JILIN, China, May 16 /Xinhua-PRNewswire/ -- Global Pharmatech, Inc. (OTC:GBLP) (BULLETIN BOARD: GBLP) today reports its financial results for the first quarter ended on March 31, 2006. Global Pharmatech develops, manufactures and markets proprietary drugs and nutritional supplements that are based on modernized Chinese medicine and bio-pharmacy. Through its subsidiaries, Global Pharmatech combines R&D of botanical drug products, manufacturing, and sales and marketing for the Over-the-Counter (OTC) and prescription drug markets. First Quarter 2006 Financial Highlights -- First quarter 2006 revenue decreased to US$ 0.69 million, reflecting a 14% year-over-year decline; -- First quarter 2006 revenue from transfer of technology was US$ 0.36 million as compared with US$ 0.02 million in the same period of 2005; -- First quarter 2006 gross profit increased to US$ 0.46 million, reflecting a 206% year-over-year growth; and -- First quarter 2006 diluted loss per share was US$0.01 as compared with US$0.01 in same period of 2005 Dr. Xiaobo Sun, President and Chief Executive Officer of Global Pharmatech, stated: "We continue to focus on our core competence in R&D. And thanks to our R&D efforts, our revenue from technology transfer grew substantially. We look forward to more cross border research projects such as with Kobayashi Pharmaceutical.' Revenue for first quarter 2006 was US$0.69 million, a 14% decrease as compared to US$0.80 million for first quarter 2005. Revenue from transfer of technology was US$ 0.36 million as compared to US$ 0.02 million, reflecting a substantial year-over-year increase. Gross profit for first quarter 2006 was US$ 0.46 million, a 206% increase as compared with US$ 0.15 million for first quarter 2005. Loss from operations for first quarter 2006 was US$ 0.24 million, a 45% decrease as compared with US$ 0.44 million for first quarter 2005. Net loss for first quarter 2006 was US$ 0.25 million and diluted loss per share was 0.01, in line with US$ 0.25 million and diluted loss per share for first quarter 2005. Joseph Levinson, Chief Financial Officer of Global Pharmatech, stated: "We will continue to work towards improved profitability and stronger gross margins. As part of that goal, we have implemented a strategy of bringing more of our sales distribution in-house. While this has resulted in a short- term loss of sales due to the cancellation of at least one distribution agreement, in the long run, we believe we will benefit from a higher margin business model." About Global Pharmatech Global Pharmatech, through its subsidiaries, develops, manufactures and markets proprietary drugs that are based on Traditional Chinese Medicine and using modern facilities and advanced R&D technologies. The company offers a full range of "start to finish" biotech services, from research and testing to manufacture and sale of liquid and solid dose products employing unique proprietary extraction methods, and also licenses patents and technologies for botanical/biological drug products. Global Pharmatech's operations are currently based in the People's Republic of China with sales distribution in China, Malaysia, Singapore and Indonesia. For more information, please visit http://www.global-pharmatech.com/ . Safe Harbor Statement under the Private Securities Litigation Reform Act of 1995 This news release contains forward-looking statements within the meaning of the "safe harbor" provisions of the Private Securities Litigation Reform Act of 1995. These statements are based upon our current expectations and speak only as of the date hereof. Our actual results may differ materially and adversely from those expressed in any forward-looking statements as a result of various factors and uncertainties, including our ability to successfully develop and commercialize products, competitive products in our key markets, changes in consumer demand for our products, legislative, regulatory and competitive developments and general economic conditions. Our SEC filings discuss some of the important risk factors that may affect our business, results of operations and financial condition. We undertake no obligation to revise or update publicly any forward-looking statements for any reason. Consolidated Statements of Operations for the Three Months Ended March 31, 2006 and 2005 2006 2005 ------------ ------------ SALES $ 688,470 $ 803,486 COST OF SALES 228,236 655,906 ------------ ------------ GROSS PROFIT 460,234 147,580 ------------ ------------ OPERATING EXPENSES Advertising 6,295 58,261 Research and development 171,647 114,326 Selling expenses 43,084 37,488 General and administrative expenses 481,077 374,665 ------------ ------------ 702,103 584,740 ------------ ------------ LOSS FROM OPERATIONS (241,869) (437,160) ------------ ------------ OTHER INCOME (EXPENSES) Government Grants 37,280 256,448 Interest expense (41,726) (35,172) ------------ ------------ (4,446) 221,276 ------------ ------------ LOSS BEFORE INCOME TAXES AND MINORITY INTEREST (246,315) (215,884) PROVISION FOR INCOME TAXES Current 0 6,602 ------------ ------------ LOSS BEFORE MINORITY INTEREST (246,315) (222,486) MINORITY INTEREST (4,553) (28,927) NET LOSS $ (250,868) $ (251,413) ============ ============ LOSS PER COMMON SHARE: Basic and Diluted $ (0.01) $ (0.01) ============ ============ WEIGHTED AVERAGE COMMON SHARES OUTSTANDING 18,247,935 17,394,333 ============ ============ DATASOURCE: Global Pharmatech CONTACT: Zhuojun Li, Investor Relations of Global Pharmatech, Inc., +1-905-787-8225, or fax, +1-905-787-9711, or Web Site: http://www.global-pharmatech.com/

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