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First China Pharma Introduces Credit Fund Solution for Drug Distribution Sector in China


February 8, 2011 - Hong Kong, China

First China Pharmaceutical Group, Inc. (OTCBB: FCPG) ("First China" or the "Company"), a rapidly growing pharmaceutical distribution company headquartered in Yunnan, China, is pleased to announce that by working in conjunction with a number of regional financial institutions, it has developed a fund based credit product to facilitate increased commerce in the burgeoning drug distribution sector in China.

New government directives identified that the previous distribution system maintained high prices and commissions which were deemed unsustainable. It was determined that institutional health care providers should rapidly move towards agreements with large volume pharmaceutical distributors. However, in some instances reports of cash flow bottlenecks between major institutions, distributors, manufacturers and dealers have inhibited adoption of the directives.

First China is once again demonstrating leadership and innovation by seizing the initiative and granting its member customers access to a dedicated drug purchasing fund in amounts ranging from RMB50,000 to RMB500,000 as a short term line of credit available to qualified users. Repayment will be available as monthly installments and are designed to assist medical facilities manage their purchasing budgets as well as aiding manufacturers in governing their cash flow. The proposed scenario also reduces the pressure of capital turnover for the Company and increases First China's ability to negotiate with its suppliers. The formal agreement and launch of the fund is anticipated to be in place by late March or April of this year.

Coming at a time when the Chinese Central Government is introducing new policies to encourage private funds, including overseas capital, to be channeled into the medical sector to meet increasingly diversified demands on health care, the net result has generated great interest and optimism in the sector. First China believes that its recent market success is an active demonstration that its timely commitment to territorial expansion, joint ventures, key acquisitions and innovative strategies combined with a period of extraordinary government reform is resulting in a very robust outlook for the Company and the sector as a whole.

Details of the company's business, finances, appointments and agreements can be found as part of the Company's continuous public disclosure as a reporting issuer under the Securities Exchange Act of 1934 filed with the Securities and Exchange Commission's ("SEC") EDGAR database.

About First China Pharmaceutical Group, Inc. (OTCBB: FCPG)
First China Pharmaceutical Group, Inc. aims to develop a high growth pharmaceutical distribution company generating significant revenue from the sale of healthcare products in China. As part of its business strategy, the Company has acquired the assets of Kun Ming Xin Yuan Tang Pharmacies Co. Ltd. (XYT), which includes a strategic advantage over its competitors as it is believed to be one of a limited number of pharmaceutical distribution companies in Yunnan Province that has obtained government approval to fulfill orders over the internet. First China Pharmaceutical Group plans to continue the rapid growth of the company from its current position as a provider of approximately 5,000 drugs to more than 4,700 pharmacies, hospitals and clinics in China's Yunnan Province. For more information visit: www.firstchinapharma.com.

Notice Regarding Forward-Looking Statements
This news release contains "forward-looking statements" as that term is defined in Section 27A of the United States Securities Act of 1933, as amended and Section 21E of the Securities Exchange Act of 1934, as amended. Statements in this press release which are not purely historical are forward-looking statements and include any statements regarding beliefs, plans, expectations or intentions regarding the future. Such forward-looking statements include, among other things, regulatory incentives, the development of new business opportunities, and projected costs, revenue, profits and results operations. Actual results could differ from those projected in any forward-looking statements due to numerous factors. Such factors include, among others, the inherent uncertainties associated with new projects and development stage companies. These forward-looking statements are made as of the date of this news release, and we assume no obligation to update the forward-looking statements, or to update the reasons why actual results could differ from those projected in the forward-looking statements. Although we believe that any beliefs, plans, expectations and intentions contained in this press release are reasonable, there can be no assurance that any such beliefs, plans, expectations or intentions will prove to be accurate. Investors should consult all of the information set forth herein and should also refer to the risk factors disclosure outlined in our annual report on Form 10-K for the most recent fiscal year, our quarterly reports on Form 10-Q and other periodic reports filed from time-to-time with the Securities and Exchange Commission.

ON BEHALF OF THE BOARD
First China Pharmaceutical Group, Inc.
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Zhen Jiang Wang
Chairman and CEO

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Contact:
Evergreen Investor Relations, Inc.
Phone: 1-888-518-3274
Email: info@firstchinapharma.com
Web: www.firstchinapharma.com

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