plus accrued
                interest of RMB 3,942,672.






17




·
            Demand
                loans from two unrelated companies in the aggregate amount of RMB
                7,200,000 (about $ 986,000).


The
        three
        bank loans above were all due for payment in full by December 31, 2007. However,
        on April 3, 2008, Shanghai Wanxing agreed to revised payment schedule for
        t he
        bank
        loan with the China Construction Bank. Under this agreement, Shanghai Wanxing
        agreed to pay 4 Million yuan (approximately $548,000) by June 30, 2008 and The
        balance of principal and interest by September 30, 2008.
 
 In
        addition on April 8, 2008, Shanghai Wanxing to a revised payment schedule For
        the
        bank loan with the Industrial Bank. Under this agreement, Shanghai Wanxing agreed
        to
        pay 3 Million yuan (approximately $411,000) by April 30, 2008, 10 Million Yuan
        (approximately $1,369,000) by June 30, 2008 and the balance of principal
        and interest
        by September 30, 2008.





In
      addition, Shanghai Wanxing has an outstanding shareholders loan owing to Beijing
      Guoan of RMB 13,454,227 (about $1,842,000), which was due in December, 2007.
      However, there is an agreement between Manhing Enterprises Limited, the 82%
      shareholder of Shanghai Wanxing, and Beijing Guoan, whereby both parties agreed
      to increase capital contributions to Shanghai Wanxing of which Beijing Guoan’s
      share of that is $3,780,000.




***Item
      2****. Description Of Property***




The
      Company’s current executive offices are located at Lane 4705, No. 58, North Yang
      Gao Rd., Pudong New Area, Shanghai, China 201206.




The
      Company does not have any policies regarding investments in real estate,
      securities or other forms of property.




***Shanghai
      Wanxing’s Facilities***




Shanghai
      Wanxing’s large-scale fermentation equipment has a production capacity of
      100,000 bottles per batch, one of the largest in China. Shanghai Wanxing’s
      combination of advanced technology and expertise enables the Company to produce
      safe, high-yield, high efficacy recombinant protein drugs at extremely
      low-cost.




Shanghai
      Wanxing owns a 20,000-square-meter facility for integrated R&D,
      manufacturing, quality control, and sales and marketing. In addition, Shanghai
      Wanxing owns a 3,000-square-meter Good Manufacturing Practice (GMP) plant
      certified by Chinese State Food and Drug Administration (SFDA). The land upon
      which these buildings are located is licensed to Shanghai Wanxing from the
      Chinese government, for a term of 30 years from September 18, 1996. At the
      end
      of the license, the Company expects to have an option to renew the
      license.




***Item
      3. Legal Proceedings***




There
      are
      no material pending legal proceedings to which we are a party or to which any
      of
      our property is subject and, to the best of our knowledge, no such actions
      against us are contemplated or threatened, except for:




On
      June
      21, 2004 the Company was sued by the Agriculture Bank of China to enforce
      payment under the loan agreement with that bank. The Company’s land, building
      and equipment, new medicine certificates and a bank account were hypothecated
      by
      the People’s Court of Yangpu District, Shanghai, China pursuant to the action.
      On September 15, 2006 the Company and the bank entered into a settlement
      agreement to settle the litigation and the debt. The debt at that time had
      a
      principal balance of 21.62 million yuan (approximately $US (2,680,000). The
      Company repaid this loan in full by June 30, 2007. On
      July
      2, 2007, the Company received a civil judgment order from the Shanghai Yangpu
      District People’s Court that the execution order of the court dated June 21,
      2004 in respect of the litigation by the
      Agriculture Bank of China has
      been
      completed and the case is closed. A recovery for forgiveness of accrued interest
      in the amount of RMB 4,091,546 (approximately $US 538,000) was recognized in
      the
      year ending December 31, 2007.




18




The
      Company has been sued by the Industrial and Commercial Bank of China to enforce
      payment under the loan agreement with that bank and judgment was granted in
      favour of the bank by the People’s Court of Pudong District. On October 25, 2006
      the Company and the bank entered into a settlement agreement to settle the
      litigation and the debt. The debt at that time had a principal balance of 77.15
      million yuan (approximately $US 9,560,000). The Company repaid the principal
      amount of this loan in the year and realized again on forgiveness of accrued
      outstanding interest of approximately $1,782,000, net of consulting fees of
      approximately $335,000 incurred for a consultant who negotiated the settlement
      on the Company’s behalf.





The
      Company has been sued by the Shenzhen Development Bank to enforce payment under
      the loan agreement with that bank and judgment was granted in favor of the
      bank
      by the 1st Secondary People’s Court of Shanghai. On October 25, 2006 the Company
      and the bank entered into a settlement agreement to settle the litigation and
      the debt. The debt at that time had a principal balance of 17,800,000 yuan
      (approximately $US 2,437,000 at December 31, 2007 exchange rates). Under the
      terms of the settlement agreement, the Company was obligated to pay the bank
      5
      million yuan (approximately $US 685,000) before October 30, 2006, 3 million
      yuan
      (approximately $US 411,000) before March 20, 2007, 3 million yuan (approximately
      $US 411,000) before June 20, 2007, 3 million yuan (approximately $US 411,000)
      before September 20, 2007 and 3.8 million yuan (approximately $US 522,000)
      plus
      the balance of accrued interest before December 20, 2007. The Company made
      a
      payment of 5 million yuan in compliance with the settlement agreement in
      December 2006. The
      Company defaulted on the settlement agreement by not making the scheduled loan
      payment of 3 million yuan (approximately $US 394,000) on March 20, 2007. The
      bank granted a waiver of default in respect of this payment until May 30, 2007.
      The Company made the payment due May 30, defaulted on the two payments due
      by
      June 20, 2007 and September 20, 2007, made payments of 4,200,000 yuan after
      September 30, 2007, and has defaulted on the payment due December 20,
      2007 .




***Item
      4. Submission Of Matters To A Vote Of Security
      Holders***




There
      were no matters submitted during the fourth quarter of the fiscal year covered
      by this report to a vote of security holders, through the solicitation of
      proxies or otherwise, however, on March 1, 2007, the Company held an annual
      meeting of stockholders whereby the following corporate actions were all
      approved by holders of a majority of the issued and outstanding shares of the
      Company:




1.
            Amendment
                to the Certificate of Incorporation to effectuate a name change of
                the
                Company to “Sinobiomed Inc.”;




19




2.
            Amendment
                to the Certificate of Incorporation to effectuate an increase in
                the
                authorized shares of common stock from 50,000,000 to
                250,000,000;




3.
            Forward
                Stock Split of the Company’s issued and outstanding shares of common stock
                on a basis of forty (40) new shares for each one (1) old
                share;




4.
            Amendment
                of the Company’s By-Law Article IV, Section 5 to read as
                follows:




“Whenever
      shareholders are required or permitted to take any action by vote, such action
      may be taken without a meeting on written consent, setting for the action so
      taken, signed by the holders of a majority of outstanding shares entitled to
      vote thereon.”;




5.
            Election
                of Messrs. Ban-Jun Yang, Ka Yu, Robert Ip, Chris Metcalf and Kim
                Kiat Ong
                as Directors of the Company to hold office until the next annual
                meeting
                of stockholders or until their successors are elected or
                appointed;




6.
            Ratification
                of the appointment of Schumacher & Associates, Inc. as the Company’s
                independent registered public accountants for the fiscal year ended
                December 31, 2006; and




7.
            Ratification
                of the adoption of the 2006 Stock Option and Incentive Plan for key
                personnel of the Company.




20




**Part
        II**
  ***Item
        5. Market For Common Equity And Related Stockholder
        Matters***
  **General**
  We
        are
        authorized to issue 250,000,000 shares of Common Stock, at a par value $.0001
        per share. As of April 4, 2008, there are 131,422,086 (post forward stock
        split)
        shares of common stock outstanding. The number of record holders of Common
        Stock
        as of April 4, 2008 is approximately 184.
  **Common
        Stock**
  The
        holders of Common Stock are entitled to one vote for each share held of record
        on all matters to be voted on by stockholders. There is no cumulative voting
        with respect to the election of directors, with the result that the holders
        of
        more than 50% of the shares voting for the election of directors can elect
        all
        of the directors then up for election. The holders of Common Stock are entitled
        to receive ratably such dividends when, as and if declared by the Board of
        Directors out of funds legally available therefore. In the event we have
        a
        liquidation, dissolution or winding up, the holders of Common Stock are entitled
        to share ratably in all assets remaining which are available for distribution
        to
        them after payment of liabilities and after provision has been made for each
        class of stock, if any, having preference over the Common Stock. Holders
        of
        shares of Common Stock, as such, have no conversion, preemptive or other
        subscription rights, and there are no redemption provisions applicable to
        the
        Common Stock.
  **Price
        Ranges of the Company’s Common Stock**
  ***Market
        Information***
  The
        Company’s Common Stock is traded on NASD operated Over-the-Counter Bulletin
        Board under the symbol “SOBM” commencing on March 2, 2007. It was previously
        traded under the symbol “CDCX” from July 28, 2006 until March 1, 2007, without
        any trading or volume.
  The
        following historical quotations obtained online at www.yahoo.com reflects
        the
        high and low bids for our common stock based on inter-dealer prices, without
        retail mark-up, mark-down or commission and may not represent actual
        transactions.
  21
 **Quarter Ended (2007)**
                
                **High ($)**
                
                **Low ($)**December
                    31
                
                $
                2.86
                
                $
                0.87September
                    30
                
                $
                3.76
                
                $
                2.07June
                    30
                
                $
                2.25
                
                $
                1.30March
                    31
                
                $
                1.35
                
                $
                1.11
  **Dividend
        Policy**
  We
        have
        never paid any cash dividends and have no plans to do so in the foreseeable
        future. Our future dividend policy will be determined by our Board of Directors
        and will depend upon a number of factors, including our financial condition
        and
        performance, our cash needs and expansion plans, income tax consequences
        and the
        restrictions that applicable laws and other arrangements then
        impose.
  ***Recent
        Sales of Unregistered Securities***
  On
        May
        14, 2007, the Company issued 2,074,668 units (each a “Unit”) to 36
        individuals/entities due to the closing of the Company’s private placement at
        $0.75 per Unit for total gross proceeds of $1,556,001. Each Unit consists
        of one
        share of common stock of the Company and one-half of one share purchase warrant,
        with each whole warrant entitling the holder to purchase one additional share
        of
        common stock of the Company at $1.25 per warrant share until May 14, 2009.
        The
        Company believes that three of the issuances are exempt from registration
        under
        Regulation D Rule 506 and Section 4(2) of the Act. In addition, the Company
        believes that the remaining issuances are exempt from registration under
        Regulation S promulgated under the Securities Act of 1933, as amended (the
        “Act”) as the securities were issued to the individuals/entities through an
        offshore transaction which was negotiated and consummated outside of the
        United
        States.
 
 In
        relation to the Company’s private placement offering at $0.75 per Unit entered
        into with the offshore investors, the Company has paid: (i) a cash finder’s fee
        in the amount of $20,625 to an entity in Singapore; (ii) a finder’s fee of
        $36,000 in cash and 48,000 shares of common stock of the Company to Rita
        Chou of
        Singapore; (iii) a finder’s fee of $12,375 in cash and 16,500 shares of common
        stock of the Company to Dennis Tan of the Philippines; (iv) a finder’s fee
        $1,500 in cash to Jim McFarland of Vancouver, B.C.; (v) a finder’s fee of 15,000
        shares of common stock of the Company to Josephine Tang of Malaysia; and
        (vi) a
        finder’s fee of $375 in cash and 500 shares of common stock of the Company to
        Jamie Liu of Hong Kong. The Company believes that the finder’s fee share
        issuances are exempt from registration under Regulation S promulgated under
        the
        Act as the securities were issued to the individuals through an offshore
        transaction which was negotiated and consummated outside of the United
        States.
  22
  In
        addition, on May 14, 2007, the Company issued 1,623,000 units (each a “Unit”) to
        44 individuals/entities due to the closing of the first part of the Company’s
        private placement at $1.00 per Unit for total gross proceeds of $1,623,000.
        Each
        Unit consists of one share of common stock of the Company and one-half of
        one
        share purchase warrant, with each whole warrant entitling the holder to purchase
        one additional share of common stock of the Company at $1.75 per warrant
        share
        until May 14, 2009. The Company believes that one of the issuances is exempt
        from registration under Regulation D Rule 506 and Section 4(2) of the Act.
        In
        addition, the Company believes that the remaining issuances are exempt from
        registration under Regulation S promulgated under the Securities Act of 1933,
        as
        amended (the “Act”) as the securities were issued to the individuals/entities
        through an offshore transaction which was negotiated and consummated outside
        of
        the United States.
 
 In
        relation to the Company’s private placement offering at $1.00 per Unit entered
        into with the offshore investors, the Company has paid: (i) a cash finder’s fee
        in the amount of $145,500 to an entity in Singapore; and (ii) a finder’s fee of
        $5,500 in cash and 5,000 shares of common stock of the Company to Dennis
        Tan of
        the Philippines. The Company believes that the finder’s fee share issuance is
        exempt from registration under Regulation S promulgated under the Act as
        the
        securities were issued to the individual through an offshore transaction
        which
        was negotiated and consummated outside of the United States.
 
 On
        May
        24, 2007, the Company issued 3,500,000 units (each a “Unit”) to two
        individuals/entities due to the closing of the second tranche of the Company’s
        private placement at $1.00 per Unit for total gross proceeds of $3,500,000.
        Each
        Unit consists of one share of common stock of the Company and one-half of
        one
        share purchase warrant, with each whole warrant entitling the holder to purchase
        one additional share of common stock of the Company at $1.75 per warrant
        share
        until May 24, 2009. The Company believes that the issuances are exempt from
        registration under Regulation S promulgated under the Act as the securities
        were
        issued to the individuals/entities through an offshore transaction which
        was
        negotiated and consummated outside of the United States.
 
 On
        May
        30, 2007, the Company issued 3,000,000 units (each a “Unit”) to four
        individuals/entities due to the closing of the third and fourth tranches
        of the
        Company’s private placement at $1.00 per Unit for total gross proceeds of
        $3,000,000. Each Unit consists of one share of common stock of the Company
        and
        one-half of one share purchase warrant, with each whole warrant entitling
        the
        holder to purchase one additional share of common stock of the Company at
        $1.75
        per warrant share until May 30, 2009. The Company believes that the issuances
        are exempt from registration under Regulation S promulgated under the Act
        as the
        securities were issued to the individuals/entities through an offshore
        transaction which was negotiated and consummated outside of the United States.
 
 In
        relation to the closing of the second, third and fourth tranches of the
        Company’s private placement offering at $1.00 per Unit entered into with the
        offshore investors, the Company has or will be paying a cash finder’s fee in the
        amount of $650,000 to an entity in Singapore.
 
 On
        September 11, 2007, the Company issued 5,248,800 units (each a “Unit”) to 69
        offshore individuals/ entities due to the closing of the Company’s private
        placement at $1.25 per Unit for total gross proceeds of $6,561,000. Each
        Unit
        consists of one share of common stock of the Company and one-half of one
        share
        purchase warrant, with each whole warrant entitling the holder to purchase
        one
        additional share of common stock of the Company at $2.00 per warrant share
        until
        September 11, 2009. The Company believes that the issuances are exempt from
        registration under Regulation S promulgated under the Act as the securities
        were
        issued to the individuals/entities through an offshore transaction which
        was
        negotiated and consummated outside of the United States.
  23
  In
        relation to the Company’s private placement offering at $1.25 per Unit entered
        into with offshore investors, the Company has paid or will be paying: (i)
        a cash
        finder’s fee in the amount of $401,000 to an entity in Singapore; (ii) a cash
        finder’s fee in the amount of $87,500 to an individual in Hong Kong; (iii) a
        finder’s fee of 80,000 shares of common stock of the Company to Josephine Tang
        of Malaysia; (iv) a finder’s fee of 20,000 shares of common stock of the Company
        to an entity in Hong Kong; (v) a finder’s fee of 4,000 shares of common stock of
        the Company to Hareton Kam Nang Leung of Hong Kong; and (vi) a finder’s fee
        3,280 shares of common stock of the Company to Jamie Liu of Taiwan. The Company
        believes that the finder’s fee share issuances are exempt from registration
        under Regulation S promulgated under the Act as the securities will be issued
        to
        the individuals/entities through an offshore transaction which was negotiated
        and consummated outside of the United States.
 
 On
        October 16, 2007, the Company issued 25,000 shares of common stock to one
        individual with respect to the exercise of 25,000 warrants at a price of
        $1.25
        per share for total gross proceeds of $31,250. The Company believes that
        the
        issuance is exempt from registration under Regulation S promulgated under
        the
        Act as the securities were issued to the individual through an offshore
        transaction which was negotiated and consummated outside of the United
        States.
 
 On
        December 5, 2007, the Company issued 548,338 units (each a “Unit”) to 21
        individuals/entities due to the closing of the Company’s private placement at
        $1.50 per Unit for total gross proceeds of $822,507. Each Unit consists of
        one
        share of common stock of the Company and one-half of one share purchase warrant,
        with each whole warrant entitling the holder to purchase one additional share
        of
        common stock of the Company at $2.00 per warrant share until December 5,
        2009.
        The Company believes that the issuance is exempt from registration under
        Regulation S promulgated under the Act as the securities were issued to the
        individuals/entities through an offshore transaction which was negotiated
        and
        consummated outside of the United States.
 
 In
        relation to the Company’s private placement offering at $1.50 per Unit entered
        into with offshore investors, the Company will be paying a cash finder’s fee in
        the amount of $78,750 to an individual in Singapore.
 
 On
        January 23, 2008, the Company issued 110,000 shares of common stock in return
        for the services of the Company’s Chief Financial Officer for the 12 months
        commencing January 1, 2008.  The
        Company believes that the issuance is exempt from registration under Regulation
        S promulgated under the Act as the securities were issued to the individual
        through an offshore transaction which was negotiated and consummated outside
        of
        the United States.
  ***Retirement
        of Common Stock***
  On
        March
        9, 2007, Mr. Ka Yu, our Secretary, Treasurer and a director, voluntarily
        surrendered for cancellation and return to treasury 76 million of his 80
        million
        (post forward stock split) shares. The cancellation of these 76 million (post
        forward stock split) shares reduced the issued and outstanding (post forward
        stock split) shares from 191 million to 115 million at that time.
  24
  ***Item
        6. Management’s Discussion And Analysis Or Plan Of
        Operation***
  You
        should read the following plan of operation together with our financial
        statements and related notes appearing elsewhere in this Annual Report. This
        plan of operation contains forward-looking statements that involve risks,
        uncertainties, and assumptions. The actual results may differ materially
        from
        those anticipated in these forward-looking statements as a result of certain
        factors, including, but not limited to, those presented under “Risk Factors”
elsewhere in this Annual Report.
  **Overview**
  As
        from
        the inception of the Company and until the end of November 2006 we were in
        business of developing a Patent known as the "Car Door Safety Feature", however,
        we determined to change our business plan from the development of the Car
        Door
        Safety Feature Patent and began focusing around the Chinese biopharmaceutical
        industry. On January 12, 2007, the Company completed the reverse merger of
        Wanxin Bio-Technology Limited (“Wanxin”) and all the subsidiaries of Wanxin in
        accordance with the Share Purchase Agreement, whereby the Company acquired
        100%
        of the issued and outstanding shares in the capital of Wanxin (the “Wanxin
        Capital”), through the issuance of 1,750,000 (pre forward stock split) shares of
        common stock of the Company in aggregate to the shareholders of Wanxin on
        a pro
        rata basis in accordance with each Wanxin shareholder’s percentage of ownership
        in Wanxin.
  **Revenues**
  We
        have
        generated $1,026,572 product sales revenues for the year ended December 31,
        2007
        compared to $773,882 of revenues for the year ended December 31, 2006. The
        increase is partly attributable to Leflunomide sales in 2007, because under
        the
        agreement with the sales agent, Leflunomide was sold at cost for most of
        2006.
        The increase is also partly attributable to sales of the new aFGF product,
        for
        which Shanghai Wanxing received GMP certification during the 2007 year, and
        sales of new cosmetic products launched by Shanghai Wanxing Bio-science Cosmetic
        Co. Ltd. Partially offsetting increased sales in these areas, sales of the
        Interferon products decreased due to great competition from other producers
        of
        similar products.
  We
        have
        generated $229,122 in revenues from product licensing and research grants
        for
        the year ended December 31, 2007 compared to $2,087,613 of revenues for the
        year
        ended December 31, 2006. The decrease is primarily due to a substantial grant
        for malaria vaccine research received in 2005 and recognized mostly in 2006,
        which did not repeat in 2007.
  25
  **Operating
        Expenses**
 
 Operating
        expenses increased from $3,427,927 for year ending December 31 2006 to
        $7,629,407 for the year ended December 31, 2007. This increase was primarily
        due
        to 1) an increase in General and Administrative Expenses and 2) an expense
        relating to Stock-Based Compensation, being recorded in 2007 in the amount
        of
        $2,682,016 which was nil in the year 2006 .
 
 1)
        General and Administrative Expenses
 
 General
        and administrative expenses increased to $2,588,957 for the year 2007 from
        $1,223,834 in the previous year, partially due to additional professional
        and
        reporting costs associated with the reverse take-over which occurred in the
        period and in being a public company with operating businesses. Also
        contributing to the increase in general and administrative expenses was the
        fact
        that the company has more administrative activity in 2007 associated with
        getting the aFGF product on line. In addition, the Wanxing Bio-pharmaceuticals
        manufacturing facility was closed down between December of 2006 and May 2007,
        as
        required by Chinese law, while that company goes through the application
        and
        review process for the purposes of obtaining its GMP certification for
        manufacturing of the aFGF product and renewing GMP certification for manufacture
        of the Interferon products. As a result, certain overhead and indirect
        manufacturing costs that would normally be absorbed into the cost of
        manufactured inventory have been included in expense.
 
 2)
        Stock-based compensation
 
 Stock-based
        compensation expense of $2,682,016 was recognized in the year December 31
        2007
        compared to $nil in the comparable period in the previous year. The expense
        for
        the year 2007 represents 1) $2,499,951 as recognition of the 6,000,000 options
        with an aggregate value of $4,545,364 granted on March 1, 2007 in accordance
        with the Company’s stock option and incentive plan. Under the terms of the
        grant, 5% of the options vested immediately and another 5% vest on the first
        day
        of each subsequent month until October 1, 2008. and 2) $120,883 as recognition
        of 7 months amortization pertaining to 1 million options with an aggregate
        value
        of $828,928 granted on May 30, 2007 in accordance to the terms of the Company's
        stock option and incentive plan. Under the terms of the grant, 50% of the
        options will vest on May 30, 2009 and the remaining 50% on May 30, 2011.,
        and 3)
        $61,182 as recognition of 1 month amortization pertaining to 1 million options
        with an aggregate value of $1,223,630 granted on November 29, 2007 in accordance
        to the terms of the Company's stock option and incentive plan. Under the
        terms
        of the grant, 5% of the options vested immediately and another 5% vest on
        the
        first day of each subsequent month thereafter starting on January 1 2008
        .
  **Other
        Income and Expenses**
 
 During
        the year ended December 31 2007 the Company incurred one-time non-recurring
        income and expenses as follows: (a) income from forgiveness of interest on
        debt
        in the amount of $2,320,115 (b) an expense relating to costs associated with
        an
        abandoned / failed acquisition in the amount of $600,216 , whereas these
        items
        were not incurred in the prior year.
  26
  **Net
        Loss**
  As
        a
        result of the above Our net loss for the year ended December 31, 2007 was
        $6,669,420, compared to a loss of $3,308,702 (realized by Wanxin Bio-technology
        Limited and consolidated subsidiaries prior to the reverse merger of January
        12,
        2007) for the year ended December 31, 2006 and cash used in operating activities
        in the year ended December 31, 2007 was $4,187,188, compared to cash generated
        from operating activities of $2,661,030 for the year ended December 31, 2006.
  **Liquidity
        and Capital Resources**
  During
        the year 2007 we raised cash from the following private equity
        offerings:
  On
        May
        14, 2007, the Company issued 2,074,668 units (each a “Unit”) to 36
        individuals/entities due to the closing of the Company’s private placement at
        $0.75 per Unit for total gross proceeds of $1,556,001. Each Unit consists
        of one
        share of common stock of the Company and one-half of one share purchase warrant,
        with each whole warrant entitling the holder to purchase one additional share
        of
        common stock of the Company at $1.25 per warrant share until May 14, 2009.
        The
        Company believes that three of the issuances are exempt from registration
        under
        Regulation D Rule 506 and Section 4(2) of the Act. In addition, the Company
        believes that the remaining issuances are exempt from registration under
        Regulation S promulgated under the Securities Act of 1933, as amended (the
        “Act”) as the securities were issued to the individuals/entities through an
        offshore transaction which was negotiated and consummated outside of the
        United
        States.
 
 In
        addition, on May 14, 2007, the Company issued 1,623,000 units (each a “Unit”) to
        44 individuals/entities due to the closing of the first part of the Company’s
        private placement at $1.00 per Unit for total gross proceeds of $1,623,000.
        Each
        Unit consists of one share of common stock of the Company and one-half of
        one
        share purchase warrant, with each whole warrant entitling the holder to purchase
        one additional share of common stock of the Company at $1.75 per warrant
        share
        until May 14, 2009. The Company believes that one of the issuances is exempt
        from registration under Regulation D Rule 506 and Section 4(2) of the Act.
        In
        addition, the Company believes that the remaining issuances are exempt from
        registration under Regulation S promulgated under the Securities Act of 1933,
        as
        amended (the “Act”) as the securities were issued to the individuals/entities
        through an offshore transaction which was negotiated and consummated outside
        of
        the United States.
 
 On
        May
        24, 2007, the Company issued 3,500,000 units (each a “Unit”) to two
        individuals/entities due to the closing of the second tranche of the Company’s
        private placement at $1.00 per Unit for total gross proceeds of $3,500,000.
        Each
        Unit consists of one share of common stock of the Company and one-half of
        one
        share purchase warrant, with each whole warrant entitling the holder to purchase
        one additional share of common stock of the Company at $1.75 per warrant
        share
        until May 24, 2009. The Company believes that the issuances are exempt from
        registration under Regulation S promulgated under the Act as the securities
        were
        issued to the individuals/entities through an offshore transaction which
        was
        negotiated and consummated outside of the United States.
  27
  On
        May
        30, 2007, the Company issued 3,000,000 units (each a “Unit”) to four
        individuals/entities due to the closing of the third and fourth tranches
        of the
        Company’s private placement at $1.00 per Unit for total gross proceeds of
        $3,000,000. Each Unit consists of one share of common stock of the Company
        and
        one-half of one share purchase warrant, with each whole warrant entitling
        the
        holder to purchase one additional share of common stock of the Company at
        $1.75
        per warrant share until May 30, 2009. The Company believes that the issuances
        are exempt from registration under Regulation S promulgated under the Act
        as the
        securities were issued to the individuals/entities through an offshore
        transaction which was negotiated and consummated outside of the United States.
 
 On
        September 11, 2007, the Company issued 5,248,800 units (each a “Unit”) to 69
        offshore individuals/ entities due to the closing of the Company’s private
        placement at $1.25 per Unit for total gross proceeds of $6,561,000. Each
        Unit
        consists of one share of common stock of the Company and one-half of one
        share
        purchase warrant, with each whole warrant entitling the holder to purchase
        one
        additional share of common stock of the Company at $2.00 per warrant share
        until
        September 11, 2009. The Company believes that the issuances are exempt from
        registration under Regulation S promulgated under the Act as the securities
        were
        issued to the individuals/entities through an offshore transaction which
        was
        negotiated and consummated outside of the United States.
 
 On
        October 16, 2007, the Company issued 25,000 shares of common stock to one
        individual with respect to the exercise of 25,000 warrants at a price of
        $1.25
        per share for total gross proceeds of $31,250. The Company believes that
        the
        issuance is exempt from registration under Regulation S promulgated under
        the
        Act as the securities were issued to the individual through an offshore
        transaction which was negotiated and consummated outside of the United
        States.
 
 On
        December 5, 2007, the Company issued 548,338 units (each a “Unit”) to 21
        individuals/entities due to the closing of the Company’s private placement at
        $1.50 per Unit for total gross proceeds of $822,507. Each Unit consists of
        one
        share of common stock of the Company and one-half of one share purchase warrant,
        with each whole warrant entitling the holder to purchase one additional share
        of
        common stock of the Company at $2.00 per warrant share until December 5,
        2009.
        The Company believes that the issuance is exempt from registration under
        Regulation S promulgated under the Act as the securities were issued to the
        individuals/entities through an offshore transaction which was negotiated
        and
        consummated outside of the United States.
 
 As
        of
        December 31, 2007, we have $65,050 of cash on hand compared
        to $2,146,280 cash on hand as of December 31, 2006.The Company is
        currently continuing to explore opportunities for the raising of cash thru
        the
        issuance of equity and / or debt securities .
  28
  ***Item
        7. Financial Statements***
 **SINOBIOMED
              INC.**
 **AND
              CONSOLIDATED SUBSIDIARIES**
  **INDEX
              TO CONSOLIDATED FINANCIAL STATEMENTS**
  PageReport of Independent
                    Auditors
                  
                  
                  F-1Consolidated
                      Balance Sheet
                  
                  
                  F-2Consolidated
                      Statements of Operations
                  
                  
                  F-3Consolidated
                      Statements of Cash Flows
                  
                  
                  F-4Consolidated
                      Statement of Stockholders' (Deficit)
                  
                  
                  F-5Notes
                      to Consolidated Financial Statements
                  
                  
                  F-6
   
  ***Report
              of Independent Registered Public Accounting Firm***
 
 
 Board
              of
              Directors
 Sinobiomed
 
 We
              have
              audited the accompanying balance sheet of Sinobiomed, as of December
              31, 2007,
              and the related statements of operations, stockholders' equity (deficit),
              and
              cash flows for the years ended December 31, 2007 and 2006. These financial
              statements are the responsibility of the Company's management. Our
              responsibility is to express an opinion on these financial statements
              based on
              our audit.
 
 We
              conducted our audit in accordance with the standards of the Public
              Company
              Accounting Oversight Board (United States of America). Those standards
              require
              that we plan and perform the audits to obtain reasonable assurance
              about whether
              the financial statements are free of material misstatement. The Company
              is not
              required to have, nor were we engaged to perform an audit of its internal
              control over financial reporting. Our audit included consideration
              of internal
              control over financial reporting as a basis for designing audit procedures
              that
              are appropriate in the circumstances, but not for the purpose of expressing
              an
              opinion on the effectiveness of the company's internal control over
              financial
              reporting. Accordingly, we express no such opinion. An audit includes
              examining,
              on a test basis, evidence supporting the amounts and disclosures in
              the
              financial statements. An audit also includes assessing the accounting
              principles
              used and significant estimates made by management, as well as evaluating
              the
              overall financial statement presentation. We believe our audit provides
              a
              reasonable basis for our opinion.
 
 In
              our
              opinion, the financial statements referred to above present fairly,
              in all
              material respects, the financial position of Sinobiomed as of December
              31, 2007,
              and the results of its operations and cash flows for the years ended
              December
              31, 2007 and 2006, in conformity with accounting principles generally
              accepted
              in the United States of America.
 
 The
              accompanying financial statements have been prepared assuming that
              the Company
              will continue as a going concern. As described in Note 1, the Company
              has
              experienced losses since commencement of operations and has negative
              working
              capital and a Stockholders’ (deficit), which raise substantial doubt about its
              ability to continue as a going concern. Management's plans in regard
              to this
              matter are also discussed in Note 1. The financial statements do not
              include any
              adjustments that might result from the outcome of this uncertainty.
 
 
 SCHUMACHER
              & ASSOCIATES, INC.
 
 Denver,
              Colorado
 April
              14,
              2008
 F-1
  **SINOBIOMED
              INC.**
 **AND
              CONSOLIDATED SUBSIDIARIES**
 ***Consolidated
              Balance Sheet***
 ***(Expressed
              in US Dollars)***
  Note
                1 -
                Basis of Presentation - going concern
 **December
                            31**
                          ******2007**ASSETSCURRENT
                        ASSETSCash
                        - unrestricted
                    
                    $
                    64,866Cash
                        - restricted (Note 3)
                    
                    
                    184Accounts
                        receivable (Note 4)
                    
                    
                    48,071Inventory
                        (Note 6)
                    
                    
                    893,402Prepaid
                        expenses and deposits
                    
                    
                    428,841Total
                        current assets
                    
                    
                    1,435,364Fixed
                        assets (Note 7)
                    
                    
                    6,658,831Total
                        assets
                    
                    $
                    8,094,195LIABILITIES
                        AND STOCKHOLDERS' (DEFICIT)CURRENT
                        LIABILITIESShort-term
                        loans (Notes 8 and 9)
                    
                    $
                    7,105,118Accounts
                        payable
                    
                    
                    824,706Interest
                        payable
                    
                    
                    1,918,408Unearned
                        revenue
                    
                    
                    170,471Shareholder
                        loans (Note 10)
                    
                    
                    2,176,526Other
                        current liabilities
                    
                    
                    1,986,284Total
                        current liabilities
                    
                    
                    14,181,513
 COMMITMENTS
                        AND CONTINGENCIES (Notes 1, 2, 3, 5, 8, 9, 10, 11, 12, 13,
                        15, 16 and
                        17)
 STOCKHOLDERS'
                        (DEFICIT)Common
                        stock (Note 13)Authorized
                        250,000,000 shares at par value of $ 0.0001 eachIssued
                        and outstanding 131,312,086 shares
                    
                    
                    13,132Additional
                        paid-in capital
                    
                    
                    26,127,797Accumulated
                        (deficit)
                    
                    
                    (30,761,870
                    )Accumulated
                        other comprehensive income (loss)
                    
                    
                    (1,466,377
                    )Total
                        stockholders' (deficit)
                    
                    
                    (6,087,318
                    )
 Total
                        liabilities and stockholders' (deficit)
                    
                    $
                    8,094,195
  The
                        accompanying notes to the consolidated financial statements
                        are an
                        integral part of these statements.
  F-2
  **SINOBIOMED
                          INC.****AND
                          CONSOLIDATED SUBSIDIARIES*****Consolidated
                          Statements of Operations******(Expressed
                          in US Dollars)***
  Year
                          Ended December 312007
                      
                      2006REVENUESales
                      
                      $
                      1,026,572
                      
                      $
                      773,882Cost
                          of goods sold
                      
                      
                      697,466
                      
                      
                      595,185Gross
                          profit
                      
                      
                      329,106
                      
                      
                      178,697Other
                          income (Note 14)
                      
                      
                      229,122
                      
                      
                      2,087,613558,228
                      
                      
                      2,266,310EXPENSESAdvertising
                          and promotion
                      
                      
                      5,153
                      
                      
                      21,948Depreciation
                      
                      
                      145,025
                      
                      
                      67,927General
                          and administration
                      
                      
                      2,588,957
                      
                      
                      1,223,834Repairs
                          and maintenance
                      
                      
                      45,192
                      
                      
                      22,129Research
                          and development
                      
                      
                      1,114,043
                      
                      
                      1,678,318Salaries
                          and benefits
                      
                      
                      694,516
                      
                      
                      329,411Stock-based
                          compensation (Note 15)
                      
                      
                      2,682,016
                      
                      
                      -Travel
                      
                      
                      354,505
                      
                      
                      84,360Total
                          expenses
                      
                      
                      7,629,407
                      
                      
                      3,427,927Net
                          (loss) for the period from operations
                      
                      
                      (7,071,179
                      )
                      
                      (1,161,617
                      )OTHER
                          INCOME AND EXPENSESInterest
                          and bank charges (Notes 8, 9 and 10)
                      
                      
                      (1,026,482
                      )
                      
                      (2,006,480
                      )Gain
                          on forgiveness of interest on debt (Note 8)
                      
                      
                      2,320,115
                      
                      
                      -Loss
                          on failed acquisition of subsidiary (Note 2)
                      
                      
                      (600,216
                      )
                      
                      -
 Losses
                          on loans and guarantees to other parties (Note 5)
                      
                      
                      (299,697
                      )
                      
                      (145,575
                      )
 Net
                          (loss) for the period before minority interests
                      
                      
                      (6,677,459
                      )
                      
                      (3,313,672
                      )Minority
                          interest in loss for the period
                      
                      
                      8,039
                      
                      
                      4,970Net
                          (loss) for the period
                      
                      $
                      (6,669,420
                      )
                      $
                      (3,308,702
                      )Other
                          comprehensive income (loss)Foreign
                          currency translation (Note 2)
                      
                      $
                      (651,210
                      )
                      
                      (517,224
                      )Comprehensive
                          (loss)
                      
                      
                      (7,320,630
                      )
                      $
                      (3,825,926
                      )Net
                          (loss) per common share - basic and fully diluted:Net
                          (loss) for the period
                      
                      $
                      (0.05
                      )
                      $
                      (0.05
                      )Weighted
                          average number of common stock outstanding
                      
                      
                      134,892,246
                      
                      
                      70,000,000
  The
                accompanying notes to the consolidated financial statements are an
                integral part
                of these statements.
  F-3
 **SINOBIOMED
              INC.**
 **AND
              CONSOLIDATED SUBSIDIARIES** ******
 ***Consolidated
              Statements of Cash Flows***
 ***(Expressed
              in US Dollars)***
 Years
                            Ended December 312007
                        
                        2006Cash
                            from (used in) operating activities:Net
                            (loss)
                        
                        $
                        (6,669,420
                        )
                        $
                        (3,308,702
                        )Adjustments
                            to reconcile net loss to net cash used in operating
                            activities:Depreciation
                        
                        
                        790,170
                        
                        
                        680,018Loss
                            on disposition of fixed assets
                        
                        
                        9,992
                        
                        
                        (3,539
                        )Imputed
                            interest expense on shareholders' loans
                        
                        
                        113,771
                        
                        
                        137,909Minority
                            interest in net income (loss)
                        
                        
                        (8,039
                        )
                        
                        (4,970
                        )Shares
                            issued for services
                        
                        
                        85,400
                        
                        
                        -Stock-based
                            compensation
                        
                        
                        2,682,016
                        
                        
                        -Write-down
                            of intangible asset
                        
                        
                        -
                        
                        
                        512,400Gain
                            on forgiveness of interest on debt
                        
                        
                        (2,320,115
                        )
                        
                        -Net
                            change in operating assets and liabilities:Accounts
                            receivable
                        
                        
                        213,817
                        
                        
                        3,204,832Inventory
                        
                        
                        (449,764
                        )
                        
                        132,051Prepaid
                            expenses and deposits
                        
                        
                        (398,178
                        )
                        
                        8,643Accounts
                            payable
                        
                        
                        560,284
                        
                        
                        (1,272
                        )Interest
                            payable
                        
                        
                        619,638
                        
                        
                        1,684,645Unearned
                            revenue
                        
                        
                        95,328
                        
                        
                        (983,965
                        )Other
                            current liabilities
                        
                        
                        487,912
                        
                        
                        602,980Net
                            cash (used in) from operating activities
                        
                        
                        (4,187,188
                        )
                        
                        2,661,030Cash
                            (used in) investing activities:Purchases
                            of fixed assets
                        
                        
                        (145,553
                        )
                        
                        (593,845
                        )Proceeds
                            of disposition of fixed assets
                        
                        
                        5,418
                        
                        
                        95,114Cash
                            acquired in reorganization
                        
                        
                        -
                        
                        
                        1,000Purchase
                            of intangible assets
                        
                        
                        -
                        
                        
                        (512,400
                        )Net
                            cash (used in) investing activities
                        
                        
                        (140,135
                        )
                        
                        (1,010,131
                        )Cash
                            from (used in) financing activities:Repayments
                            of loans by unrelated parties
                        
                        
                        146,165
                        
                        
                        5,200,112Share
                            subscriptions received
                        
                        
                        17,062,508
                        
                        
                        -Finders'
                            fees paid in cash
                        
                        
                        (1,439,125
                        )
                        
                        -Exercise
                            of warrants
                        
                        
                        31,250
                        
                        
                        -Repayments
                            of loans by shareholders
                        
                        
                        -
                        
                        
                        286,513Increase
                            in short-term loans
                        
                        
                        985,680
                        
                        
                        -Repayments
                            of short-term loans
                        
                        
                        (14,328,449
                        )
                        
                        (3,970,930
                        )Loans
                            received from shareholders
                        
                        
                        1,163,435
                        
                        
                        25,314Repayments
                            of loans from shareholders
                        
                        
                        (1,145,051
                        )
                        
                        (1,077,155
                        )Net
                            cash from (used in) financing activities
                        
                        
                        2,476,413
                        
                        
                        463,854Effect
                            of other comprehensive income (loss) on cash
                        
                        
                        (230,320
                        )
                        
                        (747,589
                        )Increase
                            (decrease) in cash
                        
                        
                        (2,081,230
                        )
                        
                        1,367,164Cash,
                            beginning of period
                        
                        
                        2,146,280
                        
                        
                        779,116Cash,
                            end of period
                        
                        $
                        65,050
                        
                        $
                        2,146,280
  The
              accompanying notes to the consolidated financial statements are an
              integral part
              of these statements.
  F-4
 **SINOBIOMED
              INC.**
 **AND
              CONSOLIDATED SUBSIDIARIES**
 ***Consolidated
              Statement of Stockholders' (Deficit)***
 ***(Expressed
              in US Dollars)***
 Common
                        Stock
                    
                    Amount
                    
                    Additional
                        paid-in capital
                    
                    Cumulative
                      Other
                        Comprehensive Income (loss)
                    
                    Accumulated
                        (Deficit)
                    
                    Stockholders'
                      (Deficit)Balance
                        December 31, 2005
                    
                    
                    400,000,000
                    
                    $
                    5,152
                    
                    $
                    7,523,021
                    
                    $
                    (297,943
                    )
                    $
                    (20,783,748
                    )
                    $
                    (13,553,518
                    )$
                    -Capital
                        changes to give effect to acquisition of subsidiary
                    
                    
                    (330,000,000
                    )
                    
                    1,848
                    
                    
                    (848
                    )
                    
                    -
                    
                    
                    -
                    
                    $
                    1,000Imputed
                        interest on shareholders' loans
                    
                    
                    
                    
                    
                    
                    
                    
                    137,909
                    
                    
                    -
                    
                    
                    -
                    
                    $
                    137,909Net
                        loss for the year
                    
                    
                    -
                    
                    
                    -
                    
                    
                    -
                    
                    
                    (517,224
                    )
                    
                    (3,308,702
                    )
                    
                    (3,825,926
                    )Balance
                        December 31, 2006
                    
                    
                    70,000,000
                    
                    $
                    7,000
                    
                    $
                    7,660,082
                    
                    $
                    (815,167
                    )
                    $
                    (24,092,450
                    )
                    $
                    (17,240,535
                    )Cancellation
                        of shares
                    
                    
                    (76,000,000
                    )
                    
                    (7,600
                    )
                    
                    7,600
                    
                    
                    -
                    
                    
                    -
                    
                    
                    -Capital
                        changes to give effect to reverse take-over
                    
                    
                    121,000,000
                    
                    
                    12,100
                    
                    
                    (74,073
                    )
                    
                    -
                    
                    
                    -
                    
                    
                    (61,973
                    )Issue
                        of shares for services
                    
                    
                    100,000
                    
                    
                    10
                    
                    
                    85,390
                    
                    
                    -
                    
                    
                    -
                    
                    
                    85,400Stock-based
                        compensation
                    
                    
                    -
                    
                    
                    -
                    
                    
                    2,682,016
                    
                    
                    -
                    
                    
                    -
                    
                    
                    2,682,016Shares
                        issued pursuant to private placements
                    
                    
                    15,994,806
                    
                    
                    1,600
                    
                    
                    17,060,908
                    
                    
                    -
                    
                    
                    -
                    
                    
                    17,062,508Finders
                        fees paid or payable in cash
                    
                    
                    -
                    
                    
                    -
                    
                    
                    (1,439,125
                    )
                    
                    -
                    
                    
                    -
                    
                    
                    (1,439,125
                    )Shares
                        issued as finders fees
                    
                    
                    192,280
                    
                    
                    19
                    
                    
                    (19
                    )
                    
                    -
                    
                    
                    -
                    
                    
                    -Shares
                        issued pursuant to exercise of warrants
                    
                    
                    25,000
                    
                    
                    3
                    
                    
                    31,247
                    
                    
                    -
                    
                    
                    -
                    
                    
                    31,250Imputed
                        interest on shareholders' loans
                    
                    
                    -
                    
                    
                    -
                    
                    
                    113,771
                    
                    
                    -
                    
                    
                    -
                    
                    
                    113,771Net
                        (loss) for the period
                    
                    
                    -
                    
                    
                    -
                    
                    
                    -
                    
                    
                    (651,210
                    )
                    
                    (6,669,420
                    )
                    
                    (7,320,630
                    )Balance
                        December 31, 2007
                    
                    
                    131,312,086
                    
                    $
                    13,132
                    
                    $
                    26,127,797
                    
                    $
                    (1,466,377
                    )
                    $
                    (30,761,870
                    )
                    $
                    (6,087,318
                    )
  F-5
  **SINOBIOMED
              INC.**
 **AND
              CONSOLIDATED SUBSIDIARIES**
 ***Notes
              to Consolidated Financial Statements***
 ***December
              31, 2007***
 ***(Expressed
              in US Dollars)***
 **1.
                BASIS OF PRESENTATION - GOING CONCERN**
  These
                consolidated financial statements of Sinobiomed Inc. (the “Company”) have been
                prepared on a going-concern basis which assumes that the Company
                will be able to
                realize assets and discharge liabilities in the normal course of
                business for
                the foreseeable future.
  The
                Company has experienced losses since commencement of operations amounting
                to
                $30,761,870 and has negative working capital and a stockholders’ deficit as of
                December 31, 2007, which raise substantial doubt about the Company's
                ability to
                continue as a going concern. The ability of the Company to meet its
                commitments
                as they become payable is dependent on the ability of the Company
                to obtain
                necessary financing or achieving a profitable level of operations.
                There are no
                assurances that the Company will be successful in achieving these
                goals.
  The
                Company is in the process of researching, developing, testing and
                evaluating
                proposed new pharmaceutical products and has not yet determined whether
                these
                products are technically or economically feasible. The underlying
                value of the
                company is entirely dependent on the successful implementation of
                one or more of
                these products, the ability of the Company to obtain the necessary
                financing to
                complete development and upon future profitable production or sufficient
                proceeds from the disposition of manufacturing rights. Management’s plan is to
                actively search for new sources of capital, including government
                and
                non-government grants toward research projects and new equity
                investment.
  These
                financial statements do not give effect to adjustments to the amounts
                and
                classifications to assets and liabilities that would be necessary
                should the
                Company be unable to continue as a going concern.
  **2.
                SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES**
 
 **Organization
                and Description of Business**
  The
                Company was incorporated under the laws of the State
                of
                Delaware on November 18, 2004 under the name CDoor Corp. The initial
                business
                plan of the Company was to develop a commercial application utilizing
                a patent
                pertaining to automobiles. In addition, in 2004, the Company commenced
                a capital
                formation activity to effect a Registration Statement on Form SB-2
                with the
                Securities and Exchange Commission (“SEC”), and raise capital of up to $100,000
                from a self-underwritten offering of 40.0 million shares of newly
                issued common
                stock (post forward stock split) in the public markets. On May 30,
                2006, the
                Company successfully completed the capital formation activity of
                its registered
                common stock.
 
 On
                October 16, 2006, the two Directors, officers, and principal stockholders
                of the
                Company agreed to sell 80.0 million shares of the Company’s common stock (post
                forward stock split), constituting 66% of the Company’s issued and outstanding
                stock, to an unrelated third party. The
                purchase closed on November 2, 2006. At the same time, the Company
                adopted a new
                business plan to pursue a reverse merger with Wanxin Bio-Technology
                Limited
                (“Wanxin BVI”), a British Virgin Islands company, and entered into a merger
                agreement with Wanxin BVI and its stockholders on December 21, 2006.
                Under the
                merger agreement, the stockholders of Wanxin BVI would transfer all
                the shares
                of Wanxin BVI to the Company in return for the issue of 70 million
                (post forward
                stock split) shares of the Company. The new business plan and focus
                of the
                Company centers around the Chinese biopharmaceutical industry.
  F-6
 **SINOBIOMED
                  INC.**
 **AND
                  CONSOLIDATED SUBSIDIARIES**
 ***Notes
                  to Consolidated Financial Statements***
 ***December
                  31, 2007***
 ***(Expressed
                  in US Dollars)***
 The
                transaction to complete the reverse merger with Wanxin BVI was effected
                on
                January 12, 2007, as a recapitalization of the Company, with the
                net assets of
                Wanxin BVI and the Company brought forward at their historical bases,
                and 95
                percent of the voting stock of the former majority shareholder of
                the Company
                (76.0 million shares of common stock, post forward stock split) being
                surrendered to the Company for cancellation and return to the treasury
                such that
                voting control of the Company was obtained by the former stockholders
                of Wanxin
                BVI. The costs associated with the reverse merger were expensed as
                incurred.
 
 At
                an
                annual meeting of the stockholders of the Company held on March 1,
                2007, the
                stockholders voted to complete a forward stock split of forty for
                one of the
                Company’s common stock with an effective date of March 2, 2007. All transactions
                involving the Company’s common stock prior to March 2, 2007 and determinations
                of the weighted average number of common shares outstanding have
                been restated
                to reflect this forward stock split. At the same meeting, a five-member
                board of
                directors was elected and the Company’s name was changed to its present
                name.
 
 Wanxin
                BVI was
                incorporated under the laws of the British Virgin Islands on July
                3, 2002. From
                the date of incorporation until October 15, 2006, Wanxin
                BVI remained
                dormant. On October 15, 2006 Wanxin
                BVI acquired
                all the shares of Manhing Enterprises Limited (“Manhing”), a company
                incorporated under the laws of Hong Kong on July 2, 1991, in return
                for 750
                shares of Wanxin
                BVI .
                The
                purposes of this transaction were to expatriate the operating companies’
ownership and to align legal and beneficial ownership of the group
                of companies
                prior to the January 12, 2007 reverse takeover. Accordingly the transaction
                has
                been treated as a reorganization of capital rather than a business
                combination.
 
 On
                June
                28, 1996, Manhing and two other unrelated companies founded Shanghai
                Pudong New
                District Wanxing Living Things Co., Ltd. (“Wanxing Bio-Pharmaceuticals”), a
                Sino-Foreign Joint Venture company incorporated with limited liability
                under the
                laws of the People’s Republic of China. Wanxing Bio-Pharmaceuticals has a term
                of 30 years from the date of incorporation, at which time it is to
                be
                liquidated. Manhing’s original investment and proportionate interest in Wanxing
                Bio-Pharmaceuticals were $1.3 Million and 52%, respectively. On August
                19, 1996,
                Wanxing Bio-Pharmaceuticals changed its name to Shanghai Wanxing
                Living Things
                Co., Ltd. On the same date Manhing transferred a 1% interest in Wanxing
                Bio-Pharmaceuticals to another company for consideration of $25,000.
                On the same
                date Wanxing Bio-Pharmaceuticals increased its registered capital
                and Manhing
                contributed an additional $895,500 to keep its interest at 51%. In
                1998 Manhing
                acquired an additional interest in Wanxing Bio-Pharmaceuticals for
                $1,445,000
                and contributed an additional $2,087,500 upon Wanxing Bio-Pharmaceuticals
                increasing its registered capital. After these transactions Manhing
                held a
                63.33% interest in Wanxing Bio-Pharmaceuticals.
  F-7
 **SINOBIOMED
                  INC.**
 **AND
                  CONSOLIDATED SUBSIDIARIES**
 ***Notes
                  to Consolidated Financial Statements***
 ***December
                  31, 2007***
 ***(Expressed
                  in US Dollars)***
 In
                2000,
                Wanxing Bio-Pharmaceuticals changed it name to its current name,
                Shanghai
                Wanxing Bio-pharmaceuticals Co., Ltd.
 
 In
                2002
                Manhing transferred an 18% interest in Wanxing Bio-Pharmaceuticals
                to another
                investor.
 
 In
                2003
                Manhing acquired an additional combined 36.6% interest in Wanxing
                Bio-Pharmaceuticals from other shareholders over three transactions.
                Subsequent
                to these transactions, Manhing’s interest in Wanxing Bio-Pharmaceuticals was
                82%, or $7.38 Million of Wanxing Bio-Pharmaceuticals’ registered capital of $9.0
                Million. On March 14, 2007, the government of China approved an increase
                in the
                registered capital of Wanxing Bio-Pharmaceuticals to $30 Million.
                Under Chinese
                law, Manhing and the minority shareholder are required to invest
                the additional
                $21 Million in Wanxing Bio-Pharmaceuticals by March 14, 2009. If
                the additional
                investment is not made by that date, time extensions are available.
                In the year
                ended December 31, 2007, Manhing has invested $14,915,545 in Wanxing
                Bio-Pharmaceuticals.
 
 Wanxing
                Bio-Pharmaceuticals’ business is research, development, manufacture and sale of
                pharmaceutical products, primarily for the Chinese market. There
                are three
                product lines currently manufactured and sold as at December 31,
                2007 and
                several other potential products in various stages of research and
                development.
                The product lines currently sold are Wanferon/Wanferin, formulations
                of
                recombinant human interferon for treating hepatitis and viral diseases,
                Leflunomide, a drug for the treatment of rheumatoid arthritis, and
                acidic
                Fibroblast Growth Factor (“aFGF”), a product that treats diabetic ulcers and
                burns and supports recovery from plastic surgery. aFGF entered commercial
                production upon the receipt of the certificate of Good Manufacturing
                Practices,
                which was issued August 2, 2007. Wanxing Bio-Pharmaceuticals’ offices and
                manufacturing facility are in owned premises located on land used
                under license
                in the Pudong New Area of Shanghai, China.
 
 On
                April
                14, 2004, Wanxing Bio-Pharmaceuticals and two other unrelated companies
                founded
                Shanghai Wanxing Bio-science Cosmetic Co., Ltd. (“Wanxing Cosmetic”). Wanxing
                Cosmetic’s registered capital is $3.0 Million and Wanxing Bio-Pharmaceuticals’
interest is 50.33% or $1,510,000. Wanxing Cosmetic has a term of
                thirty years
                from the date of issue of the business license, at which time it
                is to be
                liquidated. Wanxing Cosmetic manufactures skin-care products under
                the brand
                name KaiYing and does contract manufacturing for other companies.
  F-8
 **SINOBIOMED
                  INC.**
 **AND
                  CONSOLIDATED SUBSIDIARIES**
 ***Notes
                  to Consolidated Financial Statements***
 ***December
                  31, 2007***
 ***(Expressed
                  in US Dollars)***
 On
                August
                6, 2007, Wanxing Bio-Pharmaceuticals, entered into a formal equity
                transfer
                contract (the “Equity Transfer Contract”) with the equity owners of Suzhou Boai
                Medical Development Company (“Suzhou Boai”), a pharmaceutical distribution
                company organized under the laws of the P.R. China, to acquire 90%
                of the equity
                in Suzhou Boai in exchange for the payment of a transfer fee (the
“Transfer
                Fee”) to the equity owners of Suzhou Boai .
                Under
                the contract, all the equity owners of Suzhou Boai were to transfer
                all of their
                equity to Wanxing Bio-Pharmaceuticals, except for one equity owner
                who would
                retain a 10% interest, for a net Transfer Fee equivalent to approximately
                USD$2.4 million less a deduction as an allowance for certain bad
                debts of Suzhou
                Boai. The
                Transfer Fee was subject
                to a due diligence report ,
                which
                revealed net assets less than the total warranted by the equity owners
                of Suzhou
                Boai. This
                reduced total net assets level gave rise to a divergence on Suzhou
                Boai’s total
                net assets amount while in the fulfillment stage and Wanxing Bio-Pharmaceuticals
                decided to continue with the acquisition with the understanding that
                Wanxing
                Bio-Pharmaceuticals and the equity
                owners of Suzhou Boai would
                continue to negotiate a reduced Transfer Fee in good faith due to
                the reduced
                total net assets level.  After
                repeated negotiations, Wanxing Bio-Pharmaceuticals and the equity
                owners of Suzhou Boai could
                not agree on a reduced Transfer Fee and on January 22, 2008, the
                parties to the
                Equity Transfer Contract decided to terminate such agreement while
                in the
                fulfillment stage and executed a Cancellation Agreement of the Stock
                Transfer
                Agreement (the “Cancellation Agreement”), whereby the parties agreed to resolve
                their disputes by having Wanxing Bio-Pharmaceuticals transfer the
                90% registered
                capital back to its original status with the equity
                owners of Suzhou Boai and the equity
                owners of Suzhou Boai returning 2.8 million yuan (approximately $383,000) of the 5.4 million
                yuan
                (approximately $739,000) already paid to Wanxing Bio-Pharmaceuticals.
                As of
                February 3, 2008, Suzhou Boai and its equity
                owners have
                returned the full 2.8 million yuan to Wanxing Bio-Pharmaceuticals  as
                agreed
                under the Cancellation Agreement. The costs of the failed attempt
                to acquire
                Suzhou Boai in the amount of $600,216, which includes the RMB 2.6
                million not
                returned to Wanxing Bio-Pharmaceuticals plus audit, accounting and
                other costs,
                is presented as Loss on failed acquisition of subsidiary in the statement
                of
                operations.
 
 **Principles
                of Consolidation**
 
 The
                consolidated financial statements include accounts of the Company
                and its
                subsidiaries, Wanxin BVI, Manhing, Wanxing Bio-Pharmaceuticals and
                Wanxing
                Cosmetic .
 
 All
                significant inter-company balances and transactions are eliminated.
                Minority
                interest represents the other shareholders’ interests in the net assets of the
                subsidiaries after deducting the minority interest share of net losses
                of the
                companies.
 
 **Cash
                and Cash Equivalents**
  Cash
                equivalents comprise certain highly liquid instruments with a maturity
                of three
                months or less when purchased. As at December 31, 2007, the Company
                did not have
                any cash equivalents.
  **Inventory**
 
 Inventory
                is carried at the lower of cost and estimated net realizable value.
                Raw
                materials cost is determined on the first in, first out basis. Manufacturing
                costs are applied to goods in process on a full cost basis. Cost
                of finished
                goods on hand at the balance sheet date is determined on the first
                in, first out
                basis.
  F-9
 **SINOBIOMED
                  INC.**
 **AND
                  CONSOLIDATED SUBSIDIARIES**
 ***Notes
                  to Consolidated Financial Statements***
 ***December
                  31, 2007***
 ***(Expressed
                  in US Dollars)***
 **Revenue
                recognition**
 
 Revenues
                are recognized in accordance with SEC Staff Accounting Bulletin (SAB)
                No. 104,
                "Revenue Recognition." Under SAB 104, product revenues (or service
                revenues) are
                recognized when persuasive evidence of an arrangement exists, delivery
                has
                occurred (or service has been performed), the sales price is fixed
                and
                determinable and collectibility is reasonably assured.
 
 **Concentrations**
 
 The
                Company’s operations are located in the People’s Republic of China.
 
 The
                Interferon product line is subject to increasing competition in the
                marketplace,
                with the result that gross margin per unit on sales has decreased
                markedly over
                the years 2005 through 2007.
 
 **Research
                and Development Expenditures**
  Expenditures
                on research and development activities, including assets acquired
                for use in
                research and development activities, are charged to operations as
                incurred.
  **Asset
                Retirement Obligations**
  The
                Company has adopted SFAS No. 143, *Accounting
                for Asset Retirement Obligations* which
                requires that the fair value of a liability for an asset retirement
                obligation
                be recognized in the period in which it is incurred. The Company
                has no asset
                retirement obligations.
  **Fixed
                Assets**
  Fixed
                assets are carried at cost less a provision for depreciation on a
                straight-line
                basis over their estimated useful lives. Each asset is estimated
                to have a
                residual value of 10% of cost at the end of its useful life. Estimated
                useful
                lives are as follows:
 Buildings
                        
                        
                        20
                            - 30 yearsClimate
                            control equipment
                        
                        
                        8
                            yearsComputer
                            software
                        
                        
                        4
                            - 5 yearsLand
                            license
                        
                        
                        29
                            yearsManufacturing
                            equipment
                        
                        
                        5
                            - 8 yearsOffice
                            furniture and equipment
                        
                        
                        4
                            - 5 yearsOther
                            equipment and fixtures
                        
                        
                        4
                            - 5 yearsRoad
                        
                        
                        20
                            yearsVehicles
                        
                        
                        5
                            -
                            10 years
 
 **Advertising
                Expenses**
  Advertising
                expenses are expensed as incurred.
 
 **Foreign
                Currency**
  The
                parent company’s operation of the Company is located in China. It maintains no
                bank accounts. The functional currency is the U.S. Dollar. Transactions
                in
                foreign currencies, if any, are remeasured into the functional currency
                at the
                rate in effect at the time of the transaction. Remeasurement gains
                and losses
                that arise from exchange rate fluctuations are included in income
                or loss from
                operations. Monetary assets and liabilities denominated in foreign
                currencies
                are presented in the balance sheet at the rate in effect at the balance
                sheet
                date.
  F-10
 **SINOBIOMED
                  INC.**
 **AND
                  CONSOLIDATED SUBSIDIARIES**
 ***Notes
                  to Consolidated Financial Statements***
 ***December
                  31, 2007***
 ***(Expressed
                  in US Dollars)***
 Wanxin
                BVI’s operation of the Company is located in the British Virgin Islands
                and Hong
                Kong. It maintains bank accounts in Hong Kong Dollars and U.S. Dollars.
                The
                functional currency is the U.S. Dollar. Transactions in foreign currencies,
                if
                any, are remeasured into the functional currency at the rate in effect
                at the
                time of the transaction. Remeasurement gains and losses that arise
                from exchange
                rate fluctuations are included in income or loss from operations.
                Monetary
                assets and liabilities denominated in foreign currencies are presented
                in the
                balance sheet at the rate in effect at the balance sheet date.
 
 Manhing’s
                operation of the Company is located in Hong Kong. It maintains a
                bank account in
                U.S. Dollars. The functional currency is the U.S. Dollar. Transactions
                in
                foreign currencies, if any, are remeasured into the functional currency
                at the
                rate in effect at the time of the transaction. Remeasurement gains
                and losses
                that arise from exchange rate fluctuations are included in income
                or loss from
                operations. Monetary assets and liabilities denominated in foreign
                currencies
                are presented in the balance sheet at the rate in effect at the balance
                sheet
                date.
 
 The
                operations of Wanxing Bio-Pharmaceuticals and Wanxing Cosmetic are
                located in
                China, and their accounting records are maintained in Chinese Renminbi
                Yuan. The
                functional currency is the Chinese Renminbi Yuan. Transactions in
                foreign
                currencies other than the functional currency, if any, are remeasured
                into the
                functional currency at the rate in effect at the time of the transaction.
                Remeasurement gains and losses that arise from exchange rate fluctuations
                are
                included in income or loss from operations. Monetary assets and liabilities
                of
                the subsidiaries denominated in the functional currency are translated
                into U.S.
                Dollars at the rate in effect at the balance sheet date. Revenue
                and expenses
                denominated in the functional currency are translated at the average
                exchange
                rate. Other comprehensive income (loss) includes the foreign exchange
                losses of
                $651,210 (2006 - $517,224) that arise from translating from the functional
                currency into U.S. Dollars.
  **Use
                of Estimates**
  The
                preparation of the Company’s consolidated financial statements in conformity
                with generally accepted accounting principles of the United States
                of America
                requires management to make estimates and assumptions that affect
                the reported
                amounts of assets and liabilities and disclosure of contingent assets
                and
                liabilities at the date of the financial statements and the reported
                amounts of
                revenues and expenses during the reporting period. Management makes
                its best
                estimate of the ultimate outcome for these items based on historical
                trends and
                other information available when the financial statements are prepared.
                Actual
                results could differ from those estimates.
 
 **Loss
                Per Share**
  Basic
                earnings (loss) per share of common stock is computed by dividing
                the net
                earnings (loss) by the weighted average number of common shares outstanding
                during the period .
                For
                purposes of determining the weighted average number of common shares
                outstanding, the number of shares outstanding as at December
                31 ,
                2007 is
                given effect on a pro forma basis as if the forward stock split which
                occurred
                in 2007 had occurred by January 1, 2007. Diluted
                earnings (loss) per share is equal to the basic loss per share for
                the years
                ended December 31, 2007 and 2006 because common stock equivalents,
                consisting of
                warrants to acquire 7,972,403 shares and options to acquire 3,350,000
                shares,
                outstanding and exercisable at December 31, 2007 are anti-dilutive.
  F-11
 **SINOBIOMED
                  INC.**
 **AND
                  CONSOLIDATED SUBSIDIARIES**
 ***Notes
                  to Consolidated Financial Statements***
 ***December
                  31, 2007***
 ***(Expressed
                  in US Dollars)***
 **Fair
                Value of Financial Instruments**
  The
                Company’s financial instruments consist of cash, accounts receivable, loans
                receivable, short term loans payable and accounts payable at December
                31, 2007.
                Accounts receivable and loans receivable are carried at estimated
                net realizable
                values net of provisions for uncollectible amounts. Uncollectible
                accounts are
                charged off when determined to be unrecoverable. The carrying values
                of the
                remaining financial instruments reflected in these financial statements
                approximate their fair values due to the short-term maturity of the
                instruments.
 
 **Comprehensive
                Income**
  The
                Company has adopted Statement of Financial Accounting Standards (SFAS)
                No. 130,
“Reporting Comprehensive Income”. Comprehensive income includes net income and
                all changes in equity during a period that arise from non-owner sources,
                such as
                foreign currency items and unrealized gains and losses on certain
                investments in
                equity securities.
 
 **Income
                taxes**
  The
                Company records deferred taxes in accordance with Statement of Financial
                Accounting Standards (SFAS) No. 109, "Accounting for Income Taxes."
                The
                statement requires recognition of deferred tax assets and liabilities
                for
                temporary differences between the tax bases of assets and liabilities
                and the
                amounts at which they are carried in the financial statements, based
                upon the
                enacted tax rates in effect for the year in which the differences
                are expected
                to reverse. A valuation allowance is established when necessary to
                reduce
                deferred tax assets to the amount expected to be realized.
 
 **Impairment
                of Long-Lived Assets**
  The
                Company periodically analyzes its long-lived assets for potential
                impairment,
                assessing the appropriateness of lives and recoverability of unamortized
                balances through measurement of undiscounted operation cash flows
                in accordance
                with SFAS No. 144, *Accounting
                for the Impairment or Disposal of Long-lived Assets.* If
                impairment is deemed to exist, the asset will be written down to
                its fair value.
                Fair value is generally determined using a discounted cash flow analysis.
                As at
                December 31, 2006, the Company wrote down $512,400 in intangible
                assets acquired
                in 2006 for rights to produce the Company’s Leflunomide product, due to
                uncertainty about future sales potential and profit margins which
                makes it
                impossible to establish a fair value for the asset.
 
 **Stock-Based
                Compensation**
 
 The
                Company has implemented the provisions of Statement of Financial
                Accounting
                Standards No. 123 (revised 2004), *Share-
                Based Payment* (“SFAS
                No. 123R”), which replaced Statement of Financial Accounting Standards No.
                123, *Accounting
                for Stock-Based Compensation* (“SFAS
                No. 123”) as amended by No. 148, *Accounting
                for Stock-Based Compensation - Transition and Disclosure* .
                Compensation expense is recorded in accordance with the fair value
                recognition
                provisions of SFAS 123R for options issued to employees.
  F-12
 **SINOBIOMED
                  INC.**
 **AND
                  CONSOLIDATED SUBSIDIARIES**
 ***Notes
                  to Consolidated Financial Statements***
 ***December
                  31, 2007***
 ***(Expressed
                  in US Dollars)***
 **New
                Accounting Pronouncements**
 
 In
                December 2004, the FASB issued SFAS No. 153, “Exchanges of Nonmonetary Assets,
                an amendment of APB No. 29, Accounting for Nonmonetary Transactions”. SFAS No.
                153 requires exchanges of productive assets to be accounted for at
                fair value,
                rather than at carryover basis, unless (1) neither the asset received
                nor the
                asset surrendered has a fair value that is determinable within reasonable
                limits
                or (2) the transactions lack commercial substance. SFAS 153 is effective
                for
                nonmonetary asset exchanges occurring in fiscal periods beginning
                after June 15,
                2005. The adoption of FASB No. 153 does not have a material impact
                on the
                Company’s consolidated financial statements.
  In
                May
                2005, the FASB issued SFAS No. 154, “Accounting Changes and Error Corrections”.
                SFAS No. 154 replaces APB Opinion No. 20 “Accounting Changes” and SFAS No. 3,
“Reporting Accounting Changes in Interim Financial Statements”. SFAS No. 154
                requires retrospective application to prior periods’ financial statements of
                changes in accounting principle, unless it is impracticable to determine
                either
                the period-specific effects or the cumulative effect of the change.
                The adoption
                of SFAS No. 154 does not have any impact on the Company’s consolidated financial
                statements.
 
 In
                March
                2006, the FASB issued SFAS No. 156, *“Accounting
                for Servicing of Financial Assets,”* (“SFAS
                No. 156”), which amends SFAS No. 140, *”
                Accounting for Transfers and Servicing of Financial Assets and Extinguishments
                of Liabilities.* ”
In
                a
                significant change to current guidance, SFAS No. 156 permits an entity
                to choose
                either of the following subsequent measurement methods for each class
                of
                separately recognized servicing assets and servicing liabilities:
                (1)
                Amortization Method or (2) Fair Value Measurement Method. SFAS No.
                156 is
                effective as of the beginning of an entity’s first fiscal year that begins after
                September 15, 2006. The
                adoption of SFAS No. 156 does not have any impact on the Company’s consolidated
                financial statements.
  In
                June
                2006, the FASB issued SFAS Board Interpretation No. 48, “ *Accounting
                for Uncertainty in Income Taxes - an Interpretation of FASB statement
                No.
                109* ”
(“FIN
                48”), which clarifies the accounting for uncertainty in income taxes
                recognized
                in an enterprise’s financial statements in accordance with FASB No. 109. The
                interpretation prescribes a recognition threshold and measurement
                attribute for
                the financial statement recognition and measurement of a tax position
                taken or
                expected to be taken in a tax return. This interpretation also provides
                guidance
                on derecognition, classification, interest and penalties, accounting
                in interim
                periods, disclosure, and transition. FIN 48 is effective for fiscal
                years
                beginning after December 15, 2006. Earlier application of the provisions
                of FIN
                48 is encouraged if the enterprise has not yet issued financial statements,
                including interim financial statements, in the period this Interpretation
                is
                adopted. The
                adoption of FIN 48 does not have any impact on the Company’s consolidated
                financial statements.
  F-13
 **SINOBIOMED
                  INC.**
 **AND
                  CONSOLIDATED SUBSIDIARIES**
 ***Notes
                  to Consolidated Financial Statements***
 ***December
                  31, 2007***
 ***(Expressed
                  in US Dollars)***
 In
                September 2006, the FASB issued SFAS No. 157, “ *Fair
                Value Measurements* .”
This
                statement defines fair value, establishes a framework for measuring
                fair value
                in generally accepted accounting principles, and expands disclosure
                about fair
                value measurements. This statement applies under other accounting
                pronouncements
                that require or permit fair value measurement, the FASB having previously
                concluded in those accounting pronouncements that fair value is the
                relevant
                measurement attribute. This statement does not require any new fair
                value
                measurements. However, for some entities, the application of the
                statement will
                change current practice. This statement is effective for financial
                statements
                issued for fiscal years beginning after November 15, 2007, and interim
                periods
                within those fiscal years. The Company is currently reviewing the
                effect, if
                any, that this new pronouncement will have on its financial
                statements.
 
 In
                September 2006, the FASB issued SFAS No. 158, “ *Employers’
                Accounting for Defined Benefit Pension and Other Postretirement Plans
                - an
                amendment of FASB Statements No. 87, 88, 106 and 123(R)* .”
This
                statement improves financial reporting by requiring an employer to
                recognize the
                overfunded or underfunded status of a defined benefit postretirement
                plan (other
                than a multi-employer plan) as an asset or liability in its statement
                of
                financial position and to recognize changes in that funded status
                in the year in
                which the changes occur through comprehensive income of a business
                entity or
                changes in unrestricted net assets for a not-for-profit organization.
                This
                statement also improves financial reporting by requiring an employer
                to measure
                the funded status of a plan as of the date of its year-end statement
                of
                financial position, with limited exceptions. The Company does not
                expect the
                adoption of this pronouncement to have a material impact on its financial
                statements.
 
 There
                were various other accounting standards and interpretations recently
                issued,
                none of which is expected to have a material impact on the Company's
                financial
                position, operations or cash flows.
  **3.
                CASH - RESTRICTED**
 
 Restricted
                cash consists of $184 on deposit pursuant to agreement with a bank
                to maintain
                funds on deposit to ensure payment of interest on debt.
  **4.
                ACCOUNTS RECEIVABLE**
 
 Trade
                accounts receivable consists of receivable for sales of product on
                credit.
                Accounts receivable are net of allowance for doubtful accounts in
                the amount of
                $8,630.
  **5.
                LOANS TO UNRELATED PARTIES**
 
 The
                Company has loans receivable from other companies arising from guarantee
                arrangements under which the Company guaranteed the debt of other
                companies and
                has been called on its guarantees (Note 8). The company has $4,874,185
                receivable from these companies including interest accrued on the
                original debts
                since call of the guarantees, but has provided for the full amount
                of the
                receivables due to uncertainty of collectibility. $300,501 has been
                charged to
                income in the year ended December 31, 2007 (2006 - $266,281) in respect
                of the
                provision. The increase in the amount of the loan receivable and
                the
                corresponding provision from year to year arises due to the interest
                accruing on
                the debt guaranteed. Under the terms of the guarantee agreements,
                the other
                companies had until December 31, 2007 to pay the Company, but nothing
                has been
                paid.
  F-14
 **SINOBIOMED
                  INC.**
 **AND
                  CONSOLIDATED SUBSIDIARIES**
 ***Notes
                  to Consolidated Financial Statements***
 ***December
                  31, 2007***
 ***(Expressed
                  in US Dollars)***
 The
                Company has fully provided for $12,616 (92,155 Chinese yuan) of additional
                loans
                receivable from sales agents and employees. $804 recovery has been
                recognized in
                the year ended December 31, 2007 (2006 - $72,217 recovery) in respect
                of the
                provision.
 
 The
                Company has fully provided for $127,900 of loans receivable from
                minority
                shareholders of Wanxing Cosmetic. $48,489 recovery was recognized
                in the 2006
                year in respect of this provision.
  **6.
                INVENTORY**
 
 Inventory
                consists of the following:
  December
                          31,2007Raw
                          materials
                      
                      $
                      74,007Goods
                          in process
                      
                      
                      550,198Finished
                          goods
                      
                      
                      269,197$
                      893,402
 
 **7.
                FIXED ASSETS**
 
 Fixed
                assets consist of the following:
  December
                          31,2007Buildings
                      
                      $
                      6,220,810Climate
                          control equipment
                      
                      
                      1,265,923Computer
                          software
                      
                      
                      1,917Land
                          license
                      
                      
                      2,299,920Manufacturing
                          equipment
                      
                      
                      2,119,775Office
                          furniture and equipment
                      
                      
                      156,532Other
                          equipment
                      
                      
                      29,048Road
                      
                      
                      34,460Vehicles
                      
                      
                      701,53512,829,920Less:
                          Accumulated depreciation
                      
                      
                      6,171,089$
                      6,658,831
 
 F-15
 **SINOBIOMED
                  INC.**
 **AND
                  CONSOLIDATED SUBSIDIARIES**
 ***Notes
                  to Consolidated Financial Statements***
 ***December
                  31, 2007***
 ***(Expressed
                  in US Dollars)***
  The
                  land
                  license is for the use of the land on which the Company’s buildings are
                  situated, and is for a term of 30 years from September 18, 1996.
                  At the end of
                  the license, the Company expects to have an option to renew the
                  license.
 
 **8.
                SHORT-TERM LOANS**
 
 The
                Company has obligations under the following loan agreements.
 
 Name
                          of Lender
                      
                      Principal
                        amount
                        December
                        31,
                          2007
                      
                      Due
                          date
                      
                      Interest
                          rate
                        Not
                          due/
                        overdue
                      
                      Security
                        (1)China
                          Construction Bank
                      
                      $
                      1,957,670
                      
                      
                      October
                          16, 2004
                      
                      
                      5.31%
                          / 7.56
                      %
                      
                      Building
                          mortgage (2
                      )Shenzhen
                          Development Bank
                      
                      
                      766,640
                      
                      
                      June
                          6, 2005
                      
                      
                      6.372%/9.56
                      %
                      
                      GuaranteeIndustrial
                          Bank
                      
                      
                      3,395,128
                      
                      
                      December
                          19, 2005
                      
                      
                      6.138%
                          / NA
                      
                      
                      GuaranteeZheda
                          Haina S&T Holding
                      
                      
                      574,980
                      
                      
                      -
                      
                      
                      -
                      
                      
                      (3
                      )Luoyang
                          Zonghong
                      
                      
                      410,700
                      
                      
                      -
                      
                      
                      -
                      
                      
                      -$
                      7,105,118
 
 (1)
                      Guarantees
                          have been arranged with various companies under cross-guarantee
                          arrangements where each guarantees a loan for the other,
                          or a loan forward
                          basis where Wanxing Bio-Pharmaceuticals borrows and then
                          loans a specified
                          amount to the guarantor in return for the guarantee. The
                          Company has
                          guaranteed debt of two other companies under such arrangements,
                          up to an
                          amount of $3,423,000 (25,000,000 Chinese yuan) plus interest.
                          $4,874,185
                          of the Company’s debt above arose upon the Company being called on its
                          two
                          guarantees. The Company recorded a corresponding loan receivable
                          from the
                          other companies and has made a provision for uncollectibility
                          in the full
                          amount of the receivable (Note 5).
 (2)
                      Buildings
                          with carrying value of $3,816,315 have been mortgaged as
                          security.
 (3)
                      The
                          debt to Zheda Haina arose upon the payment by Zheda Haina
                          of part of the
                          Company’s loan from Shenzhen Development Bank pursuant to a guarantee
                          provided to the bank by Zheda Haina in
                          2004.
  F-16
 **SINOBIOMED
                  INC.**
 **AND
                  CONSOLIDATED SUBSIDIARIES**
 ***Notes
                  to Consolidated Financial Statements***
 ***December
                  31, 2007***
 ***(Expressed
                  in US Dollars)***
 The
                bank
                loans are all delinquent at December 31, 2007. The Company has been
                involved in
                litigation over some of its bank loans. Two of the suits have been
                settled, and
                a further one is outstanding as at December 31, 2007 as more fully
                described in
                Note 9.
 
 Two
                bank
                loans were settled in the year ended December 31, 2007 resulting
                in forgiveness
                of outstanding accrued interest in the amount of RMB 20,193,461 yuan
                (approximately $2,655,000). The company incurred consulting fees
                of RMB
                2,550,000 yuan (approximately $335,000) for the services of a consultant
                who
                negotiated one of the settlements on the Company’s behalf. The fees have been
                charged against the gain on forgiveness of interest.
  **9.
                LITIGATION**
 
 The
                Company has been sued by the Shenzhen Development Bank to enforce
                payment under
                the loan agreement with that bank and judgment was granted in favor
                of the bank
                by the 1st Secondary People’s Court of Shanghai. On October 25, 2006 the Company
                and the bank entered into a settlement agreement to settle the litigation
                and
                the debt. The debt at that time had a principal balance of 17,800,000
                yuan
                (approximately $US 2,437,000 at December 31, 2007 exchange rates).
                Under the
                terms of the settlement agreement, the Company was obligated to pay
                the bank 5
                million yuan (approximately $US 685,000) before October 30, 2006,
                3 million yuan
                (approximately $US 411,000) before March 20, 2007, 3 million yuan
                (approximately
                $US 411,000) before June 20, 2007, 3 million yuan (approximately
                $US 411,000)
                before September 20, 2007 and 3.8 million yuan (approximately $US
                522,000) plus
                the balance of accrued interest before December 20, 2007. The Company
                made a
                payment of 5 million yuan in compliance with the settlement agreement in
                December 2006. The
                Company defaulted on the settlement agreement by not making the scheduled
                loan
                payment of 3 million yuan (approximately $US 394,000) on March 20,
                2007. The
                bank granted a waiver of default in respect of this payment until
                May 30, 2007.
                The Company made the payment due May 30, defaulted on the two payments due
                by
                June 20, 2007 and September 20, 2007, made payments of 4,200,000
                yuan after
                September 30, 2007, and has defaulted on the payment due December
                20,
                2007 .
  **10.
                SHAREHOLDER LOANS**
 
 The
                loans
                from shareholders in the aggregate amount of $2,176,526 do not bear
                interest.
                $1,866,526 payable to a shareholder of a subsidiary was due December
                31, 2007
                and the remainder have no stated repayment terms. Imputed interest
                has been
                recorded on the shareholder loans at an interest rate of 5.31%. The
                net interest
                calculated is included in interest expense and has been recorded
                as additional
                paid-in capital since the imputed interest is not payable.
  **11.**  **RELATED
                PARTY TRANSACTIONS**
 
 The
                Company is indebted to a company related to a shareholder in the
                amount of
                $300,000 and to the minority shareholder of a subsidiary in the amount
                of
                $1,866,523 for shareholders’ loans.
  F-17
 **SINOBIOMED
                  INC.**
 **AND
                  CONSOLIDATED SUBSIDIARIES**
 ***Notes
                  to Consolidated Financial Statements***
 ***December
                  31, 2007***
 ***(Expressed
                  in US Dollars)***
 The
                Company has paid or accrued finders’ fees to shareholders and a company related
                to a shareholder in the amounts of $1,295,875 and 20,000 shares.
                These finders’
fees are included in the finders’ fees described in Note 13.
 
 The
                Company has incurred fees and associated expenses in the amount of
                $40,420 to a
                company related to a shareholder for services. The Company has committed
                to pay
                that company $2,000 per month plus expenses for services. The arrangement
                may be
                terminated by either party on one month notice.
 
 The
                Company is indebted to two persons who are shareholders and directors,
                in
                amounts of $24,600 and $10,000.
 
 Two
                minority shareholders of a subsidiary are indebted to the Company
                in the amount
                of $127,900. The Company has provided an allowance for the full amount
                of this
                indebtedness (Note 5).
 
 The
                Company has paid the residential rent in Shanghai as part of the
                remuneration
                for the Chief Executive Officer of the Company for the months of
                January through
                June 2007 in the amount of $17,000.
  **12.
                INCOME TAXES**
 
 The
                Company is subject to Chinese income taxes to the extent of its operations
                in
                China and in the United States should it have operations in the United
                States.
                The company had no income tax expense during the reported periods
                due to net
                operating losses.
 
 A
                reconciliation of income tax expense to the amount computed at the
                statutory
                rates is as follows:
 December
                            31, 2007Loss
                            for the year ended December 31, 2007
                        
                        $
                        (6,669,420
                        )Average
                            statutory tax rate in China
                        
                        
                        33
                        %Expected
                            income tax provision
                        
                        $
                        (2,200,909
                        )Non-deductible
                            stock-based compensation and imputed interest expenses
                        
                        
                        919,893Tax
                            basis of deferred expenses in excess of book cost
                        
                        
                        825,355Unrecognized
                            tax losses
                        
                        
                        455,661Income
                            tax expense
                        
                        $
                        —
  F-18
 **SINOBIOMED
                  INC.**
 **AND
                  CONSOLIDATED SUBSIDIARIES**
 ***Notes
                  to Consolidated Financial Statements***
 ***December
                  31, 2007***
 ***(Expressed
                  in US Dollars)***
 Significant
                components of deferred income tax assets are as follows:
 December
                            31, 2007Operating
                            losses carried forward
                        
                        
                        3,981,646Excess
                            of tax basis over book cost of deferred expenses in China
                        
                        $
                        4,747,265Valuation
                            allowance
                        
                        
                        (8,728,911
                        )Net
                            deferred income tax assets
                        
                        **$**
                        **-**
  The
                Company has tax losses carried forward for Chinese tax purposes of
                approximately
                $12,066,000 which will expire in 2012 if not utilized.
  **13.
                COMMON STOCK**
 
 On
                January 12, 2007 the Company issued 1,750,000 pre forward stock split
                shares of
                common stock (equivalent to 70,000,000 post-forward stock split shares)
                to the
                former shareholders of Wanxin BVI in return for all the outstanding
                shares of
                Wanxin BVI as described in Note 1.
 
 On
                March
                1, 2007 the Company increased its authorized capital from 50,000,000
                common
                shares to 250,000,000 common shares.
 
 On
                March
                2, 2007 the Company forward split its common stock on a 40-for-1
                basis.
 
 On
                March
                9, 2007 the Company cancelled 76,000,000 (post forward stock split)
                common
                shares pursuant to the surrender for cancellation of those shares
                by the former
                majority shareholder of the Company.
  On
                March
                22, 2007, the Company issued 100,000 (post forward stock split) shares
                of common
                stock in return for the services of the Company’s Chief Financial Officer for
                the 12 months commencing January 1, 2007. The Company recognized
                an issue price
                for the shares of $0.854 per share, reflecting a discount from market
                price on
                that date due to there being a one-year hold period before the shares
                can be
                sold.
 
 On
                May
                14, 2007, the Company issued 2,074,668 units (each a “Unit”) to 36
                individuals/entities due to the closing of the Company’s private placement at
                $0.75 per Unit for total gross proceeds of $1,556,001. Each Unit
                consists of one
                share of common stock of the Company and one-half of one share purchase
                warrant,
                with each whole warrant entitling the holder to purchase one additional
                share of
                common stock of the Company at $1.25 per warrant share until May
                14, 2009.
  F-19
 **SINOBIOMED
                  INC.**
 **AND
                  CONSOLIDATED SUBSIDIARIES**
 ***Notes
                  to Consolidated Financial Statements***
 ***December
                  31, 2007***
 ***(Expressed
                  in US Dollars)***
 In
                addition, on May 14, 2007, the Company issued 1,623,000 units (each
                a “Unit”) to
                44 individuals/entities due to the closing of the first part of the
                Company’s
                private placement at $1.00 per Unit for total gross proceeds of $1,623,000.
                Each
                Unit consists of one share of common stock of the Company and one-half
                of one
                share purchase warrant, with each whole warrant entitling the holder
                to purchase
                one additional share of common stock of the Company at $1.75 per
                warrant share
                until May 14, 2009.
 
 On
                May
                24, 2007, the Company issued 3,500,000 units (each a “Unit”) to 2
                individuals/entities due to the closing of the second traunche of
                the Company’s
                private placement at $1.00 per Unit for total gross proceeds of $3,500,000.
                Each
                Unit consists of one share of common stock of the Company and one-half
                of one
                share purchase warrant, with each whole warrant entitling the holder
                to purchase
                one additional share of common stock of the Company at $1.75 per
                warrant share
                until May 24, 2009.
 
 In
                addition, on May 30, 2007, the Company issued 3,000,000 units (each
                a “Unit”) to
                4 individuals/entities due to the closing of the third and fourth
                traunches of
                the Company’s private placement at $1.00 per Unit for total gross proceeds of
                $3,000,000. Each Unit consists of one share of common stock of the
                Company and
                one-half of one share purchase warrant, with each whole warrant entitling
                the
                holder to purchase one additional share of common stock of the Company
                at $1.75
                per warrant share until May 30, 2009.
 
 On
                September 11, 2007, the Company issued 5,248,800 units (each a “Unit”) due to
                the closing of the Company’s private placement at $1.25 per Unit for total gross
                proceeds of $6,561,000. Each Unit consists of one share of common
                stock of the
                Company and one-half of one share purchase warrant, with each whole
                warrant
                entitling the holder to purchase one additional share of common stock
                of the
                Company at $2.00 per warrant share until September 11, 2009.
 
 On
                October 16, 2007, the Company issued 25,000 shares of common stock
                to one
                individual with respect to the exercise of 25,000 warrants at a price
                of $1.25
                per share for total gross proceeds of $31,250.
 
 On
                December 5, 2007, the Company issued 548,338 units (each a “Unit”) to 21
                individuals/entities due to the closing of the Company’s private placement at
                $1.50 per Unit for total gross proceeds of $822,507. Each Unit consists
                of one
                share of common stock of the Company and one-half of one share purchase
                warrant,
                with each whole warrant entitling the holder to purchase one additional
                share of
                common stock of the Company at $2.00 per warrant share until December
                5, 2009.
 
 In
                relation to the Company’s private placement offerings entered into with offshore
                investors, the Company has paid or accrued cash finders’ fees in the amount of
                $1,439,125 and finders’ fees of 192,280 shares of common stock of the Company.
 
 Warrants
                outstanding and exercisable as of December 31, 2007 are as follows:
 
 Exercise
                          Price
                      
                      Number
                          of Warrants
                      
                      Expiry
                          Date$
                          1.25
                      
                      1,012,334
                      
                      May
                          14, 2009$
                          1.75
                      
                      4,061,500
                      
                      May
                          14 to May 30, 2009$
                          2.00
                      
                      2,624,400
                      
                      September
                          11, 2009$
                          2.00
                      
                      274,169
                      
                      December
                          5, 20097,972,403
 
 F-20
 **SINOBIOMED
                  INC.**
 **AND
                  CONSOLIDATED SUBSIDIARIES**
 ***Notes
                  to Consolidated Financial Statements***
 ***December
                  31, 2007***
 ***(Expressed
                  in US Dollars)***
 **14.
                OTHER INCOME**
 
 Other
                income includes $131,500 (2006 - $0) in revenue from product licensing
                and
                $97,622 (2006 - $2,071,901) in grant revenue received as funding
                assistance
                toward the research and development of the Company’s products.
 
 **15.
                STOCK-BASED COMPENSATION**
 
 The
                Company’s 2006 Stock Option and Incentive Plan (the “Plan”) allows the Company
                to award stock options for up to 10,000,000 (post-forward stock split)
                shares to
                its directors, officers, employees, and consultants. The plan is
                administered by
                the Company’s Board of Directors, or its assigned committee, who has discretion
                as to the awards and terms of the options to be issued. Upon exercise
                of
                options, shares are issued from treasury.
  On
                March
                1, 2007, 6,000,000 stock options were granted under the Plan with
                the exercise
                price of $0.50 per share. 300,000 of 6,000,000 options vested on
                March 1, 2007
                with the reminder to vest in equal monthly proportions on the first
                day of each
                of the next 19 months.
 
 On
                May
                30, 2007, 1,000,000 stock options were granted under the Plan with
                the exercise
                price of $1.90 per share. 500,000 of 1,000,000 options will vest
                on June 1, 2009
                with the reminder to vest on June 1, 2011.
 
 On
                November 29, 2007, 1,000,000 stock options were granted under the
                Plan with the
                exercise price of $1.67 per share. 50,000 of 1,000,000 options vested
                on
                November 29, 2007 with the reminder to vest in equal monthly proportions
                on the
                first day of each of the next 19 months.
 
 A
                summary
                of the Company’s stock option activities is presented below:
 
 Number
                          of
                        options
                      
                      Weighted
                        Average
                        Exercise
                          Price
                      
                      Weighted
                        Average
                        Grant-date
                        Fair
                          Value
                      
                      Aggregate
                        Intrinsic
                          Value**Options
                          Outstanding**,
                          January 1, 2007Options
                          granted:
                      
                      
                      8,000,000
                      
                      
                      0.82
                      
                      
                      0.825
                      
                      $
                      6,597,922**Options
                          Outstanding**,
                          December 31, 2007
                      
                      
                      8,000,000
                      
                      
                      0.82
                      
                      
                      0.825
                      
                      $
                      6,597,922
  F-21
 **SINOBIOMED
                  INC.**
 **AND
                  CONSOLIDATED SUBSIDIARIES**
 ***Notes
                  to Consolidated Financial Statements***
 ***December
                  31, 2007***
 ***(Expressed
                  in US Dollars)***
 Compensation
                cost related to options to vest in the future will be recognized
                as the related
                options vest. Outstanding options vest as follows:
  Vested
                            at
                          December
                            31,
                      
                      
                      Range
                            of Exercise
                          Prices
                      
                      
                      Number
                          of
                            Shares
                      
                      
                      Weighted
                          Average
                            Exercise
                          Price
                      
                      
                      Compensation
                          Expense
                            to be Recognized
                      
                      
                      Aggregate
                            Intrinsic
                            Value2007
                          and earlier
                      
                      
                      0.50
                          to 1.90
                      
                      
                      3,350,000
                      
                      
                      0.52
                      
                      
                      
                      
                      $
                      2,561,1322008
                      
                      
                      0.50
                      
                      
                      3,300,000
                      
                      
                      0.71
                      
                      $
                      2,780,400
                      
                      
                      2,779,5922009
                      
                      
                      1.90
                      
                      
                      850,000
                      
                      
                      1.81
                      
                      
                      842,735
                      
                      
                      842,7342011
                      
                      
                      1.90
                      
                      
                      500,000
                      
                      
                      1.90
                      
                      
                      414,464
                      
                      
                      414,4648,000,000
                      
                      
                      
                      
                      
                      
                      
                      $
                      6,597,922
  Non-vested
                options are as follows:
  Number
                        outstanding
                      
                      Total
                          fair value
                      
                      Weighted
                        average
                          grant-
                        date
                          fair valueNon-vested
                          options outstanding, January 1, 2007
                      
                      
                      -
                      
                      $
                      -
                      
                      
                      -Non-vested
                          options outstanding, December 31, 2007
                      
                      
                      4,650,000
                      
                      $
                      4,037,450
                      
                      
                      0.868Options
                          vested in year ended December 31, 2007
                      
                      
                      3,350,000
                      
                      $
                      2,562,550
                      
                      $
                      0.765
 
 If
                not
                previously exercised or canceled, options outstanding at December
                31, 2007 will
                expire as follows:
  Expiry
                          Date
                      
                      Range
                          of Exercise PricesYear
                              Ending December 31,
                      
                      High
                      
                      Low
                      
                      Number
                          of
                            Shares
                      
                      Weighted
                          average
                        exercise
                          price2012
                      
                      
                      1.90
                      
                      
                      0.50
                      
                      
                      8,000,000
                      
                      
                      0.82
 
 The
                fair
                values of the options granted in March, May and November, 2007 were
                estimated at
                values of $0.758 per share, $0.829 per share and $1.223, respectively,
                using the
                Black-Scholes Option Pricing Model with the following weighted average
                assumptions:
  March
                          and
                        May,
                          2007
                      
                      November,
                        2007Volatility:
                      
                      
                      41.0
                      %
                      
                      94
                      %Risk-free
                          interest rate:
                      
                      
                      4.92
                      %
                      
                      3.42
                      %Dividend
                          yield:
                      
                      
                      —
                      
                      
                      —Expected
                          lives(years):
                      
                      
                      5
                      
                      
                      5
  F-22
  **SINOBIOMED
                  INC.**
 **AND
                  CONSOLIDATED SUBSIDIARIES**
 ***Notes
                  to Consolidated Financial Statements***
 ***December
                  31, 2007***
 ***(Expressed
                  in US Dollars)***
 Option-pricing
                models require the use of highly subjective estimates and assumptions
                including
                the expected stock price volatility. Changes in the underlying assumptions
                can
                materially affect the fair value estimates and therefore, in management’s
                opinion, existing models do not necessarily provide reliable measure
                of the fair
                value of the Company’s stock options.
  **16.
                CONTINGENT PATENT RIGHTS COMMITMENTS**
 
 The
                Company has committed to payments for rights to use patented technology,
                contingent upon successful clinical trials and approval of products
                for
                production as follows:
 
 11
                Million yuan (approximately $1,506,000) will be payable upon completion
                of both
                Phase III clinical trials and approval of new drug certificate for
                Ethelphazine,
                an anti-tumor drug entering Phase III clinical trials.
 
 20
                Million yuan (approximately $2,738,000) will be payable upon completion
                of both
                Phase III clinical trials and approval of new drug certificate for
                the Company’s
                recombinant malaria vaccine. This drug is expected to enter Phase
                II clinical
                trials in 2008.
 
 2.5
                Million yuan (approximately $342,000) will be payable in respect
                of the
                Company’s recombinant Human Stem Cell factor bio-product in two stages. The
                first 1 Million yuan (approximately $137,000) will be due by the
                time of upon
                completion of Phase II trials and 1.5 Million yuan (approximately
                $205,000) will
                be payable upon completion of both Phase III clinical trials and
                approval of the
                product for production. This product is in Phase I trials.
  **17.
                SEGMENTED INFORMATION**
 
 The
                Company is operating in a single geographic market, the People’s Republic of
                China. The Company has two operating segments, the cosmetics business
                and the
                pharmaceuticals business. Segment revenues, net loss and assets are
                as
                follows:
 
 Revenues
                      
                      Net
                          loss
                      
                      Total
                          assetsPharmaceuticals
                      
                      $
                      1,038,232
                      
                      $
                      1,852,976
                      
                      $
                      7,921,199Cosmetics
                      
                      
                      217,462
                      
                      
                      14,144
                      
                      
                      158,438Parent
                          company administration
                      
                      
                      
                      
                      
                      4,802,300
                      
                      
                      14,558Total
                          consolidated
                      
                      $
                      1,255,694
                      
                      $
                      6,669,420
                      
                      $
                      8,094,195
  F-23
 **SINOBIOMED
                  INC.**
 **AND
                  CONSOLIDATED SUBSIDIARIES**
 ***Notes
                  to Consolidated Financial Statements***
 ***December
                  31, 2007***
 ***(Expressed
                  in US Dollars)***
 **18.
                MANUFACTURING SHUT-DOWN**
 
 In
                December 2006, Wanxin Bio-pharmaceuticals temporarily closed its
                manufacturing
                facility while it underwent inspection and review for the purposes
                of obtaining
                a Good Manufacturing Practice (“GMP”) certificate in respect of its
                manufacturing processes for its aFGF product and renewal of the GMP
                certification for its Interferon product line. The renewal of the
                GMP
                certificate for Interferon products was issued May 23, 2007 for a
                period of five
                years and production of this product line was recommenced thereafter.
                The
                official GMP certificate for the aFGF product was received on August
                3, 2007.
                During the shut-down, the Company continued to sell its Interferon
                products from
                inventory of finished goods in stock. Production of Leflunomide,
                which is
                manufactured under licence by another facility, was not affected.
  **19.
                SUBSEQUENT EVENTS**
 
 On
                April
                3, 2008, Wanxin Bio-pharmaceuticals agreed to a revised payment schedule
                for the
                bank loan with the China Construction Bank. Under this agreement,
                Wanxin
                Bio-pharmaceuticals agreed to pay 4 Million yuan (approximately $548,000)
                by
                June 30, 2008 and the balance of principal and interest by September
                30,
                2008.
 
 On
                April
                8, 2008, Wanxin Bio-pharmaceuticals agreed to a revised payment schedule
                for the
                bank loan with the Industrial Bank. Under this agreement, Wanxin
                Bio-pharmaceuticals agreed to pay 3 Million yuan (approximately $411,000)
                by
                April 30, 2008, 10 Million yuan (approximately $1,369,000) by June
                30, 2008 and
                the balance of principal and interest by September 30, 2008.
  F-24
  ***Item
        8. Changes In And Disagreements With Accountants On Accounting And Financial
        Disclosure***
  Effective
        on January 19, 2007, our Board of Directors dismissed Davis Accounting Group
        P.C. as our principal independent accountant for auditing our financial
        statements.
  Davis
        Accounting Group P.C. (“Davis”) performed the audit of our financial statements
        for the year ended December 31, 2005. During this period and the subsequent
        interim period prior to our decision to decline to renew their engagement,
        there
        were no disagreements with Davis on any matter of accounting principles or
        practices, financial statement disclosure or auditing scope or procedure,
        which
        disagreements if not resolved to Davis would have caused Davis to make reference
        to this subject matter of the disagreements in connection with Davis 's report,
        nor were there any “reportable events” as such term is defined in Item 304(a)(3)
        of Regulation S-B, promulgated under the Securities Exchange Act of 1934,
        as
        amended.
  Our
        Board
        of Directors determined that, although we were very satisfied with the quality
        of the audits prepared by Davis , a new independent certified public accountant
        would be in the best interests of our stockholders.
  The
        audit
        report of Davis for our year ended on December 31, 2005, did not contain
        an
        adverse opinion, or a disclaimer of opinion, or qualification or modification
        as
        to uncertainty, audit scope, or accounting principles, other than the
        uncertainty regarding our ability to continue as a going concern.
  On
        January 19, 2007, we engaged the firm of Schumacher & Associates, Inc. to
        serve as our independent registered public accountants for the fiscal year
        ended
        December 31, 2006.
  During
        the fiscal years ended December 31, 2006, 2005 and 2004, and through January
        19,
        2007, we have not consulted with Schumacher & Associates, Inc. regarding
        either:
  1.
              The
                  application of accounting principles to any specific transaction,
                  either
                  completed or proposed, or the type of audit opinion that might
                  be rendered
                  on our financial statements, and neither a written report was provided
                  to
                  Schumacher & Associates, Inc. nor oral advice was provided that
                  Schumacher & Associates, Inc. concluded was an important factor
                  considered by our Board of Directors in reaching a decision as
                  to the
                  accounting, auditing or financial reporting issue;
                  or
  2.
              Any
                  matter that was either subject of disagreement or event, as defined
                  in
                  Item 304(a)(1)(iv) of Regulation S-B and the related instruction
                  to Item
                  304 of Regulation S-B, or a reportable event, as that term is explained
                  in
                  Item 304(a)(1)(iv) of Regulation
                  S-B.
  30
  ***Item
        8a. Controls And Procedures***
  **Annual
        Report of Management on Internal Control Over Financial
        Reporting**
 
 Management
        is responsible for establishing and maintaining adequate internal control
        over
        financial reporting to provide reasonable assurance regarding the reliability
        of
        our financial reporting and the preparation of financial statements for external
        purposes in accordance with accounting principles generally accepted in the
        United States. Internal control over financial reporting includes those policies
        and procedures that (i) pertain to the maintenance of records that, in
        reasonable detail, accurately and fairly reflect the transactions and
        dispositions of the assets of Sinobiomed Inc. and our consolidated subsidiaries;
        (ii) provide reasonable assurance that transactions are recorded as necessary
        to
        permit preparation of financial statements in accordance with accounting
        principles generally accepted in the United States, and that receipts and
        expenditures of Sinobiomed Inc. and our consolidated subsidiaries are being
        made
        only in accordance with authorizations of management and directors of Sinobiomed
        Inc. and our consolidated subsidiaries, as appropriate; and (iii) provide
        reasonable assurance regarding prevention or timely detection of unauthorized
        acquisition, use or disposition of the assets of Sinobiomed Inc. and our
        consolidated subsidiaries that could have a material effect on the financial
        statements.
 
 Management,
        with the participation of our principal executive officer and principal
        financial officer, assessed the effectiveness of our internal control over
        financial reporting as of December 31, 2007, the end of our fiscal year.
        Management’s assessment included evaluation of such elements as the design and
        operating effectiveness of key financial reporting controls, process
        documentation, accounting principles and our overall control environment.
        This
        assessment is supported by testing and monitoring performed under the direction
        of management.
 
 Because
        of its inherent limitations, internal control over financial reporting may
        not
        prevent or detect misstatements. Also, projections of any evaluations of
        effectiveness to future periods are subject to the risk that controls may
        become
        inadequate because of changes in conditions, or that the degree of compliance
        with the policies or procedures may deteriorate. Accordingly, even an effective
        system of internal control over financial reporting will provide only reasonable
        assurance with respect to financial statement preparation.
 
 Based
        on
        our assessment, management has concluded that our internal control over
        financial reporting was effective as of the end of December 31, 2007, to
        provide
        reasonable assurance regarding the reliability of financial reporting and
        the
        preparation of financial statements for external reporting purposes in
        accordance with accounting principles generally accepted in the United States.
        Our audit committee has reviewed the results of management’s
        assessment.
 
 **Changes
        in Internal Control Over Financial Reporting**
 
 There
        have been no changes in our internal controls over financial reporting that
        occurred during our fourth fiscal quarter of the period covered by this Annual
        Report on Form 10-KSB that have materially affected, or are reasonably likely
        to
        materially affect, our internal controls over financial reporting.
  ***Item
        8b. Other Information***
  Not
        applicable.
  31
  **Part
        III**
  ***Item
        9. Directors, Executive Officers, Promoters, Control Persons And Corporate
        Governance; Compliance With Section 16(A) Of The Exchange
        Act***
  The
        following table sets forth certain information regarding the members of our
        Board of Directors and executive officers as of March 30, 2007:
 **Name**
                  
                  **Age**
                  
                  **Positions and Offices**
                    **Held****Ban-Jun
                      Yang**(1)
                  
                  52
                  
                  President,
                      CEO and a Director**Ka
                      Yu**(2)
                  
                  37
                  
                  Secretary,
                      Treasurer and Director**Asher
                      Zwebner**(3)
                  
                  44
                  
                  Chief
                      Financial Officer**Robert
                      Ip**(4)
                  
                  51
                  
                  Director**Chris
                      Metcalf**(5)
                  
                  38
                  
                  Director**Dr.
                      Kim Kiat Ong**(6)
                  
                  53
                  
                  Director**Dr.
                      Zhi -Xin Wang**(7)
                  
                  55
                  
                  Director**Hon.
                      Larry W. Campbell**(8)
                  
                  59
                  
                  Director
  (1)
              Mr.
                  Yang was elected as a director of the Company on March 1, 2007
                  and
                  appointed as the President and CEO of the Company on March 1,
                  2007.(2)
              Mr.
                  Yu was appointed as the President, CEO, Secretary, Treasurer and
                  director
                  of the Company on Oct. 31, 2006 until March 1, 2007 and was the
                  CFO of the
                  Company from Oct. 31, 2006 to Dec. 28, 2006. Mr. Yu was elected
                  as a
                  director of the Company on March 1, 2007 and appointed as the Secretary
                  and Treasurer of the Company on March 1, 2007.(3)
              Mr.
                  Zwebner was the CFO, Treasurer and a director of the Company until
                  Oct.
                  30, 2006. Mr. Zwebner was re-appointed as the CFO of the Company
                  on Dec.
                  28, 2006 and again re-appointed as the CFO of the Company on March
                  1,
                  2007.(4)
              Mr.
                  Ip was elected as a director of the Company on March 1,
                  2007.(5)
              Mr.
                  Metcalf was elected as a director of the Company on March 1,
                  2007.(6)
              Dr.
                  Ong was elected as a director of the Company on March 1,
                  2007.(7)
              Dr.
                  Zhi-Xin Wang was appointed a director of the Company on May 14,
                  2007.(8)
              Hon.
                  Larry Campbell was appointed a director of the Company on October
                  12,
                  2007.
 
 **Ban-Jun
        Yang** (age 52)
        has been the President, CEO and a Director of the Company since March 1,
        2007.
        Mr. Yang has served as a Director, President and CEO of Shanghai Wanxing
        Bio-pharmaceuticals Co., Ltd. (“Shanghai Wanxing”) since March 31, 1996. He
        served as Chairman of the Board and General Manager for Shanghai Wanxing
        from
        1996 to 2006. From 1991 to 1998, Mr. Yang has also served as Chairman of
        Shanghai Wanxing Automobile Service Co., Ltd. and Beijing Automobile Service
        Co., Ltd. Prior to this, Mr. Yang was Chairman of the Board for Hongkong
        Manhing
        Enterprises Limited, General Manager of Shenzheng Nanbei Commerce Center
        and
        Chairman of the Board of Beijing Hotel in Shenzhen. Mr. Yang has more than
        20
        years of experience in entrepreneurial and investment management in Hong
        Kong,
        Beijing and Shanghai.
  32
  **Ka
        Yu** (age 37)
        has been the President, CEO, Secretary, Treasurer and Director of the Company
        from October 31, 2006 to March 1, 2007 and was the CFO of the Company from
        Oct.
        31, 2006 to December 28, 2006. As of March 1, 2007, Mr. Yu is the Secretary,
        Treasurer and a Director of the Company. In addition, he is currently the
        Senior
        Vice President of CY Oriental Holdings Ltd., which is listed on the TSX Venture
        Exchange. From 1996 to 2001, Mr. Yu was the Managing Director of Powerlot
        (Pacific) Ltd., a privately owned company, during which he initiated, organized
        and supervised the business of the company with over 500 staff members. Powerlot
        is engaged in the business of garment manufacturing, logistics,
        telecommunications, and international trade with annual revenue exceeding
        $50
        million USD in 2001. Mr. Yu graduated from Shanghai Teacher’s University in
        Shanghai in 1991 with a bachelors of Science.
 
 **Asher
        Zwebner** (age 44)
        was the Company’s Chief Financial Officer and Treasurer until he resigned on
        October 30, 2006, in accordance with the Stock Purchase Agreement, dated
        October
        16, 2006, whereby Mr. Zwebner agreed to sell all of his 1,000,000 shares
        in the
        Company to Mr. Ka Yu. However, on December 28, 2006, Mr. Zwebner was
        re-appointed as the CFO of the Company and he has again been re-appointed
        by the
        Board of Directors as the CFO subsequent to the annual meeting of stockholders.
        Since May, 2002, Mr. Zwebner has served as the Chief Financial Officer of
        ForexManage Ltd., a private hi-tech developer of Internet-based foreign exchange
        and risk management solutions based in Israel. Prior to that, Mr. Zwebner
        served
        as the Chief Financial Officer of SMC Ventures.com and for Britannica.com,
        both
        private companies located in Israel. From 2000 through 2002, Mr. Zwebner
        served
        as a consultant for SMC Ventures, a strategic services firm which provides
        business consulting services for startup and established companies. From
        1995
        through 2000 Mr. Zwebner was a senior manager at Kost Forer and Gabbay (a
        division of Ernst and Young in Israel). Mr. Zwebner is a CPA in Israel and
        the
        United States, and received a BS Degree in Accounting and Finance from Touro
        College in 1988.
 
 **Robert
        Chun-Chung Ip** (age 51)
        has been a director of the Company since March 1, 2007. Mr. Ip is a solicitor
        in
        Hong Kong since 1985 and has over 15 years experience in corporate mergers
        and
        acquisitions. Mr. Ip is also a director of Wheelock Technology Limited and
        Robert C. C. Ip & Co. Limited, an investment consultancy company. In
        addition, Mr. Ip is a director of Poly (Hong Kong) Investments Ltd., a company
        listed on the Main Board of the Hong Kong Stock Exchange Limited. Mr. Ip
        graduated from the University of Hong Kong in 1979 with a Bachelors of Arts
        degree. Mr. Ip furthered his studies in law in the United Kingdom between
        1980-82 and passed the United Kingdom Law Society’s Final Examination in 1982.
        Mr. Ip is a solicitor of England & Wales, Hong Kong, Singapore and the
        Australian Capital Territories.
 
 **Christopher
        S. Metcalf** (age 38)
        has been a director of the Company since March 1, 2007. Mr. Metcalf is currently
        the President of Altitude Funds LLC, and Vice President of GF Private Equity
        Group LLC. Prior to that position, from 2002 to 2006, Mr. Metcalf served
        as the
        Vice President of the Graystone Research Group in Morgan Stanley, performing
        portfolio and research analysis for hedge funds and private equity. From
        2000 to
        2002, Mr. Metcalf held the position of Vice President of Private Equity at
        KMV
        Capital LLC, a consulting and private equity firm. Mr. Metcalf has also held
        the
        positions of Vince President and Senior Financial Analyst at Charles Schwab
        Family Private Equity Fund (1999-2000), Investment Banking Representative
        at
        Prudential Securities, and Tax Analyst at Wachovia Bank. Apart from his
        professional experience, Mr. Metcalf holds degrees from the University of
        Chicago (MBA with Honors), and the University of Virginia (JD and Bachelor
        of
        Science in Commerce).
  33
  Dr. **Kim
        Kiat Ong** (age 53)
        has been a director of the Company since March 1, 2007. Dr. Ong was a Director
        of Sinovac Biotech Ltd. (AMEX: SVA) from 2003 to 2006. Dr. Ong has been in
        the
        medical field for over 30 years and has specialized as a Cardiothoracic and
        Vascular Surgeon for 18 years. He has been a member of several national
        committees and was a Member of the Advisory Committee, for the Singapore
        Ministry of Health (2003- 2005). As a seasoned lecturer, teacher and writer
        in
        the medical profession, Dr. Ong offers a high level of quality
        experience.
 
 Dr. **Zhi-Xin
        Wang** age
        55 has been a director of the Company since May 14, 2007. From 2004 to present,
        Dr. Zhi-Xin Wang has been a professor at the Department of Biological Sciences
        and Biotechnology at Tsinghua University, P.R. China. From 1999 to 2003,
        Dr.
        Wang was a director for the Institute of Biophysics at Academia Sinica, P.R.
        China. From 1997 to 2003, Dr. Wang was also a director for the National
        Laboratory of Biomacromolecules, P.R. China. From 1993 to 2003, Dr. Wang
        was a
        professor at the Institute of Biophysics at Academia Sinica, P.R. China.
        Dr.
        Wang is the Chair of the Chinese Society of Biochemistry and Molecular Biology.
        Dr. Wang is a member of the Chinese Society of Biophysics as well as the
        Chinese
        Academy of Sciences. In addition, Dr. Wang is a fellow of the Third World
        Academy of Sciences. Dr. Wang received his Bachelors of Science (Chemistry)
        from
        the University of Tsinghua in Beijing, P.R. China in 1977 and received his
        Ph.D.
        (Biochemistry) from the Institute of Biophysics at Academia Sinica, P.R.
        China
        in 1988. Dr. Wang has not been a director or officer of any other reporting
        issuer.
 
 Hon. **Larry W. Campbell** (age 59)
        has been a director of the Company since October 12, 2007. Mr. Campbell joined
        the Royal Canadian Mounted Police in 1969, later joining the RCMP drug squad
        in
        1973. In 1981, Mr. Campbell joined the British Columbia Coroner's Service
        in
        Vancouver and become the Chief Coroner for British Columbia in 1996. In 2002,
        he
        was elected as the Mayor of Vancouver, British Columbia. In August 2005,
        Mr.
        Campbell was summoned to the Senate of Canada by the Right Honourable Paul
        Martin. Senator Campbell is currently a member of the Senate Standing Committees
        on Aboriginal Peoples, Banking, Trade and Commerce, and Fisheries and Oceans.
        In
        addition, he is on the Board of Directors of the Canucks for Kids Foundation,
        CY
        Oriental Holdings Ltd., a listed public company on the TSX Venture Board
        -
        Symbol CYO, and sits on the Board of the Kaiser Foundation. Senator Campbell
        holds a Masters Degree in Business Administration (MBA) from City University
        in
        Vancouver, British Columbia.
  **Involvement
        in Certain Legal Proceedings**
  We
        are
        not aware of any material legal proceedings that have occurred within the
        past
        five years concerning any director, director nominee, or control person which
        involved a criminal conviction, a pending criminal proceeding, a pending
        or
        concluded administrative or civil proceeding limiting one’s participation in the
        securities or banking industries, or a finding of securities or commodities
        law
        violations.
  34
  **Section
        16(a) Beneficial Ownership Reporting Compliance**
  Section
        16(a) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”)
        requires executive officers and directors and persons who own more than ten
        percent of our common stock to file reports of ownership and changes in
        ownership with the SEC. Such executive officers, directors and greater than
        ten
        percent stockholders are also required by SEC rules to furnish us with copies
        of
        all Section 16(a) forms they file. Based on information supplied to the Company
        and filings made with the SEC, the Company believes that during the fiscal
        year
        ended December 31, 2007, all Section 16(a) filing requirements applicable
        to its
        Directors, officers, and greater than ten percent beneficial owners were
        complied with, except as follows:
  Mr.
        Robert Ip failed to timely file his Form 3 after being elected as a director
        of
        the Company on March 1, 2007 and has since filed his Form 3.
  Dr.
        Kim
        Kiat Ong failed to timely file his Form 3 after being elected as a director
        of
        the Company on March 1, 2007 and has since filed his Form 3.
  Dr.
        Zhi-Xin Wang failed to timely file his Form 3 after being appointed as a
        director of the Company on May 14, 2007 and has since filed his Form 3. In
        addition, Dr. Wang failed to timely file his Form 4 after being granted stock
        options on November 20, 2007 and has since filed his Form 4.
  Mr.
        Larry
        Campbell failed to timely file his Form 3 after being appointed as a director
        of
        the Company on October 12, 2007 and has since filed his Form 3. In addition,
        Mr.
        Campbell failed to timely file his Form 4 after being granted stock options
        on
        November 29, 2007 and has since filed his Form 4.
  **Audit
        Committee**
  At
        the
        present time, the Company’s audit committee consists of Messrs. Asher Zwebner,
        Chris Metcalf, Robert Ip and Dr. Kim Kiat Ong. The only interested member
        of the
        audit committee is Mr. Asher Zwebner as he is also the Chief Financial Officer
        of the Company. Mr. Asher Zwebner is also considered the Company’s financial
        expert for the audit committee.
  The
        Company adopted an Audit Committee Charter and Audit Committee Procedures
        for
        Whistleblowers on May 22, 2007, which were filed as exhibits 99.1 and 99.2
        to
        the Form 10-QSB filed with the SEC via EDGAR on August 14, 2007, and are
        incorporated by reference herein.
  **Code
        of Ethics**
  At
        the
        present time, the Company has not adopted a code of ethics. The Company intends
        to adopt a code of ethics in the near future.
  35
  ***Item
        10. Executive Compensation***
  The
        following compensation was paid directly to the executive officers of the
        Company during the years ended December 31, 2007, 2006 and 2005:
  **Summary
        Compensation Table**
 **Annual Compensation**
                
                **Long-Term Compensation****Name and**
                  **Principal**
                  **Position**
                
                **Fiscal**
                  **Year**
                  **End**
                
                **Salary**
                  **($)**
                
                **Bonus**
                  **($)**
                
                **All other**
                  **and annual**
                  **Compensation**
                  **and LTIP**
                  **Payouts**
                  **($)**
                
                **Securities**
                  **under**
                  **Options/**
                  **SARS**
                  **Granted**
                  **(#)**
                
                **Restricted**
                  **Shares or**
                  **Restricted**
                  **Share**
                  **Units**
                  **(#)****Lavi
                    Krasney****(1)**
                
                
                2006
                
                
                Nil
                
                
                Nil
                
                
                Nil
                
                
                Nil
                
                
                NilCEO
                    & Director
                
                
                2005
                
                $
                20,000
                
                
                Nil
                
                
                Nil
                
                
                Nil
                
                
                Nil**Asher
                    Zwebner****(2)**
                
                
                2007
                
                
                Nil
                
                
                Nil
                
                
                Nil
                
                
                Nil
                
                
                100,000CFO,
                    Secretary, Treasurer & Director
                
                
                2006
                
                
                Nil
                
                
                Nil
                
                
                Nil
                
                
                Nil
                
                
                Nil2005
                
                $
                20,000
                
                
                Nil
                
                
                Nil
                
                
                Nil
                
                
                Nil**Ka
                    Yu****(3)**
                
                
                2007
                
                
                Nil
                
                
                Nil
                
                
                Nil
                
                
                500,000
                
                
                NilSecretary,
                    Treasurer & Director
                
                
                2006
                
                
                Nil
                
                
                Nil
                
                
                Nil
                
                
                Nil
                
                
                Nil**Banjun
                    Yang****(4)**
                  President,
                    CEO & Director
                
                
                2007
                
                $
                54,000
                
                
                Nil
                
                
                Nil
                
                
                2,500,000
                
                
                Nil**Robert
                    Ip****(5)**
                  Director
                
                
                2007
                
                
                Nil
                
                
                Nil
                
                
                Nil
                
                
                500,000
                
                
                Nil**Kim
                    Kiat Ong****(6)**
                  Director
                
                
                2007
                
                
                Nil
                
                
                Nil
                
                
                Nil
                
                
                500,000
                
                
                Nil**Chris
                    Metcalf****(7)**
                  Director
                
                
                2007
                
                
                Nil
                
                
                Nil
                
                
                Nil
                
                
                500,000
                
                
                Nil**Zhi-Xin
                    Wang****(8)**
                  Director
                
                
                2007
                
                
                Nil
                
                
                Nil
                
                
                Nil
                
                
                500,000
                
                
                Nil**Larry
                    W. Campbell****(9)**
                  Director
                
                
                2007
                
                
                Nil
                
                
                Nil
                
                
                Nil
                
                
                500,000
                
                
                Nil
  36
  (1)
        Mr.
        Lavi Krasney resigned as the CEO of the Company on October 30, 2006 and as
        a
        Director on October 31, 2006.
  (2)
        Mr.
        Asher Zwebner resigned as the CFO, Secretary & Treasurer of the Company on
        October 30, 2006, and as a Director on October 31, 2006. However, on December
        28, 2006, Mr. Zwebner was reappointed as the CFO of the Company.
  (3)
        Mr.
        Ka Yu was appointed as the President, CEO, CFO, Secretary, Treasurer and
        a
        Director of the Company on October 31, 2006. However, on December 28, 2006,
        Mr.
        Yu resigned as the CFO of the Company. In addition, on March 1, 2007, Mr.
        Yu
        resigned as President and CEO.
  (4)
        Mr.
        Banjun Yang was elected a director of the Company on March 1, 2007 and was
        also
        appointed as the President and CEO of the Company on the same day.
  (5)
        Mr.
        Robert Ip was elected a director of the Company on March 1, 2007.
  (6)
        Dr.
        Kim Kiat Ong was elected a director of the Company on March 1,
        2007.
  (7)
        Mr.
        Chris Metcalf was elected a director of the Company on March 1,
        2007.
  (8)
        Dr.
        Zhi-Xin Wang was appointed a director of the Company on May 14,
        2007.
  (9)
        Hon.
        Larry W. Campbell was appointed a director of the Company on October 12,
        2007.
  The
        Company anticipates that compensation will be provided by the Company during
        the
        Company’s next financial year to certain executive officers of the Company and
        in conjunction with certain management and administrative services to be
        provided to the Company by such executive officers.
  We
        do not
        maintain key-man life insurance for any of our executive officers or
        directors.
  No
        long
        term incentive plan awards were made to any executive officer during the
        fiscal
        year ended December 31, 2007.
  **Stock
        Options Grants**
  On
        March
        1, 2007, the Company granted stock options to purchase 6,000,000 (post forward
        stock split) shares of common stock to Directors, Officers and consultants
        of
        the Company at a price of $0.50 per share for a term of five years with vesting
        provisions of 5% of the options on the date of grant and 5% on the first
        of
        every month thereafter for a total vesting period of 20 months.
  37
 **Name and**
                  **Principal**
                  **Position**
                
                **Number of**
                  **Securities**
                  **Underlying**
                  **Options/**
                  **SARS**
                  **Granted**
                
                **% of Total**
                  **Options/**
                  **SARS**
                  **Granted to**
                  **Employees**
                  **in Fiscal**
                  **Year**
                
                **Exercise**
                  **or Base**
                  **Price**
                  **($/Sh)**
                
                **Expiration**
                  **Date**
                
                **Market**
                  **Price on**
                  **Date of**
                  **Grant**
                  **($/Sh)**Ban-Jun
                    Yang,
                  President,
                  CEO
                    and Director
                
                
                2,500,000
                
                
                31.25
                %
                $
                0.50
                
                
                March
                    1, 2012
                
                $
                0.00Ka
                    Yu,
                  Secretary,
                  Treasurer
                    and Director
                
                
                500,000
                
                
                6.25
                %
                $
                0.50
                
                
                March
                    1, 2012
                
                $
                0.00Robert
                    Ip,
                  Director
                
                
                500,000
                
                
                6.25
                %
                $
                0.50
                
                
                March
                    1, 2012
                
                $
                0.00Chris
                    Metcalf,
                  Director
                
                
                500,000
                
                
                6.25
                %
                $
                0.50
                
                
                March
                    1, 2012
                
                $
                0.00Dr.
                    Kim Kiat Ong,
                  Director
                
                
                500,000
                
                
                6.25
                %
                $
                0.50
                
                
                March
                    1, 2012
                
                $
                0.00Michael
                    Tan,
                  Consultant
                
                
                250,000
                
                
                3.13
                %
                $
                0.50
                
                
                March
                    1, 2012
                
                $
                0.00Dr.
                    Dicken S.C. Ko,
                  Consultant
                
                
                500,000
                
                
                6.25
                %
                $
                0.50
                
                
                March
                    1, 2012
                
                $
                0.00Devlin
                    Jensen,
                  Consultant
                
                
                250,000
                
                
                3.13
                %
                $
                0.50
                
                
                March
                    1, 2012
                
                $
                0.00Dwun-Hou
                    Chen,
                  Consultant
                
                
                500,000
                
                
                6.25
                %
                $
                0.50
                
                
                March
                    1, 2012
                
                $
                0.00
  In
        addition, on May 30, 2007, the Company granted stock options to purchase
        1,000,000 (post forward stock split) shares of common stock to employees
        of the
        Company at a price of $1.90 per share for a term of five years with vesting
        provisions of 50% of the options on June 1, 2009 and 50% of the options on
        June
        1, 2011.
  38
 **Name and**
                  **Principal**
                  **Position**
                
                **Number of**
                  **Securities**
                  **Underlying**
                  **Options/**
                  **SARS**
                  **Granted**
                
                **% of Total**
                  **Options/**
                  **SARS**
                  **Granted to**
                  **Employees**
                  **in Fiscal**
                  **Year**
                
                **Exercise**
                  **or Base**
                  **Price**
                  **($/Sh)**
                
                **Expiration**
                  **Date**
                
                **Market**
                  **Price on**
                  **Date of**
                  **Grant**
                  **($/Sh)**Cao
                    Zhifang,
                  employee
                
                
                80,000
                
                
                1
                %
                $
                1.90
                
                
                May
                    30, 2012
                
                $
                1.90Wu
                    Wangsheng,
                  employee
                
                
                80,000
                
                
                1
                %
                $
                1.90
                
                
                May
                    30, 2012
                
                $
                1.90Zhuang
                    Zhong,
                  employee
                
                
                65,000
                
                
                0.81
                %
                $
                1.90
                
                
                May
                    30, 2012
                
                $
                1.90Huang
                    Xiudong,
                  employee
                
                
                60,000
                
                
                0.75
                %
                $
                1.90
                
                
                May
                    30, 2012
                
                $
                1.90Xu
                    Lun,
                  employee
                
                
                50,000
                
                
                0.63
                %
                $
                1.90
                
                
                May
                    30, 2012
                
                $
                1.90Shao
                    Xiaoyan,
                  employee
                
                
                50,000
                
                
                0.63
                %
                $
                1.90
                
                
                May
                    30, 2012
                
                $
                1.90Xu
                    Di,
                  employee
                
                
                50,000
                
                
                0.63
                %
                $
                1.90
                
                
                May
                    30, 2012
                
                $
                1.90Lin
                    Haihong,
                  employee
                
                
                40,000
                
                
                0.5
                %
                $
                1.90
                
                
                May
                    30, 2012
                
                $
                1.90Pan
                    Xuegong,
                  employee
                
                
                45,000
                
                
                0.56
                %
                $
                1.90
                
                
                May
                    30, 2012
                
                $
                1.90Zhao
                    Xinli,
                  employee
                
                
                40,000
                
                
                0.5
                %
                $
                1.90
                
                
                May
                    30, 2012
                
                $
                1.90Li
                    Cuixia,
                  employee
                
                
                40,000
                
                
                0.5
                %
                $
                1.90
                
                
                May
                    30, 2012
                
                $
                1.90Wang
                    Qiang,
                  employee
                
                
                40,000
                
                
                0.5
                %
                $
                1.90
                
                
                May
                    30, 2012
                
                $
                1.90Gu
                    Zhongliang,
                  employee
                
                
                35,000
                
                
                0.44
                %
                $
                1.90
                
                
                May
                    30, 2012
                
                $
                1.90Cai
                    Shulin,
                  employee
                
                
                25,000
                
                
                0.31
                %
                $
                1.90
                
                
                May
                    30, 2012
                
                $
                1.90Zhou
                    Min,
                  employee
                
                
                25,000
                
                
                0.31
                %
                $
                1.90
                
                
                May
                    30, 2012
                
                $
                1.90Wang
                    Weifang,
                  employee
                
                
                40,000
                
                
                0.5
                %
                $
                1.90
                
                
                May
                    30, 2012
                
                $
                1.90Sheng
                    Hong,
                  employee
                
                
                40,000
                
                
                0.5
                %
                $
                1.90
                
                
                May
                    30, 2012
                
                $
                1.90Lou
                    Yonghua,
                  employee
                
                
                10,000
                
                
                0.13
                %
                $
                1.90
                
                
                May
                    30, 2012
                
                $
                1.90Liu
                    Jian,
                  employee
                
                
                10,000
                
                
                0.13
                %
                $
                1.90
                
                
                May
                    30, 2012
                
                $
                1.90Li
                    Jianhua,
                  employee
                
                
                20,000
                
                
                0.25
                %
                $
                1.90
                
                
                May
                    30, 2012
                
                $
                1.90Xu
                    Xiaohang,
                  employee
                
                
                15,000
                
                
                0.19
                %
                $
                1.90
                
                
                May
                    30, 2012
                
                $
                1.90Lin
                    Jian,
                  employee
                
                
                10,000
                
                
                0.13
                %
                $
                1.90
                
                
                May
                    30, 2012
                
                $
                1.90Sa
                    Rina,
                  employee
                
                
                15,000
                
                
                0.19
                %
                $
                1.90
                
                
                May
                    30, 2012
                
                $
                1.90Chen
                    Peixin,
                  employee
                
                
                10,000
                
                
                0.13
                %
                $
                1.90
                
                
                May
                    30, 2012
                
                $
                1.90Chen
                    Yaoguo,
                  employee
                
                
                10,000
                
                
                0.13
                %
                $
                1.90
                
                
                May
                    30, 2012
                
                $
                1.90Lin
                    Zhiwei,
                  employee
                
                
                10,000
                
                
                0.13
                %
                $
                1.90
                
                
                May
                    30, 2012
                
                $
                1.90Zhang
                    Rongjun,
                  employee
                
                
                6,000
                
                
                0.08
                %
                $
                1.90
                
                
                May
                    30, 2012
                
                $
                1.90Li
                    Hong,
                  employee
                
                
                8,000
                
                
                0.1
                %
                $
                1.90
                
                
                May
                    30, 2012
                
                $
                1.90Wang
                    Jun,
                  employee
                
                
                8,000
                
                
                0.1
                %
                $
                1.90
                
                
                May
                    30, 2012
                
                $
                1.90Zhang
                    Jie,
                  employee
                
                
                8,000
                
                
                0.1
                %
                $
                1.90
                
                
                May
                    30, 2012
                
                $
                1.90Zeng
                    Yaoqin,
                  employee
                
                
                6,000
                
                
                0.08
                %
                $
                1.90
                
                
                May
                    30, 2012
                
                $
                1.90Zhou
                    Dapeng,
                  employee
                
                
                8,000
                
                
                0.1
                %
                $
                1.90
                
                
                May
                    30, 2012
                
                $
                1.90Yan
                    Jie,
                  employee
                
                
                6,000
                
                
                0.08
                %
                $
                1.90
                
                
                May
                    30, 2012
                
                $
                1.90Ren
                    Youcheng,
                  employee
                
                
                15,000
                
                
                0.19
                %
                $
                1.90
                
                
                May
                    30, 2012
                
                $
                1.90Wu
                    Haixiang,
                  employee
                
                
                10,000
                
                
                0.13
                %
                $
                1.90
                
                
                May
                    30, 2012
                
                $
                1.90Xuan
                    Weiping,
                  employee
                
                
                10,000
                
                
                0.13
                %
                $
                1.90
                
                
                May
                    30, 2012
                
                $
                1.90
  39
  Furthermore,
        on November 29, 2007, the Company granted stock options to purchase 1,000,000
        (post forward stock split) shares of common stock to the two new directors
        at a
        price of $1.67 per share for a term of five years with vesting provisions
        of 5%
        of the options on the date of grant and 5% on the first of every month
        thereafter starting on January 1, 2008. Furthermore
 **Name and**
                  **Principal**
                  **Position**
                
                **Number of**
                  **Securities**
                  **Underlying**
                  **Options/**
                  **SARS**
                  **Granted**
                
                **% of Total**
                  **Options/**
                  **SARS**
                  **Granted to**
                  **Employees**
                  **in Fiscal**
                  **Year**
                
                **Exercise**
                  **or Base**
                  **Price**
                  **($/Sh)**
                
                **Expiration**
                  **Date**
                
                **Market**
                  **Price on**
                  **Date of**
                  **Grant**
                  **($/Sh)**Zhi-Xin
                    Wang,
                  Director
                
                
                500,000
                
                
                6.25
                %
                $
                1.67
                
                
                Nov.
                    29, 2012
                
                $
                1.67Larry
                    Campbell,
                  Director
                
                
                500,000
                
                
                6.25
                %
                $
                1.67
                
                
                Nov.
                    29, 2012
                
                $
                1.67
  40




***Item
      11. Security Ownership Of Certain Beneficial Owners And Management And Related
      Stockholder Matters***




The
      following table sets forth information as of the date of this Annual Report,
      with respect to the Company’s directors, named executive officers, and each
      person who is known by the Company to own beneficially, more than five percent
      (5%) of the Company’s common stock, and with respect to shares owned
      beneficially by all of the Company’s directors and executive officers as a
      group. Common Stock not outstanding but deemed beneficially owned by virtue
      of
      the right of an individual to acquire shares within 60 days is treated as
      outstanding only when determining the amount and percentage of Common Stock
      owned by such individual. Except as noted, each person or entity has sole voting
      and sole investment power with respect to the shares shown.




As
      of the
      date of this Annual Report, there are 131,422,086 (post forward stock split)
      shares of common stock issued and outstanding.




**Name
                and Address of**
              **Beneficial
                Owner**
            
            **Position**
            
            **Amount and Nature**
              **of
                Beneficial**
              **Ownership
                ***
            
            **Percent
                of**
              **Common**
              **Stock
                (1)**Ban-Jun
                Yang
              No.
                99, Jalan Lunas
              Kulim,
                Kedah, Malaysia
            
            
            President,
              Chief
                Executive
              Officer,
                and
              Director
            
            
            32,000,000
            (2)
            
            23.98
            %Robert
                Ip
              Room
                A, 5th Floor, Wing
              Sing
                Commercial
              Centre,
                12 Wing Lok
              Street,
                Sheung Wan,
              Hong
                Kong
            
            
            Director
            
            
            10,400,000
            (3)
            
            7.89
            %Chris
                Metcalf
              111
                Congress Avenue,
              Suite
                400, Austin, TX 78701
            
            
            Director
            
            
            400,000
            (4)
            
            
            (*)Dr.
                Kim Kiat Ong
              2,
                Jalan Seruling,
              Singapore
                576855
            
            
            Director
            
            
            400,000
            (5)
            
            
            (*)Ka
                Yu
              Room
                402, Bldg. C, 555
              Hai-Lun
                Road
              Shanghai,
                China 200080
            
            
            Secretary,
              Treasurer
                and Director
            
            
            5,400,000
            (6)
            
            4.1
            %




41




Asher
                Zwebner
              20A
                Rehov Sharei
              Torah,
                Jerusalem, Israel 96387
            
            
            Chief
                Financial Officer
            
            
            110,000
            
            
            
            (*)Zhi-Xin
                Wang
              Dept.
                Biol. Sci. Biotech,
              Tsing
                Hua University,
              Beijing,
                China 100084
            
            
            Director
            
            
            175,000
            (7)
            
            
            (*)Larry
                W. Campbell
              3333
                W. 4th Ave., Suite
              107,
                Vancouver, B.C.,
              Canada
                V6R 4R9
            
            
            Director
            
            
            175,000
            (8)
            
            
            (*)Sutee
                Kaitsakulsak
              328
                Charoenkrung 65,
              Charoenkrungrd,
              Bangkok
                10120
            
            
            Shareholder
            
            
            8,000,000
            
            
            6.09
            %Directors
                and Officers as
              a
                group (8 persons)
            
            
            
            
            
            49,060,000
            (9)
            
            36.24
            %




Note:


(*)
            indicates
                less than 1%(1)
            Beneficial
                ownership of common stock has been determined for this purpose in
                accordance with Rule 13d-3 under the Exchange Act, under which a
                person is
                deemed to be the beneficial owner of securities if such person has
                or
                shares voting power or investment power with respect to such securities,
                has the right to acquire beneficial ownership within 60 days or acquires
                such securities with the purpose or effect of changing or influencing
                the
                control of the Company.(2)
            This
                figure includes 30,000,000 shares directly owned by Mr. Ban-Jun Yang,
                1,750,000 stock options which have already vested and 250,000 stock
                options which will vest within 60 days of the date of this Annual
                Report.(3)
            This
                figure includes 10,000,000 shares indirectly owned by Mr. Robert
                Ip
                through Wheelock Technology Limited, which Mr. Ip has sole voting
                power
                and sole dispositive power over the shares held by Wheelock Technology
                Limited, 350,000 stock options which have already vested and 50,000
                stock
                options which will vest within 60 days of the date of this Annual
                Report.(4)
            This
                figure includes 350,000 stock options which have already vested and
                50,000
                stock options which will vest within 60 days of the date of this
                Annual
                Report.(5)
            This
                figure includes 350,000 stock options which have already vested and
                50,000
                stock options which will vest within 60 days of the date of this
                Annual
                Report.(6)
            This
                figure includes 2,000,000 shares directly owned by Mr. Ka Yu, 350,000
                stock options which have already vested, 50,000 stock options which
                will
                vest within 60 days of the date of this Annual Report and 3,000,000
                shares
                owned by Mr. Ka Yu’s wife, Ms. Hui Wang, which are deemed to be indirectly
                beneficially owned by Mr. Yu.(7)
            This
                figure includes 125,000 stock options which have already vested and
                50,000
                stock options which will vest within 60 days of the date of this
                Annual
                Report.(8)
            This
                figure includes 125,000 stock options which have already vested and
                50,000
                stock options which will vest within 60 days of the date of this
                Annual
                Report.(9)
            This
                figure includes 45,110,000 shares owned directly and indirectly by
                directors and officers as well as 3,400,000 stock options with have
                already vested and 550,000 stock options which will vest within 60
                days of
                the date of this Annual Report.




42




**Securities
      Authorized for Issuance Under Equity Compensation Plans**




On
      November 3, 2006, our Board of Directors unanimously approved and adopted a
      stock option and incentive plan (the “Stock Option Plan”). The purpose of the
      Stock Option Plan is to advance our interests and our shareholders’ interests by
      affording our key personnel an opportunity for investment in the Company and
      the
      incentive advantages inherent in stock ownership in the Company. Pursuant to
      the
      provisions of the Stock Option Plan, stock options, stock awards, cash awards
      or
      other incentives (the “Stock Options and Incentives”) will be granted only to
      our key personnel, generally defined as a person designated by the Board of
      Directors upon whose judgment, initiative and efforts we may rely including
      any
      director, officer, employee, consultant or advisor of the Company.




The
      Stock
      Option Plan is to be administered by our Board of Directors, which shall
      determine (i) the persons to be granted Stock Options and Incentives; (ii)
      the
      Fair Market Value of our shares; (iii) the exercise price per share of options
      to be granted; (iv) the number of shares to be represented by each option or
      incentive award; (v) the time or times at which options and incentive awards
      shall be granted; (vi) the interpretation of the Stock Option Plan; (vii)
      whether to prescribe, amend and rescind rules and regulations relating to the
      Stock Option Plan; (viii) the term and provisions or each option and incentive
      award granted (which need not be identical) and, with the consent of the grantee
      thereof, modify or amend such option or incentive award; (ix) whether to
      accelerate or defer (with the consent of the grantee) of the exercise date
      of
      any option or incentive award; (x) the person to execute on our behalf any
      instrument required to effectuate the grant of an option or incentive award
      previously granted by the Board; (xi) whether to accept or reject the election
      made by a grantee pursuant to Section 7.5 of the Stock Option Plan; and (xii)
      all other determinations deemed necessary or advisable for the administration
      of
      the Stock Option Plan. The Stock Option Plan provides authorization to the
      Board
      of Directors to grant Stock Options and Incentives to a total number of shares
      of our common stock, not to exceed ten million (10,000,000) (after the forward
      stock split adjustment of 40 new shares for each one share effective March
      2,
      2007) shares of our common stock as at the date of adoption by the Board of
      Directors of the Stock Option Plan.




In
      the
      event an optionee who is a director, officer, employee (employee also
      encompasses consultants and advisors where such is appropriate or where such
      is
      intended by the Board or by a particular grant under the Stock Option Plan)
      (each an "Employee") of the Company has his employment terminated by us, except
      if such termination is voluntary or occurs due to retirement with the consent
      of
      the Board or due to death or disability, then the option, to the extent not
      exercised, shall terminate on the date on which the Employee's employment by
      the
      Company is terminated. If an Employee's termination is voluntary or occurs
      due
      to retirement with the consent of the Board, then the Employee may after the
      date such Employee ceases to be an employee of the Company, exercise his option
      at any time within three (3) months after the date he ceases to be an Employee
      of the Company, but only to the extent that he was entitled to exercise it
      on
      the date of such termination. To the extent that the Employee was not entitled
      to exercise the Option at the date of such termination, or if he does not
      exercise such option (which he was entitled to exercise) within the time
      specified herein, the option shall terminate. In no event may the period of
      exercise in the case of incentive options extend more than three (3) months
      beyond termination of employment.




43




In
      the
      event an Employee is unable to continue his employment with us as a result
      of
      his permanent and total disability (as defined in Section 22(e)(3) of the
      Internal Revenue Code), he may exercise his option at any time within six (6)
      months from the date of termination, but only to the extent he was entitled
      to
      exercise it at the date of such termination. To the extent that he was not
      entitled to exercise the option at the date of termination, or if he does not
      exercise such option (which he was entitled to exercise) within the time
      specified herein, the option shall terminate. In no event may the period of
      exercise in the case of an incentive option extend more than six (6) months
      beyond the date the Employee is unable to continue employment due to such
      disability.




In
      the
      event an optionee dies during the term of the option and is at the time of
      his
      death an Employee who shall have been in continuous status as an Employee since
      the date of grant of the option, the option may be exercised at any time within
      six (6) months following the date of death by the optionee's estate or by a
      person who acquired the right to exercise the option by bequest or inheritance,
      but only to the extent that an optionee was entitled to exercise the option
      on
      the date of death, or if the optionee's estate, or person who acquired the
      right
      to exercise the option by bequest or inheritance, does not exercise such option
      (which he was entitled to exercise) within the time specified herein, the option
      shall terminate. In no event may the period of exercise in the case of an
      incentive option extend more than six (6) months beyond the date of the
      Employee's death.




Except
      to
      the extent otherwise expressly provided in an award, the right to acquire shares
      or other assets under the Stock Option Plan may not be assigned, encumbered
      or
      otherwise transferred by an optionee and any attempt by an optionee to do so
      will be null and void. However Stock Options and Incentives granted under this
      Stock Option Plan may be transferred by an optionee by will or the laws of
      descent and distribution or pursuant to a qualified domestic relations order
      as
      defined by the Internal Revenue Code or Title I of the Employee Retirement
      Income Security Act, as amended, or the rules thereunder. Unless assigned in
      accordance with the terms of an award, options and other awards granted under
      this Stock Option Plan may not be exercised during an optionee's lifetime except
      by the optionee or, in the event of the optionee's legal incapacity, by his
      guardian or legal representative acting in a fiduciary capacity on behalf of
      the
      optionee under state law and court supervision.




***Item
      12. Certain Relationships And Related Transactions***




On
      December 14, 2004, we acquired the rights to United States Patent No. 5,074,073
      from Asher Zwebner, the patent owner. The Patent was granted to Asher Zwebner
      by
      the United States Patent and Trademark Office on December 24, 1991, and is
      scheduled to expire on December 24, 2008. As consideration for such assignment,
      we have agreed to pay Mr. Zwebner 10% of all royalties we receive from the
      sale
      and marketing of products based on this patent.




From
      our
      inception through the period ended December 31, 2006, Mr. Zwebner has loaned
      the
      Company $15,064.50 and Mr. Krasney has loaned the Company $15,064.50, however,
      these loans amounting to $30,129 were cancelled pursuant to the transactions
      to
      purchase their shares of common stock. The Company has classified the
      cancellation of the loans as additional paid-in capital in the accompanying
      balance sheet as of December 31, 2006.




44




Effective
      January 1, 2007, the Company entered into a one-year consulting services
      agreement with Mr. Asher Zwebner whereby Mr. Zwebner is to serve as the CFO
      of
      the Company. The agreement shall automatically renew for subsequent one-year
      periods unless notice not to renew is given by either party at least 60 calendar
      days prior to the end of the term. Terms of the agreement call for the issuance
      of 100,000 (post forward stock split) restricted shares of common stock of
      the
      Company as annual compensation for services as CFO, within ten days after the
      execution of the agreement by the parties, effective January 1, 2007. Such
      shares were to be held in escrow until January 1, 2008, which shares have been
      released to Mr. Zwebner prior to January 1, 2008 in accordance with the
      Company’s instructions.




Effective
      January 1, 2008, the Company entered into a one-year consulting services
      agreement with Mr. Asher Zwebner whereby Mr. Zwebner is to serve as the CFO
      of
      the Company. The agreement shall automatically renew for subsequent one-year
      periods unless notice not to renew is given by either party at least 60 calendar
      days prior to the end of the term. Terms of the agreement call for the issuance
      of 110,000 restricted shares of common stock of the Company as annual
      compensation for services as CFO, within ten days after the execution of the
      agreement by the parties, effective January 1, 2008. Such shares are being
      held
      in escrow with 55,000 share to be released to Mr. Zwebner on July 1, 2008 and
      55,000 shares to be released to Mr. Zwebner on January 1, 2009.


The
        Company is indebted to a company related to a shareholder in the amount of
        $300,000 and to minority shareholder of a subsidiary in the amount of $1,866,523
        for shareholder’s loans.
 
 The
        Company has paid or accrued finders’ fees to shareholders and a company related
        to a shareholder in the amounts of $1,295,875 and 20,000 shares.
 
 The
        Company has incurred fees and associated expenses in the amount of $40,420
        to a
        company related to a shareholder for services. The Company has committed
        to pay
        that company $2,000 per month plus expenses for services. The arrangement
        may be
        terminated by either party on one month notice.
 
 The
        Company is indebted to two persons who are shareholders and directors, in
        amounts of $24,600 and $10,000.
 
 Two
        minority shareholders of a subsidiary are indebted to the Company in the
        amount of $127,900. The Company has provided an allowance for the full amount
        of
        this indebtedness.
 
 The
        Company has paid the residential rent in Shanghai as part of the remuneration
        for the Chief Executive Officer of the Company for the months of January
        through
        June 2007 in the amount of $17,000.




***Item
      13. Exhibits***




**Exhibit
                No.**
            **Description
                of Exhibit**3.1*
            Memorandum
                of Association for Wanxin Bio-Technology Limited3.2*
            Articles
                of Association for Wanxin Bio-Technology Limited3.3*
            Memorandum
                of Association for Manhing Enterprises Limited3.4*
            Articles
                of Association for Manhing Enterprises Limited3.5(1)
            Certificate
                of Incorporation of CDoor Corp.3.6(2)
            Certificate
                of Amendment to the Certificate of Incorporation of CDoor
                Corp.5.1*
            Legal
                opinion with respect to the ownership of Manhing Enterprises
                Limited5.2*
            Legal
                opinion with respect to the ownership of Shanghai Wanxing
                Bio-pharmaceuticals Co., Ltd.10.1*
            Extension
                Agreement between CDoor Corp., Wanxing Bio-Technology Limited and
                all the
                Shareholders of Wanxin Bio-Technology Limited, dated effective January
                4,
                2007.10.2*
            Share
                Purchase Agreement between CDoor Corp., Wanxin Bio-Technology Limited
                and
                all the shareholders of Wanxin Bio-Technology Limited, dated December
                21,
                2006.10.3*
            Contract
                for cooperation development of rh-Interferonα-2a project between Shanghai
                Wanxing and Fudan University, dated September 26, 1997.10.4*
            Contract
                for cooperation development of rh-Interferonα-2b project between Shanghai
                Wanxing and Fudan University, dated June 8,
                1998.




45




**Exhibit
                No.**
            **Description
                of Exhibit**


10.5*
            Technology
                of Leflunomide Transfer Contract between Shanghai Wanxing and China
                People
                2nd Army Hospital University, dated March 11,
                2002.10.6*
            Collaboration
                and License Agreement between Shanghai Wanxing and Second Military
                Medical
                University, PLA, dated March 22, 2001.10.7*
            Memorandum
                of Understanding between Shanghai Wanxing and the World Health
                Organization, dated February 12, 2003.10.8*
            Collaborative
                Research, Development and Supply Agreement between Shanghai Wanxing
                and
                the Program for Appropriate Technology in Health, dated December
                22,
                2005.10.9*
            Multi-Party
                Agreement between Shanghai Wanxing, Second Military Medical University
                and
                the Program for Appropriate Technology in Health, dated December
                22,
                2005.10.10*
            Authorization
                Letter issued by Second Military Medical University to Shanghai Wanxing,
                dated January 20, 2006.10.11*
            Fixed
                Asset Loan Contract between Shanghai Wanxing and China Industrial
                and
                Commercial Bank Pudong Shangchuan Branch, dated May 23,
                2000.10.12*
            Suretyship
                Contract between Shangahi Wanxing and Shanghai JinYuan Real Estate
                Development Co., Ltd., dated May 14, 2001.10.13*
            Maximum
                Value Mortgage Contract between Shanghai Wanxing and China Construction
                Bank Shanghai Branch, dated October 17, 2002.10.14*
            Current
                Capital Loan Contract (6) between Shanghai Wanxing and China Industrial
                Commercial Bank Pudong Branch, dated April 23, 2003.10.15*
            Loan
                Contract #9 between Shanghai Wanxing and Agricultural Bank of China,
                dated
                May 16, 2003.10.16*
            Current
                Capital Loan Contract (5) between Shanghai Wanxing and China Industrial
                and Commercial Bank Pudong Branch, dated September 13,
                2003.10.17*
            Current
                Capital Loan Contract (4) between Shanghai Wanxing and China Industrial
                and Commercial Bank Pudong Branch, dated January 9,
                2004.10.18*
            Current
                Capital Loan Contract (3) between Shanghai Wanxing and China Industrial
                and Commercial Bank Pudong Branch, dated January 12,
                2004.10.19*
            Current
                Capital Loan Contract (2) between Shanghai Wanxing and China Industrial
                and Commercial Bank Pudong Branch, dated January 14,
                2004.10.20*
            Loan
                Contract between Shanghai Wanxing and Shenzhen Development Bank Co.,
                Ltd.,
                dated August 5, 2004.10.21*
            Short-Term
                Loan Contract between Shanghai Wanxing and Industrial Bank Shanghai
                Branch, dated December 20, 2004.




46




**Exhibit
                No.**
            **Description
                of Exhibit**


10.22*
            Short-Term
                Loan Contract (8) between Shanghai Wanxing and Industrial Bank Shanghai
                Branch, dated December 20, 2004.10.23*
            Deed
                of Indemnity provided by Mr. Ban-Jun Yang to Shanghai Wanxing, dated
                December 2006.10.24*
            Settlement
                Agreement between Shanghai Wanxing and the Agriculture Bank of China,
                Shanghai Wujiaochang Branch, dated September 15, 2006.10.25*
            Settlement
                Agreement between Shanghai Wanxing and the Industrial and Commercial
                Bank
                Pudong Branch, dated October 25, 2006.10.26*
            Settlement
                Agreement between Shanghai Wanxing and the Shenzhen Development Bank
                Shanghai Lujiazui Branch, dated October 25, 2006.10.27*
            Settlement
                Agreement between Shanghai Wanxing and Chian Construction Bank Shanghai
                Yangpu Branch, dated October 24, 2006.10.28(4)
            Equity
                Transfer Contract, dated as of August 6, 2007, by and between Shanghai
                Wanxing Bio-pharmaceuticals Co., Ltd. and the equity owners of Suzhou
                Boai
                Medical Development Company.10.29(5)
            Cancellation
                Agreement of the Equity Transfer Contract between Shanghai Wanxing
                Bio-pharmaceuticals Co., Ltd. and the equity owners of Suzhou Boai
                Medical
                Development Company, dated January 22, 2008.31.1
            Certificate
                pursuant to Rule 13a-14(a)31.2
            Certificate
                pursuant to Rule 13a-14(a)32.1
            Certificate
                pursuant to 18 U.S.C. Section 135032.2
            Certificate
                pursuant to 18 U.S.C. Section 135099.1*
            Patent
                Certificate for aFGF issued by State Intellectual Property Office
                of the
                P.R. China, dated September 22, 2004.99.2*
            Patent
                Certificate for Ethelphazine issued by State Intellectual Property
                Office
                of the P.R. China, dated November 11, 2004.99.3*
            Patent
                Certificate for IFN issued by State Intellectual Property Office
                of the
                P.R. China, dated October 20, 2004.99.4*
            Notice
                of publication and essential examination of invention patent for
                rBAT
                issued by State Intellectual Property Office of the P.R. China, dated
                October 29, 2004.99.5*
            Accepting
                Notice for the Patent Application for rh-HRF issued by State Intellectual
                Property Office of the P.R. China, dated October 22,
                2004.99.6*
            Accepting
                Notice for the Patent Application for rhK1 issued by State
                Intellectual Property Office of the P.R. China, dated June 19,
                2006.99.7*
            Accepting
                Notice for the Patent Application for rhSCF issued by State Intellectual
                Property Office of the P.R. China, dated February 4,
                2005.99.8*
            Patent
                Certificate for Plasmodium Fusion Antigen issued by the United States
                Patent Office, dated September 5,
                2006.




47




**Exhibit
                No.**
            **Description
                of Exhibit**


99.9(2)
            Corporate
                Consulting Services Agreement between Sinobiomed Inc. and Asher Zwebner,
                dated effective January 1, 2007.99.10(2)
            Consulting
                Agreement between Sinobiomed Inc. and Michael Tan, dated effective
                March
                1, 2007.99.11(3)
            Consulting
                Agreement between Sinobiomed Inc. and Dr. Dicken S.C. Ko, dated April
                12,
                2007.99.12(6)
            Audit
                Committee Charter99.13(6)
            Audit
                Committee Procedures for
                Whistleblowers





(*) Previously
                filed on Form 8-K/A-1 with the SEC via EDGAR on January 16, 2007
                and
                incorporated herein by reference.(1) Previously
                filed on Form SB-2 with the SEC via EDGAR on September 19, 2005 and
                incorporated herein by reference.(2) Previously
                filed on Form 10-KSB with the SEC via EDGAR on March 28, 2007 and
                incorporated herein by reference.(3) Previously
                filed on Form 10-QSB with the SEC via EDGAR on May 18, 2007 and
                incorporated herein by reference.(4) Previously
                filed on Form 8-K with the SEC via EDGAR on August 10, 2007 and
                incorporated herein by reference.(5) Previously
                filed on Form 8-K with the SEC via EDGAR on March 31, 2008 and
                incorporated herein by reference.(6) Previously
                filed on Form 10-QSB with the SEC via EDGAR on August 14, 2007 and
                incorporated herein by reference.




***Item
      14. Principal Accountant Fees And Services***




**Audit
      Fees**




The
      aggregate fees billed for the last two fiscal years for professional services
      rendered by the principal accountant for the audit of the Company’s annual
      financial statements and review of financial statements included in the
      Company’s Form 10-QSBs or services that are normally provided by the accountant
      in connection with statutory and regulatory engagements for those fiscal years
      was:




2007
      -
      $88,900 - Schumacher & Associates, Inc.


2006 –
      $16,000 – Davis Accounting Group, P.C.




**Audit
      - Related Fees**




The
      aggregate fees billed in each of the last two fiscal years for assurance and
      related services by the principal accountants that are reasonably related to
      the
      performance of the audit or review of the Company’s financial statements and are
      not reported in the preceding paragraph:




2007 –
      Nil – Schumacher & Associates, Inc.


2006 –
      Nil – Davis Accounting Group, P.C.




48




**Tax
      Fees**




The
      aggregate fees billed in each of the last two fiscal years for professional
      services rendered by the principal accountant for tax compliance, tax advice,
      and tax planning was:




2007 –
      Nil – Schumacher & Associates, Inc.


2006 –
      Nil – Davis Accounting Group, P.C.




**All
      Other Fees**




The
      aggregate fees billed in each of the last two fiscal years for the products
      and
      services provided by the principal accountant, other than the services reported
      in paragraphs (1), (2), and (3) was:




2007 –
      $111,200 – Schumacher & Associates, Inc.


2006 –
      Nil – $10,000 Davis Accounting Group, P.C.




49




**SIGNATURES**




Pursuant
      to the requirements of Section 13 or 15(d) of the *Securities
      Exchange Act of 1934* ,
      the
      Registrant has duly caused this report to be signed on its behalf by the
      undersigned, thereunto duly authorized on this 14 th day of
      April, 2008.




**SINOBIOMED
                INC.**
              
              (Registrant)By:
                /s/ Ban-Jun
                YangBan-Jun
                YangPresident
                and Chief Executive Officer




Pursuant
      to the requirements of the Securities Exchange Act of 1934, this report has
      been
      signed below by the following persons on behalf of the registrant and in the
      capacities and on the dates indicated:




**Signature**
            
            **Title**
            
            **Date**/s/
                Ban-Jun Yang
            
            President,
                CEO and Director
            
            April
                14 2008Ban-Jun
                Yang/s/
                Ka Yu
            
            Secretary,
                Treasurer and Director
            
            April
                14 2008Ka
                Yu/s/
                Asher Zwebner
            
            Chief
                Financial Officer
            
            April
                14 2008Asher
                Zwebner




50




***Exhibit
      Index***




**Exhibit
                #**
            
            **Page#**31.1
            Certificate
                pursuant to Rule 13a-14(a).
            5231.2
            Certificate
                pursuant to Rule 13a-14(a).
            5432.1
            Certificate
                pursuant to 18 U.S.C. Section 1350.
            5632.2
            Certificate
                pursuant to 18 U.S.C. Section 1350.
            57





51