U. S. Securities and Exchange Commission
                          Washington, D. C. 20549

                                FORM 10-QSB

[X]    	QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES
        EXCHANGE ACT OF 1934

        For the quarterly period ended June 30, 2006

[ ]    	TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES
        EXCHANGE ACT OF 1934

        For the transition period from _____ to _____

                        Commission File No. 3-52472

                        PINGCHUAN PHARMACEUTICAL, INC.
               ----------------------------------------------
               (Name of Small Business Issuer in its Charter)

              North Carolina                       58-2258912
       ----------------------------------------------------------------
       (State or Other Jurisdiction of      (I.R.S. Employer I.D. No.)
        incorporation or organization)

131 Shizi Street, Nangang District, Harbin Heilongjiang F4, P.R. China 150000
-----------------------------------------------------------------------------
                 (Address of Principal Executive Offices)

              Issuer's Telephone Number: 011-86451-8271-3712

Indicate by check mark whether the Registrant (1) has filed all reports
required to be filed by Sections 13 or 15(d) of the Securities Exchange
Act of 1934 during the preceding 12 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  [ ]

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

APPLICABLE ONLY TO CORPORATE ISSUERS:  Indicate the number of shares
outstanding of each of the Registrant's classes of voting stock, as of the
latest practicable date:
                             August 11, 2006
                             Common Voting Stock: 71,996,407

Transitional Small Business Disclosure Format (check one):   Yes  [ ]   No  [X]

<PAGE>


PART I - FINANCIAL INFORMATION

                        PINGCHUAN PHARMACEUTICAL, INC.

                          CONSOLIDATED BALANCE SHEET

                                                     June 30,
                                                      2006
ASSETS                                             ----------
 Current Assets:
  Cash and cash equivalents                       $     64,823
  Accounts receivable, net                              50,581
                                                    ----------
  Total current assets                                 115,404

Consulting fees receivable from a related
 party (Note 4)                                         54,754
                                                    ----------
Total Assets                                      $    170,158
                                                    ==========
LIABILITIES AND STOCKHOLDERS' EQUITY
 Current Liabilities:
  Accounts payable and accrued expenses           $      7,414
  Taxes payable                                         18,642
  Loan from shareholders (Note 4)                       47,487
                                                    ----------
Current liabilities                                     73,543

Commitments and Contingencies (Note 6)                       -

Stockholders' Equity:
 Preferred stock, $0.001 par value, 5,000,000
  shares authorized; none issued and outstanding
  as of June 30, 2006
 Common stock, $0.001 par value, 150,000,000 shares
  authorized;  71,996,406 shares issued and
  outstanding as of June 30, 2006 (Note 4)              71,996
 Additional Paid-in capital                            302,760
 Accumulated deficiency                               (282,309)
 Accumulated other comprehensive income                  4,168
                                                    ----------
 Stockholders' Equity                                   96,615
                                                    ----------
Total Liabilities and Stockholders' Equity         $   170,158
                                                    ==========

See Notes to Financial Statements
                                      3
<PAGE>
                         PINGCHUAN PHARMACEUTICAL, IN

                     CONSOLIDATED STATEMENTS OF OPERATIONS
                                 (UNAUDITED)

                         For the Three Months Ended     For the Six Months Ended
                                   June 30,                    June 30,
                             2006          2005           2006          2005
                          ---------     ---------      ---------     ---------
Revenues
 Service income          $   61,660    $   67,904     $  122,603   $  135,775

Operating Expenses
 Consulting fees paid
  with stock                      -        41,000              -      241,000
 Professional fees           18,943         3,300         27,443        6,600
 Payroll                     12,522        12,097         25,188       24,204
 Office rent                  1,689         1,688          3,376        3,375
 General and
  administrative                471         1,116          2,171        2,166
                          ---------     ---------      ---------    ---------
Total Operating Expenses     33,625        59,201         58,178      277,345
                          ---------     ---------      ---------    ---------
Income (Loss) from
 Operation and before
 provision for Income Tax    28,035         8,703         64,425     (141,570)

Provision for Income Tax          -        18,048         14,949       36,103
                          ---------     ---------      ---------    ---------
Net Income (Loss)            28,035        (9,344)        49,476     (177,673)

Other Comprehensive Income
 Effects of foreign
  currency conversion           519             -          1,670            -
                          ---------     ---------      ---------    ---------
Comprehensive Income
 (Loss)                   $  28,554   $    (9,344)    $   51,146   $ (177,673)
                          =========     =========      =========    =========
Basic and fully diluted
 earnings per Share       $    0.00   $     (0.00)    $     0.00   $    (0.00)
                          =========     =========      =========    =========
Weighted average shares
 outstanding             71,996,406    71,496,074     71,996,406   71,496,074
                         ==========    ==========     ==========   ==========



See Notes to Financial Statements.
                                      4
<PAGE>
                         PINGCHUAN PHARMACEUTICAL, INC.

                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                                 (UNAUDITED)
                                                For the Six Months Ended
                                                        June 30,
                                                  2006            2005
Operating Activities                           --------------------------
 Net income (loss)                            $    49,476  $    (177,673)
 Adjustments to reconcile net income
  (loss) to net cash provided (used) by
  operating activities:
  Contributed rent                                  3,376          3,376
  Stock issued for consulting expense                   -        241,000
 Changes in operating assets and liabilities:
  (Increase)/Decrease in accounts receivable       29,497        100,000
  (Increase)/Decrease in consulting fee
    receivable from a related party                   (46)        (2,061)
  Increase/(Decrease) in accounts payable
   and accrued expenses                           (22,439)         8,140
  Increase/(Decrease) in taxes payable             18,642         38,110
                                                ---------      ---------
 Net cash provided (used) by operating
  activities                                       78,506         10,892
                                                ---------      ---------
Financing Activities
 Repayment of notes payable                             -        (10,000)
 Loan from shareholders                                 -         51,781
 Repayment on Loan from shareholders              (43,713)             -
                                                ---------      ---------
 Net cash provided (used) by financing
  activities                                      (43,713)        41,781
                                                ---------      ---------

Increase (decrease) in cash                        34,793         52,673

Effects of exchange rates on cash                  (1,585)             -

Cash at beginning of period                        31,615          1,431
                                                ---------      ---------
Cash at end of period                          $   64,823     $   54,104
                                                =========      =========

Supplemental Disclosures of Cash Flow Information:
 Cash paid (received) during year for:
  Interest                                     $        -     $        -
                                                =========      =========
  Income taxes                                 $        -     $        -
                                                =========      =========

Supplemental Cash Flow Information:
 Issuance of 1,000,000 shares of common stock
  par value $0.001 per share for consulting
  services                                     $        -     $  241,000
                                                =========      =========

See Notes to Financial Statements.

                                      5
<PAGE>
                      PINGCHUAN PHARMACEUTICAL, INC.

                       NOTES TO FINANCIAL STATEMENTS
                               (UNAUDITED)
Note 1- BASIS OF PRESENTATION

     The consolidated financial statements of Pingchuan Pharmaceutical,
     Inc. and subsidiary (collectively, the Company), included herein were
     prepared, without audit, pursuant to rules and regulations of the
     Securities and Exchange Commission.  Because certain information and
     notes normally included in financial statements prepared in accordance
     with accounting principles generally accepted in the United States of
     America were condensed or omitted pursuant to such rules and regulations,
     these financial statements should be read in conjunction with the
     financial statements and notes thereto included in the audited financial
     statements of the Company as included in the Company's Form 10-KSB for
     the year ended December 31, 2005.

Note 2- ORGANIZATION AND OPERATIONS

     Pingchuan Pharmaceuticals, Inc. ("Pingchuan" or the Company) was
     organized under the laws of the State of North Carolina on July 20,
     1996. the Company is authorized to issue 50,000,000 shares of common
     stock of $0.001 par value and 50,000,000 shares of preferred stock of
     $0.001 par value. Pingchuan is a non-operative holding company of
     Heilongjiang Pingchuan Yi Liao Qi Xie You Xian Gong Si (Heilongjiang
     Pingchuan), a corporation organized and existed under the laws of the
     Peoples' Republic of China ("PRC") and is primarily engaged in the sale
     of medical equipment and the providing of consultation services in the
     pharmaceutical business.

     On June 22, 2004, Pingchuan (formerly Xenicent, Inc.) executed a Plan
     of Exchange ("the Agreement") with all the shareholders of Heilongjiang
     Pingchuan to exchange 70,000,000 shares of common stock of the Company
     for 100% of the registered capital of Heilongjiang Pingchuan. On July
     28, 2004, Xenicent changed its name to Pingchuan Pharmaceutical, Inc.
     ("Pingchuan Pharmaceutical") and increased its authorized shares of
     common stock from 50,000,000 to 150,000,000 by filing Articles of
     Amendment with the Secretary of State in the State of North Carolina.

     Going Concern

     As reflected in the accompanying consolidated financial statements, the
     Company has an accumulated deficit of $282,309 at June 30, 2006 that
     includes an operating loss of $136,263 for the year ended December 31,
     2005.  Additionally, the Company has only two customers, one of which is
     a related party.  The loss of either customer would have a material
     adverse effect on the Company's financial position and results of
     operations.  These factors raise substantial doubt about its ability to
     continue as a going concern.  In view of the matters described above,
     recoverability of a major portion of the recorded asset amounts shown in
     the accompanying consolidated balance sheet is dependent upon continued
     operations of the company, which in turn is dependent upon the Company's
     ability to raise additional capital, obtain financing and succeed in its
     future operations.  The financial statements do not include any adjust-
     ments relating to the recoverability and classification of recorded
     asset amounts or amounts and classification of liabilities that might be
     necessary should the Company be unable to continue as a going concern.

                                      6
<PAGE>
                       PINGCHUAN PHARMACEUTICAL, INC.

                       NOTES TO FINANCIAL STATEMENTS
                                 (UNAUDITED)

Note 2- ORGANIZATION AND OPERATIONS (continued)

     Going Concern (continued)

     Management has taken the following steps to revise its operating and
     financial requirements, which it believes are sufficient to provide the
     Company with the ability to continue as a going concern.  The Company
     is actively pursuing additional funding and a potential merger or
     acquisition candidate and strategic partners, which would enhance
     stockholders' investment.  Management believes that the above actions
     will allow the Company to continue operations through the next fiscal
     year.

Note 3- SIGNIFICANT ACCOUNTING POLICIES

     Principles of Consolidation

     The accompanying consolidated financial statements include the accounts
     of the Company and its wholly owned subsidiary, Heilongjiang Pingchuan.

     Use of Estimates

     The preparation of the financial statements in conformity with generally
     accepted accounting principles requires management to make estimates and
     assumptions that affect the reported amount 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. Actual results could differ from those
     estimates.

     Cash and Cash Equivalents

     For purpose of the statements of cash flows, cash and cash equivalents
     include cash on hand and demand deposits with a bank with a maturity of
     three months or less.

     Accounts Receivable

     The Company extends unsecured credit to its customers in the ordinary
     course of business but mitigates the associated risks by performing
     credit checks and actively pursuing past due accounts. An allowance for
     doubtful accounts is established and recorded based on managements'
     assessment of the credit history with the customer and current relation-
     ships with them. As of June 30, 2006 and 2005, the Company considers all
     its accounts receivable to be collectable and no provision for doubtful
     accounts has been made in the financial statements.

                                      7
<PAGE>
                       PINGCHUAN PHARMACEUTICAL, INC.

                       NOTES TO FINANCIAL STATEMENTS
                                 (UNAUDITED)

Note 3- SIGNIFICANT ACCOUNTING POLICIES (continued)

     Fair Value of Financial Instruments

     Statement of Financial Accounting Standards No. 107, Disclosure About
     Fair Value of Financial Instruments, requires certain disclosures
     regarding the fair value of financial instruments. These financial
     instruments include cash, accounts receivable, accounts payable and
     accrued liabilities, indebtedness to related parties and notes payable.
     Fair values were assumed to approximate cost or carrying values because
     of the short-term maturity of the instruments.  Management is of the
     opinion that the Company is not exposed to significant interest, credit
     or currency risks arising from these financial instruments.

     Revenue Recognition

     The Company provides consultation services to a related company and one
     other customer based on a negotiated contract basis. The Company
     recognizes service based revenue from it contracts when the service has
     been performed, the customer has approved the completion of services
     and collectibility is reasonably assured.

     Consulting revenues were derived from two customers.  An unrelated third
     party, provided 75% of revenues and the current contract will expire on
     January 2007.  The balance of the revenues 25%, were provided by a
     company owned by directors of the Company.

     Income Taxes

     The Company accounts for income taxes under the Statement of Financial
     Accounting Standards No. 109, "Accounting for Income Taxes" ("Statement
     109"). Under Statement 109, deferred tax assets and liabilities are
     recognized for the future tax consequences attributable to differences
     between the financial statement carrying amounts of existing assets and
     liabilities and their respective tax bases. Deferred tax assets and
     liabilities are measured using enacted tax rates expected to apply to
     taxable income in the years in which those temporary differences are
     expected to be recovered or settled. Under Statement 109, the effect on
     deferred tax assets and liabilities of a change in tax rates is
     recognized in income in the period that includes the enactment date.

     PRC income tax is computed according to the relevant laws and regulations
     in the PRC. The Company's applicable tax rate has been 33%.

                                      8
<PAGE>

                        PINGCHUAN PHARMACEUTICAL, INC.

                        NOTES TO FINANCIAL STATEMENTS
                                  (UNAUDITED)

Note 3- SIGNIFICANT ACCOUNTING POLICIES (continued)

     Foreign Currency Translation

     For the Chinese subsidiary the Chinese Renminbi ("RMB") is the functional
     currency.  Assets and liabilities denominated in the RMB are translated
     into U.S. dollars at end-of-period exchange rates, and the resultant
     translation adjustments are reported, net of their related tax effects,
     as a component of Accumulated Other Comprehensive Income (Loss) in
     stockholders' equity.  Assets and liabilities denominated in other than
     the local currency are remeasured into the local currency prior to
     translation into U.S. dollars, and the resultant exchange gains or losses
     are included in income in the period in which they occur.  Income and
     expenses are translated into U.S. dollars at average exchange rates in
     effect during the period.

     Comprehensive income (loss)

     The foreign currency translation gain or loss resulting from translation
     of the financial statements expressed in RMB to United States Dollar is
     reported as other comprehensive income (loss) in the statements of
     operations and stockholders' equity.

     Translation adjustments resulting from this process are included in
     accumulated other comprehensive income (loss) and amounted to $4,168 as
     of June 30, 2006. The balance sheet amounts with the exception of equity
     at June 30, 2006 were translated at 7.99 RMB to $1.00 USD. The equity
     accounts were stated at their historical rate. The average translation
     rate of 8.02 RMB to $1.00 USD for the six months ended June 30, 2006 was
     applied to income statement accounts.

     Earnings Per Share

     Basic earnings per share are computed by dividing income available to
     common stockholders by the weighted average number of common shares
     outstanding during the year. Diluted income per share is computed
     similar to basic income per share except that the denominator is
     increased to include the number of additional common shares that would
     have been outstanding if the potential common shares had been issued
     and if the additional common shares were dilutive. As of June 30, 2006,
     there are no potentially dilutive securities issued and outstanding.

     Segments

     The Company operates in only one business segment, therefore segment
     disclosure is not presented.

     Interim Financial Information

     The unaudited interim financial statements have been prepared in
     accordance with United States generally accepted accounting principles
     for interim financial information. In the opinion of management, all
     adjustments considered necessary for a fair presentation of the
     financial position, results of operations and cash flows as at June 30,
     2006, and 2005, have been included.  Readers of these financial
     statements should note that the interim results for the six month period
     ended June 30, 2006, are not necessarily indicative of the results that
     may be expected for the fiscal year as a whole.

                                      9
<PAGE>

                        PINGCHUAN PHARMACEUTICAL, INC.

                        NOTES TO FINANCIAL STATEMENTS
                                 (UNAUDITED)

Note 4- SHAREHOLDER EQUITY - STOCK ISSUANCES

     On June 22, 2004, the Company executed a Plan of Exchange pursuant to
     which the Company agreed to issue 70,000,000 new shares of common stock
     to the shareholders of Heilongjiang Pingchuan in exchange for 100% of
     registered capital of Heilongjiang Pingchuan. The Plan of Exchange was
     consummated on August 11, 2004 and recorded for accounting purposes as
     a reverse merger and recapitalization of the Company.

     Additionally, the new shareholders of the Company paid $400,000 to
     purchase and retire 1,300,000 shares  of the Company's  common  stock.
     These shares were contributed back to the Company as Treasury Stock and
     the cancelled.

     During April 2005, the Company issued 200,000 shares of common stock to
     a consultant for his website maintenance service. The price of the
     Company's common stock on April 8, 2005 was $0.20.  The Management
     valued the cost of the service at $40,000.

     During April 2005, the Company issued 5,000 shares of common stock to a
     consultant for services. The price of the Company's common stock on April
     8, 2005 was $0.20.  The Management valued the cost of the service at
     $1,000.

     On March 20, 2005, the Company executed a consulting agreement, pursuant
     to which the Company agreed to issue 500,000 shares of common stock for
     a pharmaceutical consultation service. The agreement was consummated in
     2005 when the price of the Company's common stock was $0.20.  The
     Management valued the cost of this service at $100,000.

     During January, 2005, the Company issued 500,000 shares of common stock
     for marketing consultation services. The price of the Company's common
     stock was $0.20.  Management valued the cost of this service at $100,000.

                                      10

<PAGE>
                        PINGCHUAN PHARMACEUTICAL, INC.

                        NOTES TO FINANCIAL STATEMENTS
                                 (UNAUDITED)

Note 5- RELATED PARTY TRANSACTIONS

     Due From Related Parties

     Consulting fee receivable from a related partie at March 31,2006 consist
     of: party at June 30, 2006 consist of

     Heilongjiang  consulting fee receivable              $   54,754
                                                           ---------
                                                          $   54,754
                                                           =========

     The Company provides consultation services to a related company owned by
     the Company's directors, based on a negotiated contract basis.  The
     Company earned management fees of $22,603 and $35,775 from this related
     company in the six months ended June 30, 2006 and 2005, respectively.
     As of June 30, 2006, $54,754 was outstanding as accounts receivable.

     Loans from shareholders represent loans payable that are unsecured, non-
     interest bearing and have no fixed terms of repayment, therefore, deemed
     payable on demand.

     The Company uses office space of approximately 4,000 square feet provided
     by a related company owned by the Company's directors at no charge to the
     Company.  The market value of the annual rent was approximately $6,750
     and the Company recorded the free rent as a contribution to capital of
     $3,376 in the six months ended June 30, 2006 and 2005, respectively.

Note 6- CONCENTRATIONS AND RISKS

     The Company's business operations exist solely in the PRC and are subject
     to significant risks not typically associated with companies in North
     America and Western Europe.  These include risks associated with, among
     others, the political, economic and legal environments and foreign
     currency limitations.

     The Company's results may thus be adversely affected by changes in the
     political and social conditions in the PRC, and by changes in
     governmental policies, laws, regulations, anti-inflationary measures,
     currency conversion and remittance limitation, and rates and methods of
     taxation, among other things.

     The Company relies on two customers for all of its revenue.

Note 7- COMMITMENTS AND CONTINGENCIES

     On August 1, 2006 Greentree Financial Group, Inc. (Greentree), a former
     consultant to a subsidiary of the Company, filed a breach of contract
     complaint in the Superior Court in Mecklenberg County, North Carolina
     for non payment of contractual obligations for 2004 and 2005.  The claim
     is for $49,000 in cash and $40,000 worth of stock as compensatory damages
     or $80,000 in liquidated damages.  Company management believes it has
     paid Greentree the full amount it is due and will contest the complaint.
     An adverse outcome to this matter would have a material adverse effect
     on the Company's financial position and results of operations.

                                     11




<PAGE>

ITEM 2.  MANAGEMENT DISCUSSION AND ANALYSIS

     A Warning Concerning Forward- Looking Statements

     The information in this discussion contains forward-looking
statements within the meaning of Section 27A of the Securities Act of 1933,
as amended, and Section 21E of the Securities Exchange Act of 1934, as
amended.  These forward-looking statements include statements regarding our
capital needs, business strategy and expectations.  Any statements
contained herein that are not statements of historical facts may be deemed
to be forward-looking statements.  Readers are cautioned that there are
risks and uncertainties which may cause actual future results to differ
from the results anticipated in these forward-looking statements. Among the
more significant risks are:

     *  The fact that Pingchuan does not have a detailed business plan, but
         provides consulting services to only two clients.

     *  The fact that Pingchuan's current business operations are not
         sufficient in size to produce significant financial results.

     *  The fact that Pingchuan lacks the capital necessary to substantially
         enlarge its business operations.

     These factors and other risks, known and unanticipated, may cause
Pingchuan's results to differ significantly from those anticipated in this
report.  Readers are cautioned not to place undue reliance on the forward-
looking statements in this report, which reflect management's opinions only
as of the date hereof. We disclaim any obligation to publicly update these
statements, or disclose any difference between its actual results and those
reflected in these statements.

     Results of Operations

     We recorded revenues of $122,603 in the first six months of 2006,
compared to $135,775 in revenue in the first six months of 2005. All of our
revenue represented professional service fees from (a) Harbin Pingchuan,
which has contracted to pay us through 2009 for consulting services a
professional services fee of $48,000 per year plus 15% of its sales revenue
and (b) Moscow Sing Sing Co, Ltd., which has contracted to pay us $50,000
every 90 days through January 2007 for marketing services.

     The majority of our revenue currently comes from the Sing Sing
contract, which will terminate at the end of this year.  We expect the
growth of our business in 2006 to come primarily from increased business at
Harbin Pingchuan.  Our revenue from that source will increase, however,
only if Harbin Pingchuan is successful in obtaining the funds that it needs
in order to expand the marketing of its herbal supplements for diabetics.
Revenue from Harbin Pingchuan for the first six months of 2006 was
significantly less than in the first six months of 2005.

     Because our operations consist entirely of consulting services
performed by our management, we record no cost of sales, so all of our
revenue flows through to become gross profit.  Similarly, we incur
relatively low operating expenses.  Our operating expenses in the first six
months of 2006 were $58,178, representing only 47% of our revenue.  In the
same period of 2005, we incurred somewhat lower operating expenses that we
settled in cash but an additional $241,000 in consulting fees that we paid
by issuing stock.  Because of our lack of cash resources, it is likely that
we will in the future issue stock to the individuals that are critical to
our efforts at business expansion.

     For the first six months of 2006 we realized net income (before gains
from currency translations) of $49,476, compared to a net loss of $177,673
in the six months of 2005, loss primarily resulting from our issuance of
stock to consultants.  At our current level of operations, we expect to
continue to realize profits, albeit modest, except during periods when we
issue stock for services.  Our plan, however, is to expand operations,
which is likely to affect our profitability.

     Liquidity and Capital Resources

     On June 30, 2006 Pingchuan Pharmaceutical had $41,961 in working
capital.  This represents an improvement of $51,321 over our working
capital deficit of $9,360 at December 31, 2005.  The primary reason for the
improvement was is the fact that the Company's receivable from the Sing
Sing contract was reduced, and the funds were used to reduce the loan from
the Company's shareholders.  During the same period, however, the Company's
receivable from Harbin Pingchuan has remained constant and is classified as
a non-current liability, since the Company does not expect to receive
payment from Harbin Pingchuan within the next twelve months.  The
operations of Harbin Pingchuan provide the only significant prospect for
growth in the Company's revenues.  Accordingly, the Company has determined
that the cash resources of Harbin Pingchuan would be better used for the
business of Harbin Pingchuan than to settle its obligation to Pingchuan
Pharmaceutical.

     The Company's liabilities primarily consisted of obligations to the
shareholders who have been funding Pingchuan Pharmaceutical's operations.
Although that $47,487 debt is carried on our balance sheet as a current
liability, the shareholders have not required that we pay it unless cash is
available for that purpose, and we do not expect them to require payment in
the near future.  So we believe that we will be able to continue our
operations without concern about debt service.

     Pingchuan realized $78,506 in net cash from operations during the six
months of 2006, due to payments by Sing Sing.  Although some of those funds
were used to repay debts from our shareholders, we retained enough to
increase our cash position from $31,615 to $64,823.  While this is
sufficient to sustain our current level of operations, the low level of
operations currently carried on will not produce sufficient cash to fund an
expansion of operations.  Therefore, unless additional capital is obtained
or the Company's relationship with Harbin Pingchuan provides increased cash
flow to Heilongjiang Pingchuan, the Company will not have the resources
necessary to expand its operations.

     In order to expand operations, the Company will have to invest funds
in marketing, capital equipment and related infrastructure items.
Currently the Company lacks the capital resources necessary to make those
investments.  Accordingly, the Company is currently exploring opportunities
to raise capital.  At present it has secured no commitments from investors.

     Off-Balance Sheet Arrangements

     We do not have any off-balance sheet arrangements that have or are
reasonably likely to have a current or future effect on our financial
condition or results of operations.

ITEM 3.  CONTROLS AND PROCEDURES

     Evaluation of Disclosure Controls and Procedures.  Yao Qitai, our
Chief Executive Officer, and Zhang Chunman, our Chief Financial Officer,
carried out an evaluation of the effectiveness of the Company's disclosure
controls and procedures as of June 30, 2006.  Pursuant to Rule13a-15(e)
promulgated by the Securities and Exchange Commission pursuant to the
Securities Exchange Act of 1934, "disclosure controls and procedures" means
controls and other procedures that are designed to insure that information
required to be disclosed by the Company in the reports that it files with
the Securities and Exchange Commission is recorded, processed, summarized
and reported within the time limits specified in the Commission's rules.
"Disclosure controls and procedures" include, without limitation, controls
and procedures designed to insure that information the Company is required
to disclose in the reports it files with the Commission is accumulated and
communicated to our Chief Executive Officer and our Chief Financial Officer
as appropriate to allow timely decisions regarding required disclosure.
Based on their evaluation, Messrs. Yao and Zhang concluded that the
Company's system of disclosure controls and procedures was effective as of
June 30, 2006 for the purposes described in this paragraph.

     Changes in Internal Controls.  There was no change in internal
controls over financial reporting (as defined in Rule 13a-15(f) promulgated
under the Securities Exchange Act or 1934) identified in connection with
the evaluation described in the preceding paragraph that occurred during
the Company's second fiscal quarter that has materially affected or is
reasonably likely to materially affect the Company's internal control over
financial reporting.

<PAGE>

PART II - OTHER INFORMATION

Item 6.	Exhibits

     31.1    Rule 13a-14(a) Certification - CEO
     31.2    Rule 13a-14(a) Certification - CFO
     32      Rule 13a-14(b) Certification


                                 SIGNATURES

     Pursuant to the requirements 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.

                                PINGCHUAN PHARMACEUTICAL, INC.


Date: August 11, 2006		By:  /s/ Hu Zhanwu
                                -------------------------
                                Hu Zhanwu, President