Led by Top Oncologist Professor Wu Yilong　Expected to Commence Phase III Clinical Trial in 2H2019
Demonstrates Strong R&D Capability   Solidifies Oncology Drug Development Strategy

HONG KONG, CHINA  - Media OutReach - 13 August 2018 - SihuanPharmaceutical Holdings Group Ltd. (HKEx: 0460) ("SihuanPharmaceutical" or the "Group"),the largest cardio-cerebral vascular ("CCV")drug manufacturer in China's prescription drug market, announced that itsself-developed oncology innovative drug commenced Phase II Clinical Trial inChina (the "Study"), subsequent tothe completion of Phase I Clinical Trial in the U.S.. Led by top oncologist ProfessorWu Yilong, the progress of Pirotinib's Clinical Trial marks an importantmilestone in Sihuan Pharmaceutical's innovative drug research and development("R&D"). A key product in theGroup's oncology R&D pipeline, Pirotinib is a novel irreversible pan-epidermalgrowth factor receptor ("EGFR") tyrosinekinase inhibitor, intended for the treatment of various types of malignant tumor,including non-small cell lung cancer ("NSCLC").The product is expected to have good growth potential after its launch.

The Studyis led by top oncologist Professor Wu Yilong, Chairman of the Chinese Societyof Lung Cancer and standing member of the Chinese Society of Clinical Oncology("CSCO"). The first batch ofparticipants have been enrolled prior to this announcement. Previously, U.S. PhaseI clinical trial of Pirotinib has been completed in three renowned cancerresearch centers, with periodic results published in the 2017 American Societyof Clinical Oncology ("ASCO") annualmeeting. (ASCO is the largest professional organization for physicians andoncology professionals).

Participantshave manifested desirable pharmacokinetic properties and drug response, withgood safety profile and side-effects proved tolerable. Preclinical in intro and in vivo studies have demonstrated that Pirotinib suppressed thegrowth of certain types of EGFR mutation induced-NSCLC that were irresponsiveto target drug treatments available. Receiving clinical trial approval from theU.S. FDA and the completion of U.S. Phase I study have expedited the progressof clinical trials in China by providing with supportive data. Phase III ClinicalTrial is expected to commence in the second half year of 2019.

EGFRmutation can cause various types of malignant including tumor lung cancer,stomach cancer, esophageal cancer while effective treatment remains elusive. InChina, lung cancer ranks highest in malignant tumors in terms of mortality and morbidity.According to Globaldata, the global market capacity of NSCLC reached US$20.9billion in 2016 and is expected to rise at double-digit CAGR in the next fewyears. Pirotinib, once proved to be able to effectively suppress the growth ofsuch mutation, will enjoy considerable growth potential.

SihuanPharmaceutical has been dedicating considerable resources and efforts ininnovative drug R&D since as early as 2008. Its well-established innovativedrug R&D platform brings together experts on various areas and aspects ofinnovative drug R&D. With extensive working experiences in multi-nationalpharmaceutical companies, the Group's innovative drug R&D team ranks amongthe top in China in terms of integrated R&D capabilities. In 2017, theGroup's R&D expenditure accounted for approximately 11% of its salesrevenue, exceeding industry average.

Dr.Che Fengsheng, Chairman and CEO of Sihuan Pharmaceutical,said, "after 10 years of continuous dedication of substantial resources andefforts, Sihuan Pharmaceutical now possesses a well-developed innovative drugR&D platform, with a strong product pipeline focusing on therapeutic areaswith considerable unmet clinical demand, including CCV, oncology, diabetes,non-alcoholic liver diseases and pain relief. The development of Pinotrinib hasachieved sound progress that application for production approval will complete in2021 the earliest. The exciting progress speaks for our international-levelR&D capabilities. Looking ahead, Sihuan Pharmaceutical is striving forwardwith focus and determination. We have implemented a series of internaladjustments with the aim to 'strengthen R&D capabilities, optimize productresources and accelerate market expansion'. The Group is entering the nextstage of development, with view to create better and sustainable return for itsshareholders."

Sihuan Pharmaceutical is also equipped with awell-established generic drug R&D team and platform, which has successfullydeveloped a number of first-to-market generic drugs in its current productportfolio. As disclosed in the 2017 annual report, Sihuan Pharmaceutical selecteda few oral solid form drugs for bioequivalence tests, such as metforminhydrochloride tablet (鹽酸二甲雙胍片). Upon the passing ofbioequivalent test in the near future, it will become another growth driver ofthe Group. Sihuan Pharmaceutical's generic drug pipeline includes CCV drugvinpocetine injection (長春西汀注射液),rivastigmine hydrogen tartrate capsules (重酒石酸卡巴拉汀膠囊),levetiracetam tablets (左乙拉西坦片),amlodipine besylate tablets (苯磺酸左氨氯地平片),levetiracetam injection (左乙拉西坦注射液) , etc.Its strategic diversity will contribute to the Group's product resources in theshort-, mid- and long-term.

About Sihuan Pharmaceutical Holdings Group Ltd.

Foundedin 2001, Sihuan Pharmaceutical Holdings Group Ltd. has become the largestcardio-cerebral vascular drug manufacturer in China's prescription drug marketby market share since 2007. The Group was the sixth largest pharmaceuticalcompany in terms of hospital purchase in the Chinese prescription drug marketin 2017. Sihuan Pharmaceutical is an integrated corporate with its ownproduction, R&D and marketing capacities. The success of the Group can beattributed to its differentiated and proven sales and marketing model,extensive nationwide distribution network, diversified product portfolio, andstrong R&D capabilities. The Group's current products encompass the topfive medical therapeutic areas in China: cardio-cerebral vascular system,central nervous system, metabolism, oncology and anti-infectives. The Group hasbegun its innovative drug R&D since 2008 and now possesses awell-established innovative drug R&D platform, which is supported by 400R&D experts and focuses in therapeutic areas with considerable unmetclinical demand, including CCV, oncology, diabetes, non-alcoholic liverdiseases and pain relief.