UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                              Washington, DC 20549

                                   Form 10-QSB

--------------------------------------------------------------------------------


                                   (Mark one)

     X Quarterly Report Under Section 13 or 15(d) of the Securities Exchange
                                   Act of 1934


                  For the quarterly period ended March 31, 2004

     Transition Report Under Section 13 or 15(d) of the Securities Exchange
                                   Act of 1934


         For the transition period from ______________ to _____________

--------------------------------------------------------------------------------


                         Commission File Number: 0-49666
                                                 -------

                         Tiens Biotech Group (USA), Inc.
        (Exact name of small business issuer as specified in its charter)

        Delaware                                               75-2926439
------------------------                                ------------------------
(State of incorporation)                                (IRS Employer ID Number)

                      No. 6, Yuanquan Road, Wuqing New-Tech
                         Industrial Park, Tianjin, China
            --------------------------------------------------------
                    (Address of principal executive offices)

                              (011) 86-22-8213-7264
                       ----------------------------------
                           (Issuer's telephone number)

--------------------------------------------------------------------------------

Check  whether the issuer (1) filed all reports  required to be filed by Section
13 or 15(d) of the  Exchange  Act during the past 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
                                                             ---   ---

State the number of shares outstanding of each of the issuer's classes of common
equity as of the latest practicable date: March 31, 2004: 71,998,586.

Transitional Small Business Disclosure Format (check one): YES    NO X
                                                              ---   ---

<PAGE>

                         Tiens Biotech Group (USA), Inc.

                Form 10-QSB for the Quarter ended March 31, 2004

                                Table of Contents


                                                                            Page
                                                                            ----
Part I - Financial Information

  Item 1   Financial Statements                                                2

  Item 2   Management's Discussion and Analysis or Plan of Operation          13

  Item 3   Controls and Procedures                                            17

Part II - Other Information

  Item 1   Legal Proceedings                                                  17

  Item 2   Changes in Securities                                              17

  Item 3   Defaults Upon Senior Securities                                    17

  Item 4   Submission of Matters to a Vote of Security Holders                17

  Item 5   Other Information                                                  17

  Item 6   Exhibits and Reports on Form 8-K                                   17


Signatures                                                                    18







<PAGE>
<TABLE>
<CAPTION>

Part I - Financial Information

Item 1- Financial Statements

                TIENS BIOTECH GROUP (USA), INC. AND SUBSIDIARIES

                           CONSOLIDATED BALANCE SHEETS
                   AS OF MARCH 31, 2004 AND DECEMBER 31, 2003

                                     ASSETS
                                     ------
                                                               March 31,     December 31,
                                                                 2004            2003
                                                             ------------    ------------
                                                              (Unaudited)      (Audited)
                                                             ------------    ------------
<S>                                                          <C>             <C>
CURRENT ASSETS:
    Cash                                                     $ 18,235,584    $ 12,725,043
    Accounts receivable, trade - related party, net of
      allowance for doubtful accounts of $12,877 as of
       March 31, 2004 and December 31, 2003, respectively         972,888           8,533
    Other receivables                                             139,820         139,820
    Other receivables and note receivable - related party      20,280,776      26,831,339
    Inventories                                                 5,119,183       4,004,216
    Other assets                                                  168,731            --
                                                             ------------    ------------
      Total current assets                                     44,916,982      43,708,951
                                                             ------------    ------------

PLANT AND EQUIPMENT, net                                       11,189,913      11,156,268
                                                             ------------    ------------
OTHER ASSETS:
    Intangible asset, net                                         351,389         363,330
    Employee advances                                             507,119         821,536
    Deposits                                                    1,109,487       1,051,557
                                                             ------------    ------------
      Total other assets                                        1,967,995       2,236,423
                                                             ------------    ------------

        Total assets                                         $ 58,074,890    $ 57,101,642
                                                             ============    ============
                      LIABILITIES AND SHAREHOLDERS' EQUITY
                      ------------------------------------
CURRENT LIABILITIES:
    Accounts payable                                         $  2,364,211    $  2,531,829
    Accounts payable - related party                                 --           758,570
    Advances from customers - related parties                      74,183       5,141,661
    Wages and benefits payable                                     31,042          25,447
    Other taxes payable                                           339,612         206,723
    Other payables                                                 35,752          27,251
    Other payables - related parties                              872,253       1,312,288
    Short term notes payable                                    4,719,000       5,324,000
    Current portion of long term debt                             251,854         259,364
                                                             ------------    ------------
      Total current liabilities                                 8,687,907      15,587,133
                                                             ------------    ------------

LONG TERM DEBT, net of current portion                             95,796         155,591
                                                             ------------    ------------

      Total liabilities                                         8,783,703      15,742,724
                                                             ------------    ------------

MINORITY INTEREST                                               9,785,999       8,272,726
                                                             ------------    ------------
SHAREHOLDERS' EQUITY:
    Common stock, $0.001 par value, 260,000,000
      shares authorized, 71,998,586 shares
      issued and outstanding, respectively                          6,851           6,851
    Paid-in-capital                                             8,906,492       8,906,492
    Statutory reserves                                          3,730,137       3,730,137
    Retained earnings                                          26,865,636      20,453,290
    Stock receivable                                                 --            (6,650)
    Accumulated other comprehensive income (loss)                  (3,928)         (3,928)
                                                             ------------    ------------
      Total shareholders' equity                               39,505,188      33,086,192
                                                             ------------    ------------

        Total liabilities and shareholders' equity           $ 58,074,890    $ 57,101,642
                                                             ============    ============
</TABLE>

The accompanying notes are an integral part of this statement.


                                       2
<PAGE>

                TIENS BIOTECH GROUP (USA), INC. AND SUBSIDIARIES

     CONSOLIDATED STATEMENTS OF INCOME AND OTHER COMPREHENSIVE INCOME (LOSS)
               FOR THE THREE MONTHS ENDED MARCH 31, 2004 AND 2003

                                                        2004           2003
                                                    ------------   ------------
REVENUE - RELATED PARTIES                           $ 11,489,695   $  8,113,932

COST OF SALES                                          2,729,137      2,628,895
                                                    ------------   ------------

GROSS PROFIT                                           8,760,558      5,485,037

SELLING, GENERAL AND  ADMINISTRATIVE EXPENSES          1,138,696        673,645
                                                    ------------   ------------

INCOME FROM OPERATIONS                                 7,621,862      4,811,392

OTHER INCOME (EXPENSE), net                              303,757       (171,828)
                                                    ------------   ------------

INCOME BEFORE MINORITY INTEREST                        7,925,619      4,639,564

MINORITY INTEREST                                      1,513,273        927,913
                                                    ------------   ------------

NET INCOME                                             6,412,346      3,711,651

OTHER COMPREHENSIVE INCOME (LOSS):
    Foreign currency translation adjustment                 --             --
                                                    ------------   ------------

COMPREHENSIVE INCOME                                $  6,412,346   $  3,711,651
                                                    ============   ============

EARNINGS PER SHARE, BASIC AND DILUTED               $       0.09   $       0.11
                                                    ============   ============

WEIGHTED AVERAGE NUMBER OF SHARES                     71,998,586     32,503,302
                                                    ============   ============









The accompanying notes are an integral part of this statement.


                                       3
<PAGE>
<TABLE>
<CAPTION>

                TIENS BIOTECH GROUP (USA), INC. AND SUBSIDIARIES

                 CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY
               FOR THE THREE MONTHS ENDED MARCH 31, 2004 AND 2003



                                          Number          Common         Paid-in         Statutory
                                        of shares         stock          capital         reserves
                                      -------------   -------------   -------------   -------------
<S>                                      <C>          <C>             <C>             <C>
BALANCE, January 1, 2004, audited        71,998,586   $       6,851   $   8,906,492   $   3,730,137

   Net income                                  --              --              --              --
   Receipt of stock receivable                 --              --              --              --
                                      -------------   -------------   -------------   -------------
BALANCE, March 31, 2004, unadudited      71,998,586           6,851       8,906,492       3,730,137
                                      =============   =============   =============   =============

BALANCE, January 1, 2003, audited         5,000,508   $           1   $   8,906,492   $     399,173

   Net income                                  --              --              --              --
                                      -------------   -------------   -------------   -------------
BALANCE, MARCH 31, 2003, unaudited        5,000,508   $           1   $   8,906,492   $     399,173
                                      =============   =============   =============   =============


                                                                       Accumulated
                                                                          other
                                         Retained         Stock       comprehensive
                                         earnings       receivable    income (loss)      Totals
                                      -------------   -------------   -------------   -------------
BALANCE, January 1, 2004, audited     $  20,453,290   $      (6,650)  $      (3,928)  $  33,086,192

   Net income                             6,412,346            --              --         6,412,346
   Receipt of stock receivable                 --             6,650            --             6,650
                                      -------------   -------------   -------------   -------------
BALANCE, March 31, 2004, unadudited      26,865,636            --            (3,928)     39,505,188
                                      =============   =============   =============   =============

BALANCE, January 1, 2003, audited     $   6,730,432   $        --     $      (3,928)  $  16,032,170

   Net income                             3,711,651            --              --         3,711,651
                                      -------------   -------------   -------------   -------------
BALANCE, MARCH 31, 2003, unaudited    $  10,442,083   $        --     $      (3,928)  $  19,743,821
                                      =============   =============   =============   =============
</TABLE>























The accompanying notes are an integral part of this statement.

                                       4
<PAGE>
<TABLE>
<CAPTION>

                TIENS BIOTECH GROUP (USA), INC. AND SUBSIDIARIES

                     CONSOLIDATED STATEMENTS OF CASH FLOWS
               FOR THE THREE MONTHS ENDED MARCH 31, 2004 AND 2003

                                                                  2004            2003
                                                              ------------    ------------
<S>                                                           <C>             <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
    Net income                                                $  6,412,346    $  3,711,651
    Adjustments to reconcile net income to cash
      provided by (used in) operating activities:
         Minority interest                                       1,513,273         927,913
         Depreciation                                              241,482         255,049
         Amortization                                               11,941          15,469
      (Increase) decrease in assets:
         Accounts receivable trade - related party                (964,355)     (1,093,693)
         Other receivables                                                        (571,219)
         Other receivables - related party                       6,550,563
         Inventories                                            (1,114,967)     (1,050,182)
         Other assets                                             (168,731)
         Employee advances                                         314,417        (366,432)
         Deposits                                                  (57,930)        460,592
      Increase (decrease) in liabilities:
         Accounts payable                                         (167,618)        630,238
         Accounts payable - related party                         (758,570)       (762,694)
         Advances from customers                                (5,067,478)         1,106
         Wages and benefits payable                                 5,595         472,146
         Other taxes payable                                      132,889         (76,224)
         Other payables                                              8,501         (81,335)
         Other payables - related parties                         (440,035)      2,263,207
                                                              ------------    ------------
           Net cash provided by operating activities             6,451,323       4,735,592
                                                              ------------    ------------

CASH FLOWS FROM INVESTING ACTIVITIES:
    Increase in loans receivable - related party                                (1,384,612)
    Purchase of equipment and automobiles                         (275,127)       (433,008)
                                                              ------------    ------------
           Net cash used in investing activities                  (275,127)     (1,817,620)
                                                              ------------    ------------

CASH FLOWS FROM FINANCING ACTIVITIES:
    Proceeds from receipt of stock receivable                        6,650
    Payments, net of borrowings on short term notes payable       (605,000)          1,210
    Payments on long term debt                                     (67,305)        (67,385)
                                                              ------------    ------------
           Net cash used in financing activities                  (665,655)        (66,175)
                                                              ------------    ------------

INCREASE IN CASH                                                 5,510,541       2,851,797

CASH, beginning of period                                       12,725,043         302,974
                                                              ------------    ------------

CASH, end of period                                           $ 18,235,584    $  3,154,771
                                                              ============    ============
</TABLE>




The accompanying notes are an integral part of this statement.


                                       5
<PAGE>

                TIENS BIOTECH GROUP (USA), INC. AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


Note 1 - Summary of significant accounting policies

Background
----------

On February 17, 2004,  Tiens  Biotech Group (USA),  Inc. (the Company)  formally
changed it name from Strategika, Inc. to Tiens Biotech Group (USA), Inc.

On August 22, 2003, Strategika,  Inc., a corporation organized under the laws of
the State of Delaware ("STRATEGIKA"); Tianshi International Holdings Group Ltd.,
a  corporation   organized   under  the  laws  of  the  British  Virgin  Islands
("TIANSHI");  Li Jin Yuan,  Jiao Wen Jun and Yan Yu Peng, all Chinese  Nationals
who are  stockholders  of TIANSHI (the "TIANSHI  Stockholders")  entered into an
Agreement  and Plan of  Reorganization  (the  "Agreement").  The  Agreement  was
effective  on  September  9,  2003  (the  "Effective  Date").  Pursuant  to  the
Agreement,  STRATEGIKA received from the TIANSHI  Stockholders all of the issued
and  outstanding  common stock of TIANSHI in exchange for  68,495,000  shares of
restricted  (as defined in Rule 144 of the  Securities  Act of 1933, as amended)
common stock of STRATEGIKA. As additional  consideration,  the 29,000,000 shares
of the common stock of  STRATEGIKA  held by Rene  Larrave,  the sole officer and
director of STRATEGIKA prior to the reorganization,  were redeemed to STRATEGIKA
and dully cancelled by STRATEGIKA.

Pursuant to the Agreement and on the Effective  Date, as  consideration  for the
exchange  of  the  TIANSHI  Shares,   STRATEGIKA  issued  68,495,000  shares  of
restricted  common  capital  stock,  par value $0.001 per share,  to the TIANSHI
Stockholders,  representing  approximately  95% of the  issued  and  outstanding
common capital stock of STRATEGIKA following the time of the issuance. There are
currently  71,998,586  issued  and  outstanding  shares of  common  stock of the
reorganized STRATEGIKA.

STRATEGIKA was incorporated on July 13, 1990 as Super Shops, Inc. under the laws
of the State of Michigan.  In October 2000, Super Shops, Inc.  reincorporated in
Delaware and changed its name to MIA Acquisition  Corp. On February 11, 2002, in
connection with a change in control  transaction,  MIA Acquisition  Corp changed
its name to  Strategika,  Inc.  Until the Effective  Date,  STRATEGIKA  had only
nominal assets and liabilities and was a development stage company attempting to
provide network security services to Fortune 1000 listed companies.  As a result
of the  reorganization,  STRATEGIKA  will  continue the business  operations  of
TIANSHI.

TIANSHI  was  incorporated  on March 24,  2003 in the  territory  of the British
Virgin  Islands.  The following is a description of the various  individuals and
companies discussed in the footnotes and their relationship to TIANSHI.

Tianshi  International  Holdings  Group Ltd.  - British  Virgin  Island  company
         formerly  owned 100% by Li Jinyuan  and  currently  owned 100% by Tiens
         Biotech Group (USA), Inc.

Li Jinyuan - individual - President and majority shareholder

Li Baolan - individual - Daughter of Li Jinyuan

Tianjin Tianshi  Biological  Development Co., Ltd. - Chinese joint venture which
         Tianshi International Holdings Group Ltd. owns 80%




                                       6
<PAGE>

                TIENS BIOTECH GROUP (USA), INC. AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


Note 1 - Summary of significant accounting policies (continued)

Background (continued)
----------------------

Tianshi Hong Kong International  Development Co., Ltd. - Hong Kong company owned
        100% by Li Jinyuan

Tianjin Tianshi Biological  Engineering Co., Ltd. - Chinese company owned 49% by
         Li Baolan and 51% by Tianjing Tianshi Group Co., Ltd.

Tianjin  Tianshi  Pharmaceuticals  Co., Ltd. - Chinese  company and the majority
         shareholder is Tianjin Tianshi Group Co., Ltd.

Tianjin Tianshi Group Co., Ltd. - Owned 90% by Li Jinyuan and 10% by Li Baolan

On June 18, 2001,  Tianshi  International  Holdings  Group Ltd.  acquired 80% of
Tianjin Tianshi Biological Development Co., Ltd. ("BIOLOGICAL"). Tianjin Tianshi
Biological  Development Co., Ltd. is a foreign investment joint venture which is
incorporated  under the laws of the People's  Republic of China ("PRC") on March
27,  1998.  The original  partners in this joint  venture were Tianshi Hong Kong
International Development Co., Ltd. incorporated in Hong Kong which owned 80% of
the joint venture and Tianjin Tianshi Biological Engineering Co., Ltd, a Chinese
company incorporated in the People's Republic of China which owned the remaining
20% of the joint venture. Tianshi Hong Kong International  Development Co., Ltd.
is owned 100% by Li Jinyuan,  the  Company's  president  and major  shareholder.
Tianjin Tianshi  Biological  Engineering Co., Ltd is 49% owned by Ms. Li Baolan,
the daughter of Li Jinyuan and 51% by Tianjin  Tianshi  Group Co.,  Ltd. On June
18, 2003,  Tianjin Tianshi  Biological  Engineering Co., Ltd transferred its 20%
interest  in  the  joint  venture  for  no   consideration  to  Tianjin  Tianshi
Pharmaceuticals Co., Ltd, a Chinese company in which the majority shareholder is
Tianjin Tianshi Group Co., Ltd. On June 18, 2003, Tianshi International Holdings
Group Ltd. acquired 80% of Tianjin Tianshi Biological  Development Co., Ltd from
Tianshi Hong Kong International Development Co., Ltd. for no consideration. This
transfer was made for no  consideration  since Li Jinyuan is president  and sole
shareholder of both companies.

The reporting entity
--------------------

The financial  statements in the filings of STRATEGIKA  become those of TIANSHI.
The consolidated financial statements of Strategika,  Inc. and subsidiaries (the
"Company")  reflect  the  activities  of  its  100%  owned  subsidiary,  Tianshi
International Holdings Group Ltd., and its 80% owned subsidiary, Tianjin Tianshi
Biological  Development  Co.,  Ltd. The  consolidated  financial  statements  of
TIANSHI have been presented as if the acquisition of BIOLOGICAL  occurred at the
beginning of 2002 due to common management and ownership.

The consolidated  financial  statements generally reflect only the activities of
Tianjin  Tianshi  Biological  Development  Co.,  Ltd. at its cost since  Tianshi
International  Holdings Ltd., had no operational activities for the three months
ended March 31,  2003.  Since  STRATEGIKA's  continuing  operations  and balance
sheets  are  insignificant,  a pro forma  balance  sheets at March 31,  2004 and
December 31, 2003 and  statements of  operations  for the periods then ended are
not presented herein.


                                       7
<PAGE>

                TIENS BIOTECH GROUP (USA), INC. AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


Note 1 - Summary of significant accounting policies (continued)

The reporting entity (continued)
--------------------------------

Tianjin Tianshi  Biological  Development Co., Ltd. is a foreign investment joint
venture which is incorporated  under the laws of the People's Republic of China.
BIOLOGICAL is classified as a Foreign Investment Enterprise (FIE) in the PRC and
is  subject  to the FIE  laws of the PRC.  BIOLOGICAL  is a  Chinese  registered
limited   liability  company  with  a  legal  structure  similar  to  a  regular
corporation and a limited  liability  company  organized under state laws in the
United  States of America.  The Articles of  Association  provides for a 50 year
term beginning on March 27, 1998 with registered capital of $10,000,000.

TIANSHI owns 80% of its  subsidiary  BIOLOGICAL.  The  remaining 20% is owned by
Tianjin  Tianshi  Pharmaceuticals  Co., Ltd, a Chinese  company and the majority
shareholder of this Chinese company is Tianjin Tianshi Group Co., Ltd.

Nature of operations
--------------------

The Company through its subsidiary is primarily engaged in the manufacturing and
marketing of herbal products, vitamin and mineral supplements, personal care and
other  products.  The  Company  sells its  products  to a sales force of related
distributors  who in turn sell to independent  distributors and managers who use
the products  themselves or resell them to other distributors or consumers.  The
Company markets its products in the United States,  China,  South Korea,  Japan,
India, Thailand, Malaysia,  Indonesia, Canada, Peru, Brazil, Russia, Kazakhstan,
Belarus,  Mongolia,  Finland,  Lithuania,  Britain,  Germany,  France,  Romania,
Ukraine, Portugal, Turkey, Italy, Nigeria, Ghana, South Africa and Australia.

Revenue recognition
-------------------

The Company recognizes revenue from domestic sales by distributors, net of sales
commissions and taxes only when the related Chinese distributor recognizes sales
of the Company's products to unaffiliated third parties.  The Company recognizes
revenue  from   international   sales   (non-Chinese)  to  both  affiliated  and
unaffiliated  third parties,  net of commissions  and taxes as goods are shipped
and clears the review by the international customs department.

The Company is generally not contractually obligated to accept returns. However,
on a case by case  negotiated  basis,  the Company  permits  customers to return
their products.  In accordance with SFAS No. 48, "Revenue  Recognition  when the
Right of Return  Exists",  revenue is recorded net of an allowance for estimated
returns.  Such  reserves are based upon  management's  evaluation  of historical
experience and estimated costs. The amount of the reserves  ultimately  required
could  differ  materially  in  the  near  term  from  amounts  included  in  the
accompanying consolidated financial statements.

In 2003,  Tianjin Tianshi  Biological  Engineering  Co., LTD, a related company,
owned all of the related party  distributors  which sell the Company's  products
domestically  in China.  The Company was  responsible for paying all the related
sales expenses incurred to sell their products to outside third parties.




                                       8
<PAGE>

                TIENS BIOTECH GROUP (USA), INC. AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


Note 1 - Summary of significant accounting policies (continued)

Foreign currency translation
----------------------------

The  reporting  currency  of the Company is the US dollar.  Tianshi's  financial
records are maintained and the statutory financial  statements are stated in its
local  currency,  Renminbi  (RMB),  as their  functional  currency.  Results  of
operations  and cash flow are  translated at average  exchange  rates during the
period,  and assets and liabilities are translated at the unified  exchange rate
as quoted by the People's Bank of China at the end of the period.

This quotation of the exchange rates does not imply free  convertibility  of RMB
to other foreign currencies.  All foreign exchange transactions continue to take
place either through the Bank of China or other banks authorized to buy and sell
foreign currencies at the exchange rate quoted by the People's Bank of China.

Approval of foreign currency payments by the Bank of China or other institutions
requires submitting a payment application form together with invoices,  shipping
documents and signed contracts.

Translation  adjustments resulting from this process are included in accumulated
other comprehensive income in the consolidated statement of shareholders' equity
and  amounted  to  $(3,928)  as  of  March  31,  2004  and  December  31,  2003,
respectively.

Transaction  gains and losses  that arise from  exchange  rate  fluctuations  on
transactions  denominated in a currency  other than the functional  currency are
included  in the  results of  operations  as  incurred.  These  amounts  are not
material to the consolidated financial statements.

Income taxes
------------

The Company has adopted  Statement of Financial  Accounting  Standards  No. 109,
"Accounting  for Income Taxes" (SFAS 109).  SFAS 109 requires the recognition of
deferred  income  tax  liabilities  and  assets  for  the  expected  future  tax
consequences  of temporary  differences  between  income tax basis and financial
reporting basis of assets and liabilities.

The Company is subject to income taxes on an entity  basis on income  arising in
or derived  from the tax  jurisdiction  in which each entity is  domiciled.  The
Company was  incorporated  in the British  Virgin  Islands and is not liable for
income taxes.

The Company's subsidiary,  Tianshi, is a Sino-Foreign Joint Venture incorporated
in the  People's  Republic of China.  Pursuant to the income tax laws of the PRC
concerning  Foreign Investment  Enterprises and foreign  Enterprises and various
local  income  tax laws (the  "Income  Tax  Law"),  Sino-foreign  joint  venture
enterprises generally are subject to income tax at an effective rate of 33% (30%
state income  taxes plus 3% local  income  taxes) on income as reported in their
statutory   financial   statements   unless   the   enterprise   is  located  in
specially-designated  regions or cities for which more favorable effective rates
apply. Tianshi is located in Special Economic Zone and is subject to the special
reduced income tax rate of 15%. Pursuant to the approval of the relevant PRC tax
authorities,  Tianshi  is fully  exempt  from PRC  income  taxes  for two  years
starting  from the year  profits are first  made,  followed by a 10% reduced tax
rate for the next three years.


                                       9
<PAGE>

                TIENS BIOTECH GROUP (USA), INC. AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


Note 1 - Summary of significant accounting policies (continued)

Income taxes (continued)
------------------------

Prior to the year ended  December  31,  2002,  Tianshi  has  suffered  operating
losses.  Tianshi started  generating  taxable profits in the year ended December
31, 2003.  Effective  January 1, 2005,  the two-year  100%  exemption for income
taxes will  expire for  Tianshi  and it will  become  subject to income tax at a
reduced rate of 10%.

Note 2 - Condensed financial statements and footnotes

The  interim  consolidated  financial  statements  presented  herein  have  been
prepared by the Company  and include the  unaudited  accounts of the Company and
its subsidiaries.  All significant  inter-company accounts and transactions have
been eliminated in the consolidation.

These  condensed  financial  statements  have been prepared in  accordance  with
generally  accepted  accounting  principles  in the United  States  for  interim
financial  information  and the  instructions  to Form  10-QSB and Article 10 of
Regulation S-X. Certain information and footnote  disclosures  normally included
in  financial   statements  presented  in  accordance  with  generally  accepted
accounting principles have been condensed or omitted.  Management of the Company
believes the disclosures made are adequate to make the information presented not
misleading.  The condensed  consolidated  financial statements should be read in
conjunction  with  TIEN'S  audited  financial  statements  for the  years  ended
December  31, 2003 and 2002 and notes  thereto  included  in TIENS Form  10-KSB,
dated April 29, 2004.

In the opinion of management,  the unaudited  condensed  consolidated  financial
statements   reflect  all  adjustments  (which  include  only  normal  recurring
adjustments)  necessary to present fairly the financial  position of the Company
as of March 31, 2004 and the results of  operations  for the three  months ended
March 31,  2004 and 2003,  respectively.  Interim  results  are not  necessarily
indicative  of full year  performance  because  of the  impact of  seasonal  and
short-term variations.

Note 3 - Inventories

Inventories  are  stated  at the lower of cost or  market  using  the  first-in,
first-out basis and consists of the following:


                          March 31,      December 31,
                             2004            2003
                        -------------   -------------
                         (Unaudited)      (Audited)
                        -------------   -------------
Raw materials           $   2,086,417   $   1,673,405
Work-in-progress              276,722         342,252
Finished goods              2,756,044       1,988,559
                        -------------   -------------
                        $   5,119,183   $   4,004,216
                        =============   =============





                                       10
<PAGE>

                TIENS BIOTECH GROUP (USA), INC. AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS



Note 4 - Supplemental disclosure of cash flow information

No income  taxes were paid for the three  months  ended March 31, 2004 and 2003,
respectively.  Interest  paid  amounted  to $87,938 and  $123,319  for the three
months ended March 31, 2004 and 2003, respectively.

Note 5 - Earnings per share

The  Company  adopted  Statement  of  Financial  Accounting  Standards  No. 128,
"Earnings Per Share" (SFAS 128). SFAS 128 requires the  presentation of earnings
per share (EPS) as Basic EPS and Diluted EPS. There are no  differences  between
Basic and Diluted EPS for the three  months  ended March 31, 2004 and 2003.  The
weighted  average  number of shares used to  calculate  EPS reflect the 6.5 to 1
share split  retroactively  to January 1, 2002.  The weighted  average number of
shares used to calculate  EPS for the three months ended March 31, 2004 and 2003
reflect only the shares outstanding for those periods.

Note 6 - Related party transactions

Sales
-----

The Company sells a majority of its products to distributors that are related to
the Company  through common  ownership.  The related party  distributors in turn
market and sell the Company's products to independent  distributors or end users
of the products.

Related party sales amounted to $11,489,695 and $8,113,932 for the periods ended
March 31, 2004 and 2003 which represent 100% of total sales for the periods then
ended.  Related party  accounts  receivable  related to these sales  amounted to
$972,888 and $8,533 as at March 31, 2004 and  December  31, 2003,  respectively,
net of an allowance for doubtful accounts of $12,877, respectively.

Other receivables and note receivable - related party
-----------------------------------------------------

The Company is owed  additional  amounts  classified as other  receivables  from
related  parties  totaling  $20,280,776 and $26,831,339 as of March 31, 2004 and
December  31, 2003,  respectively.  These  receivables  are  generated  from the
Company  making various cash advances and short term loans and the allocation of
various  expenses to related  parties.  These  transactions  are re-occurring in
nature and are paid off during the year. The Company does not charge interest on
these receivables.

On March 26, 2004, Tianjin Tianshi Biological Development Co., Ltd. entered into
an agreement  with Tianjin  Juchao  Commercial  and Trading Co., Ltd. to convert
various   receivable   amounts  into  a  note   receivable   in  the  amount  of
RMB200,000,000  or  approximately  USD$24,200,000.  The note will be paid off in
four quarterly installments of RMB50,000,000 beginning March 31, 2004 and ending
December  31, 2004.  Interest  will be charged  beginning  January 1, 2004 at an
annual interest rate of 6.048%. Total interest income for the three months ended
March 31, 2004 amounted to approximately $365,900.





                                       11
<PAGE>

                TIENS BIOTECH GROUP (USA), INC. AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS



Note 6 - Related party transactions (continued)

Other receivables and note receivable - related party (continued)
-----------------------------------------------------------------

The receivable is secured by the personal guarantee of Li Jinyuan, President and
major  shareholder of Tiens Biotech Group (USA),  Inc., and the pledge of 20% of
his stock  ownership in Tiens  Biotech Group (USA),  Inc. or 13,167,000  shares.
These shares are restricted  stock (as defined in Rule 144 of the Securities Act
of 1933,  as amended) and can not be traded  until  September  10, 2004.  During
March, 2004, Tianjin Tianshi Biological Development Co., Ltd. received its first
principal payment of  RMB50,000,000.  This amount was distributed in turn to the
parent company,  Tianshi International Holdings Group Limited as a joint venture
distribution.

Accounts payable
----------------

Accounts  payable due to related parties  amounted to $-0- and $758,570 at March
31, 2004 and December 31, 2003, respectively.  These amounts were generated from
the purchases of raw  materials,  rent expense and the Company's  transportation
costs.

Other payables
--------------

The Company also had amounts classified as other payables due to related parties
which  amounted to $872,253 and $1,312,288 as of March 31, 2004 and December 31,
2003, respectively. These amounts arose from cash advances from related parties,
management fees due to related parties and various non-operational  transactions
incurred with related parties.

Rent expense
------------

As of January 1, 2003,  the Company had a verbal  agreement  with Tianshi Group,
which is a related  party  through  ownership,  to lease a portion of its office
building and manufacturing facilities. The Company has agreed to pay for certain
expenses of the Tianshi Group in lieu of a lease payment.  On June 30, 2003, the
Company  entered into a written lease agreement with Tianshi Group to pay annual
rent on  these  facilities  at 1% of  total  gross  revenues.  The  term of this
agreement is for five years  commencing  on January 1, 2003.  In  addition,  the
Company is obligated to pay insurance, maintenance and other expenses related to
the  premises.  The total  amount paid on this lease  amounted  to $118,202  and
$81,140 for the three months ended March 31, 2004 and 2003, respectively.







                                       12
<PAGE>

Item 2 - Management's Discussion and Analysis of Financial Condition and Results
         of Operation


Forward-Looking Statements:

The following  discussion  of the financial  condition and results of operations
should be read in conjunction  with the  consolidated  financial  statements and
related  notes  thereto.  The  following  discussion  contains   forward-looking
statements.  Tiens  Biotech  Group (USA),  Inc. is referred to herein as "we" or
"our." The words or phrases "would be," "will allow," "expect to", "intends to,"
"will likely  result,"  "are expected to," "will  continue,"  "is  anticipated,"
"estimate,"   "project,"  or  similar   expressions  are  intended  to  identify
"forward-looking  statements"  Such  statements  include  those  concerning  our
expected  financial  performance,  our corporate strategy and operational plans.
Actual   results   could  differ   materially   from  those   projected  in  the
forward-looking  statements as a result of a number of risks and  uncertainties,
including:  (a) those  risks  and  uncertainties  related  to  general  economic
conditions in China,  including regulatory factors that may affect such economic
conditions; (b) whether we are able to manage our planned growth efficiently and
operate profitable operations,  including whether our management will be able to
identify,  hire, train,  retain,  motivate and manage required personnel or that
management  will  be  able to  successfully  manage  and  exploit  existing  and
potential market  opportunities;  (c) whether we are able to generate sufficient
revenues or obtain financing to sustain and grow our operations; and (d) whether
we are able to successfully  fulfill our primary requirements for cash which are
explained below under "Liquidity and Capital  Resources.  Statements made herein
are as of the date of the filing of this Form  10-QSB  with the  Securities  and
Exchange  Commission  and should not be relied upon as of any  subsequent  date.
Unless  otherwise  required  by  applicable  law,  we do not  undertake,  and we
specifically disclaim any obligation,  to update any forward-looking  statements
to reflect  occurrences,  developments,  unanticipated  events or  circumstances
after the date of such statement.


OVERVIEW

On February 17, 2004,  Tiens  Biotech Group (USA),  Inc. (the Company)  formally
changed its name from Strategika, Inc. to Tiens Biotech Group (USA), Inc.

On August 22, 2003, Strategika,  Inc., a corporation organized under the laws of
the State of  Delaware  ("Strategika");  Tianshi  International  Holdings  Group
Limited,  a corporation  organized  under the laws of the British Virgin Islands
("TIANSHI");  LI Jinyuan,  JIAO Wenjun and YAN Yupeng, all Chinese Nationals who
are  stockholders  of  TIANSHI  (the  "TIANSHI   Stockholders")entered  into  an
Agreement  and Plan of  Reorganization  (the  "Agreement").  The  Agreement  was
effective  on  September  9,  2003  (the  "Effective  Date").  Pursuant  to  the
Agreement,  Strategika received from the TIANSHI  Stockholders all of the issued
and  outstanding  common stock of TIANSHI in exchange for  68,495,000  shares of
restricted  (as defined in Rule 144 of the  Securities  Act of 1993, as amended)
common stock of Strategika. As additional  consideration,  the 29,000,000 shares
of the common stock of  Strategika  held by Rene  Larrave,  the sole officer and
director of Strategika prior to the reorganization,  were redeemed to Strategika
and dully cancelled by Strategika.

Pursuant to the Agreement and on the Effective  Date, as  consideration  for the
exchange of the TIANSHI Shares,  Strategika issued 68,495,000  restricted common
capital  stocks,  par value  $0.001  per  share,  to the  TIANSHI  Stockholders,
representing  approximately  95% of the issued and  outstanding  common  capital
stock of  Strategika  following  the time of the  issuance.  There are currently
71,998,586  issued and  outstanding  shares of common  stock of the  reorganized
Strategika.

Strategika was incorporated on July 13, 1990 as Super Shops, Inc. under the laws
of the State of Michigan.  In October 2000, Super Shops, Inc.  reincorporated in
Delaware and changed its name to MIA Acquisition  Corp. On February 11, 2002, in
connection with a change in control  transaction,  MIA Acquisition  Corp changed
its name to Tiens Biotech Group (USA), Inc. Until the Effective Date, Strategika
had only nominal  assets and  liabilities  and was a  development  stage company
attempting  to  provide  network  security   services  to  Fortune  1000  listed
companies.  As a result of the  reorganization,  Strategika  will  continue  the
business operations of TIANSHI.



                                       13
<PAGE>

TIANSHI  was  incorporated  on March 24,  2003 in the  territory  of the British
Virgin  Islands.  On June  18,2003,  TIANSHI  acquired  80% of  Tianjin  Tianshi
Biological  Development Co. Limited ("Tianshi  China") which conducts  TIANSHI's
main business  operations.  Tianshi China is a foreign  investment joint venture
incorporated  in the  People's  Republic of China  ("PRC") on March 27,  1998. A
joint venture agreement was subsequently signed on July 13, 1998 between Tianshi
(HK) International  Limited ("HKCo."),  a company  incorporated in Hong Kong and
100% owned by Mr. LI Jinyuan;  and Tianjin Tianshi  Biological  Engineering Co.,
Limited  ("Tianshi  Engineering"),  a  Chinese  companies  49%  owned by Mr.  LI
Jinyuan's  daughter  Ms. LI Baolan and 51% owned by Tianjin  Tianshi  Group Co.,
Ltd.("Tianshi Group").  Tianshi Group is a company organized under the PRC laws,
located in Tianjin,  PRC and 90% owned by Mr. LI Jinyuan and 10% owned by Ms. LI
Baolan.  Tianshi China is classified as a Foreign  Invested  Enterprise (FIE) in
the PRC and is  subject  to the FIE  laws of the PRC.  Its  legal  structure  is
similar to a corporation and a limited  liability  company organized under state
laws in the United States. The Articles of Association  provide for a term of 50
years and registered  capital of $10,000,000.  Tianshi China was 80% owned by HK
Co., and 20% owned by Tianshi  Engineering.  On June 18, 2003,  TIANSHI acquired
80%  ownership in Tianshi  China from HK Co. The  remaining  20% was acquired by
Tianjin Tianshi  Pharmaceuticals Co., Ltd., a Chinese company with Tianshi Group
as its majority shareholder (51%).

Tianshi  China is engaged in the  manufacturing  and  production  of  healthcare
products and is based in Tianjin, PRC. Tianshi China is primarily engaged in the
research,  development,  manufacturing  and  marketing  of  healthcare  products
including  herbal  products,  vitamin and mineral  supplements and personal care
products.  Since its establishment,  Tianshi China has developed 7 major product
series and produced 45 types of  healthcare  products.  Twenty three of them are
health food products,  all of which have obtained the "Health Food Certificates"
issued by the PRC Ministry of Health to be sold in the PRC. The 7 major  product
series are:  High-Calcium  Series,  Immune System  Adjustment  Series,  Nutrient
Supplements Series,  Cholesterol Adjustment Series, High-Fiber Series, Heart and
Brain  Improvement  Series and  Personal  Care  Series.  Under the  High-Calcium
series,  Tianshi China has conducted  extensive  research and developed  Tianshi
Hyperglycemia  High Calcium  Nutrient  Powder and Tianshi  Children High Calcium
Nutrient  Powder,  which  have been  awarded  patents  from  State  Intellectual
Properties  Office in China with respective  patent numbers of ZL97115067.2  and
ZL97115068.0.

Tianshi China has its own research and product  development  center.  It employs
professionals in research,  product  development and innovation.  On November 3,
2002,  Tianshi China was awarded Quality System  Certificate for compliance with
the standard "ISO9001:  2000" in the area of Design and Development,  Production
and Service of Food and Healthcare Food in China.

Tianshi  China has been  conducting  the  marketing  and  sales of its  products
through its affiliate company, Tianshi Engineering in China. Tianshi Engineering
is a limited  liability  company  duly  incorporated  under the laws of PRC, and
affiliated  with  Tianshi  China  through  common  ownership  of Mr. LI Jinyuan.
Tianshi  Engineering  markets and sells Tianshi  China's  products  domestically
through its 22 branches, representative offices and chain stores and 12 domestic
affiliate  companies.  The Company also markets its products to approximately 90
countries  worldwide  including the United States,  South Korea,  Japan,  India,
Thailand,  Malaysia,   Indonesia,  Canada,  Peru,  Brazil,  Russia,  Kazakhstan,
Belarus,  Mongolia,  Finland,  Lithuania,  Britain,  Germany,  France,  Romania,
Ukraine, Portugal, Turkey, Italy, Nigeria, Ghana, South Africa and Australia.

RESULTS OF OPERATIONS

General Results of Operations for the three months ending March 31, 2004

As of March 31, 2004, we had $26,865,636 of retained  earnings.  As of March 31,
2004, we had cash of  $18,235,584  and reported  total  shareholders'  equity of
$39,505,188.  For the three months  ending  March 31,  2004,  we had revenues of
$11,489,695 and general, administrative and sales expenses of $1,138,696.

1) SALES increased by $3,375,763,  or approximately  41.6%,  from $8,113,932 for
the three months ended March 31, 2003 to $11,489,695  for the three months ended
March 31,  2004.  The 41.6%  increase  was a result of  directly  marketing  our
products  internationally since the end of 2002. By the end of 2003, we sold our
products to approximately 90 countries. In addition, we increased our networking
sales forces in China during 2003.  For the first  quarter ended March 31, 2004,
domestic sales in China  increased to $8,021,109 and overseas sales increased to
$3,468,586.

2) COST OF GOODS SOLD.  For the three months ended March 31, 2004,  consolidated
cost of goods sold increased by $100,242, from $2,628,895 to $2,729,137. Cost of
goods sold as a  percentage  of sales  decreased  to 23.75% for the three months
ended March 31, 2004, from 32.40% for the three months ended March 31, 2003. The
decrease  in cost of  goods  sold as a  percentage  of  sales  was a  result  of
continuing  stronger management control over (1) cost of raw material purchases;
(2)  utilization of raw material and  production  cost  efficiency;  (3) product
quality control; (4) improvement of manufacturing technology; and (5) economy of
scale.



                                       14
<PAGE>

(3) GROSS PROFIT. For the three months ended March 31, 2004,  consolidated gross
profit increased by $3,275,521 or 59.72%, from $5,485,037 to $ 8,760,558.  Gross
profit as a percentage of sales  increased to 76.25% from 67.60%.  This increase
in gross profit as a  percentage  of sales was the results of  increasing  sales
both  in  the  domestic  and  worldwide  markets  and  successful  control  over
production cost.

(4) SELLING AND  ADMINISTRATIVE  EXPENSES.  For the three months ended March 31,
2004, selling and administrative expenses increased by $465,051 from $673,645 to
$1,138,696.  The selling and  administrative  expenses as a percentage  of sales
increased to 9.91% from 8.3%.

(5) NET INCOME.  For the three  months ended March 31,  2004,  consolidated  net
income  increased by $2,700,695,  or  approximately  72.76%,  from $3,711,651 to
$6,412,346.  The  increase  was mainly due to increase in sales and  decrease in
production cost.

CERTAIN RELATIONSHIP AND RELATED TRANSACTIONS

TIANSHI markets most of its products through various domestic and  international
business  entities that are related to Tianshi China through  common  ownership.
Related  party  sales  amounted  to  100%  of  total  sales.  Due to the  common
ownership, there are no formal sales or administrative agreement between Tianshi
China and those related  parties.  The business  operations  among these related
entities are regulated  through  internal  ordinances.  For the domestic market,
Tianshi  China sells all of its products to Tianshi  Engineering,  which in turn
sells  them  through  its 22  representative  offices,  and 12 other  affiliated
companies in China. All of these  affiliated  companies are owned in whole or in
part by LI Jinyuan.

Other receivables
-----------------

The Company  through its  Chinese  joint  venture,  Tianjin  Tianshi  Biological
Development  Co.,  Ltd.,  is  owed  additional   amounts   classified  as  other
receivables  from related  parties  totaling  $20,280,776  and $26,831,339 as of
March 31, 2004 and  December  31,  2003,  respectively.  These  receivables  are
generated from the Company making various cash advances and short-term loans and
the allocation of various  expenses to related parties.  These  transactions are
re-occurring   in  nature.   The  Company  did  not  charge  interest  on  these
receivables, with the exception of the note receivable described below.

On March 26, 2004,  Tianjin Tianshi  Biological  Development Co., Ltd.  (Tianshi
China),  entered into an agreement  with Tianjin  Juchao  Commercial and Trading
Co., Ltd. to convert  various  receivable  amounts into a note receivable in the
amount of RMB200,000,000 or approximately USD$24,200,000.  The note will be paid
off in four quarterly installments of RMB50,000,000 beginning March 31, 2004 and
ending December 31, 2004.  Interest will be charged beginning January 1, 2004 at
an annual  interest rate of 6.048%.  Total interest income charged for the three
months ended March 31, 2004  amounted to  $365,900.  This note is secured by the
personal  guarantee  of LI Jinyuan,  President  and major  shareholder  of Tiens
Biotech Group (USA), Inc., and the pledge of 20% of his stock ownership in Tiens
Biotech Group (USA),  Inc. or  13,167,000  shares.  These shares are  restricted
stock (as defined in Rule 144 of the Securities Act of 1933, as amended) and can
not be traded until  September 10, 2004.  During March,  2004,  Tianjin  Tianshi
Biological  Development  Co.,  Ltd.  received  its first  principal  payment  of
RMB50,000,000.  This  amount was  distributed  in turn to Tianshi  International
Holdings Group Limited as a joint venture distribution.

Accounts payable
----------------

Accounts payable due to related parties amounted to $0 and $758,570 at March 31,
2004 and December 31, 2003, respectively.  These amounts were generated from the
purchases of raw materials, rent expense and the Company's transportation costs.

Other payables
--------------

The  Company  also has  amounts  classified  as other  payables  due to  related
parties,  which  amounted to $872,253  and  $1,312,288  as of March 31, 2004 and
December 31, 2003,  respectively.  These  amounts  arose from cash advances from
related  parties,  management  service  fees due to related  parties and various
non-operational transactions incurred with related parties.




                                       15
<PAGE>

Rent expense
------------

At December 31, 2002,  the Company had a verbal  agreement  with Tianshi  Group,
which is a related  party  through  ownership,  to lease a portion of its office
building and manufacturing facilities. The Company had agreed to pay for certain
expenses of the Tianshi  Group in lieu of a lease  payment.  The amount of these
expenses  paid in 2002  amounted  to  $242,960  and have  been  expensed  in the
accompanying  statement of operations  under various general and  administrative
expense  accounts.  On June 30, 2003,  the Company  entered into a written lease
agreement  with Tianshi  Group to pay annual rent on these  facilities  at 1% of
total gross revenues. The term of this agreement is for five years commencing on
January  1, 2003.  In  addition,  the  Company is  obligated  to pay  insurance,
maintenance and other expenses related to the premises. The total amount paid on
this lease amounted to $118,202 and $81,140 for the three months ended March 31,
2004 and 2003, respectively.

LIQUIDITY AND CAPITAL RESOURCES

For the three  months  ended March 31,  2004,  net cash  provided  by  operating
activities was $6,451,323,  net cash used in investing  activities was $275,127,
and net cash used in financing activities was $665,655.

For the three  months  ended March 31,  2003,  net cash  provided  by  operating
activities was $4,735,592, net cash used in investing activities was $1,817,620,
and net cash used in financing activities was $66,175.

Net cash provided by operating  activities increased by $1,715,731 to $6,451,323
for the  three  months  ended  March  31,  2004,  representing  an  increase  of
approximately  36.23%  compared to  $4,735,592  net cash  provided by  operating
activities for the same period of 2003. The increase in cash flow from operating
activities  primarily reflects increasing in revenues for the three months ended
March  31,  2004.  This  increase  was  also  due to our  better  management  on
collection of other  receivables from our related party during the first quarter
of 2004.

Net cash used in investing  activities  decreased by  $1,542,493 to $275,127 for
the three months ended March 31, 2004, representing an 84.86% decrease, compared
to $1,817,620 net cash used by investing activities for the same period of 2003.
The  decrease  in net  cash  used in  investing  activities  was  due to  higher
collections  of loan  receivable  to related  party.

Net cash used in financing  activities increased by $599,480 to $665,655 for the
three months ended March 31, 2004,  representing  a 906%  increase,  compared to
$66,175 net cash used in financing  activities  for the same period of 2003. The
increase in cash used in financing  was  primarily due to decrease in borrowings
from banks and increase in payments on long term debt to banks.

Going forward,  our primary  requirements for cash consist of: (1) the continued
production  of existing  products  and general  overhead and  personnel  related
expenses to support  these  activities;  (2)  continued  promotion of networking
sales activities pertaining to our attempt to increase related revenues; and (3)
the development costs of new products.  We anticipate that our current operating
activities will enable us to meet the anticipated cash requirements for the 2004
fiscal year.

MANAGEMENT ASSUMPTIONS

Management anticipates,  based on internal forecasts and assumptions relating to
our current  operations  that existing cash and funds  generated from operations
will be sufficient to meet working capital requirements for at least the next 12
months.  In the  event  that  plans  change,  our  assumptions  change  or prove
inaccurate or if other capital resources and projected cash flow otherwise prove
to be insufficient to fund operations (due to unanticipated  expense,  technical
difficulties,  or otherwise), we could be required to seek additional financing.
There can be no assurance that we will be able to obtain additional financing on
terms acceptable to it, or at all.


EFFECTS OF INFLATION

We are subject to commodity  price risks arising from price  fluctuations in the
market  prices of the various raw materials  that  comprise our products.  Price
risks are managed by each business unit through  productivity  improvements  and
cost-containment  measures.  For the time being, the management does not believe
that  inflation risk is material to our business or our  consolidated  financial
position, results of operations or cash flows.


EFFECT OF FLUCTUATION IN FOREIGN EXCHANGE RATES

Our  operating  subsidiaries  are located in China.  This  Company  buys all raw
materials in China and sells 50% of our products in China using Chinese Renminbi
as the functional currency.  Based on China government  regulation,  all foreign
currencies  under the  category  of current  accounts  are  allowed to be freely
exchanged with hard  currencies.  During the past two years of operation,  there
were no significant changes in exchange rates; however, there are potentials for
significant change in exchange rates.


                                       16
<PAGE>

Item 3 - Controls and Procedures

As required by Rule 13a-15 under the Exchange  Act,  within the 90 days prior to
the filing date of this report,  the Company  carried out an  evaluation  of the
effectiveness of the design and operation of the Company's  disclosure  controls
and  procedures.  This evaluation was carried out under the supervision and with
the participation of the Company's management, including the Company's President
and Financial Officer.  Based upon that evaluation,  the Company's President and
Financial  Officer  concluded  that  the  Company's   disclosure   controls  and
procedures  are  effective.  There  have  been  no  significant  changes  in the
Company's  internal  controls or in other  factors,  which  could  significantly
affect  internal  controls  subsequent  to the date the Company  carried out its
evaluation.

Disclosure  controls and procedures are controls and other  procedures  that are
designed to ensure that information  required to be disclosed in Company reports
filed or submitted under the Exchange Act is recorded, processed, summarized and
reported,  within the time  periods  specified  in the  Securities  and Exchange
Commission's  rules and  forms.  Disclosure  controls  and  procedures  include,
without limitation,  controls and procedures designed to ensure that information
required to be  disclosed  in Company  reports  filed under the  Exchange Act is
accumulated and  communicated to management,  including the Company's  President
and  Financial  Officer as  appropriate,  to allow  timely  decisions  regarding
required disclosure.

The Company is in process of outsourcing accredited Accounting firm to re-design
the Internal Control system as well as Risk Management system for the Company to
be in compliance with rules and regulations set forth in the Sarbanes-Oxley Act.



Part II - Other Information

Item 1 - Legal Proceedings

         None

Item 2 - Changes in Securities

         None

Item 3 - Defaults on Senior Securities

         None

Item 4 - Submission of Matters to a Vote of Security Holders

         None.


Item 5 - Other Information

         None



         Exhibits

         31.1     Certification  by Li Jinyuan  Pursuant  to Section  302 of the
                  Sarbanes-Oxley Act of 2002

         31.2     Certification  by Jiao  Wenjun  Pursuant to Section 302 of the
                  Sarbanes-Oxley Act of 2002


         32.1     Certification  Pursuant to Section  906 of the  Sarbanes-Oxley
                  Act of 2002




                                       17
<PAGE>

                                  SIGNATURES

In accordance with the  requirements of the Exchange Act, the registrant  caused
this  report to be  signed on its  behalf  by the  undersigned,  thereunto  duly
authorized.

                                            Tiens Biotech Group (USA), Inc.

Dated: May 13, 2004                          /s/ LI Jinyuan
       ------------                         ------------------------------------
                                            LI Jinyuan
                                            Chairman and President






























                                       18