UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549  FORM 10-Q  [ X ] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934  For the quarterly period ended September 30, 2010  [] 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: 000-53213   SINOCOM PHARMACEUTICAL, INC (Exact name of registrant as specified in its charter)  Nevada26-1188540(State or other jurisdiction of incorporation)(IRS Employer Identification Number)Room 3, 21/F, Far East Consortium Building
121 Des Voeux Road
Central, Hong Kong(Address of principal executive offices)011-852-2159-7863(Registrants telephone number, including area code)  Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for 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.  [ X ] Yes   [ ] No  Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company.  See the definitions of large accelerated filer, accelerated filer and smaller reporting company in Rule 12b-2 of the Exchange Act.


|                                                                         |                              
|------------------------------------------------------------------------ | -----------------------------
|Large accelerated filer [ ]                                              | Accelerated filer [ ]        
|Non-accelerated filer [X]  (Do not check if a smaller reporting company) | Smaller reporting company [ ]

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). [   ] Yes   [ X ] No  As of September 30, 2010, the Issuer had 71,416,660 shares of common stock issued and outstanding.


PART I-FINANCIAL INFORMATION  ITEM 1. FINANCIAL STATEMENTS.    The consolidated financial statements of Sinocom Pharmaceutical, Inc. (the "Company" or the Registrant"), a Nevada corporation, included herein were prepared, without audit, pursuant to rules and regulations of the Securities and Exchange Commission.  Because certain information and notes normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America were condensed or omitted pursuant to such rules and regulations, these financial statements should be read in conjunction with the Companys audited consolidated financial statements for the fiscal years ended December 31, 2009 and 2008, and notes thereto, included in the Company's Annual Report on Form 10-K/A for the fiscal year ended December 31, 2009, filed with the Securities and Exchange Commission on September 29, 2010.


2


SINOCOM PHARMACEUTICAL, INC CONSOLIDATED FINANCIAL STATEMENTS PERIOD ENDED SEPTEMBER 30, 2010    INDEX TO FINANCIAL STATEMENTS:PageConsolidated Balance Sheets
(Unaudited)4Consolidated Statements of Income (Unaudited)5Consolidated Statements of Cash Flows (Unaudited)6Notes to Unaudited Financial Statements7-9


3





|                                                                                       |   |                    |   |                  
|-------------------------------------------------------------------------------------- | - | ------------------ | - | -----------------
|SINOCOM PHARMACEUTICAL, INC.                                                          
|CONSOLIDATED BALANCE SHEETS                                                           
|(UNADITED)                                                                            
|                                                                                       |   |                    |   |                  
|                                                                                       |   | September 30,
2010 |   | December 31,
2009
|                                                                                       |   |                    |   |                  
|Current Assets                                                                         |   |                    |   |                  
|Cash and cash equivalents                                                              | $ | 25,804,057         | $ | 34,363,124       
|Accounts receivable                                                                    |   | 23,592,163         |   | 22,488,263       
|Inventory                                                                              |   | 2,166,842          |   | 2,120,516        
|Trade deposits                                                                         |   | 4,931,880          |   | -                
|Prepaid expenses and other receivables                                                 |   | 546,958            |   | 180,933          
|Total Current Assets                                                                   |   | 57,041,900         |   | 59,152,836       
|                                                                                       |   |                    |   |                  
|Land use right                                                                         |   | 2,940,923          |   | -                
|Prepaid lease                                                                          |   | 3,684,047          |   | 1,366,234        
|Deposit for construction                                                               |   | 2,856,775          |   | -                
|Property and equipment, net                                                            |   | 714,276            |   | 613,891          
|Total Assets                                                                           | $ | 67,237,921         | $ | 61,132,961       
|                                                                                       |   |                    |   |                  
|Liability and stockholders' equity                                                     |   |                    |   |                  
|Current Liabilities                                                                    |   |                    |   |                  
|Accounts payable                                                                       | $ | 8,142,365          | $ | 14,537,732       
|Due to related parties                                                                 |   | 119,636            |   | -                
|Accrued expenses and other payables                                                    |   | 1,947,036          |   | 1,715,759        
|Income tax payable                                                                     |   | 1,408,188          |   | 2,220,501        
|Total Current Liabilities                                                              |   | 11,617,225         |   | 18,473,992       
|                                                                                       |   |                    |   |                  
|Stockholders' Equity                                                                   |   |                    |   |                  
|Common stock, par value $.001; 150,000,000 shares authorized;                          |   | 71,417             |   | 71,417           
|71,416,660 shares issued and outstanding                                              
|Preferred stock, par value $.001; 20,000,000 shares authorized;                        |   | 15,847             |   | 15,847           
|15,847,099 shares issued and outstanding                                              
|Additional paid in capital                                                             |   | 15,112,290         |   | 15,490,448       
|Statutory reserves                                                                     |   | 5,677,041          |   | 5,677,041        
|Other comprehensive income                                                             |   | 5,668,439          |   | 4,905,832        
|Retained earnings                                                                      |   | 29,075,662         |   | 16,498,384       
|Total Stockholders' Equity                                                             |   | 55,620,696         |   | 42,658,969       
|Total Liabilities and Stockholders' Equity                                             | $ | 67,237,921         | $ | 61,132,961       
|                                                                                       |   |                    |   |                  
|The accompanying notes are an integral part of these consolidated financial statements




4





|                                                                                       |                                          |                                         |   |            |   |            |   |           
|-------------------------------------------------------------------------------------- | ---------------------------------------- | --------------------------------------- | - | ---------- | - | ---------- | - | ----------
|SINOCOM PHARMACEUTICAL, INC.                                                          
|CONSOLIDATED STATEMENTS OF INCOME                                                     
|(UNAUDITED)                                                                           
|                                                                                       |                                          |                                        
|                                                                                       | For the three months ended
September 30, | For the nine months ended
September 30,
|                                                                                       |                                          | 2010                                    |   | 2009       |   | 2010       |   | 2009      
|                                                                                       |                                          |                                         |   |            |   |            |   |           
|Sales, net                                                                             | $                                        | 26,994,546                              | $ | 20,541,872 | $ | 71,248,647 | $ | 56,081,037
|                                                                                       |                                          |                                         |   |            |   |            |   |           
|Cost of sales                                                                          |                                          | 19,343,886                              |   | 15,051,987 |   | 49,946,702 |   | 39,310,837
|Gross profit                                                                           |                                          | 7,650,660                               |   | 5,489,885  |   | 21,301,945 |   | 16,770,200
|Selling expenses                                                                       |                                          | 1,061,462                               |   | 452,454    |   | 2,631,018  |   | 1,171,468 
|General and administrative expenses                                                    |                                          | 406,326                                 |   | 488,223    |   | 1,182,885  |   | 1,326,780 
|Income from operations                                                                 |                                          | 6,182,872                               |   | 4,549,208  |   | 17,488,042 |   | 14,271,952
|                                                                                       |                                          |                                         |   |            |   |            |   |           
|Other income (expense)                                                                 |                                          |                                         |   |            |   |            |   |           
|Non-operating income (expense)                                                         |                                          | (6,236)                                 |   | (2,083)    |   | 67,376     |   | (5,323)   
|Interest income                                                                        |                                          | 22,897                                  |   | 15,130     |   | 50,143     |   | 38,028    
|Total other income (expense)                                                           |                                          | 16,661                                  |   | 13,047     |   | 117,519    |   | 32,705    
|Income before income taxes                                                             |                                          | 6,199,533                               |   | 4,562,255  |   | 17,605,561 |   | 14,304,657
|                                                                                       |                                          |                                         |   |            |   |            |   |           
|Provision for income taxes                                                             |                                          | 1,420,289                               |   | 1,041,475  |   | 4,467,324  |   | 3,593,190 
|Net income                                                                             | $                                        | 4,779,244                               | $ | 3,520,780  | $ | 13,138,237 | $ | 10,711,467
|                                                                                       |                                          |                                         |   |            |   |            |   |           
|Dividend on series A preferred stock                                                   |                                          | (189,041)                               |   | -          |   | (560,959)  |   | -         
|Net income (loss) available to common shareholders                                     | $                                        | 4,590,203                               | $ | 3,520,780  | $ | 12,577,278 | $ | 10,711,467
|                                                                                       |                                          |                                         |   |            |   |            |   |           
|Net income per common share                                                            |                                          |                                         |   |            |   |            |   |           
|Basic                                                                                  | $                                        | 0.06                                    | $ | 0.05       | $ | 0.18       | $ | 0.15      
|Diluted                                                                                | $                                        | 0.05                                    | $ | 0.05       | $ | 0.15       | $ | 015       
|Weighted average common shares outstanding                                             |                                          |                                         |   |            |   |            |   |           
|Basic                                                                                  |                                          | 71,416,660                              |   | 71,416,660 |   | 71,416,660 |   | 70,628,976
|Diluted                                                                                |                                          | 87,263,759                              |   | 71,416,660 |   | 87,263,759 |   | 70,628,976
|                                                                                       |                                          |                                         |   |            |   |            |   |           
|The accompanying notes are an integral part of these consolidated financial statements




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|                                                                                       |                                         |              |   |            
|-------------------------------------------------------------------------------------- | --------------------------------------- | ------------ | - | -----------
|SINOCOM PHARMACEUTICAL, INC.                                                          
|CONSOLIDATED STATEMENTS OF CASH FLOWS                                                 
|(UNAUDITED)                                                                           
|                                                                                       |                                         |              |   |            
|                                                                                       | For the nine months ended
September 30,
|                                                                                       |                                         | 2010         |   | 2009       
|CASH FLOWS FROM OPERATING ACTIVITIES                                                   |                                         |              |   |            
|Net Income                                                                             | $                                       | 13,138,237   | $ | 10,711,467 
|Adjustments to reconcile net income to net cash                                        |                                         |              |   |            
|provided by operating activities:                                                      |                                         |              |   |            
|Depreciation and amortization                                                          |                                         | 474,770      |   | 124,432    
|Loss on disposal of property and equipment                                             |                                         | 3,714        |   | -          
|                                                                                       |                                         |              |   |            
|(Increase) / decrease in current assets:                                               |                                         |              |   |            
|Accounts receivables                                                                   |                                         | (1,103,900)  |   | (4,120,843)
|Inventories                                                                            |                                         | (46,326)     |   | 922,347    
|Trade deposits                                                                         |                                         | (4,931,880)  |   | -          
|Prepaid expense and other receivables                                                  |                                         | (366,025)    |   | (1,858,795)
|Increase / (decrease) in current liabilities:                                          |                                         |              |   |            
|Accounts payable                                                                       |                                         | (6,395,369)  |   | 10,585,779 
|Accrued expenses and other payables                                                    |                                         | 42,236       |   | 1,314,219  
|Due to related parties                                                                 |                                         | 119,636      |   | (163,225)  
|Income taxes payable                                                                   |                                         | (812,313)    |   | (194,222)  
|Total Adjustments                                                                      |                                         | (13,015,457) |   | 6,609,692  
|Net cash provided/(used) by operating activities                                       |                                         | 122,780      |   | 17,321,158 
|                                                                                       |                                         |              |   |            
|CASH FLOWS FROM INVESTING ACTIVITIES                                                   |                                         |              |   |            
|Purchase of property and equipment                                                     |                                         | (162,607)    |   | (734)      
|Payment to acquire land use right                                                      |                                         | (2,985,905)  |   | -          
|Prepaid lease                                                                          |                                         | (2,689,091)  |   | (1,463,687)
|Deposit paid for construction                                                          |                                         | (2,856,775)  |   |            
|Net cash used by investing activities                                                  |                                         | (8,694,378)  |   | (1,464,421)
|                                                                                       |                                         |              |   |            
|CASH FLOWS FROM FINANCING ACTIVITIES                                                   |                                         |              |   |            
|Issuance cost of preferred stock paid                                                  |                                         | (378,158)    |   | -          
|Preferred stock dividend paid                                                          |                                         | (371,918)    |   | -          
|Net cash used by financing activities                                                  |                                         | 750,076)     |   | -          
|                                                                                       |                                         |              |   |            
|Effect of exchange rate changes on cash and cash equivalents                           |                                         | 762,608      |   | (14,941)   
|Net change in cash and cash equivalents                                                |                                         | (8,559,067)  |   | 15,871,678 
|Cash and cash equivalents, beginning balance                                           |                                         | 34,363,124   |   | 5,302,591  
|Cash and cash equivalents, ending balance                                              | $                                       | 25,804,057   | $ | 21,174,269 
|SUPPLEMENTAL DISCLOSURES:                                                              |                                         |              |   |            
|Cash paid during the period for:                                                       |                                         |              |   |            
|Income tax                                                                             |                                         | 5,279,637    |   | 3,787,412  
|                                                                                       |                                         |              |   |            
|The accompanying notes are an integral part of these consolidated financial statements




6


SINOCOM PHARMACEUTICAL, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS SEPTEMBER 30, 2010 (Unaudited)  Note 1 - ORGANIZATION  Sinocom Pharmaceutical, Inc. ("Sinocom" or "Company") was formed on September 13, 2007 in the State of Nevada.  The Company was originally incorporated as Tiger Acquisitions, Inc. and changed its name to Sinocom on February 26, 2009.  Through a share exchange, Rolling Rhine Holdings, Ltd ("Rolling Rhine") and its wholly- owned subsidiaries, China Zhongxi Yao Group Ltd and Anqing Zhongxi Yao Ltd ("Anqing Zhongxi Yao"), became wholly-owned subsidiaries of the Company.  Rolling Rhine was incorporated in December 2007, under the laws of the British Virgin Islands as a holding company for the purposes of owning 100% of China Zhongxi Yao Group Ltd.   China Zhongxi Yao Group Limited was incorporated in July 2008 under the laws of Hong Kong, for the purpose of owning 100% of the stock of Anqing Zhongxi Yao.  Anqing Zhongxi Yao, formed in December 1997, was organized under the laws of the Peoples Republic of China ("PRC") and was owned by a number of individuals until December 13, 2005 when it was acquired by a company, which was under the common control of Rolling Rhine and China Zhongxi Yao Group Ltd.   Note 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES  Basis of Presentation  The accompanying condensed consolidated financial statements have been prepared without audit, pursuant to the rules and regulations of the Securities and Exchange Commission. In the opinion of management, all adjustments, consisting of only those of a normal recurring nature, considered necessary for a fair presentation of the financial position and interim results of the Company as of and for the periods presented, have been included.  Interim results are not necessarily indicative of the results to be expected for a full year. These financial statements have been prepared in accordance with Generally Accepted Accounting Principles in the United States (U.S. GAAP) for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by U.S. GAAP for complete financial statements.  The financial information included herein should be read in conjunction with the Companys consolidated financial statements and related notes in its 2009 Annual Report onForm 10-K/A  filed on September 29, 2010.   Note 3  EARNINGS PER SHARE  Basic earnings per share is computed in accordance with SFAS No.128 (now known as ASC 260), Earnings Per Share, by dividing the net income by the weighted average number of outstanding common stock during the period. The diluted earnings per share calculation includes the impact of dilutive convertible securities, if applicable. The weighted average number of outstanding common stock is determined by relating the portion of time within a reporting period that a particular number of common stock has been outstanding to the total time in that period.


7


Note 3  EARNINGS PER SHARE


|                                                           |                                          |                                         |  |            |  |            |  |           
|---------------------------------------------------------- | ---------------------------------------- | --------------------------------------- |  | ---------- |  | ---------- |  | ----------
|                                                           | For the three months ended
September 30, | For the nine months ended
September 30,
|                                                           |                                          | 2010                                    |  | 2009       |  | 2010       |  | 2009      
|                                                           |                                          |                                         |  |            |  |            |  |           
|Earnings per share  Basic                                 |                                          |                                         |  |            |  |            |  |           
|Income for the period                                      |                                          | 4,590,203                               |  | 3,520,780  |  | 12,577,278 |  | 10,711,467
|Weighted average common shares                             |                                          | 71,416,660                              |  | 71,416,660 |  | 71,416,660 |  | 70,628,976
|Basic earnings per share                                   |                                          | 0.06                                    |  | 0.05       |  | 0.18       |  | 0.15      
|                                                           |                                          |                                         |  |            |  |            |  |           
|Earnings per share  Diluted                               |                                          |                                         |  |            |  |            |  |           
|Income for the period                                      |                                          | 4,590,203                               |  | 3,520,780  |  | 12,577,278 |  | 10,711,467
|Dividend on series A preferred stock                       |                                          | 189,041                                 |  | -          |  | 560,959    |  | -         
|                                                           |                                          | 4,779,244                               |  | 3,520,780  |  | 13,138,237 |  | 10,711,467
|                                                           |                                          |                                         |  |            |  |            |  |           
|Weighted average common shares                             |                                          | 71,416,660                              |  | 71,416,660 |  | 71,416,660 |  | 70,628,976
|Diluted effect from Series A preferred
stock               |                                          | 15,847,099                              |  | -          |  | 15,847,099 |  | -         
|Weighted average common shares and
potential common shares |                                          | 87,263,759                              |  | 71,416,660 |  | 87,263,759 |  | 70,628,976
|                                                           |                                          |                                         |  |            |  |            |  |           
|Diluted earnings per share                                 |                                          | 0.05                                    |  | 0.05       |  | 0.15       |  | 0.15      

Note 4  INVENTORIES


|               |  |                     |           |  |                   |          
|-------------- |  | ------------------- | --------- |  | ----------------- | ---------
|               |  |                     |           |  |                   |          
|               |  | September  30,
2010 |           |  | December 31, 2009
|               |  |                     |           |  |                   |          
|Finished goods |  | $                   | 2,166,842 |  | $                 | 2,120,516
|               |  |                     |           |  |                   |          

Note 5 – TRADE DEPOSITS  Trade deposits represent amounts held by pharmacy agencies for distribution rights.  The deposits are refundable upon expiry of the distribution agreements unless the Company violates the restriction to sell outside the designated area.


8


Note 6  LAND USE RIGHT  The land use right consisted of the following: September 30, 2010December 31, 2009Land lease$2,985,905$-Less: Accumulated amortization(44,982)-$2,940,923$- In January 2010, a subsidiary of the Company operating in Anqing, the PRC acquired a land use right, which granted the Company a right to use a piece of land for a period of 50 years commencing on January 1, 2010. Amortization expense was $15,100 and $44,982 for the three months and nine months ended September 30, 2010, respectively.   Note 7  DEPOSIT FOR CONSTRUCTION  The Company entered into an agreement with a developer and paid a deposit for the construction of distribution center.   Note 8  DUE TO RELATED PARTY  The amount was due to the Companys chief executive officer.  The amount was unsecured, interest-free and repayable on demand.   Note 9  COMPREHENSIVE INCOME


|                                         |                                          |                                         |  |           |  |            |  |           
|---------------------------------------- | ---------------------------------------- | --------------------------------------- |  | --------- |  | ---------- |  | ----------
|                                         | For the three months ended
September 30, | For the nine months ended
September 30,
|                                         |                                          | 2010                                    |  | 2009      |  | 2010       |  | 2009      
|                                         |                                          |                                         |  |           |  |            |  |           
|Net income                               |                                          | 4,779,244                               |  | 3,520,780 |  | 13,138,237 |  | 10,711,467
|Foreign currency transaction adjustments |                                          | 656,139                                 |  | (12,391)  |  | 762,608    |  | 11,999    
|Comprehensive income                     |                                          | 5,435,383                               |  | 3,508,389 |  | 13,900,845 |  | 10,723,466




9


ITEM 2. MANAGEMENTS DISCUSSIONS AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS.  SPECIAL NOTE OF CAUTION REGARDING FORWARD-LOOKING STATEMENTS  CERTAIN STATEMENTS IN THIS REPORT, INCLUDING STATEMENTS IN THE FOLLOWING DISCUSSION, ARE WHAT ARE KNOWN AS "FORWARD LOOKING STATEMENTS", WHICH ARE BASICALLY STATEMENTS ABOUT THE FUTURE. FOR THAT REASON, THESE STATEMENTS INVOLVE RISK AND UNCERTAINTY SINCE NO ONE CAN ACCURATELY PREDICT THE FUTURE. WORDS SUCH AS "PLANS," "INTENDS," "WILL," "HOPES," "SEEKS," "ANTICIPATES," "EXPECTS "AND THE LIKE OFTEN IDENTIFY SUCH FORWARD LOOKING STATEMENTS, BUT ARE NOT THE ONLY INDICATION THAT A STATEMENT IS A FORWARD LOOKING STATEMENT. SUCH FORWARD LOOKING STATEMENTS INCLUDE STATEMENTS CONCERNING OUR PLANS AND OBJECTIVES WITH RESPECT TO THE PRESENT AND FUTURE OPERATIONS OF THE COMPANY, AND STATEMENTS WHICH EXPRESS OR IMPLY THAT SUCH PRESENT AND FUTURE OPERATIONS WILL OR MAY PRODUCE REVENUE, INCOME OR PROFITS. NUMEROUS FACTORS AND FUTURE EVENTS COULD CAUSE THE COMPANY TO CHANGE SUCH PLANS AND OBJECTIVES OR FAIL TO SUCCESSFULLY IMPLEMENT SUCH PLANS OR ACHIEVE SUCH OBJECTIVES, OR CAUSE SUCH PRESENT AND FUTURE OPERATIONS TO FAIL TO PRODUCE REVENUE, INCOME OR PROFITS. THEREFORE, THE READER IS ADVISED THAT THE FOLLOWING DISCUSSION SHOULD BE CONSIDERED IN LIGHT OF THE DISCUSSION OF RISKS AND OTHER FACTORS CONTAINED IN THIS REPORT ON FORM 10-Q AND IN THE COMPANY'S OTHER FILINGS WITH THE SECURITIES AND EXCHANGE COMMISSION. NO STATEMENTS CONTAINED IN THE FOLLOWING DISCUSSION SHOULD BE CONSTRUED AS A GUARANTEE OR ASSURANCE OF FUTURE PERFORMANCE OR FUTURE RESULTS.  Overview  Sinocom Pharmaceutical, Inc (sometimes hereinafter referred to as We,  Us, Our, or the Company) is a Chinese pharmaceutical company engaged in the two complementary businesses of wholesale distribution of pharmaceuticals and medical supplies, and cultivation and sale of natural herbs. The operations involving wholesale distribution of pharmaceuticals and medical supplies were commenced in 1986 as a state-owned enterprise by a predecessor of the Company. The Company commenced operations in 1997 when the state-owned predecessor company was privatized.  In 2009, the Company distributed a portfolio of over 5,446 types of western pharmaceuticals, medical supplies and processed Chinese herbs, to over 4,166 customers including hospitals, clinics, drug stores and sub-distributors covering five provinces in southeastern China.   The operations relating to cultivation of natural herbs were commenced by the Company in 2004.  They currently involve seven  main species of herbs which are cultivated by over 700 farmers on a plantation base of approximately 18.1 million square meters located primarily in the Da Bie mountain region of Anhui province, PRC.  Our business operations are based in Anqing, Anhui Province, PRC, and all operations are currently conducted through our wholly-owned subsidiary, Anqing Zhongxi. Yao Ltd., a PRC corporation.  HistoryThe Company was incorporated in the State of Nevada on September 13, 2007, under the name Tiger Acquisitions, Inc.  It was organized as a vehicle to investigate and, if such investigation warrants, acquire a target company or business seeking the perceived advantages of being a publicly held corporation. On February 26, 2009, the Company changed its name to Sinocom Pharmaceutical, Inc.  On February 20, 2009, the Company completed a share exchange transaction with Rolling Rhine Holdings, Ltd., a British Virgin Islands corporation (Rolling Rhine), pursuant to which the shareholders of Rolling Rhine transferred 300,000 shares of Rolling Rhine, representing all of the issued and outstanding shares of


10


common stock in Rolling Rhine, to the Company in exchange for the issuance of an aggregate of 67,131,660 shares of the Companys common stock.  As a result of the share exchange transaction, Rolling Rhine Holdings, Ltd., and its subsidiaries, China Zhongxi Yao Group Limited, and Anqing Zhongxi Yao, Ltd., became wholly-owned subsidiaries of the Company.  Rolling Rhine was incorporated in December, 2007, under the laws of the British Virgin Islands, and China Zhongxi was incorporated in December, 2007, under the laws of Hong Kong. China Zhongxi was formed for the purpose of owning 100% of the capital stock of Anqing Zhongxi, and Rolling Rhine was formed as a holding company for the purposes of owning 100% of the capital stock of China Zhongxi.  Corporate Structure  The Chart below depicts the Companys current corporate structure.  The Company owns 100% of the capital stock of Rolling Rhine and has no other direct subsidiaries.  Rolling Rhine owns 100% of the capital stock of China Zhongxi and has no other direct subsidiaries. China Zhongxi owns 100% of the capital stock of Anqing Zhongxi and has no other subsidiaries.   Sinocom Pharmaceutical, Inc.
A Nevada Corporation ↓ 100% Rolling Rhine Holdings, Ltd.
A British Virgin Islands Corporation ↓ 100% China Zhongxi Yao Group Limited
A Hong Kong Corporation ↓ 100% Anqing Zhongxi Yao, Ltd,
A PRC Corporation   Results of Operation  The following discussion and analysis provides information that we believe is relevant to an assessment and understanding of our results of operation and financial condition for the three and nine months periods ended September 30, 2010 and 2009.  Our financial statements are stated in US Dollars and are prepared in accordance with generally accepted accounting principles of the United States (GAAP).  Revenue  Revenue for the three months ended September 30, 2010 was $26,994,546, as compared to revenue of $20,541,872 for the three months ended September 30, 2009, an increase of $6,452,674, or approximately 31%. Revenue for the nine months ended September 30, 2010 was $71,248,647, as compared to revenue of $56,081,037 for the nine months ended September 30, 2009, an increase of $15,167,610, or approximately 27%.  The increase in revenue was attributable to higher revenue from the distribution sale of pharmaceutical products and herbs. Revenue from distribution of pharmaceutical products increased $3,498,777 or


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approximately 21%, and $10,004,398, or approximately 25%, for the three and nine months ended September 30, 2010, respectively, as compared to the corresponding periods in 2009. Revenue from distribution and sales of cultivated natural herbs increased by $2,953,897, or approximately 74% and increased by $5,163,213, or approximately  31%, for the three and nine months ended September 30, 2010, as compared to the corresponding periods of 2009.   The increase in revenue from distribution of pharmaceutical products was primarily attributable to the increased sales and marketing efforts and the results of PRC's 2009 RMB850 billion Health Reform Plan where major efforts are focused on improving medical care for the rural population. The increase in revenue from sales of herbs is primarily attributable to the higher sales activities as a result of larger land size of herbs plantation.  Gross Profit  Cost of sales for the three months ended September 30, 2010 was $19,343,886, as compared to cost of sales of $15,051,987 for the three months ended September 30, 2009, an increase of $4,291,899, or approximately 28%. Cost of sales increased $10,635,865, or approximately 27%, to $49,946,702 for the nine months ended September 30, 2010, as compared to $39,310,837 for the nine months ended September 30, 2009, primarily as a result of higher sales volume.  Gross profit for the three months ended September 30, 2010 was $7,650,660, as compared to $5,489,885 for the three months ended September 30, 2009, an increase of $2,160,775 (approximately 39%). For the nine months ended September 30, 2010, gross profit increased $4,531,745, or approximately 27%, to $21,301,945 for the nine months ended September 30, 2010, as compared to $16,770,200 for nine months ended September 30, 2009.  The increase in gross profit is attributable mainly to the higher gross margin derived from distribution and sales of herbs.  Gross margin from sales of herbs increased by $1,551,458 (approximately 86%) from $1,796,236 for the three months ended September 30, 2009, to $3,347,694 for the three months ended September 30, 2010. On pharmaceutical products, the gross margin increased by $609,317, or approximately 16%, from $3,693,649 for the three months ended September 30, 2009, to $4,302,966 for the three months ended September 30, 2010 as a result of higher sales.  Gross margin from sales of herbs increased by $2,773,773 (approximately 34%) from $8,084,496 for the nine months ended September 30, 2009, to $10,858,269 for the nine months ended September 30, 2010. On pharmaceutical products, the gross margin increased by $1,757,972, or approximately 20%, from $8,685,704 for the nine months ended September 30, 2009, to $10,443,676 for the nine months ended September 30, 2010 as a result of higher sales.  Selling, General and Administrative Expenses  For the three months ended September 30, 2010, selling expenses was $1,061,462 as compared to selling expenses of $452,454 for the three months ended September 30, 2009. Selling expenses increased by $609,008, or approximately 135%, mainly as a result of higher sales incentive payout of $459,545.  For the nine months ended September 30, 2010, selling expenses was $2,631,018 as compared to $1,171,468 for the nine months ended September 30, 2009. The increase of $1,459,510 in selling expenses, or approximately 125%, was mainly due to an increase of $1,083,009 in sales incentives to promote higher sales activities and increase market share and size., and partly due to higher amortization of land lease (raw herbs) in 2010 due to more land leased in 2010.  For the three months ended September 30, 2010, general and administrative expenses was $406,326 as compared to general and administrative expenses of $488,223 for the three months ended September 30, 2009, a decrease of $81,897, or approximately 17%. The decrease was as a result re-designation of


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resources to assist in the company's selling processes in 2010. For the nine months ended September 30, 2010, general and administrative expenses was $1,182,885 as compared to general and administrative expenses of $1,326,780 for the nine months ended September 30, 2009, a decrease of $143,895, or approximately 11%, which was mainly due to re-designation of resources to assist in the company's selling processes in 2010.  Income From Operations  Income from operations increased $1,633,664, or approximately 36%, to $6,182,872 for the three months ended September 30, 2010, as compared to $4,549,208 for the three months ended September 30, 2009, and increased $3,216,090, or approximately 23%, to $17,488,042 for the nine months ended September 30, 2010, as compared to $14,271,952 for the nine months ended September 30, 2009.  The increases in income from operations for the three months and nine months ended September 30 were mainly due to higher distribution sales of pharmaceutical products, and increased cultivated herbs sales.  Net Income The Company recorded net income of $4,779,244 for the three months ended September 30, 2010, as compared to net income of $3,520,780 for the three months ended September 30, 2009, and recorded net income of $13,138,237 for the nine months ended September 30, 2010, as compared to net income of $10,711,467 for the nine months ended September 30, 2009. The increases of $1,258,464, or approximately 36%, and $2,426,770, or approximately 23%, respectively, were mainly due to higher distribution sales of pharmaceutical products, and increased cultivated herbs sales.  Liquidity and Capital Resources  Total Current Assets & Total Assets  As of September 30, 2010, we had current and total assets of $57,041,900 and $67,237,921, respectively, as compared to current and total assets of $59,152,836 and $61,132,961, respectively, as of December 31, 2009.  Current assets decreased by $2,110,936 from December 31, 2009 to September 30, 2010, primarily as a result of the decline in in cash and cash equivalent, as the Company's operating subsidiary in Anqing has acquired a 50-year land use right in January 2010 and entered into an development agreement for the construction of a distribution centre. Coupled with higher amount of prepaid lease amounts for new land leased for raw herbs cultivation, total assets increased by $6,104,960 as of September 30, 2010.  Total Current Liabilities  As of September 30, 2010, we had total current liabilities of $11,617,225, as compared to total current liabilities of $18,473,992, as of December 31, 2009.  The decrease in total current liabilities of $6,856,767, or approximately 37%, is primarily attributable to lower accounts payable as a result of earlier payment to distribution suppliers made in order to secure better terms.  Operating Activities  Net cash provided by operating activities was $122,780 for the nine months ended September 30, 2010, as compared to net cash provided by operating activities of $17,321,158 for the nine months ended September 30, 2009. The decrease of $17,198,378 or approximately 100%, was primarily a result of an increase in trade deposits and accounts receivable, and a decrease in accounts payable.  Investing Activities


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Net cash used by investing activities was $8,694,378 for the nine months ended September 30, 2010, as compared to $1,464,421 for the nine months ended September 30, 2009.  The increase was attributable to increased land use rights, prepaid lease and deposit for a distribution center.  Financing Activities  Net cash used in financing activities was $750,076 for the nine months ended September 30, 2010, as compared to nil for the nine months ended September 30, 2009.  The increase of $750,076 was attributable to cost of issuing preferred stock, and dividends paid to preferred stockholders.   Off Balance Sheet Arrangements  The Company does not have any off-balance sheet arrangements.   ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.  Inflation  Inflation has not had a material impact on our business.  Foreign Exchange Rate Risk  Although the conversion of the RMB is highly regulated in China, the value of the RMB against the value of the U.S. dollar (or any other currency) may fluctuate and be affected by, among other things, changes in Chinas political and economic conditions. Under the currency policy in effect in China today, the RMB is permitted to fluctuate in value within a narrow band against a basket of certain foreign currencies. China is currently under significant international pressures to liberalize this currency policy, and if such liberalization occurs, the value of the RMB could appreciate or depreciate against the U.S. dollar.  While our reporting currency is the U.S. dollar, to date all of our revenue and expenses and all of our assets are denominated in RMB.  As a result, we are exposed to foreign exchange risk because our reported revenue and results of operations may be affected by fluctuations in the exchange rate between the U.S. dollar and the RMB. If the RMB depreciates against the U.S. dollar, the value of our RMB revenue and assets as expressed in our U.S. dollar financial statements will decline. The fluctuations in the exchange rate would affect our financial results translated in U.S. dollar terms without giving effect to any underlying change in our business or results of operations.  For reporting purposes, all assets and liabilities were translated at the current exchange rate, stockholders equity was translated at the historical rates and income statement items were translated at the average exchange rate for the period. The resulting translation adjustments are reported under other comprehensive income as a component of shareholders equity. Transaction gains and losses are reflected in the income statement.


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ITEM 4T. CONTROLS AND PROCEDURES.  Disclosure Controls and Procedures  The Securities and Exchange Commission defines the term disclosure controls and procedures to mean the   controls and other procedures of an issuer that are designed to ensure that information required to be disclosed in the reports that it files or submits under the Securities Exchange Act of 1934 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 by an issuer in the reports that it files or submits under the Securities Exchange Act of 1934 is accumulated and communicated to the issuers management, including its principal executive and principal financial officers, or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure.  The Company maintains such a system of controls and procedures in an effort to ensure that all information which it is required to disclose in the reports it files under the Securities Exchange Act of 1934 is recorded, processed, summarized and reported within the time periods specified under the SEC's rules and forms and that information required to be disclosed is accumulated and communicated to principal executive and principal financial officers to allow timely decisions regarding disclosure.  As of the end of the period covered by this report, we carried out an evaluation, under the supervision and with the participation of our chief executive officer and chief financial officer, of the effectiveness of the design and operation of our disclosure controls and procedures.  Based on this evaluation, our chief executive officer and chief financial officer concluded that our disclosure controls and procedures are designed to provide reasonable assurance of achieving the objectives of timely alerting them to material information required to be included in our periodic SEC reports and of ensuring that such information is recorded, processed, summarized and reported within the time periods specified.  Our chief executive officer and chief financial officer also concluded that our disclosure controls and procedures were effective as of the end of the period covered by this report to provide reasonable assurance of the achievement of these objectives.  Changes in Internal Control over Financial Reporting  There was no change in the Company's internal control over financial reporting during the period ended September 30, 2010, that has materially affected, or is reasonably likely to materially affect, the Company's internal control over financial reporting.


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PART II-OTHER INFORMATION   ITEM 1. LEGAL PROCEEDINGS.  The Company is not a party to any pending legal proceedings, and no such proceedings are known to be contemplated. No director, officer or affiliate of the Company, and no owner of record or beneficial owner of more than 5.0% of the securities of the Company, or any associate of any such director, officer or security holder is a party adverse to the Company or has a material interest adverse to the Company in reference to pending litigation.   ITEM 1A. RISK FACTORS.  Not Applicable.   ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS.  Not Applicable      ITEM 3. DEFAULTS UPON SENIOR SECURITIES.  None.   ITEM 4. (REMOVED AND RESERVED)   ITEM 5. OTHER INFORMATION.   None.     ITEM 6. EXHIBITS.  (a) The following exhibits are filed herewith:  31.1 Certifications pursuant to Rule 13a-14(a) or 15d-14(a) under the Securities Exchange Act of 1934, as amended, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.*  31.2 Certifications pursuant to Rule 13a-14(a) or 15d-14(a) under the Securities Exchange Act of 1934, as amended, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.*  32.1 Certifications pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.*  32.2 Certifications pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.*  * filed herewith


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SIGNATURES  Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.  SINOCOM PHARMACEUTICAL, INC.    By: XueXiang Ai, Chief Executive Officer  Date:  November 15, 2010       By:     Tuck Wing Pang, Chief Financial Officer  Date:  November 15, 2010


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