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April 2011
Disclaimer
Neither this presentation nor any of its contents are to be distributed to third parties without the prior written consent of China Health Labs & Diagnostics Ltd.
(“China Health Labs”). This presentation supersedes and replaces any and all material s which may have been provided to potential investors. There are certain
risks inherent in an investment in the securities of China Health Labs, which prospective investors should carefully consider before investing in the securities of
China Health Labs. Reference is made to the section entitled “Risk Factors” in the draft Filing Statement of China Health Labs dated May 30, 2010, which section
is incorporated by reference into this investor presentation, for a discussion of the risks inherent in an investment in the securities of China Health Labs. The draft
Filing Statement is available on SEDAR at www.sedar.com under China Health Labs’s profile.

This presentation is not, and under no circumstances is it to be construed as, an advertisement or a public offering of these securities. This presentation is
personal to each offeree and does not constitute an offer to any other person or to the public generally to subscribe for or otherwise acquire any of the securities
referred to herein. No securities regulatory authority or similar authority has reviewed or in any way passed upon the presentation or the merits of these securities
and any representation to the contrary is an offence. This presentation has been prepared for information purposes only in order to assist prospective investors in
evaluating an investment in China Health Labs.

Except for the statements of historical fact, the information contained herein may be of a forward-looking nature. Such forward-looking information involves
known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievement of China Health Labs to be materially
different from any future results, performance or achievements expressed or implied by statements containing forward-looking information. Although China Health
Labs has attempted to identify important factors that could cause actual results to differ materially, there may be other factors that cause results not to be as
anticipated, estimated or intended. There can be no assurance that statements containing forward looking information will prove to be accurate as actual results
and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on statements
containing forward looking information.

The information contained herein includes market and industry data that has been obtained from third party sources, including industry publications, as well as
industry data prepared by China Health Labs management on the basis of its knowledge of and experience in the industry in which China Health Labs operates.
Third party sources generally state that the information contained therein has been obtained from sources believed to be reliable, but there is no assurance as to
the accuracy or completeness of included data. China Health Labs believes that its industry data is accurate and that its estimates and assumptions are reasonable,
but there is no assurance as to the accuracy or completeness of this included data. Although the data is believed to be reliable, China Health Labs has not
independently verified any of the information from third party sources referred to in this presentation or ascertained the underlying economic assumptions relied
upon by such sources.




                                                                                   2
Mission Statement




To be the leading provider of total lab solutions for
    medical diagnostics and food safety in China




                          3
Company Overview
                                                          Who We Are

 China Health Labs & Diagnostics is a leading provider of total lab solutions for medical
 diagnostics and food safety in China
•    We develop and sell proprietary total lab solutions to targeted sectors and sell diagnostic equipment & reagents to
     large urban hospitals
•    We generate revenues from the sale of solutions and equipment, and recurring revenues from reagents and service
•    We manufacture our own propriety equipment and reagents in our Beijing facility

                                              2010 Performance & Status

                       Revenue growth of 41% to 33.7 million

                       Net Income growth of 41% to $5.5 million equal to EPS of $0.10

                       Net income growth of 78% and EPS of $0.12 excluding one-time going public expense

                       Installed 124 rural labs to have total 210. Secured bid for 587 new locations in Jilin

                       More than doubled sales of POCT solutions to the Chinese military

                       Increased sales of food safety solution to Beijing municipal government by over 40%

                       Increased sales of equipment and reagents by 19% to large urban hospitals




                                                                     4
                                                                                                                           4
Growth Strategy
                        •  Only provider of total lab solutions to our targeted sectors, providing premium value
                           compared with individual products
  Provide Solutions     •  Total lab solutions combines equipment, software, installation & training and ongoing
                           supply of reagents and service
                        •  Building tremendous customer loyalty and multiple recurring revenue streams

                        •  On solutions where we have competitive advantages in technology and relationships
  Focus Resources       •  On sectors that have Chinese government policy and budget support
                        •  On sectors where we have limited competition and large market potential


                        •    Total rural hospital lab solution
Leverage Track Record   •    POCT solutions for military and emergency rescue applications
to Build Market Share   •    Food safety testing solutions
                        •    Selected products for large urban hospitals


Collaborative Product   •  Developed rural lab solution with provincial and central government Ministry of Health
      & Service         •  Joint R&D agreement with the Chinese military
    Development         •  Developed food safety testing solution with the Beijing government



                        •  Reagent technology that can enhance ongoing revenues to rural labs and urban hospitals
  Acquisitions and      •  Small size medical equipment and manufacturers with established brands, high quality
   partnerships            products and complementary customers



                                                         5
China Market Size and Growth
  •        Large and growing market, driven by increasing Chinese wealth and growing
           consumer demand for improved health care
  •        Trend towards universal health care system
  •        Chinese government policy and budget support for our key sectors: improved rural
           health care, emergency and rescue services and food safety

            China’s Medical Device Market                                                             China’s Per Capita Healthcare Expenditures (2006)
   US$ Billions




Sources: China: Accessing the Medical Device Market. Espicom Business Intelligence, July 2007; Report of Chinese Medical Instrument Industry under International Financial Crisis, 2009;
         The Red Hot Market for Medical Devices in China by: Evelyn Rubin September 08, 2006; How will China's healthcare reform affect the medical device sector in 2009? by Glenn Hou

                                                                                                          6
Business Sectors

•    Started business in 1993 by
     importing equipment and
     reagents for large urban hospitals

•    2010 growth driven by 100%
     increase in sales of total lab
     solutions to three new sectors

•    In 2010 three new sectors
     increased to 41% of revenues
     from less than 30% in 2009, trend
     to continue in 2011 and beyond

•    Generate higher margins in new
     sectors due to proprietary
     solutions and limited competition



                                          7
Products and Services

                                                         1) Rural hospital lab solution


5) Equipment & Reagents



                                                                                 2) Point-of-Care
                                                                                    Technology
                                                                                    Solution




     4) Service, training and
        support services                                                     3) Food safety ‘quick-
                                                                                test’ lab solution



                                Strong suite of complementary products


                                                  8
Large Urban Hospitals
                                                    Overview

•    Large existing market served by many Chinese and international players
•    Lower margins than for total lab solutions business


            Competitive Advantages                                            Photo

•    Long term market presence, since 1993
•    Strong market position with deliveries to
     more than 500 of the 1000 biggest hospitals
•    Competitive product range with a
     combination of imported and locally made
     products
•    In 2010, revenues grew by 19% and accounted
     for 59% of total revenues
•    Opportunity to accelerate growth if we
     localize production of high quality reagents




                                                       9
Rural Hospitals and Labs
                                                  Overview
•  Turnkey package of diagnostic testing equipment, installation & training, hardware and software and
ongoing reagent supply & service
•  Company estimates market opportunity is approximately $2 billion over next 5 years based on
50,000 existing and 40,000 new rural hospitals throughout China

           Competitive Advantages                                           Photo

•    First-mover advantage to aggressively roll out
     network of clinics before competition can
     establish a comparable product
•  Installed base of 210 rural hospitals plus new
   bid to install 587 – at least 797 for 2011
•    Initial revenues and profits from installation and
     recurring revenues from reagents and service
•    Currently no competitors due to high barriers to
     entry: long certification process, requirement
     for full suite of complementary products,
     relationships with provincial governments



                                                          10
Military & Emergency Rescue Services
                                                         Overview
•    Point of Care Technology (“POCT”) Dry-chemistry diagnostic solution for use in ‘out-of-lab’
     environments where urgent diagnosis is required (natural catastrophes, military settings)
      –    Used in joint military exercises and disaster relief in China, Haiti, Pakistan, Peru and Indonesia


             Competitive Advantages                                                         Photos
•    China Health is the only supplier in China
•    Closed system with exclusive reagent supply
•    Patented system protected by registered
     copyright
•    Chinese military bought 17 systems in 2009 &
     more than doubled order in 2010
•    Developing full range of POCT products with
     Chinese military in three year R&D
     agreement
•    13 systems sold to NERT in 2011
•    Appeals to international markets



                                                              11
Food Safety Testing
                                                        Overview
•    Lab solutions for the PRC government to test the safety of food for public consumption
      –    Tests the chemical or biochemical index of food items similar to testing that of the human body




             Competitive Advantages                                                      Photo
•    Established market
      –    established business in 2008 for Beijing
           Olympics, later set up 17 large food safety
           testing labs for the Beijing government at food
           distribution centers, mini-labs and mobile labs
      –    Beijing government increased order in 2010
•    New LIS and mobile POCT products under
     development
•    Use “Beijing Model” as reference site to sell
     solution to additional cities in China
•    Company estimates that total Chinese
     market opportunity is over $1 billion for 50
     largest cities in China (660 cities in China)


                                                             12
Locations and Distribution
Facilities
•  Beijing: HQ and 15,600 m2 production facility
                                                              Company facility                                    Heilongjiang
•  Guangdong: Sales and distribution hub                      Direct sales force presence
                                                              Planned sales force expansion                           Jilin
•  Shanghai: Sales office
                                                                                                                Liaoning

Direct Sales and distribution                                                                     Beijing

•  58 person sales force, with direct sales in 12                                              Hebei
   regions                                                                              Shanxi        Tianjin


•  Direct sales of of total lab solutions                                                     Henan

•  Third party wholesale distribution network,                                                                  Shanghai

   consisting of approximately 25 distributors for                                                          Jiangsu
   large urban hospitals                                                Sichuan
                                                                                                      Jiangxi Zhejiang

Import business
•  Typically highly advanced equipment
                                                                                               Guangdong
•  Exclusive distributor in China for 3 European                                    Guangxi

   medical device manufacturers
•  Partners include Trinity Biotech, Toshiba, Boule
   Medical AB, Eschweiler, Maxmat, Abbott
   Laboratories, and Elektronika 77

            In-place manufacturing operating at 25% capacity to support internal growth


                                                      13
Management and Board
Management
                               •    Founded Biochem Group in 1993
Shiping (Wilson) Yao
                               •    20 years experience in the medical equipment industry
President, CEO, Chairman and
                               •    Member of China’s National Standardization Technical Committee
Director
                               •    Member of the Board of Renmin University of China
Yuqiang Tang
                               •  Over 15 years of managerial, sales and marketing experience
COO, Director
Bill Tunbrant                  •  Wide range of experience in the medical equipment industry, as well as in international manufacturing
VP of Marketing, Director      •  Former director of Nibe Industrier AB (OMX: NIBE’B)
Adam Kniec                     •  Founder of ArkOrion Enterprises Inc., a provider of accounting and financial reporting services to Canadian
CFO                               and US publicly traded companies

Chao Zhang
                               •  10 years financial management experience in the medical equipment and private health care industries
VP of Finance
Stephen D. Wortley
                               •  Currently a partner at the law firm Lang Michener LLP
Secretary
Non-Executive (independent) Directors
                               •  Deputy Dean of the School of Finance of Renmin University
Yumin Zhuang
                               •  Independent supervisor with China CITIC Bank
Hong Chang                     •  Physician with the University Health Network in Toronto
                               •  Director of Migao Corporation (TSX: MGO)
Paul Haber
                               •  Former Vice President, Chief Financial Officer and Corporate Secretary of QuStream Corporation (TSXV:QVC)
                               •  Director of Zongshen PEM Power Systems (TSX: ZPP)
Kim Oishi                      •  Former President and Director of Hanfeng Evergreen (TSX: HF); Senior Vice President of Hanwei Energy (TSX:
                                  HE); Director of Cantronic Systems (TSX-V: CTS); and Grand Power Logistics (TSX-V: GPW)



                                                                    14
Financial Highlights
 000’s (except per share amounts)

                                     2010              2009                Change
Revenue                             $33,705           $23,824                41%
Gross Margin                        39.3%              34.7%                 13%
Net Income                          $5,527             $3,914                41%
EPS - Diluted                        $0.10             $0.07                 43%
WANS - Diluted                      55,188             52,233                 6%
Total Assets                        $37,081           $21,361                74%
Long Term Financial                  $Nil               $Nil
Liabilities

•  Strong revenue growth and margins drive earnings growth
•  Net income growth of 78% and EPS of $0.12 in 2010, if one time QT expenses are excluded
•  Sufficient funding to continue growth in 2011
•  May need additional debt of equity to for acquisition or for large rural lab contract


                                              15
Outlook

 •  Expect continued strong revenue growth in 2011 and beyond, driven by growth
 of total lab solutions for three key sectors

 •  Expect growth of revenue from large urban hospitals to be lower, such that total
 lab solutions to account for growing percentage of revenues

 •  Gross margins expected to be stable in 2011, supported by strong margins
 from proprietary products and services

 •  Sufficient working capital and capacity to support 2011 growth

 •  Continued strong growth in net income and EPS expected for 2011




                                         16
Appendix




           17
History of the Company
1993   •  Company founded by Mr. Wilson Yao in Guangzhou
       •  Began by providing distribution and services for medical diagnostic equipment to hospitals

1995   •  Begin geographic expansion within China

1998   •  Established offices outside of Guangdong, forming the basis for a regional distributors and service network

2003   •  Transformed from distributor to manufacturer
       •  Relocated head office to Beijing

2007   •    Began construction of a new R&D and production facility
       •    Awarded PRC state level and military tenders for laboratory equipment
       •    Developed Biochem branded lab information hardware and software system
       •    Launched the total lab solution in rural areas of China (20 rural labs in Henan province)

2008   •  Recognized as being compliant with the PRC’s “Good Manufacturing Practice” (GMP)
       •  Entered into agreement Liaoning province to implement 66 rural labs
       •  PRC government began using Biochem Group products in food safety testing

2009   •  R&D and production centre was officially placed into operation
       •  First batch of point-of-care-technology products were used in military exercises

2010   •  Accumulated 60 PRC government issued production licenses for medical diagnostic equipment and reagents
       •  Focus on growth opportunities in rural diagnostic facilities, point-of-care-technology, and food testing




                                                         18
                                                                                                                   18
State of the Chinese Healthcare Industry
•      Old system (pre 2009): Market-oriented (hospitals run as profit centers)
         –     Resulted in higher medical fees, making medical services less affordable to ordinary citizens
         –     Large development gap between urban and rural areas
         –     Low government funding
         –     Weak rural healthcare facilities
         –     Increasing disease burdens
•      New system (post 2009): Universal health care
         –     Investment of RMB 850 billion (US$125 billion) over the next three years
         –     Focus on improving rural hospitals, public emergency rescue forces and good safety controls
         –     Expanding coverage of basic medical insurance from 30% today to 90% in 2011
     China’s Health Care Expenditure as a % of GDP vs. G8 Nations (2006)        China’s Hospital Beds per 10,000 Citizens vs. G8 Nations (2004-2006)




Source: OECD

                                                                           19
Recent Sweeping Healthcare Reforms
•       In April 2009, the Chinese government announced plans to reform China’s healthcare
        system into a universal healthcare system

•       The plan involves the following commitments:
          –      An investment of RMB 850 billion towards healthcare reform over the next three years;
          –      Prioritized development of small, rural hospitals and clinics
          –      Implement a diversified medical insurance system targeting coverage of over 90% of the
                 population by 2011


•       The government has committed to undertake the following improvements:
          –      Upgrade basic treatment and diagnostic equipment at 50,000 existing township clinics
          –      Build 39,400 new diagnostic facilities, health clinics, hospitals and service centers primarily in
                 rural areas
          –      Train 1.37 million village doctors and 160,000 community doctors




               Massive government reforms targeted at improving healthcare for rural citizens

Source: JP Morgan’s Hands-on China Report – March 9, 2009

                                                             20

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Presentation April 2011

  • 2. Disclaimer Neither this presentation nor any of its contents are to be distributed to third parties without the prior written consent of China Health Labs & Diagnostics Ltd. (“China Health Labs”). This presentation supersedes and replaces any and all material s which may have been provided to potential investors. There are certain risks inherent in an investment in the securities of China Health Labs, which prospective investors should carefully consider before investing in the securities of China Health Labs. Reference is made to the section entitled “Risk Factors” in the draft Filing Statement of China Health Labs dated May 30, 2010, which section is incorporated by reference into this investor presentation, for a discussion of the risks inherent in an investment in the securities of China Health Labs. The draft Filing Statement is available on SEDAR at www.sedar.com under China Health Labs’s profile. This presentation is not, and under no circumstances is it to be construed as, an advertisement or a public offering of these securities. This presentation is personal to each offeree and does not constitute an offer to any other person or to the public generally to subscribe for or otherwise acquire any of the securities referred to herein. No securities regulatory authority or similar authority has reviewed or in any way passed upon the presentation or the merits of these securities and any representation to the contrary is an offence. This presentation has been prepared for information purposes only in order to assist prospective investors in evaluating an investment in China Health Labs. Except for the statements of historical fact, the information contained herein may be of a forward-looking nature. Such forward-looking information involves known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievement of China Health Labs to be materially different from any future results, performance or achievements expressed or implied by statements containing forward-looking information. Although China Health Labs has attempted to identify important factors that could cause actual results to differ materially, there may be other factors that cause results not to be as anticipated, estimated or intended. There can be no assurance that statements containing forward looking information will prove to be accurate as actual results and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on statements containing forward looking information. The information contained herein includes market and industry data that has been obtained from third party sources, including industry publications, as well as industry data prepared by China Health Labs management on the basis of its knowledge of and experience in the industry in which China Health Labs operates. Third party sources generally state that the information contained therein has been obtained from sources believed to be reliable, but there is no assurance as to the accuracy or completeness of included data. China Health Labs believes that its industry data is accurate and that its estimates and assumptions are reasonable, but there is no assurance as to the accuracy or completeness of this included data. Although the data is believed to be reliable, China Health Labs has not independently verified any of the information from third party sources referred to in this presentation or ascertained the underlying economic assumptions relied upon by such sources. 2
  • 3. Mission Statement To be the leading provider of total lab solutions for medical diagnostics and food safety in China 3
  • 4. Company Overview Who We Are China Health Labs & Diagnostics is a leading provider of total lab solutions for medical diagnostics and food safety in China •  We develop and sell proprietary total lab solutions to targeted sectors and sell diagnostic equipment & reagents to large urban hospitals •  We generate revenues from the sale of solutions and equipment, and recurring revenues from reagents and service •  We manufacture our own propriety equipment and reagents in our Beijing facility 2010 Performance & Status Revenue growth of 41% to 33.7 million Net Income growth of 41% to $5.5 million equal to EPS of $0.10 Net income growth of 78% and EPS of $0.12 excluding one-time going public expense Installed 124 rural labs to have total 210. Secured bid for 587 new locations in Jilin More than doubled sales of POCT solutions to the Chinese military Increased sales of food safety solution to Beijing municipal government by over 40% Increased sales of equipment and reagents by 19% to large urban hospitals 4 4
  • 5. Growth Strategy •  Only provider of total lab solutions to our targeted sectors, providing premium value compared with individual products Provide Solutions •  Total lab solutions combines equipment, software, installation & training and ongoing supply of reagents and service •  Building tremendous customer loyalty and multiple recurring revenue streams •  On solutions where we have competitive advantages in technology and relationships Focus Resources •  On sectors that have Chinese government policy and budget support •  On sectors where we have limited competition and large market potential •  Total rural hospital lab solution Leverage Track Record •  POCT solutions for military and emergency rescue applications to Build Market Share •  Food safety testing solutions •  Selected products for large urban hospitals Collaborative Product •  Developed rural lab solution with provincial and central government Ministry of Health & Service •  Joint R&D agreement with the Chinese military Development •  Developed food safety testing solution with the Beijing government •  Reagent technology that can enhance ongoing revenues to rural labs and urban hospitals Acquisitions and •  Small size medical equipment and manufacturers with established brands, high quality partnerships products and complementary customers 5
  • 6. China Market Size and Growth •  Large and growing market, driven by increasing Chinese wealth and growing consumer demand for improved health care •  Trend towards universal health care system •  Chinese government policy and budget support for our key sectors: improved rural health care, emergency and rescue services and food safety China’s Medical Device Market China’s Per Capita Healthcare Expenditures (2006) US$ Billions Sources: China: Accessing the Medical Device Market. Espicom Business Intelligence, July 2007; Report of Chinese Medical Instrument Industry under International Financial Crisis, 2009; The Red Hot Market for Medical Devices in China by: Evelyn Rubin September 08, 2006; How will China's healthcare reform affect the medical device sector in 2009? by Glenn Hou 6
  • 7. Business Sectors •  Started business in 1993 by importing equipment and reagents for large urban hospitals •  2010 growth driven by 100% increase in sales of total lab solutions to three new sectors •  In 2010 three new sectors increased to 41% of revenues from less than 30% in 2009, trend to continue in 2011 and beyond •  Generate higher margins in new sectors due to proprietary solutions and limited competition 7
  • 8. Products and Services 1) Rural hospital lab solution 5) Equipment & Reagents 2) Point-of-Care Technology Solution 4) Service, training and support services 3) Food safety ‘quick- test’ lab solution Strong suite of complementary products 8
  • 9. Large Urban Hospitals Overview •  Large existing market served by many Chinese and international players •  Lower margins than for total lab solutions business Competitive Advantages Photo •  Long term market presence, since 1993 •  Strong market position with deliveries to more than 500 of the 1000 biggest hospitals •  Competitive product range with a combination of imported and locally made products •  In 2010, revenues grew by 19% and accounted for 59% of total revenues •  Opportunity to accelerate growth if we localize production of high quality reagents 9
  • 10. Rural Hospitals and Labs Overview •  Turnkey package of diagnostic testing equipment, installation & training, hardware and software and ongoing reagent supply & service •  Company estimates market opportunity is approximately $2 billion over next 5 years based on 50,000 existing and 40,000 new rural hospitals throughout China Competitive Advantages Photo •  First-mover advantage to aggressively roll out network of clinics before competition can establish a comparable product •  Installed base of 210 rural hospitals plus new bid to install 587 – at least 797 for 2011 •  Initial revenues and profits from installation and recurring revenues from reagents and service •  Currently no competitors due to high barriers to entry: long certification process, requirement for full suite of complementary products, relationships with provincial governments 10
  • 11. Military & Emergency Rescue Services Overview •  Point of Care Technology (“POCT”) Dry-chemistry diagnostic solution for use in ‘out-of-lab’ environments where urgent diagnosis is required (natural catastrophes, military settings) –  Used in joint military exercises and disaster relief in China, Haiti, Pakistan, Peru and Indonesia Competitive Advantages Photos •  China Health is the only supplier in China •  Closed system with exclusive reagent supply •  Patented system protected by registered copyright •  Chinese military bought 17 systems in 2009 & more than doubled order in 2010 •  Developing full range of POCT products with Chinese military in three year R&D agreement •  13 systems sold to NERT in 2011 •  Appeals to international markets 11
  • 12. Food Safety Testing Overview •  Lab solutions for the PRC government to test the safety of food for public consumption –  Tests the chemical or biochemical index of food items similar to testing that of the human body Competitive Advantages Photo •  Established market –  established business in 2008 for Beijing Olympics, later set up 17 large food safety testing labs for the Beijing government at food distribution centers, mini-labs and mobile labs –  Beijing government increased order in 2010 •  New LIS and mobile POCT products under development •  Use “Beijing Model” as reference site to sell solution to additional cities in China •  Company estimates that total Chinese market opportunity is over $1 billion for 50 largest cities in China (660 cities in China) 12
  • 13. Locations and Distribution Facilities •  Beijing: HQ and 15,600 m2 production facility Company facility Heilongjiang •  Guangdong: Sales and distribution hub Direct sales force presence Planned sales force expansion Jilin •  Shanghai: Sales office Liaoning Direct Sales and distribution Beijing •  58 person sales force, with direct sales in 12 Hebei regions Shanxi Tianjin •  Direct sales of of total lab solutions Henan •  Third party wholesale distribution network, Shanghai consisting of approximately 25 distributors for Jiangsu large urban hospitals Sichuan Jiangxi Zhejiang Import business •  Typically highly advanced equipment Guangdong •  Exclusive distributor in China for 3 European Guangxi medical device manufacturers •  Partners include Trinity Biotech, Toshiba, Boule Medical AB, Eschweiler, Maxmat, Abbott Laboratories, and Elektronika 77 In-place manufacturing operating at 25% capacity to support internal growth 13
  • 14. Management and Board Management •  Founded Biochem Group in 1993 Shiping (Wilson) Yao •  20 years experience in the medical equipment industry President, CEO, Chairman and •  Member of China’s National Standardization Technical Committee Director •  Member of the Board of Renmin University of China Yuqiang Tang •  Over 15 years of managerial, sales and marketing experience COO, Director Bill Tunbrant •  Wide range of experience in the medical equipment industry, as well as in international manufacturing VP of Marketing, Director •  Former director of Nibe Industrier AB (OMX: NIBE’B) Adam Kniec •  Founder of ArkOrion Enterprises Inc., a provider of accounting and financial reporting services to Canadian CFO and US publicly traded companies Chao Zhang •  10 years financial management experience in the medical equipment and private health care industries VP of Finance Stephen D. Wortley •  Currently a partner at the law firm Lang Michener LLP Secretary Non-Executive (independent) Directors •  Deputy Dean of the School of Finance of Renmin University Yumin Zhuang •  Independent supervisor with China CITIC Bank Hong Chang •  Physician with the University Health Network in Toronto •  Director of Migao Corporation (TSX: MGO) Paul Haber •  Former Vice President, Chief Financial Officer and Corporate Secretary of QuStream Corporation (TSXV:QVC) •  Director of Zongshen PEM Power Systems (TSX: ZPP) Kim Oishi •  Former President and Director of Hanfeng Evergreen (TSX: HF); Senior Vice President of Hanwei Energy (TSX: HE); Director of Cantronic Systems (TSX-V: CTS); and Grand Power Logistics (TSX-V: GPW) 14
  • 15. Financial Highlights 000’s (except per share amounts) 2010 2009 Change Revenue $33,705 $23,824 41% Gross Margin 39.3% 34.7% 13% Net Income $5,527 $3,914 41% EPS - Diluted $0.10 $0.07 43% WANS - Diluted 55,188 52,233 6% Total Assets $37,081 $21,361 74% Long Term Financial $Nil $Nil Liabilities •  Strong revenue growth and margins drive earnings growth •  Net income growth of 78% and EPS of $0.12 in 2010, if one time QT expenses are excluded •  Sufficient funding to continue growth in 2011 •  May need additional debt of equity to for acquisition or for large rural lab contract 15
  • 16. Outlook •  Expect continued strong revenue growth in 2011 and beyond, driven by growth of total lab solutions for three key sectors •  Expect growth of revenue from large urban hospitals to be lower, such that total lab solutions to account for growing percentage of revenues •  Gross margins expected to be stable in 2011, supported by strong margins from proprietary products and services •  Sufficient working capital and capacity to support 2011 growth •  Continued strong growth in net income and EPS expected for 2011 16
  • 17. Appendix 17
  • 18. History of the Company 1993 •  Company founded by Mr. Wilson Yao in Guangzhou •  Began by providing distribution and services for medical diagnostic equipment to hospitals 1995 •  Begin geographic expansion within China 1998 •  Established offices outside of Guangdong, forming the basis for a regional distributors and service network 2003 •  Transformed from distributor to manufacturer •  Relocated head office to Beijing 2007 •  Began construction of a new R&D and production facility •  Awarded PRC state level and military tenders for laboratory equipment •  Developed Biochem branded lab information hardware and software system •  Launched the total lab solution in rural areas of China (20 rural labs in Henan province) 2008 •  Recognized as being compliant with the PRC’s “Good Manufacturing Practice” (GMP) •  Entered into agreement Liaoning province to implement 66 rural labs •  PRC government began using Biochem Group products in food safety testing 2009 •  R&D and production centre was officially placed into operation •  First batch of point-of-care-technology products were used in military exercises 2010 •  Accumulated 60 PRC government issued production licenses for medical diagnostic equipment and reagents •  Focus on growth opportunities in rural diagnostic facilities, point-of-care-technology, and food testing 18 18
  • 19. State of the Chinese Healthcare Industry •  Old system (pre 2009): Market-oriented (hospitals run as profit centers) –  Resulted in higher medical fees, making medical services less affordable to ordinary citizens –  Large development gap between urban and rural areas –  Low government funding –  Weak rural healthcare facilities –  Increasing disease burdens •  New system (post 2009): Universal health care –  Investment of RMB 850 billion (US$125 billion) over the next three years –  Focus on improving rural hospitals, public emergency rescue forces and good safety controls –  Expanding coverage of basic medical insurance from 30% today to 90% in 2011 China’s Health Care Expenditure as a % of GDP vs. G8 Nations (2006) China’s Hospital Beds per 10,000 Citizens vs. G8 Nations (2004-2006) Source: OECD 19
  • 20. Recent Sweeping Healthcare Reforms •  In April 2009, the Chinese government announced plans to reform China’s healthcare system into a universal healthcare system •  The plan involves the following commitments: –  An investment of RMB 850 billion towards healthcare reform over the next three years; –  Prioritized development of small, rural hospitals and clinics –  Implement a diversified medical insurance system targeting coverage of over 90% of the population by 2011 •  The government has committed to undertake the following improvements: –  Upgrade basic treatment and diagnostic equipment at 50,000 existing township clinics –  Build 39,400 new diagnostic facilities, health clinics, hospitals and service centers primarily in rural areas –  Train 1.37 million village doctors and 160,000 community doctors Massive government reforms targeted at improving healthcare for rural citizens Source: JP Morgan’s Hands-on China Report – March 9, 2009 20