GUANGZHOU, China, July 8, 2011 /PRNewswire-Asia/ -- China Medicine
Corporation (Other OTC: CHME) (the "Company"), a leading
manufacturer, developer and distributor of Western pharmaceuticals,
traditional Chinese medicines ("TCM"), and other health products in
the People's Republic of China,
today announced that the Board of Directors (the "Board") of China
Medicine Corporation, after consultation with and upon the
recommendation of the management of the Company and the Audit
Committee of the Board (the "Audit Committee"), concluded
that the Company's previously issued financial statements
contained in the Company's Annual Report on Form 10-K for the
fiscal years ended December 31, 2006
and 2007, and the Quarterly Reports on Form 10-Q for the periods
within the fiscal years 2006 and 2007 (collectively, "the
previously issued financial statements") should no longer be relied
upon.
As previously disclosed in the Company's Form 8-K filed with the
Securities and Exchange Commission on March
23, 2011, the Board, concluded that the Company's
previously issued financial statements contained in the
Company's Annual Report on Form 10-K for the fiscal years
ended December 31, 2008 and 2009, and
the Quarterly Reports on Form 10-Q for the periods within the
fiscal years 2008, 2009 and 2010 should no longer be relied
upon.
On July 1, 2011, during the course
of the on-going internal reviews by the management and the Audit
Committee of the Company, the Board determined that the accounting
and reporting errors at Guangzhou Konzern Medicine Co., Ltd., a
wholly-owned subsidiary of the Company, also occurred in fiscal
years 2006 and 2007 in addition to fiscal years 2008, 2009 and the
quarterly periods in fiscal year 2010, as previously reported, and
such errors materially impacted the previously issued financial
statements. The Company currently is not able to and will not
be able to quantify the impact of these errors and related
accounting adjustments until the completion of its internal reviews
but has concluded that the previously issued financial statements
should no longer be relied upon. The Company anticipates that at
the conclusion of the internal review by the Audit Committee and
its legal counsel, with the assistance of Ernst & Young
Advisory Services Limited, and the completion of a re-audit of the
affected fiscal years, it will have revised financial results and
will issue restated financial statements.
Management is assessing what changes may be necessary in the
evaluation of the Company's internal control over financial
reporting and its disclosure controls and procedures and will not
reach a final conclusion with respect to these matters until
completion of the restatement process.
As soon as practicable, in addition to the previously disclosed
amendments, the Company expects to file amendments to its Annual
Report on Form 10-K for the years ended December 31, 2006 and 2007, and amendments to its
Quarterly Reports on Form 10-Q for the periods within fiscal years
2006 and 2007 reflecting the restated financial statements with
respect to the previously issued financial statements. Given
that the review process is still ongoing, the matters discussed
herein are preliminary and subject to change.
About China Medicine Corporation
China Medicine Corporation, a vertically integrated enterprise
with a research and development center, manufacturing facility and
well established sales network, engages in the production and
distribution of prescription and over the counter drugs,
traditional Chinese medicine products, herbs and
dietary-supplements, medical devices, and medical formulations in
China. The Company is developing a
number of proprietary products for a variety of indications,
including oncology, high blood pressure and toxin removal from food
and animal feeds. For more information, please visit the Company's
website at http://www.cmc621.com. The Company routinely posts
important information on its website.
Safe-Harbor Statement
This press release contains forward-looking statements
concerning the Company's business and products. The Company's
actual results may differ materially depending on a number of risk
factors including, but not limited to, the following: general
economic and business conditions, obtaining regulatory approval for
new products, government support for rural health care, competition
from existing and new competitors, changes in technology, and
various other factors beyond its control. All forward-looking
statements are expressly qualified in their entirety by this
cautionary statement and the risk factors detailed in the Company's
reports filed with the Securities and Exchange Commission. China
Medicine Corporation undertakes no duty to revise or update any
forward-looking statement to reflect events or circumstances after
the date of this release.
Contact Information
ICR, Inc.
In New York: Ms. Christine Duan:
1-203-682-8200
In Beijing: Ms. Wen Lei Zheng: 86-10-6599-7968
SOURCE China Medicine Corporation