**SECURITIES
      AND EXCHANGE COMMISSION**


**WASHINGTON, D.C.
      20549**







**FORM
      10-QSB**






**x** **QUARTERLY
      REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT
      OF 1934**


For
      Quarter ended March 31, 2008




**OR**




** ̈** **TRANSITION
      REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT
      OF 1934**


For
      the
      transition period
      from                to




Commission
      File Number 333-128399







**SINOBIOMED
      INC.**




(Exact
      Name of Registrant as Specified in its Charter)




**Delaware**
            **20-1945139**(State
                or other Jurisdiction of
              Incorporation
                or Organization)
            (IRS
                Employer
              Identification
                Number)**Lane
                4705, No. 58, North Yang Gao Rd.**
              **Pudong
                New Area Shanghai, China**
            **201206**(Address
                of Principal Executive Offices)
            (Zip
                Code)




**011-86-21-58546923**


(Registrant's
      Telephone Number, Including Area Code)







Indicate
      by check mark whether the issuer (1) filed all reports required to be filed
      by
      Section 13 or 15(d) of the Exchange Act of 1934 during the past 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 issuers involved in bankruptcy proceedings during the preceding five
      years:**





Check
      whether the registrant filed all documents and reports required to be filed
      by
      Section 12, 13 or 15(d) of the Exchange Act after the distribution of securities
      under a plan confirmed by a court.





Yes  ̈ No  ̈





**Applicable
      only to corporate issuers:**





Indicate
      the number of shares outstanding of each of the issuer’s classes of common
      equity, as of the latest practicable date.





Class
            
            Outstanding
                as of May 14, 2008Common
                Stock, $0.0001 par value
            
            
            131,422,086




Traditional
      Small Business Disclosure Format (Check one):





Yes  ̈ No x







**TABLE
      OF CONTENTS**




**Page**FORWARD-LOOKING
                STATEMENTS
            1USE
                OF NAMES
            1**PART
                I – FINANCIAL INFORMATION**
            2ITEM
                1. FINANCIAL STATEMENTS
            2ITEM
                2. MANAGEMENT’S DISCUSSION AND ANALYSIS OR PLAN OF
                OPERATION
            3ITEM
                3. CONTROLS AND PROCEDURES
            6**PART
                II – OTHER INFORMATION**
            6ITEM
                1. LEGAL PROCEEDINGS
            6ITEM
                2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF
                PROCEEDS
            7ITEM
                3. DEFAULTS UPON SENIOR SECUTIRIES
            7ITEM
                4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
            7ITEM
                5. OTHER INFORMATION
            7ITEM
                6. EXHIBITS
            7SIGNATURES
            8







**Forward
      Looking Statements**




This
      quarterly report on Form 10-QSB 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
      periodic 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.




**Use
      of Names**




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




1





**PART
      1. FINANCIAL INFORMATION**




**Item
      1. Financial Statements**


**SINOBIOMED
                  INC.****AND
                  CONSOLIDATED SUBSIDIARIES****INDEX
                  TO CONSOLIDATED FINANCIAL STATEMENTS*****Unaudited
                  - Prepared by
                  Management***
  PageConsolidated
                  Balance Sheet
              
              
              1Consolidated
                  Statements of Operations
              
              
              2Consolidated
                  Statements of Cash Flows
              
              
              3Consolidated
                  Statement of Stockholders' (Deficit)
              
              
              4Notes
                  to Consolidated Financial Statements
              
              
              5
  2
 
 **SINOBIOMED
                      INC.****AND
                      CONSOLIDATED SUBSIDIARIES*****Consolidated
                      Balance Sheet******(Expressed
                      in US Dollars)******Unaudited-
                      Prepared by Management***Note
                      1 - Basis of Presentation - going concern
                  
                  **March
                      31**
                  
                  **December
                      31****2008**
                  
                  **2007**ASSETSCURRENT
                      ASSETSCash
                      - unrestricted
                  
                  $
                  64,745
                  
                  $
                  64,866Cash
                      - restricted (Note 3)
                  
                  
                  192
                  
                  
                  184Accounts
                      receivable (Note 4)
                  
                  
                  138,694
                  
                  
                  48,071Inventory
                      (Note 6)
                  
                  
                  1,036,326
                  
                  
                  893,402Prepaid
                      expenses and deposits
                  
                  
                  351,618
                  
                  
                  428,841Total
                      current assets
                  
                  
                  1,591,575
                  
                  
                  1,435,364Fixed
                      assets (Note 7)
                  
                  
                  6,738,878
                  
                  
                  6,658,831Total
                      assets
                  
                  $
                  8,330,453
                  
                  $
                  8,094,195LIABILITIES
                      AND STOCKHOLDERS' (DEFICIT)CURRENT
                      LIABILITIESShort-term
                      loans (Notes 8 and 9)
                  
                  $
                  6,650,350
                  
                  $
                  7,105,118Accounts
                      payable
                  
                  
                  883,540
                  
                  
                  824,706Interest
                      payable
                  
                  
                  2,046,875
                  
                  
                  1,918,408Unearned
                      revenue
                  
                  
                  204,695
                  
                  
                  170,471Shareholder
                      loans (Note 10)
                  
                  
                  3,636,129
                  
                  
                  2,176,526Other
                      current liabilities
                  
                  
                  2,038,734
                  
                  
                  1,986,284Total
                      current liabilities
                  
                  
                  15,460,323
                  
                  
                  14,181,513COMMITMENTS
                      AND CONTINGENCIES (Notes 1, 2, 3, 5, 8, 9, 10, 11, 12, 13,
                      14,
                      15 and 17)STOCKHOLDERS'
                      (DEFICIT)Common
                      stock (Note 13)Authorized
                      250,000,000 shares at par value of $ 0.0001 eachIssued
                      and outstanding 131,422,086 shares (2007 - 131,312,086)
                  
                  
                  13,143
                  
                  
                  13,132Additional
                      paid-in capital
                  
                  
                  27,138,522
                  
                  
                  26,127,797Accumulated
                      (deficit)
                  
                  
                  (32,620,776
                  )
                  
                  (30,761,870
                  )Accumulated
                      other comprehensive income (loss)
                  
                  
                  (1,660,759
                  )
                  
                  (1,466,377
                  )Total
                      stockholders' (deficit)
                  
                  
                  (7,129,870
                  )
                  
                  (6,087,318
                  )Total
                      liabilities and stockholders' (deficit)
                  
                  $
                  8,330,453
                  
                  $
                  8,094,195The
                      accompanying notes to the consolidated financial statements
                      are an
                      integral part of these
                      statements.
  1
 
 **SINOBIOMED
                          INC.****AND
                          CONSOLIDATED SUBSIDIARIES*****Consolidated
                          Statements of Operations******(Expressed
                          in US Dollars)******Unaudited-
                          Prepared by Management***Three
                          Months Ended March 312008
                      
                      2007REVENUESales
                      
                      $
                      174,093
                      
                      $
                      216,002Cost
                          of goods sold
                      
                      
                      62,101
                      
                      
                      156,064Gross
                          profit
                      
                      
                      111,992
                      
                      
                      59,938Other
                          income
                      
                      
                      -
                      
                      
                      156,198111,992
                      
                      
                      216,136EXPENSESAdvertising
                          and promotion
                      
                      
                      232
                      
                      
                      1,523Depreciation
                      
                      
                      64,494
                      
                      
                      21,785General
                          and administration
                      
                      
                      458,663
                      
                      
                      471,624Repairs
                          and maintenance
                      
                      
                      14,063
                      
                      
                      5,606Research
                          and development
                      
                      
                      88,155
                      
                      
                      492,774Salaries
                          and benefits
                      
                      
                      195,739
                      
                      
                      101,783Stock-based
                          compensation (Note 14)
                      
                      
                      917,158
                      
                      
                      454,536Travel
                      
                      
                      17,566
                      
                      
                      25,266Total
                          expenses
                      
                      
                      1,756,070
                      
                      
                      1,574,897Net
                          (loss) for the period from operations
                      
                      
                      (1,644,078
                      )
                      
                      (1,358,761
                      )OTHER
                          INCOME AND EXPENSESInterest
                          and bank charges (Notes 8, 9 and 10)
                      
                      
                      (135,294
                      )
                      
                      (353,991
                      )Losses
                          on loans and guarantees to other parties (Note 5)
                      
                      
                      (79,534
                      )
                      
                      (72,631
                      )Net
                          (loss) for the period before minority interests(1,858,906
                      )
                      
                      (1,785,383
                      )Minority
                          interest in loss for the period
                      
                      
                      -
                      
                      
                      8,039Net
                          (loss) for the period
                      
                      $
                      (1,858,906
                      )
                      $
                      (1,777,344
                      )Other
                          comprehensive income (loss)Foreign
                          currency translation
                      
                      $
                      (194,382
                      )
                      
                      (175,868
                      )Comprehensive
                          (loss)
                      
                      
                      (2,053,288
                      )
                      $
                      (1,953,212
                      )Net
                          (loss) per common share - basic and fully diluted:Net
                          (loss) for the period
                      
                      $
                      (0.01
                      )
                      $
                      (0.01
                      )Weighted
                          average number of common stock outstanding131,393,075
                      
                      
                      162,321,111The
                          accompanying notes to the consolidated financial statements
                          are an
                          integral part of these
                          statements.
  2
 
 **SINOBIOMED
                              INC.****AND
                              CONSOLIDATED SUBSIDIARIES*****Consolidated
                              Statements of Cash Flows******(Expressed
                              in US Dollars)******Unaudited-
                              Prepared by Management***Three
                              Months Ended March 312008
                          
                          2007Cash
                              from (used in) operating activities:Net
                              (loss)
                          
                          $
                          (1,858,906
                          )
                          $
                          (1,777,344
                          )Adjustments
                              to reconcile net loss to net cash used in operating
                              activities:Depreciation
                          
                          
                          201,992
                          
                          
                          184,163Imputed
                              interest expense on shareholders' loans
                          
                          
                          35,828
                          
                          
                          27,439Minority
                              interest in net income (loss)
                          
                          
                          -
                          
                          
                          (8,039
                          )Shares
                              issued for services
                          
                          
                          14,438
                          
                          
                          85,400Stock-based
                              compensation
                          
                          
                          917,158
                          
                          
                          454,536Net
                              change in operating assets and liabilities:Accounts
                              receivable
                          
                          
                          (90,623
                          )
                          
                          20,907Inventory
                          
                          
                          (142,924
                          )
                          
                          87,188Prepaid
                              expenses and deposits
                          
                          
                          120,535
                          
                          
                          (112,747
                          )Accounts
                              payable
                          
                          
                          58,834
                          
                          
                          (93,619
                          )Interest
                              payable
                          
                          
                          128,467
                          
                          
                          360,126Unearned
                              revenue
                          
                          
                          34,224
                          
                          
                          16,939Other
                              current liabilities
                          
                          
                          52,450
                          
                          
                          146,810Net
                              cash (used in) from operating activities(528,527
                          )
                          
                          (608,241
                          )Cash
                              (used in) investing activities:Purchases
                              of fixed assets
                          
                          
                          (4,791
                          )
                          
                          (22,208
                          )Proceeds
                              of disposition of fixed assets
                          
                          
                          -
                          
                          
                          3,911Net
                              cash (used in) investing activities(4,791
                          )
                          
                          (18,297
                          )Cash
                              from (used in) financing activities:Loans
                              made to unrelated parties
                          
                          
                          -
                          
                          
                          (499,683
                          )Share
                              subscriptions received
                          
                          
                          -
                          
                          
                          416,000Repayments
                              of short-term loans
                          
                          
                          (734,807
                          )
                          
                          (835,440
                          )Loans
                              received from shareholders
                          
                          
                          1,385,720
                          
                          
                          82,676Repayments
                              of loans from shareholders
                          
                          
                          (20,492
                          )
                          
                          -Net
                              cash from (used in) financing activities
                          
                          
                          630,421
                          
                          
                          (836,447
                          )Effect
                              of other comprehensive income (loss) on cash
                          
                          
                          (97,216
                          )
                          
                          (245,367
                          )Increase
                              (decrease) in cash
                          
                          
                          (113
                          )
                          
                          (1,708,352
                          )Cash,
                              beginning of period
                          
                          
                          65,050
                          
                          
                          2,146,280Cash,
                              end of period
                          
                          $
                          64,937
                          
                          $
                          437,928The
                              accompanying notes to the consolidated financial statements
                              are an
                              integral part of these
                              statements.
  3
 
 **SINOBIOMED
                                  INC.****AND
                                  CONSOLIDATED SUBSIDIARIES*****Consolidated
                                  Statement of Stockholders' (Deficit)******(Expressed
                                  in US Dollars)******Unaudited-
                                  Prepared by Management***Common
                                  Stock
                              
                              Amount
                              
                              Additional
                                  paid-in capital
                              
                              Cumulative
                                  Other Comprehensive Income (loss)
                              
                              Accumulated
                                  (Deficit)
                              
                              Stockholders'
                                  (Deficit)Balance
                                  December 31, 2007
                              
                              
                              131,312,086
                              
                              $
                              13,132
                              
                              $
                              26,127,797
                              
                              $
                              (1,466,377
                              )
                              $
                              (30,761,870
                              )
                              $
                              (6,087,318
                              )Issue
                                  of shares for services
                              
                              
                              110,000
                              
                              
                              11
                              
                              
                              57,739
                              
                              
                              -
                              
                              
                              -
                              
                              
                              57,750Stock-based
                                  compensation
                              
                              
                              -
                              
                              
                              -
                              
                              
                              917,158
                              
                              
                              -
                              
                              
                              -
                              
                              
                              917,158Imputed
                                  interest on shareholders' loans
                              
                              
                              -
                              
                              
                              -
                              
                              
                              35,828
                              
                              
                              -
                              
                              
                              -
                              
                              
                              35,828Net
                                  (loss) for the period
                              
                              
                              -
                              
                              
                              -
                              
                              
                              -
                              
                              
                              (194,382
                              )
                              
                              (1,858,906
                              )
                              
                              (2,053,288
                              )Balance
                                  March 31, 2008
                              
                              
                              131,422,086
                              
                              $
                              13,143
                              
                              $
                              27,138,522
                              
                              $
                              (1,660,759
                              )
                              $
                              (32,620,776
                              )
                              $
                              (7,129,870
                              )
  4
 
 **SINOBIOMED
                            INC.**
 **AND
                            CONSOLIDATED SUBSIDIARIES**
 ***Notes
                            to Consolidated Financial Statements***
 ***March
                            31, 2008***
 ***(Expressed
                            in US Dollars)***
 ***(Unaudited
                            - Prepared by Management)***
 **1.
                            BASIS OF PRESENTATION**
  The
                            unaudited financial statements as of March 31, 2008 included
                            herein have been
                            prepared without audit pursuant to the rules and regulations
                            of the Securities
                            and Exchange Commission. Certain information and footnote
                            disclosures normally
                            included in financial statements prepared in accordance
                            with United States
                            generally accepted accounting principles have been condensed
                            or omitted pursuant
                            to such rules and regulations. In the opinion of management,
                            all adjustments
                            (consisting of normal recurring accruals) considered
                            necessary for a fair
                            presentation have been included. It is suggested that
                            these financial statements
                            be read in conjunction with the December 31, 2007 audited
                            financial statements
                            and notes thereto.
 
 **2.
                            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
                            $32,620,776 and has negative working capital and a stockholders’ deficit as of
                            March 31, 2008, 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.
 
 **3.
                            CASH - RESTRICTED**
 
 Restricted
                            cash consists of $192 on deposit pursuant to agreement
                            with a bank to maintain
                            funds on deposit to ensure payment of interest on debt.
  5
 
 **SINOBIOMED
                                INC.**
 **AND
                                CONSOLIDATED SUBSIDIARIES**
 ***Notes
                                to Consolidated Financial Statements***
 ***March
                                31, 2008***
 ***(Expressed
                                in US Dollars)***
 ***(Unaudited
                                - Prepared by Management)***
 
 
 **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
                            $8,990.
 
 **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 $5,158,370
                            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. $79,534
                            has been charged to
                            income in the three months ended March 31, 2008 (2007
                            - $72,631) 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.
 
 The
                            Company has fully provided for $14,446 of additional
                            loans receivable from sales
                            agents and employees. $1,278 has been charged to expense
                            in the three months
                            ended March 31, 2008 (2007 - $214 recovery) in respect
                            of the
                            provision.
 
 The
                            Company has fully provided for $127,900 of loans receivable
                            from minority
                            shareholders of Wanxing Cosmetic.
 
 **6.
                            INVENTORY**
 
 Inventory
                            consists of the following:
  March
                                      31,
                                      2008
                                  
                                  December
                                      31,
                                      2007Raw
                                      materials
                                  
                                  $
                                  129,634
                                  
                                  $
                                  74,007Goods
                                      in process
                                  
                                  
                                  625,967
                                  
                                  
                                  550,198Finished
                                      goods
                                  
                                  
                                  280,725
                                  
                                  
                                  269,197$
                                  1,036,326
                                  
                                  $
                                  893,402
  6
 
  **SINOBIOMED
                                INC.**
 **AND
                                CONSOLIDATED SUBSIDIARIES**
 ***Notes
                                to Consolidated Financial Statements***
 ***March
                                31, 2008***
 ***(Expressed
                                in US Dollars)***
 ***(Unaudited
                                - Prepared by Management)***
 
 
 **7.
                            FIXED ASSETS**
 
 Fixed
                            assets consist of the following:
  March
                                      31,
                                      2008
                                  
                                  December
                                      31,
                                      2007Buildings
                                  
                                  $
                                  6,479,821
                                  
                                  $
                                  6,220,810Climate
                                      control equipment
                                  
                                  
                                  1,318,632
                                  
                                  
                                  1,265,923Computer
                                      software
                                  
                                  
                                  1,996
                                  
                                  
                                  1,917Land
                                      license
                                  
                                  
                                  2,395,680
                                  
                                  
                                  2,299,920Manufacturing
                                      equipment
                                  
                                  
                                  2,208,034
                                  
                                  
                                  2,119,775Office
                                      furniture and equipment
                                  
                                  
                                  167,841
                                  
                                  
                                  156,532Other
                                      equipment
                                  
                                  
                                  30,257
                                  
                                  
                                  29,048Road
                                  
                                  
                                  35,895
                                  
                                  
                                  34,460Vehicles
                                  
                                  
                                  730,744
                                  
                                  
                                  701,53513,368,900
                                  
                                  
                                  12,829,920Less:
                                      Accumulated depreciation
                                  
                                  
                                  6,630,022
                                  
                                  
                                  6,171,089$
                                  6,738,878
                                  
                                  $
                                  6,658,831
 
 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
                                    March
                                      31, 2008
                                  
                                  Principal
                                      amount
                                    December
                                      31, 2007
                                  
                                  Due
                                      date
                                  
                                  Interest
                                      rate
                                    Not
                                      due/ overdue
                                  
                                  Security
                                    (1)China
                                      Construction Bank
                                  
                                  $
                                  1,967,880
                                  
                                  $
                                  1,957,670
                                  
                                  
                                  October
                                      16, 2004
                                  
                                  
                                  5.31%
                                      / 7.56
                                  %
                                  
                                  Building
                                      mortgage (2
                                  )Shenzhen
                                      Development Bank
                                  
                                  
                                  798,560
                                  
                                  
                                  766,640
                                  
                                  
                                  June
                                      6, 2005
                                  
                                  
                                  6.372%/9.56
                                  %
                                  
                                  GuaranteeIndustrial
                                      Bank
                                  
                                  
                                  2,857,190
                                  
                                  
                                  3,395,128
                                  
                                  
                                  December
                                      19, 2005
                                  
                                  
                                  6.138%
                                      / NA
                                  
                                  
                                  Guarantee
                                      (3
                                  )Zheda
                                      Haina S&T Holding
                                  
                                  
                                  598,920
                                  
                                  
                                  574,980
                                  
                                  
                                  -
                                  
                                  
                                  -
                                  
                                  
                                  (4
                                  )Luoyang
                                      Zonghong
                                  
                                  
                                  427,800
                                  
                                  
                                  410,700
                                  
                                  
                                  -
                                  
                                  
                                  -$
                                  6,650,350
                                  
                                  $
                                  7,105,118
  7
 
  **SINOBIOMED
                                INC.**
 **AND
                                CONSOLIDATED SUBSIDIARIES**
 ***Notes
                                to Consolidated Financial Statements***
 ***March
                                31, 2008***
 ***(Expressed
                                in US Dollars)***
 ***(Unaudited
                                - Prepared by Management)***
 
 (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 $3565,000 (25,000,000 Chinese yuan)
                                      plus interest. The Company’s
                                      debt to the Industrial Bank 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 $3,900,025 have been
                                      mortgaged as
                                      security.
 (3)
                                  The
                                      payment on the Industrial Bank loan in the
                                      three months ended March 31,
                                      2008 was provided by the minority shareholder
                                      of Wanxing
                                      Bio-Pharmaceuticals pursuant to a guarantee
                                      provided by the minority
                                      shareholder. The corresponding debt to the
                                      minority shareholder is
                                      included in Shareholder Loans (Note 10).
 (4)
                                  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 guarantees
                                      provided to the bank by Zheda Haina in
                                      2004.
 
 The
                            bank
                            loans are all delinquent at March 31, 2008. 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 March 31, 2008 as
                            more fully described in
                            Note 9.
 
 Subsequent
                            to March 31, 2008 the Company has agreed to revised payment
                            schedules with two
                            of the banks as more
                            fully described in Note 17.
 
 **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 .
  8
 
  **SINOBIOMED
                                INC.**
 **AND
                                CONSOLIDATED SUBSIDIARIES**
 ***Notes
                                to Consolidated Financial Statements***
 ***March
                                31, 2008***
 ***(Expressed
                                in US Dollars)***
 ***(Unaudited
                                - Prepared by Management)***
 
 
 **10.
                            SHAREHOLDER LOANS**
 
 The
                            loans
                            from shareholders in the aggregate amount of $3,636,129
                            do not bear interest.
                            $1,918,573 payable to a shareholder of a subsidiary was
                            due December 31, 2007,
                            $500,000 is payable on demand, 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
                            $2,731,393, and to two individual shareholders in the
                            amounts of $500,000 and
                            $35,000 for shareholders’ 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 has committed to purchase consulting services
                            from a shareholder at the
                            rate of $10,000 per month for five years from March 31,
                            2007. The Company is
                            indebted to the shareholder in the amount of $60,000
                            at March 31, 2008 in
                            respect of these fees.
 
 The
                            Company is indebted to two persons who are shareholders
                            and directors, in
                            amounts of $4,736 and $65,000 for shareholders’ loans.
 
 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).
 
 9
 
  **SINOBIOMED
                                INC.**
 **AND
                                CONSOLIDATED SUBSIDIARIES**
 ***Notes
                                to Consolidated Financial Statements***
 ***March
                                31, 2008***
 ***(Expressed
                                in US Dollars)***
 ***(Unaudited
                                - Prepared by Management)***
 
 
 **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:
  Three
                                      months ended March 31, 2008Loss
                                      for the period
                                  
                                  $
                                  (1,858,906
                                  )Average
                                      statutory tax rate in China
                                  
                                  
                                  33
                                  %Expected
                                      income tax provision
                                  
                                  $
                                  (613,439
                                  )Non-deductible
                                      stock-based compensation and imputed interest
                                      expenses
                                  
                                  
                                  314,485Tax
                                      basis of deferred expenses in excess of book
                                      cost
                                  
                                  
                                  7,376Unrecognized
                                      tax losses
                                  
                                  
                                  291,578Income
                                      tax expense
                                  
                                  $
                                  --
  Significant
                            components of deferred income tax assets are as follows:
  March
                                      31, 2008Operating
                                      losses carried forward
                                  
                                  
                                  4,273,224Excess
                                      of tax basis over book cost of deferred expenses
                                      in China
                                  
                                  $
                                  4,754,641Valuation
                                      allowance
                                  
                                  
                                  (9,027,865
                                  )Net
                                      deferred income tax assets
                                  
                                  $
                                  -
  The
                            Company has tax losses carried forward for Chinese tax
                            purposes of approximately
                            $12,949,000 which will expire in 2013 if not utilized.
  10
 
  **SINOBIOMED
                                INC.**
 **AND
                                CONSOLIDATED SUBSIDIARIES**
 ***Notes
                                to Consolidated Financial Statements***
 ***March
                                31, 2008***
 ***(Expressed
                                in US Dollars)***
 ***(Unaudited
                                - Prepared by Management)***
 
 **13.
                            COMMON STOCK**
 
 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 recognized an
                            issue price for the shares
                            of $0.525 per share, reflecting a discount from market
                            price on that date due to
                            there being a hold period before the shares can be sold.
 
 Warrants
                            outstanding and exercisable as of March 31, 2008 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
 
 **14.
                            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:
  11
 
  **SINOBIOMED
                                INC.**
 **AND
                                CONSOLIDATED SUBSIDIARIES**
 ***Notes
                                to Consolidated Financial Statements***
 ***March
                                31, 2008***
 ***(Expressed
                                in US Dollars)***
 ***(Unaudited
                                - Prepared by Management)***
 
 Number
                                      of options
                                  
                                  Weighted
                                      Average Exercise Price
                                  
                                  Weighted
                                      Average Grant-date Fair Value
                                  
                                  Aggregate
                                      Intrinsic Value**Options
                                      Outstanding**,
                                      January 1, 2008
                                  
                                  
                                  8,000,000
                                  
                                  
                                  0.82
                                  
                                  
                                  0.825
                                  
                                  $
                                  6,597,922Options
                                      granted:
                                  
                                  
                                  -**Options
                                      Outstanding**,
                                      March 31, 2008
                                  
                                  
                                  8,000,000
                                  
                                  
                                  0.82
                                  
                                  
                                  0.825
                                  
                                  $
                                  6,597,922
 
 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
                                  
                                  
                                  Range
                                      of Exercise Prices
                                  
                                  
                                  Number
                                      of
                                      Shares
                                  
                                  
                                  Weighted
                                      Average
                                      Exercise Price
                                  
                                  
                                  Compensation
                                      Expense
                                      to be Recognized
                                  
                                  
                                  Aggregate
                                      IntrinsicValueMarch
                                      31,2008 and earlier
                                  
                                  
                                  0.50
                                      to 1.90
                                  
                                  
                                  4,400,000
                                  
                                  
                                  0.55
                                  
                                  
                                  
                                  
                                  $
                                  3,426,481Remainder
                                      of 2008
                                  
                                  
                                  0.50
                                  
                                  
                                  2,250,000
                                  
                                  
                                  0.73
                                  
                                  $
                                  1,914,750
                                  
                                  
                                  1,914,2432009
                                  
                                  
                                  1.90
                                  
                                  
                                  850,000
                                  
                                  
                                  1.81
                                  
                                  
                                  842,735
                                  
                                  
                                  842,7342011
                                  
                                  
                                  1.90
                                  
                                  
                                  500,000
                                  
                                  
                                  1.91
                                  
                                  
                                  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, 2008
                                  
                                  
                                  4,650,000
                                  
                                  $
                                  -
                                  
                                  
                                  -Non-vested
                                      options outstanding, March 31, 2008
                                  
                                  
                                  3,600,000
                                  
                                  $
                                  3,171,442
                                  
                                  
                                  0.881Options
                                      vested in three months ended March 31, 2008
                                  
                                  
                                  1,050,000
                                  
                                  $
                                  866,008
                                  
                                  $
                                  0.825
  12
 
  **SINOBIOMED
                                INC.**
 **AND
                                CONSOLIDATED SUBSIDIARIES**
 ***Notes
                                to Consolidated Financial Statements***
 ***March
                                31, 2008***
 ***(Expressed
                                in US Dollars)***
 ***(Unaudited
                                - Prepared by Management)***
 
  If
                            not
                            previously exercised or canceled, options outstanding
                            at March 31, 2008 will
                            expire as follows:
  Range
                                      of Exercise Prices
                                  
                                  Number
                                  
                                  Weighted
                                      averageExpiry
                                      Date
                                  
                                  High
                                  
                                  Low
                                  
                                  of
                                      Shares
                                  
                                  exercise
                                      priceYear
                                      Ending December 31,2012
                                  
                                  
                                  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
  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.
 
 **15.
                            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 $1,569,000) 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 $2,852,000) 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 $357,000) 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 $143,000) will be
                            due by the time of upon
                            completion of Phase II trials and 1.5 Million yuan (approximately
                            $214,000) 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.
 
 13
 
  **SINOBIOMED
                                INC.**
 **AND
                                CONSOLIDATED SUBSIDIARIES**
 ***Notes
                                to Consolidated Financial Statements***
 ***March
                                31, 2008***
 ***(Expressed
                                in US Dollars)***
 ***(Unaudited
                                - Prepared by Management)***
 
 
 **16.
                            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 (income)
                                  
                                  Total
                                      assetsPharmaceuticals
                                  
                                  $
                                  26,670
                                  
                                  $
                                  839,188
                                  
                                  $
                                  7,970,590Cosmetics
                                  
                                  
                                  147,423
                                  
                                  
                                  (83,663
                                  )
                                  
                                  311,187Parent
                                      company administration
                                  
                                  
                                  
                                  
                                  
                                  1,103,382
                                  
                                  
                                  48,676Total
                                      consolidated
                                  
                                  $
                                  174,093
                                  
                                  $
                                  1,858,907
                                  
                                  $
                                  8,330,453
 
 **17.
                            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
                            $570,000) 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
                            $428,000) by
                            April 30, 2008, 10 Million yuan (approximately $1,426,000)
                            by June 30, 2008 and
                            the balance of principal and interest by September 30,
                            2008. Wanxin
                            Bio-pharmaceuticals paid 1 Million yuan by April 30,
                            2008 under this
                            agreement.
  14


**Item
        2. 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 quarterly 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” in
      the Form 10-KSB filed with the SEC on EDGAR on April 14, 2008.





**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.





Wanxin
      is
      a company incorporated
      under the laws of the British Virgin Islands. Its only asset at the time of
      the
      reverse merger was 100% ownership of Manhing Enterprises Limited (“Manhing”), a
      company incorporated under the laws of Hong Kong. Manhing’s only asset was 82%
      ownership of Shanghai
      Wanxing Bio-pharmaceuticals Co., Ltd. (“Shanghai Wanxing”), a Sino- Foreign
      Joint Venture company incorporated with limited liability under the laws of
      the
      People’s Republic of China. Shanghai Wanxing’s business is research,
      development, manufacture and sale of pharmaceutical products, primarily for
      the
      Chinese market. There are currently 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. Currently manufactured product lines include 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 .





Shanghai
      Wanxing is also the owner of 50.33% of Shanghai Wanxing Bio-science Cosmetic
      Co., Ltd. (“Wanxing Cosmetic”). Wanxing Cosmetic manufactures skin-care products
      under the brand name KaiYing.





During
      the quarter ended March 31, 2008, Shanghai Wanxing was approved to receive
      grants from government funding of RMB 9 million (US$1.24 million) to continue
      the clinical trial of its recombinant malaria vaccine and advance its
      development with partner Second Military Medical University (“SMMU”). The
      funding is the largest the Chinese government has ever granted to a
      biopharmaceutical company.




The
      grant
      from China’s Ministry of Science and Technology, awarded jointly to Shanghai
      Wanxing and SMMU, is part of the key “863 Program” to support technology
      development as part of the government’s 11th five-year plan. Two-thirds of the
      fund will support Shanghai Wanxing’s planned Phase II Clinical Trial of the
      patented PfCP2.9 vaccine to be conducted in epidemic areas. The current research
      schedule calls for the application to the Chinese Food and Drug Administration
      (SFDA) for the Phase II Clinical trial in malaria endemic areas to be submitted
      by end of 2008.




The
      balance of the fund will support the joint development by Shanghai Wanxing
      and
      SMMU of a multistage, multivalent vaccine based on PfCP2.9. The multistage,
      multivalent vaccine, which seeks to improve immunogenicity and extend the immune
      period, is expected to enter into clinical trials in 2009.


3




**Attempted
      Acquisition and Rescission**





On
      August
      6, 2007, the Company through its 82% owned subsidiary, 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).





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.





On
      February 3, 2008, Suzhou Boai and the former owners 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.




4


**Revenues**





The
      Company has revenues from the Wanferon/Wanferin product line, aFGF, and the
      cosmetics products in the three months ended March 31, 2008. Shanghai Wanxing
      is
      involved in a dispute with the company which manufactures the Leflunomide
      product under license. Should this dispute not be resolved, we may not realize
      further sales of the Leflunomide product. The Company also sells a relatively
      small amount of reagent, which is a product completed only to the stage where
      it
      can still be made into various different recombinant protein based
      pharmaceutical products.





Wanferon/Wanferin
      sales accounted for $5,954 of sales revenue and $1,970 of cost of sales in
      the
      three months ended March 31, 2008, as compared to $124,903
      of sales revenue and $111,621 of cost of sales in the three months ended March
      31, 2007. The market for this product line is very competitive, and selling
      prices and volume have been decreasing through the 2006, 2007 years and to
      date
      in 2008 due to increased competition.





There
      has
      been no sales of the Leflunomide product and therefore no revenue or costs
      attributable to the product for the three months ended March 31,
      2008 ***.***





aFGF
      sales accounted for $20,716 of sales revenue and $32,773 of cost of sales in
      the
      three months ended March 31, 2008. There was no sales revenue or cost of sales
      of aFGF in the three months ended March 31, 2007 as the product was awaiting
      regulatory approval at the time..





Cosmetics
      sales accounted for $147,423 of sales revenue and $27,358 of cost of sales
      in
      the three months ended March 31, 2008, as compared to $71,801 of sales revenue
      and $50,200 of cost of sales in the three months ended March 31, 2007.




Cost
      of sales exceeds revenue for the quarter as low
      production volume during the early stage of the product life has resulted in
      high manufacturing cost per unit due to overhead and indirect costs of the
      manufacturing facility being allocated to cost of product
      manufactured.




Cosmetic
      products sales exceed pharmaceutical product
      sales this quarter due to introduction of new high-end cosmetics products in
      the
      cosmetics product line through television shopping channel sales, which have
      been very well received and have resulted in rapid growth of cosmetic sales
      since the introduction in October of 2007.





**Operating
      Expenses**





Operating
      expenses increased from $  1,574,897
      for the three months ended March 31, 2007 to $1,756,070 for the three months
      ended March 31, 2008. This increase was primarily due to (1) an increase in
      Salaries and benefits (in the amount of $93,956), and (2) an increase in
      expenses relating to Stock-Based Compensation on options issued to employees
      and
      consultants (in the amount of $462,622).





Stock-based
      compensation





Stock-based
      compensation expense of $917,158 was recognized in the three months ended March
      31, 2008 compared to $454,536 in the comparable period in the previous year.
      The
      expense represents (1) $681,805 as recognition of three months amortization
      of
      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) $51,807
      as
      recognition of 3 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) $183,546 as recognition of 3 months 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.


5


**Other
      Income and Expenses**





During
      the three month period ending March 31, 2008, the Company's interest expense
      (included in other income and expenses) was reduced from $353,991 from that
      in
      the comparable period to $135,294, attributable to a substantial reduction
      of
      its bank debt in 2007.





**Net
      Loss**





As
      a
      combined result of (1) the increase in our operating expenses, and (2) the
      reduction in other income and expenses, our net loss for the three months ended
      March 31, 2008, was $1,858,906, compared to a net loss of $1,777,344 for the
      three months ended March 31, 2007 and the related cash used in operating
      activities in the three months ended March 31, 2008, was $528,527, compared
      to
      cash used of $608,241 for the three months ended March 31, 2007.





**Liquidity
      and Capital Resources**





At
      March 31, 2008, we had $64,937 of cash on hand and a working capital deficiency
      of $13,868,748. The Company is currently in the process of seeking to raise
      additional funds from equity and/or debt financing. The Company believes that
      its cash on hand as at March 31, 2008, and the funds it expects to raise from
      additional equity and/or debt financing, and its future revenues from its new
      products currently entering the market will enable the Company to meet its
      working capital needs and its debt service requirements for the following 12
      months.




**ITEM
      3. Controls and Procedures**




**Disclosure
      Controls and Procedures.** The
      Company’s management, with the participation of the Company’s Chief Executive
      Officer and Chief Financial Officer, has evaluated the effectiveness of the
      Company’s disclosure controls and procedures as of the end of the period covered
      by this report. Based on such evaluation, the Chief Executive Officer and Chief
      Financial Officer have concluded that, as of the end of such period, the
      Company’s disclosure controls and procedures were effective.




**Internal
      Control over Financial Reporting.** There
      have been no changes in the Company’s internal controls over the financial
      reporting that occurred during the most recent fiscal quarter that have
      materially affected, or are reasonably likely to materially affect, our internal
      controls over financial reporting.





The
      Company has appointed Chris Metcalf who is a director of the company and a
      financial expert to serve as the head of the audit committee.





The
      Company intends to adopt a code of business conduct and ethics as an additional
      element to its financial controls and procedures in the near
      future.





**PART
      II - OTHER INFORMATION**




**Item
      1. Legal Proceedings**




The
      Company, through Shanghai Wanxing, 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 2,205,000). Under the terms of
      the
      settlement agreement, the Company was obligated to pay the bank five million
      yuan (approximately $US 620,000) before October 30, 2006, three million yuan
      (approximately $US 394,000) before March 20, 2007, three million yuan
      (approximately $US 394,000) before June 20, 2007, three million yuan
      (approximately $US 394,000) before September 20, 2007 and 3.8 million yuan
      (approximately $US 499,000) plus the balance of accrued interest before December
      20, 2007. The Company made a payment of five 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 three 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, 2007, 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 .


6


Other
      than the above mentioned litigation and settlement agreements, 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.





**Item
      2. Unregistered Sales of Equity Securities and Use of
      Proceeds**





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.





**Item
      3. Defaults Upon Senior Securities**





N/A





**Item
      4. Submission of Matters to a Vote of Security Holders**





N/A




**Item
      5. Other Information**




N/A




**Item** **6.
        Exhibits**




(a)
            Exhibit
                List




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. §135032.2
            Certificate
                pursuant to 18 U.S.C. §1350


7




**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 14th day of
      May, 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 andDirector
              
              May
                  14, 2008Ban
                  Jun Yang/s/
                    Ka Yu
              
              Secretary,
                  Treasurerand
                  Director
              
              May
                  14, 2008Ka
                  Yu/s/
                    Asher Zwebner
              
              Chief
                  Financial Officer
              
              May
                  14, 2008Asher
                  Zwebner


8