SHENZHEN, China, March 31 /PRNewswire-Asia-FirstCall/ -- Tongjitang Chinese Medicines Company (the "Company" or "Tongjitang") (NYSE:TCM - News), a leading specialty pharmaceutical company focusing on the development, manufacturing, marketing and selling of modernized traditional Chinese medicine in China, today announced its financial results for the fourth quarter of 2009 and for the full year ended December 31, 2009.

    Financial Results for the Quarter Ended December 31, 2009
    -- Net revenue increased 31.5% to RMB 151.5 million ($22.2 million)(1),
       from RMB 115.2 million in the prior year period.
    -- Operating income was RMB 0.3 million ($0.1 million), compared to an
       operating loss of RMB 86.2 million in the prior year period.
    -- Net income attributable to the Company was RMB 4.1 million
       ($0.6 million), which yielded earnings per ADS of RMB 0.15 ($0.02) and
       earnings per share(2) of RMB 0.04 ($0.01).
    -- Non-GAAP adjusted EBITDA per share was RMB 0.11 ($0.02), compared to
       net loss of Non-GAAP adjusted EBITDA per share of RMB 0.56 in the
       fourth quarter of 2008.

Xiaochun Wang, Chief Executive Officer and Chairman of Tongjitang, stated, "We are very pleased with our fourth quarter performance, which was a significant revenue improvement from the fourth quarter of last year. While our margin performance does reflect a mix shift to lower margin products, we are operating in a more stable macro environment. Uncertainty in the market has been greatly reduced by the release and implementation of healthcare reform, from which we expect to continue to benefit in the long term. The destocking issues from previous quarters have largely abated, and our sales have grown as a result. Going forward we will continue to focus on expanding our sales networks into community hospitals, and we expect these efforts to result in increased selling and marketing expenses in the near future."

Net revenue in the fourth quarter of 2009 increased 31.5% to RMB 151.5 million ($22.2 million) from RMB 115.2 million in the fourth quarter of 2008. Xianling Gubao ("XLGB") sales were RMB 92.0 million ($13.5 million) in the fourth quarter of 2009, compared to RMB 86.7 million in the fourth quarter of 2008. Net revenue from Moisturizing & Anti-itching Capsules and Zaoren Anshen Capsules reached RMB 18.8 million ($2.8 million), an increase of 41.4% from RMB 13.3 million in the prior year period. Net revenue from the Company's other products increased 167.8% to RMB 40.7 million ($6.0 million) from RMB 15.2 million in the fourth quarter of 2008. Revenue contribution from Anhui Jingfang Pharmaceutical Co., Ltd. ("Jingfang"), which was acquired at the end of the first quarter of 2009, was RMB14.0 million ($2.1 million), compared to RMB17.6 million in the third quarter of 2009.

Gross profit increased 20.0% to RMB 84.6 million ($12.4 million) in the fourth quarter of 2009 from RMB 70.5 million in the fourth quarter of 2008. Gross margin was 55.9% in the fourth quarter of 2009, compared to 61.2% in the same period of 2008. Tongjitang's decreased gross margin reflects higher revenue contribution from lower-margin products. The price of barrenwort, used in the production of XLGB, remained stable in the fourth quarter of 2009.

Operating income in the fourth quarter of 2009 was RMB 0.3 million ($0.1 million), compared to an operating loss of RMB 86.2 million in the fourth quarter of 2008. Operating loss in the fourth quarter of 2008 included significant asset impairments to goodwill and intangible assets related to the Guizhou LLF and Qinghai Pulante acquisitions.

Net income attributable to the Company was RMB 4.1 million ($0.6 million), which yielded earnings per ADS of RMB 0.15 ($0.02) and earnings per share2 of RMB 0.04 ($0.01).

Non-GAAP adjusted EBITDA in the fourth quarter of 2009 was RMB 11.4 million ($1.7 million), compared to net loss of Non-GAAP adjusted EBITDA of RMB 75.5 million in the fourth quarter of 2008. Non-GAAP adjusted EBITDA per share was RMB 0.11 ($0.02) in the fourth quarter of 2009, compared to net loss of Non-GAAP adjusted EBITDA per share of RMB 0.56 in the fourth quarter of 2008. For the fourth quarter of 2009, the number of shares used in the computation of GAAP and non-GAAP adjusted EBITDA per share was 106.2 million. Please refer to the Company's GAAP to non-GAAP reconciliation table provided below for additional details.

Financial Results for the Year Ended December 31, 2009

For the year ended December 31, 2009, revenues increased 6.5% to RMB 480.3 million ($70.4 million), from RMB 451.0 million for the full year 2008. During this same time period, gross profit decreased by 1.6% to RMB 279.1 million ($40.9 million) from RMB 283.7 million. Gross margin for the full year 2009 was 58.1%, compared to 62.9% in the year before. Operating loss improved to RMB 10.9 million ($1.6 million) from RMB 77.7 million in the full year 2008. Net loss attributable to the Company was RMB 3.8 million ($0.6 million), or RMB 0.03 ($0. 01) per share, compared to net loss of RMB 52.3 million, or RMB 0.39 per share, in the year before. Net loss per ADS was RMB 0.12 ($0.02) in the year 2009, compared to net loss per ADS of RMB 1.55 in the year 2008. The weighted average number of shares outstanding for the year 2009 was 122.9 million.

Balance Sheet

As of December 31, 2009, the Company had cash and cash equivalents of RMB 237.6 million ($34.8 million). This compares to RMB 310.6 million as of September 30, 2009, and RMB 516.1 million as of December 31, 2008.

Business Updates

On February 2, 2010, the Company announced that it set up a joint venture with a third party to acquire 100% of state-owned Guiyang Liquor Factory for RMB120.6 million in cash. Tongjitang owns 95% of the joint venture and has already completed the acquisition.

On December 23, 2009, the Company held its annual meeting of shareholders for the fiscal year ended December 31, 2009 at its executive office in Shenzhen. At the meeting, Tongjitang's Chairman of the Board of Directors and Chief Executive Officer gave an update on company affairs, and management and stakeholders discussed their views of Tongitang's progress and prospects.

On November 19, 2009, the Company announced the repurchase of 4.8 million ordinary shares, or 4% of the Company's issued and outstanding shares, in privately negotiated transactions.

On October 13, 2009, the Company announced the repurchase of 19.3 million ordinary shares, or 15% of the Company's issued and outstanding shares, in privately negotiated transactions.

On June 22, 2009, the Company announced that effective June 16, 2009, it changed its independent auditor from Deloitte Touche Tohmatsu ("Deloitte") to Ernst & Young Hua Ming.

On April 2, 2009, the Company announced the acquisition of Anhui Jingfang Pharmaceutical Co. Ltd. for RMB 60.0 million in cash. Jingfang began to contribute to Tongjitang's revenue stream upon the closing of the transaction.

About Non-GAAP Financial Measures

To supplement the Company's unaudited condensed consolidated financial information presented in accordance with the United States Generally Accepted Accounting Principles ("GAAP"), the Company also provides non-GAAP financial measures, non-GAAP adjusted EBITDA and non-GAAP adjusted EBITDA per share, all of which exclude depreciation and amortization, interest (income) expense, provision for income taxes and share-based compensation expenses recorded under FASB Accounting Standards Codification ("ASC") Subtopic 718 - 10 Compensation - Stock Compensation: Overall (Pre-codification: SFAS No. 123(R), Share-Based Payment.) The Company's management believes the non-GAAP financial measures facilitate better understanding of operating results from quarter to quarter and allows the management team to better plan and forecast future periods, as the non-GAAP financial measures provide additional information to the investors. The non-GAAP information is not in accordance with GAAP and may be different from non-GAAP methods of accounting and reporting used by other companies. The presentation of this additional information should not be considered a substitute for the GAAP results. A limitation of using these non-GAAP financial measures is that these non-GAAP measures exclude share- based compensation expenses that have been and will continue to be significant recurring expenses in our business for the foreseeable future. Reconciliations of the Company's non-GAAP financial data to the most comparable GAAP data are included at the end of this press release.

Conference Call

Tongjitang's management team will hold a conference call on March 31 at 8:00 a.m. U.S. Eastern Time (8:00 p.m. Beijing/Hong Kong time) following the announcement. Listeners may access the call by dialing the following numbers:

    United States toll free:  1-888-228-5279
    Hong Kong toll free:      800-903-658
    Northern China toll free: 10-800-7141504
    Southern China toll free: 10-800-1401379
    International:            1-913-312-1429

Listeners may access the replay through April 7, 2010, by dialing the following numbers:

    United States toll free: 1-888-203-1112
    International:           1-719-457-0820
    Password:                1164592

An audio webcast of the call will also be available through the Company's website at http://www.tongjitang.co... .

About Tongjitang Chinese Medicines Company

Tongjitang Chinese Medicines Company, through its operating subsidiaries Tongjitang Pharmaceutical, Tongjitang Distribution, Tongjitang Chain Stores, Guizhou Long-Life Pharmaceutical Company Limited, Qinghai Pulante and Anhui Jingfang, is a vertically integrated specialty pharmaceutical company focused on the development, manufacturing, marketing and selling of modernized traditional Chinese medicine in China. Tongjitang's principal executive offices are located in Shenzhen, China.

Tongjitang's flagship product, Xianling Gubao, is the leading traditional Chinese medicine for the treatment of osteoporosis in China as measured by sales in Renminbi. In addition to Xianling Gubao, the Company manufactures and markets 36 other modernized traditional Chinese medicine products and 37 western medicines. Please visit http://www.tongjitang.co... for more information.

Safe Harbor Statements

This press release contains forward-looking statements that are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Although the Company believes that the expectations reflected in such forward-looking statements are based on reasonable assumptions, such statements are subject to risks and uncertainties that could cause actual results to differ materially from those projected. Although the Company believes that the expectations expressed in these forward-looking statements are reasonable, they cannot assure you that their expectations will turn out to be correct, and investors are cautioned that actual results may differ materially from those described in the forward-looking statements in this press release. A number of factors could cause actual results to differ materially from those contained in any forward-looking statement, including but not limited to the following: the Company's heavy dependence on the success of Xianling Gubao; the Company's ability to market Xianling Gubao to hospitals and to retail pharmacies; the retail prices of its principal products' being subject to price control by the government authorities in China; the inclusion of the Company's products in national and provincial medical catalogs of the National Medical Insurance Program in China; the Company's ability to obtain approval from the State Food and Drug Administration in China to convert a provisional national production standard of the Company's principal products to a national final production standard; the Company's ability to continue having the exclusive production rights for its products; the Company's ability to further improve its barrenwort extraction efficiency; the presence of certain side effects in the Company's current products and the Company's ability to identify side effects associated with its current or future products prior to their marketing and sale; the Company's ability to obtain manufacturing or marketing approval for its future products; the Company's dependence on a limited number of distributors for a significant portion of its net revenues; the Company's exposure to the risk of product liability claims and its limited insurance coverage; the Company's ability to manage the expansion of its operations and its future research and development projects successfully; the Company's ability to protect its intellectual property rights and defend infringement or misappropriation claims by third parties; intense competition in the pharmaceutical market in China; the supply of quality medicinal raw materials; the Company's U.S. tax status as a passive foreign investment company ("PFIC") for the taxable year ended December 31, 2008 and the significant risk that the Company will be a PFIC for the current taxable year ended December 31, 2009; uncertainties with respect to the legal system in China, including uncertainty with respect to potential regulatory changes in China's healthcare industry; if disruptions in the financial markets and other macro-economic challenges currently affecting the economy of the United States and other parts of the world continue or even worsen, it may adversely impact the economy and consumer confidence in China; the Company's ability to expand its business through organic growth and strategic acquisitions and investments; and the Company's ability to integrate its acquisitions, including the recently-acquired state-owned Guiyang Liquor Factory. Further information regarding these and other risks is and will be included in the Company's filings with the U.S. Securities and Exchange Commission, including its annual report on Form 20-F and other filings. The Company does not undertake any obligation to update any forward-looking statement, except as required under applicable law. All information provided in this press release is as of the date of this press release, and the Company undertakes no duty to update such information, except as required under applicable law.

    (1) This announcement contains translations of certain Renminbi amounts
        into US dollars at specified rates solely for the convenience of
        readers. Unless otherwise noted, all translations from Renminbi to US
        dollars as of and for the quarter ended December 31, 2009 were made at
        the noon buying rate on December 31, 2009 in the City of New York for
        cable transfers in Renminbi per US dollar as certified for customs
        purposes by the Federal Reserves Bank of New York, which was RMB6.8259
        to USD1.00. Tongjitang makes no representation that the Renminbi or US
        dollar amounts referred to in this release could have been or could be
        converted into US dollars or Renminbi, as the case may be, at any
        particular rate or at all.
    (2) All references to "shares" are to our ordinary shares. Each of our
        American Depositary Shares, which are traded on the New York Stock
        Exchange, represents four ordinary shares.


    For further information, please contact:

    ICR, Inc.
     Ashley M. Ammon or Christine Duan
     Tel: +1-203-682-8200 (Investor Relations)



                     Tongjitang Chinese Medicines Company
               Condensed Consolidated Statements of Operations
               (In thousands, except share and per share data)

                                                   Fourth Quarter Ended
                                                        December 31
                                             2008          2009         2009
                                              RMB           RMB          US$
                                                                       (Note)

    Net revenues                           115,204       151,486       22,193
    Cost of revenues                        44,736        66,878        9,798
    Gross profit                            70,468        84,608       12,395
    Advertising expenses                   (18,069)      (10,526)      (1,542)
    Other selling and marketing expenses   (22,256)      (41,100)      (6,021)
    General and administrative expenses    (20,050)      (21,991)      (3,222)
    Research and development expenses       (2,705)       (5,880)        (861)
    Impairment loss on intangible assets   (72,910)       (4,500)        (659)
    Impairment loss on goodwill            (28,062)           --           --
    Government grant (related to
     research and development)               1,428           200           29
    Gain (loss) on disposal of property,
     plant and equipment and land
     use rights                              3,970          (817)        (120)
    Gain on disposal of a subsidiary         1,312            --           --
    Other operating income                     710           351           51
    Income (loss) from operations          (86,164)          345           50
    Other income (expenses):
     Interest income                         3,369           566           83
     Interest expense                       (3,335)       (2,129)        (312)
     Government grants                         710         2,009          294
     Investment (loss) / gain                 (175)          309           45
     Tax refund on reinvestment of
      profits                               16,064            --           --
     Other income / (expenses), net        (14,549)          473           69
    Income (loss) before income taxes
     and non-controlling interest          (84,080)        1,573          229
    (Provision for income taxes)
     tax benefit                             4,826         2,535          371
    Net income (loss)                      (79,254)        4,108          600
    Less: Net income (loss) attributable
     to the non-controlling interests          (10)           --           --
    Net income (loss) attributable to
     controlling interests                 (79,264)        4,108          600
    Earnings per share
     Ordinary shares
      Basic                                  (0.59)         0.04         0.01
      Diluted                                (0.59)         0.04         0.01
    Shares used in computation of
     earnings per share
      Ordinary shares
       Basic                           134,929,939   106,153,483  106,153,483
       Diluted                         134,929,939   106,153,483  106,153,483



                     Tongjitang Chinese Medicines Company
               Condensed Consolidated Statements of Operations
               (In thousands, except share and per share data)

                                                        Year Ended
                                                        December 31
                                             2008          2009         2009
                                              RMB           RMB          US$
                                                                       (Note)

    Net revenues                           451,032        480,339       70,370
    Cost of revenues                       167,345        201,205       29,477
    Gross profit                           283,687        279,134       40,893
    Advertising expenses                   (80,180)       (32,384)      (4,744)
    Other selling and marketing expenses   (80,031)      (151,755)     (22,232)
    General and administrative expenses    (91,325)       (86,501)     (12,672)
    Research and development expenses      (17,368)       (16,057)      (2,352)
    Impairment loss on intangible assets   (72,910)        (4,500)        (659)
    Impairment loss on goodwill            (28,062)            --           --
    Government grant (related to
     research and development)               1,428            232           34
    Gain (loss) on disposal of property,
     plant and equipment and land
     use rights                              3,970           (817)        (120)
    Gain on disposal of a subsidiary         1,312             --           --
    Other operating income                   1,801          1,700          249
    Income (loss) from operations          (77,678)       (10,948)      (1,603)
    Other income (expenses):
     Interest income                        17,114          4,047          593
     Interest expense                      (16,599)        (8,553)      (1,253)
     Government grants                       6,752          5,554          814
     Investment (loss) / gain               (1,830)           829          121
     Tax refund on reinvestment of
      profits                               16,064             --           --
     Other income / (expenses), net          4,171          6,963        1,020
    Income (loss) before income taxes
     and non-controlling interest          (52,006)        (2,108)        (308)
    (Provision for income taxes)
     tax benefit                              (502)        (1,617)        (237)
    Net income (loss)                      (52,508)        (3,725)        (545)
    Less: Net income (loss)
     attributable to the non-controlling
     interests                                 208            (66)         (10)
    Net income (loss) attributable to
     controlling interests                 (52,300)        (3,791)        (555)
    Earnings per share
     Ordinary shares
      Basic                                  (0.39)         (0.03)       (0.01)
      Diluted                                (0.39)         (0.03)       (0.01)
    Shares used in computation of
     earnings per share
     Ordinary shares
      Basic                            134,758,695    122,940,745  122,940,745
      Diluted                          134,758,695    122,940,745  122,940,745

    (Note)
    The condensed consolidated financial statements of Tongjitang Chinese
    Medicines Company are stated in Renminbi ("RMB"). The translation of RMB
    amounts as of and for the year ended December 31, 2009 into United States
    dollar ("US$") is included solely for the convenience of readers and has
    been translated at the rate of RMB6.8259 to US$1.00, which is based on the
    noon buying rate in The City of New York for cable transfers of Renminbi
    as certified for customs purposes by the Federal Reserve Bank of New York
    at December 31, 2009. Such translations should not be construed as
    representations that RMB amounts could be converted into US$ at that rate
    or any other rate.



                       Tongjitang Chinese Medicines Company
                      Condensed Consolidated Balance Sheets
                        (In thousands, except share data)

                                    Dec. 31     Sept. 30    Dec. 31    Dec. 31
                                     2008         2009       2009       2009
                                      RMB          RMB        RMB        US$
                                   (Note 2)                           (Note 1)
    ASSETS
     Current assets:
      Cash and cash equivalents      516,087      310,649    237,578    34,805
      Short-term bank deposit         50,000       55,000     50,000     7,325
      Notes receivable                55,987       41,757     70,248    10,291
      Accounts receivable, net of
       allowance for doubtful
       accounts                      214,543      233,966    232,038    33,994
      Amounts due from related
       parties                         8,500           --         --        --
      Amounts due from former
       shareholders of a
       subsidiary                        689           --         --        --
      Inventories                     97,553      134,645    139,100    20,378
      Trading securities                 792        1,255      1,447       212
      Prepaid advertising expenses     1,692        4,359      1,204       176
      Receivable on sales of
       property, plant and
       equipment                      12,600       18,810      9,320     1,365
      Other prepaid expenses and
       current assets, net of
       allowance for doubtful
       accounts                       21,548       33,161     16,139     2,364
      Deferred tax assets                 --        1,533      6,771       992
       Total current assets          979,991      835,135    763,845   111,902
     Property, plant and equipment,
      net                            152,249      174,118    172,097    25,212
     Land use rights, net             28,902       42,468     42,515     6,228
     Deposit for acquisition of a
      subsidiary                          --           --    120,599    17,668
     Deposits for acquisition of
      property, plant and
      equipment and intangible
      assets                         188,103      163,170    162,440    23,798
     Acquired intangible assets,
      net                             24,736       33,242     27,592     4,042
     Goodwill                             --        4,475      2,345       344
     Receivable on sales of
      property, plant and
      equipment                        6,210           --      9,170     1,343
     Long-term other assets            1,800          441      1,000       147
     Deferred tax assets               1,107        1,165      3,603       528
       Total assets                1,383,098    1,254,214  1,305,206   191,212

    LIABILITIES AND SHAREHOLDERS'
     EQUITY
     Current liabilities:
      Short-term borrowings           85,100      103,100    101,100    14,811
      Accounts payable                14,663       23,854     38,288     5,610
      Amounts due to related
       parties                         1,332          900        900       132
      Amounts due to former
       shareholders of a
       subsidiary                      7,385        6,186      5,186       760
      Accrued expenses and other
       current liabilities            81,130       92,856    156,247    22,890
      Income taxes payable               926        2,894      4,026       590
     Total current
      liabilities                    190,536      229,790    305,747    44,793
     Long-term bank loans             50,000       50,000     50,000     7,325
     Deferred tax liabilities          7,272        9,073     11,868     1,739
    Total liabilities                247,808      288,863    367,615    53,857
    Total shareholders' equity
     attributable to the Company   1,134,815      965,351    937,591   137,358
    Non-controlling interests
     (Note 2)                            475           --         --        --
    Total equity                   1,135,290      965,351    937,591   137,358
    Total liabilities
     and equity                    1,383,098    1,254,214  1,305,206   191,215

    (Note 1)
    The condensed consolidated financial statements of Tongjitang Chinese
    Medicines Company are stated in Renminbi ("RMB"). The translation of RMB
    amounts as of and for the year ended December 31, 2009 into United States
    dollar ("US$") is included solely for the convenience of readers and has
    been translated at the rate of RMB6.8259 to US$1.00, which is based on the
    noon buying rate in The City of New York for cable transfers of Renminbi
    as certified for customs purposes by the Federal Reserve Bank of New York
    at December 31, 2009. Such translations should not be construed as
    representations that RMB amounts could be converted into US$ at that rate
    or any other rate.

    (Note 2)
    Effective from January 1, 2009, the Company adopted FASB ASC Topic 810
    "Noncontrolling Interest" ("ASC 810") (Pre-codification: SFAS 160,
    Noncontrolling Interests in Consolidated Financial Statements), which
    amends ARB 51 to establish accounting and reporting standards for
    noncontrolling interests in a subsidiary. FASB ASC 810 further clarifies
    that a noncontrolling interest in a subsidiary is an ownership interest in
    the consolidated entity that should be reported in the financial
    statements. Accordingly, the Company has included the noncontrolling
    subsidiary minority interests in the current year financial statements and
    adjusted the previous year periods for comparative presentation.
    Additionally, net loss attributable to non-controlling interests was shown
    separately from net loss in the accompanying condensed consolidated
    statement of operations. Reclassifications -- Certain prior period
    balances have been reclassified to conform with current period
    presentation related to the adoption of ASC 810 "Noncontrolling Interest."



                     Tongjitang Chinese Medicines Company
                      Reconciliation of GAAP to Non-GAAP
                (In thousands, except share and per share data)

                                          Fourth Quarter Ended December 31
                                           2008         2009         2009
                                            RMB          RMB          US$
                                                                    (Note 1)
    GAAP net income                       (79,264)       4,108          600
    Share-based compensation expenses
     (Note 2)                               1,996        1,599          234
    Depreciation and amortisation           6,602        6,622          970
    Interest (income) expense, ne             (34)       1,563          229
    Provision for income taxes             (4,826)      (2,535)        (371)
    Non-GAAP adjusted EBIDTA              (75,526)      11,357        1,662
    GAAP earnings per share
     Ordinary shares
      Basic                                 (0.59)        0.04         0.01
      Diluted                               (0.59)        0.04         0.01
    Non-GAAP adjusted EBIDTA per share
     Ordinary shares
      Basic                                 (0.56)        0.11         0.02
      Diluted                               (0.56)        0.11         0.02
    Shares used in computation of
     GAAP/Non-GAAP adjusted EBIDTA per
     share
     Ordinary shares
      Basic                           134,929,939  106,153,483  106,153,483
      Diluted                         134,929,939  106,153,483  106,153,483



                     Tongjitang Chinese Medicines Company
                      Reconciliation of GAAP to Non-GAAP
                (In thousands, except share and per share data)

                                               Year Ended December 31
                                           2008         2009         2009
                                            RMB          RMB          US$
                                                                   (Note 1)
    GAAP net income                       (52,300)      (3,791)        (555)
    Share-based compensation expenses
     (Note 2)                              20,446        5,799          850
    Depreciation and amortisation          25,819       22,970        3,365
    Interest (income) expense, net           (515)       4,506          660
    Provision for income taxes                502        1,617          237
    Non-GAAP adjusted EBIDTA               (6,048)      31,101        4,557
    GAAP earnings per share
     Ordinary shares
      Basic                                 (0.39)       (0.03)       (0.01)
      Diluted                               (0.39)       (0.03)       (0.01)
    Non-GAAP adjusted EBIDTA per share
        Ordinary shares
        -Basic                              (0.04)        0.25         0.04
        -Diluted                            (0.04)        0.25         0.04
    Shares used in computation of GAAP
     / Non-GAAP adjusted EBIDTA per
     share
        Ordinary shares
        -Basic                        134,758,695  122,940,745  122,940,745
        -Diluted                      134,758,695  122,940,745  122,940,745


    (Note 1)
    The condensed consolidated financial statements and the related amounts of
    Tongjitang Chinese Medicines Company are stated in Renminbi ("RMB"). The
    translation of RMB amounts as of and for the year ended December 31, 2009
    into United States dollar ("US$") is included solely for the convenience
    of readers and has been translated at the rate of RMB6.8259 to US$1.00,
    which is based on the noon buying rate in The City of New York for cable
    transfers of Renminbi as certified for customs purposes by the Federal
    Reserve Bank of New York at December 31, 2009. Such translations should
    not be construed as representations that RMB amounts could be converted
    into US$ at that rate or any other rate.

    (Note 2)
    Share-based compensation expenses recorded in accordance to ASC subtopic
    718-10 ("ASC 718-10"), Compensation-Stock Compensation: Overall (Pre-
    Codification: SFAS No. 123(R), Share-Based Payment) are as follows:


                                             Forth Quarter Ended September 30
                                               2008         2009         2009
                                                RMB          RMB          US$
                                                                      (Note 1)
    General and administrative expenses       1,996        1,599          234

                                                   Year Ended December 31
                                               2008         2009         2009
                                                RMB          RMB          US$
                                                                      (Note 1)
    General and administrative expenses      20,446        5,799          850

Holders of record of the Company’s ordinary shares at the close of business on December 7, 2009 (the “Record Date”) are entitled to receive notice of and to attend the annual general meeting and any adjournment or postponement thereof in person. Beneficial owners of the Company’s American Depositary Shares (“ADSs”) as of the Record Date are welcome to attend the meeting in person.

The Company has filed its annual report on Form 20-F (the “Annual Report”), which includes the Company’s audited financial statements for the fiscal year ended December 31, 2008, with the U.S. Securities and Exchange Commission (the “SEC”). The Company’s Annual Report and the notice of the 2009 annual general meeting can be accessed on the investor relations section of its website at http://www.tongjitang.co..., as well as on the SEC’s website at http://www.sec.gov.

Holders of the Company’s ordinary shares or ADSs may obtain a hard copy of the Annual Report free of charge by emailing to ir@tongjitang.com or by writing to:

About Tongjitang Chinese Medicines Company

Tongjitang Chinese Medicines Company, through its operating subsidiaries Tongjitang Pharmaceutical, Tongjitang Distribution, Tongjitang Chain Stores, Guizhou Long-Life Pharmaceutical Company Limited, Qinghai Pulante and Anhui Jingfang, is a vertically integrated specialty pharmaceutical company focused on the development, manufacturing, marketing and selling of modernized traditional Chinese medicine in China. Tongjitang’s principal executive offices are located in Shenzhen, China.

Tongjitang’s flagship product, Xianling Gubao, is the leading traditional Chinese medicine for the treatment of osteoporosis in China as measured by sales in Renminbi. In addition to Xianling Gubao, the Company manufactures and markets 36 other modernized traditional Chinese medicine products and 37 western medicines. Please visit www.tongjitang.com for more information.

ICR, Inc.
Ashley M. Ammon or Christine Duan
(Investor Relations)
203-682-8200

Financial Results for the Quarter Ended September 30, 2009

• Net revenue was RMB104.6 million ($15.3 million)¹, compared to RMB110.4 million in the prior year period.
• Gross margin was 57.6% in the third quarter of 2009, compared to 62.4% in the same period of 2008.
• Net loss attributable to the Company was RMB13.7 million ($2.0 million), which yielded net loss per ADS of RMB0.43 ($0.06) and net loss per share² of RMB0.11 ($0.02).
• Non-GAAP loss per share was RMB0.04 ($0.01), compared to non-GAAP earnings per share of RMB0.11 in the third quarter of 2008.

Net revenue for the third quarter of 2009 was RMB104.6 million ($15.3 million), a decrease of 5.3% from RMB110.4 million in the third quarter of 2008. Xianling Gubao (“XLGB”) sales were RMB60.6 million ($8.9 million) in the third quarter of 2009, compared to RMB78.7 million in the third quarter of 2008. Net revenue of the Company’s other core products, including Moisturizing & Anti-itching Capsules and Zaoren Anshen Capsules, increased 4.1% to RMB12.8 million ($1.9 million) from RMB12.3 million in the third quarter of 2008. Revenue contribution from Guizhou Long-Life Pharmaceutical Company Limited (”Guizhou LLF”) was RMB2.6 million ($376,000), compared to RMB5.1 million in the third quarter of 2008. Revenue contribution from Qinghai Pulante Pharmaceutical Co., Ltd. (“Pulante”) was RMB1.9 million ($278,000), roughly flat year over year. Revenue contribution from Anhui Jingfang Pharmaceutical Co., Ltd. (“Jingfang”), which was acquired at the end of the first quarter of 2009, was RMB17.6 million ($2.6 million), compared to RMB14.4 million in the second quarter of 2009.

Xiaochun Wang, Chief Executive Officer and Chairman of Tongjitang, stated, “Our third quarter performance reflects the introduction of the newly-launched sales rebate program to the majority of distributors. As a result of this rebate program, RMB6.2 million has been recorded against revenues year to date. Additionally, even though the Essential Drug List was announced by China’s Ministry of Health during this third quarter, uncertainties regarding execution details and pricing continued to cause hospitals and distributors to destock their inventory levels, leading to low sales during the quarter. However, we believe that such declines in purchases from hospitals and distributors should recover noticeably when the pending Chinese healthcare policies are finalized and disclosed.”

Gross profit was RMB60.3 million ($8.8 million) in the third quarter of 2009, down from RMB69.0 million in the third quarter of 2008. Gross margin was 57.6% in the third quarter of 2009, compared to 62.4% in the same period of 2008. Tongjitang’s decreased gross margin reflects reduced revenues from XLGB and Guizhou LLF (which enjoys a higher margin) and the introduction of sales rebates. The price of barrenwort, used in the production of XLGB, remained stable in the third quarter of 2009.

Operating loss in the third quarter of 2009 was RMB12.8 million ($1.9 million), compared to operating income of RMB7.7 million in the third quarter of 2008, primarily reflecting increased selling and marketing expenses related to Jingfang’s products.

Net loss attributable to the Company was RMB13.7 million ($2.0 million), which yielded net loss per ADS of RMB0.43 ($0.06) and net loss per share² of RMB0.11 ($0.02).

Non-GAAP net loss in the third quarter of 2009 was RMB5.4 million ($790,000), compared to non-GAAP net income of RMB15.3 million in the third quarter of 2008. Non-GAAP loss per share was RMB0.04 ($0.01), compared to non-GAAP earnings per share of RMB0.11 in the third quarter of 2008. For the third quarter of 2009, the number of shares used in the computation of GAAP and non-GAAP net loss per share was 126.8 million. Please refer to the Company’s GAAP to non-GAAP reconciliation table provided below for additional details.

Wang continued, “During the third quarter, we are very pleased to see that our recently-integrated business, Jingfang, started to show great potential in sales. We also expect to see initial progress from our ongoing marketing campaign and the restructuring of Jingfang’s sales team in the fourth quarter. ”

Financial Results for the Nine Months Ended September 30, 2009

For the nine months ended September 30, 2009, revenue was RMB328.9 million ($48.2 million), down from RMB335.8 million in the first nine months of 2008. During this same time period, gross profit was RMB194.5 million ($28.5 million), down from RMB213.2 million. Operating loss was RMB11.3 million ($1.7 million), compared to operating income of RMB8.5 million in the first nine months of 2008. Net loss attributable to the Company was RMB7.9 million ($1.2 million), or RMB 0.06 ($0.01) per share, compared to net income attributable to the Company of RMB27.0 million, or RMB0.20 per share, in the first nine months of 2008. Net loss per ADS was RMB0.25 ($0.04) in the first nine months of 2009, compared with net income per ADS of RMB0.80 in the first nine months of 2008. The weighted average number of shares outstanding for the first nine months of 2009 was 128.6 million.

Balance Sheet

As of September 30, 2009, the Company had cash and cash equivalents of RMB310.6 million ($45.5 million). This compares to RMB473.7 million as of June 30, 2009.

Share Repurchase in a Private Transaction

On November 11, 2009, the Company completed a repurchase of 4.8 million ordinary shares in a private transaction. The purchase price of $1.025 per ordinary share was the same as the purchase price paid by the Company to certain non-affiliate and non-management investors in the recent share repurchases completed in September 2009 through privately negotiated transactions. Since the seller of these 4.8 million ordinary shares was a company controlled and owned by certain current and ex-senior management of the Company’s operating subsidiary in China, this transaction may be deemed a related party transaction. Due to such consideration, before the share repurchase was carried out, it was pre-approved by both the Company’s board of directors as well as the board’s audit committee.

About Non-GAAP Financial Measures

To supplement the Company’s unaudited condensed consolidated financial information presented in accordance with the United States Generally Accepted Accounting Principles ("GAAP"), the Company also provides non-GAAP financial measures, non-GAAP adjusted EBITDA and non-GAAP adjusted EBITDA per share, all of which exclude share-based compensation expenses recorded under Accounting Standards Codification 718: Compensation—Stock Compensation (Pre-Codification: Statement of Financial Accounting Standards 123R, “Share-Based Payment”). The Company’s management believes the non-GAAP financial measures facilitate better understanding of operating results from quarter to quarter and allows the management team to better plan and forecast future periods, as the non-GAAP financial measures provide additional information to the investors. The non-GAAP information is not in accordance with GAAP and may be different from non-GAAP methods of accounting and reporting used by other companies. The presentation of this additional information should not be considered a substitute for the GAAP results. A limitation of using these non-GAAP financial measures is that these non-GAAP measures exclude share-based compensation expenses that have been and will continue to be significant recurring expenses in the Company’s business for the foreseeable future. Reconciliations of the Company’s non-GAAP financial data to the most comparable GAAP data are included at the end of this press release.

Conference Call

The Company will hold a conference call on November 18 at 8:00 a.m. U.S. Eastern Time (9:00 p.m. Beijing/Hong Kong time) following the announcement. Listeners may access the call by dialing the following numbers:

An audio webcast of the call will also be available through the Company’s website at www.tongjitang.....

1. This announcement contains translations of certain Renminbi amounts into US dollars at specified rates solely for the convenience of readers. Unless otherwise noted, all translations from Renminbi to US dollars as of and for the quarter ended September 30, 2009 were made at the noon buying rate on September 30, 2009 in the City of New York for cable transfers in Renminbi per US dollar as certified for customs purposes by the Federal Reserve Bank of New York, which was RMB6.8262 to USD1.00. Tongjitang makes no representation that the Renminbi or US dollar amounts referred to in this release could have been or could be converted into US dollars or Renminbi, as the case may be, at any particular rate or at all.

2. All references to ‘shares’ are to our ordinary shares. Each of our American Depositary Shares, which are traded on the New York Stock Exchange, represents four ordinary shares.

About Tongjitang Chinese Medicines Company

Tongjitang Chinese Medicines Company, through its operating subsidiaries Tongjitang Pharmaceutical, Tongjitang Distribution, Tongjitang Chain Stores, Guizhou Long-Life Pharmaceutical Company Limited, Qinghai Pulante and Anhui Jingfang, is a vertically integrated specialty pharmaceutical company focused on the development, manufacturing, marketing and selling of modernized traditional Chinese medicine in China. Tongjitang’s principal executive offices are located in Shenzhen, China.

Tongjitang’s flagship product, Xianling Gubao, is the leading traditional Chinese medicine for the treatment of osteoporosis in China as measured by sales in Renminbi. In addition to Xianling Gubao, the Company manufactures and markets 36 other modernized traditional Chinese medicine products and 37 western medicines. Please visit www.tongjitang.com for more information.

Safe Harbor Statements

This press release contains forward-looking statements that are made pursuant to the safe harbor provisions of the Securities Litigation Reform Act of 1995. Although the Company believes that the expectations reflected in such forward-looking statements are based on reasonable assumptions, such statements are subject to risks and uncertainties that could cause actual results to differ materially from those projected. Although the Company believes that the expectations expressed in these forward-looking statements are reasonable, they cannot assure you that their expectations will turn out to be correct, and investors are cautioned that actual results may differ materially from those described in the forward-looking statements in this press release. A number of factors could cause actual results to differ materially from those contained in any forward-looking statement, including but not limited to the following: the Company’s heavy dependence on the success of Xianling Gubao; the Company’s ability to market Xianling Gubao to hospitals and to retail pharmacies; the retail prices of its principal products’ being subject to price control by the government authorities in China; the inclusion of the Company’s products in national and provincial medical catalogs of the National Medical Insurance Program in China; the Company’s ability to obtain approval from the State Food and Drug Administration in China to convert a provisional national production standard of the Company’s principal products to a national final production standard; the Company’s ability to continue having the exclusive production rights for its products; the Company’s ability to further improve its barrenwort extraction efficiency; the presence of certain side effects in the Company’s current products and the Company’s ability to identify side effects associated with its current or future products prior to their marketing and sale; the Company’s ability to obtain manufacturing or marketing approval for its future products; the Company’s dependence on a limited number of distributors for a significant portion of its net revenues; the Company’s exposure to the risk of product liability claims and its limited insurance coverage; the Company’s ability to manage the expansion of its operations and its future research and development projects successfully; the Company’s ability to protect its intellectual property rights and defend infringement or misappropriation claims by third parties; intense competition in the pharmaceutical market in China; the supply of quality medicinal raw materials; the Company’s U.S. tax status as a passive foreign investment company (“PFIC”) for the taxable year ended December 31, 2008 and the significant risk that the Company will be a PFIC for the current taxable year ending December 31, 2009; uncertainties with respect to the legal system in China, including uncertainty with respect to potential regulatory changes in China’s healthcare industry; if disruptions in the financial markets and other macro-economic challenges currently affecting the economy of the United States and other parts of the world continue or even worsen, it may adversely impact the economy and consumer confidence in China; and the Company’s ability to expand its business through organic growth and strategic acquisitions and investments. Further information regarding these and other risks is and will be included in the Company’s registration statement on Form F-1, its annual report on Form 20-F and other documents filed and to be filed with the U.S. Securities and Exchange Commission. The Company does not undertake any obligation to update any forward-looking statement, except as required under applicable law. All information provided in this press release is as of the date of this press release, and the Company undertakes no duty to update such information, except as required under applicable law.

ICR, Inc.
Ashley M. Ammon or Christine Duan
203-682-8200 (Investor Relations)

Financial Results for the Quarter Ended June 30, 2009

· Net revenues increased 12.1% to RMB134.1 million ($19.6 million)¹from RMB119.6 million the year before, reflecting sales in Xianling Gubao (“XLGB”) of RMB80.7 million ($11.8 million) which remained at approximately the same level as the second quarter of 2008, a 39.7% increase in sales of other core products to RMB18.2 million ($2.7 million), and revenue contribution of RMB14.4 million ($2.1 million) from Anhui Jingfang (“Jingfang”), which was acquired at the end of the first quarter of 2009.

· Gross margin was 61.0% in the second quarter of 2009, compared to 66.7% in the same period of 2008, and 58.2% in the first quarter of 2009.

· Net income attributable to the Company increased 117.6% to RMB17.2 million ($2.5 million), which yielded net income per ADS of RMB0.53 ($0.08), and net income per share² of RMB0.13 ($0.02).

· Non-GAAP adjusted EBITDA per share was RMB0.21 ($0.03), compared to RMB0.20 in the second quarter of 2008 and RMB(0.01) in the first quarter of 2009.

Net revenues for the second quarter of 2009 were RMB134.1 million ($19.6 million), up by 12.1% from RMB119.6 million in the second quarter of 2008, and up by 48.7% from RMB90.2 million in the first quarter of 2009. XLGB sales were RMB80.7 million ($11.8 million) in the second quarter of 2009, compared to RMB81.5 million in the second quarter of 2008. Net revenues of the Company’s other core products, including Moisturizing & Anti-itching Capsules and Zaoren Anshen Capsules, increased 39.7% to RMB18.2 million ($2.7 million) from RMB13.0 million in the second quarter of 2008. Revenue contribution from Guizhou Long-Life Pharmaceutical Company Limited (”Guizhou LLF”) was RMB2.2 million ($322,000), compared to RMB2.3 million in the first quarter of 2009. Revenue contribution from Qinghai Pulante Pharmaceutical Co., Ltd. (“Pulante”) was RMB1.0 million ($146,000). Revenue contribution from Jingfang, which was acquired at the end of the first quarter of 2009, was RMB14.4 million ($2.1 million).

Gross profit increased by 2.5% to RMB81.7 million ($12.0 million) in the second quarter of 2009 from RMB79.7 million in the second quarter of 2008. Gross margin was 61.0% in the second quarter of 2009, compared to 66.7% in the same period of 2008 and 58.2% in the first quarter of 2009. Tongjitang’s cost of revenues and the decreased gross margin reflect the reduced revenues from Guizhou LLF (which enjoys a higher margin), lower selling prices of certain non-XLGB core products, and the increased cost of some of the raw materials for products other than XLGB. The price of barrenwort, used in the production of XLGB, remained stable in the second quarter of 2009.

Operating income in the second quarter of 2009 increased 28.8% to RMB11.7 million ($1.7 million) from RMB9.1 million in the second quarter of 2008, primarily reflecting the aforesaid increase in gross profit.

Net income attributable to the Company increased 117.6% to RMB17.2 million ($2.5 million), which yielded net income per ADS of RMB0.53 ($0.08), and net income per share² of RMB0.13 ($0.02).

Non-GAAP adjusted EBITDA in the second quarter of 2009 was RMB27.1 million ($4.0 million), compared to RMB27.4 million in the second quarter of 2008, and a loss of RMB1.9 million in the first quarter of 2009. Non-GAAP adjusted EBITDA per share was RMB0.21 ($0.03), compared to RMB0.20 in the second quarter of 2008 and RMB(0.01) in the first quarter of 2009. The number of shares used in the computation of GAAP net income per share and Non-GAAP adjusted EBITDA per share was 128.3 million. Please refer to the Company’s GAAP to Non-GAAP reconciliation table provided below.

Xiaochun Wang, Chief Executive Officer and Chairman of Tongjitang, stated, “We are very pleased to report a quarter with improved revenue growth driven by our more diversified product portfolio. Our increased sales benefitted from our newly-integrated business, Jingfang, and our existing branded product lines. Revenue performance also reflects initial progress of our ongoing sales team restructuring.”

Financial Results for the Six Months Ended June 30, 2009

For the six months ended June 30, 2009, revenues were RMB224.2 million ($32.8 million), down from RMB225.4 million in the first six months of 2008. During this same time period, gross profit was RMB134.2 million ($19.7 million), down from RMB144.3 million. Income from operations increased 95.3% to RMB1.5 million ($0.2 million) from RMB0.7 million in the first six months of 2008. Net income attributable to the Company was RMB5.8 million ($0.9 million), or RMB 0.04 ($0.01) per share, compared to net income attributable to the Company of RMB19.8 million, or RMB0.15 per share, in the first six months of 2008. Net income per ADS was RMB0.18 ($0.03) in the first six months of 2009, compared with net income per ADS of RMB0.59 in the first six months of 2008. On a year over year basis, weighted average number of shares outstanding for the first six months of 2009 was 129.5 million.

Balance Sheet

As of June 30, 2009, the Company had cash and cash equivalents of RMB473.7 million ($69.4 million). This compares to RMB488.4 million as of March 31, 2009, and RMB731.1 million as of June 30, 2008.

About Non-GAAP Financial Measures

To supplement the Company’s unaudited condensed consolidated financial information presented in accordance with the United States Generally Accepted Accounting Principles ("GAAP"), the Company also provides non-GAAP financial measures, non-GAAP adjusted EBITDA and non-GAAP adjusted EBITDA per share, all of which exclude share-based compensation expenses recorded under Statement of Financial Accounting Standards 123R, “Share-Based Payment.” The Company’s management believes the non-GAAP financial measures facilitate better understanding of operating results from quarter to quarter and allows the management team to better plan and forecast future periods, as the non-GAAP financial measures provide additional information to the investors. The non-GAAP information is not in accordance with GAAP and may be different from non-GAAP methods of accounting and reporting used by other companies. The presentation of this additional information should not be considered a substitute for the GAAP results. A limitation of using these non-GAAP financial measures is that these non-GAAP measures exclude share-based compensation expenses that have been and will continue to be significant recurring expenses in the Company’s business for the foreseeable future. Reconciliations of the Company’s non-GAAP financial data to the most comparable GAAP data are included at the end of this press release.

Conference Call

The Company will hold a conference call on August 17, 2009, at 8:00 a.m. U.S. Eastern Time (8:00 p.m. Beijing/Hong Kong time) following the announcement. Listeners may access the call by dialing the following numbers:

An audio webcast of the call will also be available through the Company’s website at www.tongjitang.....

1. This announcement contains translations of certain Renminbi amounts into US dollars at specified rates solely for the convenience of readers. Unless otherwise noted, all translations from Renminbi to US dollars as of and for the quarter ended June 30, 2009 were made at the noon buying rate on June 30, 2009 in the City of New York for cable transfers in Renminbi per US dollar as certified for customs purposes by the Federal Reserve Bank of New York, which was RMB6.8302 to USD1.00. Tongjitang makes no representation that the Renminbi or US dollar amounts referred to in this release could have been or could be converted into US dollars or Renminbi, as the case may be, at any particular rate or at all.

2. All references to ‘shares’ are to our ordinary shares. Each of our American Depositary Shares, which are traded on the New York Stock Exchange, represents four ordinary shares.

About Tongjitang Chinese Medicines Company

Tongjitang Chinese Medicines Company, through its operating subsidiaries Tongjitang Pharmaceutical, Tongjitang Distribution, Tongjitang Chain Stores, Guizhou Long-Life Pharmaceutical Company Limited, Qinghai Pulante and Anhui Jingfang, is a vertically integrated and profitable specialty pharmaceutical company focused on the development, manufacturing, marketing and selling of modernized traditional Chinese medicine in China. Tongjitang’s principal executive offices are located in Shenzhen, China.

Tongjitang’s flagship product, Xianling Gubao, is the leading traditional Chinese medicine for the treatment of osteoporosis in China as measured by sales in Renminbi. In addition to Xianling Gubao, the Company manufactures and markets 36 other modernized traditional Chinese medicine products and 37 western medicines. Please visitwww.tongjitang.... for more information.

Safe Harbor Statements

This press release contains forward-looking statements that are made pursuant to the safe harbor provisions of the Securities Litigation Reform Act of 1995. Although the Company believes that the expectations reflected in such forward-looking statements are based on reasonable assumptions, such statements are subject to risks and uncertainties that could cause actual results to differ materially from those projected. Although the Company believes that the expectations expressed in these forward-looking statements are reasonable, they cannot assure you that their expectations will turn out to be correct, and investors are cautioned that actual results may differ materially from those described in the forward-looking statements in this press release. A number of factors could cause actual results to differ materially from those contained in any forward-looking statement, including but not limited to the following: the Company’s heavy dependence on the success of Xianling Gubao; the Company’s ability to market Xianling Gubao to hospitals and to retail pharmacies; the retail prices of its principal products’ being subject to price control by the government authorities in China; the inclusion of the Company’s products in national and provincial medical catalogs of the National Medical Insurance Program in China; the Company’s ability to obtain approval from the State Food and Drug Administration in China to convert a provisional national production standard of the Company’s principal products to a national final production standard; the Company’s ability to continue having the exclusive production rights for its products; the Company’s ability to further improve its barrenwort extraction efficiency; the presence of certain side effects in the Company’s current products and the Company’s ability to identify side effects associated with its current or future products prior to their marketing and sale; the Company’s ability to obtain manufacturing or marketing approval for its future products; the Company’s dependence on a limited number of distributors for a significant portion of its net revenues; the Company’s exposure to the risk of product liability claims and its limited insurance coverage; the Company’s ability to manage the expansion of its operations and its future research and development projects successfully; the Company’s ability to protect its intellectual property rights and defend infringement or misappropriation claims by third parties; intense competition in the pharmaceutical market in China; the supply of quality medicinal raw materials; the Company’s U.S. tax status as a passive foreign investment company (“PFIC”) for the taxable year ended December 31, 2008 and the significant risk that the Company will be a PFIC for the current taxable year ending December 31, 2009; uncertainties with respect to the legal system in China, including uncertainty with respect to potential regulatory changes in China’s healthcare industry; if disruptions in the financial markets and other macro-economic challenges currently affecting the economy of the United States and other parts of the world continue or even worsen, it may adversely impact the economy and consumer confidence in China; a further slowdown in the growth of China’s economy; and the Company’s ability to expand its business through organic growth and strategic acquisitions and investments. Further information regarding these and other risks is and will be included in the Company’s registration statement on Form F-1, its annual report on Form 20-F and other documents filed and to be filed with the U.S. Securities and Exchange Commission. The Company does not undertake any obligation to update any forward-looking statement, except as required under applicable law. All information provided in this press release is as of the date of this press release, and the Company undertakes no duty to update such information, except as required under applicable law.

Financial Results for the Quarter Ended March 31, 2009

• Net revenues decreased to RMB90.2 million ($13.2 million)¹ from RMB105.8 million the year before, reflecting a 20.7% decline in Xianling Gubao (“XLGB”) sales to RMB55.7 million ($8.1 million), a 11.3% increase in sales of other core products to RMB14.8 million ($2.2 million) and a 11.5% decrease in sales of other non-core products to RMB19.7 million ($2.9 million).
• Gross margin decreased to 58.2% in the first quarter of 2009 from 61.0% in the same period of 2008.
• Net loss was RMB11.4 million ($1.7 million), which yielded net loss per ADS of RMB0.32 ($0.04), and net loss per share² of RMB0.08 ($0.01).
• The Company broke even on an adjusted EBITDA per ADS basis. Please refer to the reconciliation table provided below.

Net revenues for the first quarter of 2009 were RMB90.2 million ($13.2 million), down by 14.8%, or RMB15.6 million, from RMB105.8 million in the first quarter of 2008, and down 21.7% from RMB115.2 million in the fourth quarter of 2008. XLGB sales were RMB55.7 million ($8.1 million) in the first quarter of 2009, compared to RMB70.3 million in the first quarter of 2008. Revenue of the Company’s other core products, such as Moisturizing and Anti-itching Capsules increased to RMB14.8 million ($2.2 million) from RMB13.3 million in the first quarter of 2008. Revenue contribution from Guizhou Long-Life Pharmaceutical Company Limited (”Guizhou LLF”) decreased to RMB2.3 million ($335,445) from RMB2.5 million in the fourth quarter of 2008. Products by Guizhou LLF contributed approximately 2.5% of revenue in the first quarter of 2009, compared to 2.1% in the fourth quarter of 2008. The first quarter contribution from Qinghai Pulante Pharmaceutical Co. (“Pulante”), which was acquired in the second quarter of 2008, was RMB1.6 million ($239,284).

Gross profit decreased by 18.6% to RMB52.5 million ($7.7 million) in the first quarter of 2009 from RMB64.5 million in the first quarter of 2008. Gross margin was 58.2% in the first quarter of 2009, compared to 61.0% in the same period of 2008 and 61.2% in the fourth quarter of 2008. Gross margin performance primarily reflects revenue mix, including greater revenue contribution from distribution activities versus the prior year period. The price of barrenwort, used in the production of XLGB, remained stable in the first quarter of 2009.

Operating loss in the first quarter of 2009 was RMB10.3 million ($1.5 million), compared to operating loss of RMB8.3 million in the first quarter of 2008, primarily reflecting increased selling and marketing expenditure as the Company implemented its new marketing strategy.

Net loss was RMB11.4 million ($1.7 million), net loss per ADS was RMB0.32 ($0.04), and net loss per share was RMB0.08 ($0.01) in the first quarter of 2009. Adjusted EBITDA in the first quarter of 2009 was a loss of RMB1.9 million ($280,000), compared to adjusted EBITDA of RMB26.5 million in the first quarter of 2008. Adjusted EBITDA on a per share basis was approximately RMB0.01 ($0.00) in the first quarter of 2009. The number of shares used in the computation of GAAP earnings per share and adjusted EBITDA per share (Non-GAAP) was 135.3 million. Please refer to the Company’s GAAP to Non-GAAP reconciliation table provided below.

Xiaochun Wang, Chief Executive Officer and Chairman of Tongjitang, stated, “We are confident that our diversified product portfolio, which contains leading branded products, combined with our increased marketing efforts and the completed restructuring of our sales team, will drive our long-term growth and result in operational improvements in the rest of the year.”

Balance Sheet

As of March 31, 2009, the Company had cash and cash equivalents of RMB488.4 million ($71.5 million). This compares to RMB516.1 million as of December 31, 2008, and RMB797.3 million as of March 31, 2008.

Form 20-F Filed

The Company also announced today that it has filed its annual report on Form 20-F for the fiscal year ended December 31, 2008 with the Securities and Exchange Commission. The annual report can be accessed at www.sec.gov and has been posted on the investor relations section of Tongjitang’s website through http://www.tongjitang.co.... Tongjitang will provide a hard copy of its annual report on Form 20-F containing complete audited financial statements, free of charge, to its shareholders and ADS holders upon request. Requests should be directed to the Company’s IR representative, listed below.

About Non-GAAP Financial Measures

To supplement the Company’s unaudited condensed consolidated financial information presented in accordance with the United States Generally Accepted Accounting Principles ("GAAP"), the Company also provides non-GAAP financial measures, non-GAAP net income and non-GAAP earnings per share, all of which exclude share-based compensation expenses recorded under Statement of Financial Accounting Standards 123R, “Share-Based Payment.” The Company’s management believes the non-GAAP financial measures facilitate better understanding of operating results from quarter to quarter and allows the management team to better plan and forecast future periods, as the non-GAAP financial measures provide additional information to the investors. The non-GAAP information is not in accordance with GAAP and may be different from non-GAAP methods of accounting and reporting used by other companies. The presentation of this additional information should not be considered a substitute for the GAAP results. A limitation of using these non-GAAP financial measures is that these non-GAAP measures exclude share-based compensation expenses that have been and will continue to be significant recurring expenses in the Company’s business for the foreseeable future. Reconciliations of the Company’s non-GAAP financial data to the most comparable GAAP data are included at the end of this press release.

Conference Call

The Company will hold a conference call on June 3, 2009, at 8:00 a.m. U.S. Eastern Time (8:00 p.m. Beijing/Hong Kong time) following the announcement. Listeners may access the call by dialing the following numbers:

Listeners may access the replay through June 10, 2009, by dialing the following numbers:

An audio webcast of the call will also be available through the Company’s website at www.tongjitang.....

About Tongjitang Chinese Medicines Company

Tongjitang Chinese Medicines Company, through its operating subsidiaries Tongjitang Pharmaceutical, Tongjitang Distribution, Tongjitang Chain Stores, Guizhou Long-Life Pharmaceutical Company Limited, Qinghai Pulante and Anhui Jingfang, is a vertically integrated and profitable specialty pharmaceutical company focused on the development, manufacturing, marketing and selling of modernized traditional Chinese medicine in China. Tongjitang’s principal executive offices are located in Shenzhen, China.

Tongjitang’s flagship product, Xianling Gubao, is the leading traditional Chinese medicine for the treatment of osteoporosis in China as measured by sales in Renminbi. In addition to Xianling Gubao, the Company manufactures and markets 36 other modernized traditional Chinese medicine products and 37 western medicines. Please visit www.tongjitang.... for more information.

Safe Harbor Statements

This press release contains forward-looking statements that are made pursuant to the safe harbor provisions of the Securities Litigation Reform Act of 1995. Although the Company believes that the expectations reflected in such forward-looking statements are based on reasonable assumptions, such statements are subject to risks and uncertainties that could cause actual results to differ materially from those projected. Although the Company believes that the expectations expressed in these forward-looking statements are reasonable, they cannot assure you that their expectations will turn out to be correct, and investors are cautioned that actual results may differ materially from those described in the forward-looking statements in this press release. A number of factors could cause actual results to differ materially from those contained in any forward-looking statement, including but not limited to the following: the Company’s heavy dependence on the success of Xianling Gubao; the Company’s ability to market Xianling Gubao to hospitals and to retail pharmacies; the retail prices of its principal products’ being subject to price control by the government authorities in China; the inclusion of the Company’s products in national and provincial medical catalogs of the National Medical Insurance Program in China; the Company’s ability to obtain approval from the State Food and Drug Administration in China to convert a provisional national production standard of the Company’s principal products to a national final production standard; the Company’s ability to continue having the exclusive production rights for its products; the Company’s ability to further improve its barrenwort extraction efficiency; the presence of certain side effects in the Company’s current products and the Company’s ability to identify side effects associated with its current or future products prior to their marketing and sale; the Company’s ability to obtain manufacturing or marketing approval for its future products; the Company’s dependence on a limited number of distributors for a significant portion of its net revenues; the Company’s exposure to the risk of product liability claims and its limited insurance coverage; the Company’s ability to manage the expansion of its operations and its future research and development projects successfully; the Company’s ability to protect its intellectual property rights and defend infringement or misappropriation claims by third parties; intense competition in the pharmaceutical market in China; the supply of quality medicinal raw materials; the Company’s U.S. tax status as a passive foreign investment company (“PFIC”) for the taxable year ended December 31, 2008 and the significant risk that the Company will be a PFIC for the current taxable year ending December 31, 2009; uncertainties with respect to the legal system in China, including uncertainty with respect to potential regulatory changes in China’s healthcare industry; if disruptions in the financial markets and other macro-economic challenges currently affecting the economy of the United States and other parts of the world continue or even worsen, it may adversely impact the economy and consumer confidence in China; a further slowdown in the growth of China’s economy; and the Company’s ability to expand its business through organic growth and strategic acquisitions and investments. Further information regarding these and other risks is and will be included in the Company’s registration statement on Form F-1, its annual report on Form 20-F and other documents filed and to be filed with the U.S. Securities and Exchange Commission. The Company does not undertake any obligation to update any forward-looking statement, except as required under applicable law. All information provided in this press release is as of the date of this press release, and the Company undertakes no duty to update such information, except as required under applicable law.

Integrated Corporate Relations
Ashley M. Ammon, 203-682-8200

Jingfang manufactures and sells more than thirty Western and traditional Chinese medicines. According to Jingfang’s financial accounts audited by its PRC accountants, Jingfang was profitable and achieved revenue of RMB56.1 million in 2007 and revenue of RMB40.7 million in 2008. Its major revenue-generating products are Fengshi Gutong Capsules, designed to relieve pain caused by rheumatic arthritis, and Jingshu Granules, designed to relieve stiffness and pain caused by degenerative osteoarthritis. Both of these products are traditional Chinese medicine-based prescription drugs exclusively produced by Jingfang and included in the National Medical Insurance Catalogue. In 2007 and 2008, revenue from these two products accounted for approximately 30% and 40%, respectively, of total revenue. Jingfang was founded in 1969 and is located in Xuancheng city, Anhui Province, China.

Xiaochun Wang, Tongjitang’s Chief Executive Officer and Chairman of the Board of Directors, commented, “One of our ongoing goals is to deploy capital efficiently so that we generate compelling future returns, and we believe acquiring Jingfang furthers this goal for several reasons. Jingfang’s main products nicely complement our existing product portfolio and further strengthen our therapeutic focus in orthopedics and geriatrics. We intend to capture incremental revenue by marketing and selling these leading products through our salesforce, which already focuses on the prescription orthopedics market. Additionally, the Company’s two core products are both included in the National Insurance Catalogue, which drives consistent future revenue aimed at a large, growing and relatively untapped marketplace.”

Tongjitang believes that the transaction is an attractive strategic decision for several reasons, including:

• Enhances Orthopedic-Specialty Brand. Tongjitang believes that Jingfang’s Fengshi Gutong and Jingshu products, in addition to Tongjitang’s Xianling Gubao and LLF’s Heiguteng, will further Tongjitang’s brand leadership in orthopedic-focused traditional Chinese medicine in both the prescription and OTC markets. Tongjitang believes that under its established, widely-trusted name, it could co-brand the new acquired products and reinforce its trusted image as an orthopedic specialist in the modernized TCM arena.
• Complements and Enriches Existing Product Portfolio. Jingfang’s major products, Fengshi Gutong Capsules and Jingshu Granules, both relieve pain caused by orthopedic conditions and complement Tongjitang’s existing product portfolio. Through its existing sales network and well-established distribution channels, Tongjitang intends to drive incremental sales.
• Augments Geographic Presence. The Jingfang acquisition will augment the Company’s existing presence and drive additional brand recognition in the Yangtze River Delta region, where Tongjitang already has a sizeable presence. Jingfang’s location, approximately 319 kilometers from Shanghai, 243 kilometers from Hangzhou and 194 kilometers from Nanjing, is convenient to major cities in Southeastern China. Such location provides easy access to large distribution channels and the associated markets in Southeastern China.
• Inclusion in National Medical Insurance CataIogue. Both of Jingfang’s primary products are included in the National Medical Insurance Catalogue, which helps create consistent product demand in China’s healthcare marketplace.

About Tongjitang Chinese Medicines Company

Tongjitang Chinese Medicines Company, through its operating subsidiaries Tongjitang Pharmaceutical, Tongjitang Distribution, Tongjitang Chain Stores, Guizhou Long-Life Pharmaceutical Company Limited and Qinghai Pulante, is a vertically integrated and profitable specialty pharmaceutical company focused on the development, manufacturing, marketing and selling of modernized traditional Chinese medicine in China. Tongjitang’s principal executive offices are located in Shenzhen, China.

Tongjitang’s flagship product, Xianling Gubao, is the leading traditional Chinese medicine for the treatment of osteoporosis in China as measured by sales in Renminbi. In addition to Xianling Gubao, the Company manufactures and markets 20 other modernized traditional Chinese medicine products and 22 western medicines. Please visit www.tongjitang.com for more information.

Safe Harbor Statements

This press release contains forward-looking statements that are made pursuant to the safe harbor provisions of the Securities Litigation Reform Act of 1995. Although the Company believes that the expectations reflected in such forward-looking statements are based on reasonable assumptions, such statements are subject to risks and uncertainties that could cause actual results to differ materially from those projected. Although the Company believes that the expectations expressed in these forward-looking statements are reasonable, they cannot assure you that their expectations will turn out to be correct, and investors are cautioned that actual results may differ materially from those described in the forward -looking statements in this press release. A number of factors could cause actual results to differ materially from those contained in any forward-looking statement, including but not limited to the following: if disruptions in the financial markets and other macro-economic challenges currently affecting the economy of the United States and other parts of the world continue or even worsen, it may adversely impact the economy and consumer confidence in China; a further slowdown in the growth of China’s economy; our growth strategy; our future business development, results of operations and financial condition; our heavy dependence on the success of Xianling Gubao; our ability to market Xianling Gubao to hospitals and to retail pharmacies; the retail prices of our principal products’ being subject to price control by the government authorities in China; our products’ inclusion in national and provincial medical catalogs of the National Medical Insurance Program in China; our ability to obtain approval from the State Food and Drug Administration in China to convert a provisional national production standard of our principal products to a national final production standard; our ability to continue having the exclusive production rights for our products; our ability to further improve our barrenwort extraction efficiency; our ability to obtain manufacturing or marketing approval for our future products; our dependence on a limited number of distributors for a significant portion of our net revenues; our ability to protect our intellectual property rights and defend infringement or misappropriation claims by third parties; intense competition in the pharmaceutical market in China; the supply of quality medicinal raw materials; and uncertainties with respect to the legal system in China, including uncertainty with respect to potential regulatory changes in China’s healthcare industry. Further information regarding these and other risks is and will be included in our registration statement on Form F-1, our annual report on Form 20-F and other documents filed and to be filed with the U.S. Securities and Exchange Commission. The Company does not undertake any obligation to update any forward-looking statement, except as required under applicable law. All information provided in this press release is as of the date of this press release, and the Company undertakes no duty to update such information, except as required under applicable law.

ICR, Inc.
Ashley M. Ammon or Christine Duan
203-682-8200 (Investor Relations)

Financial Results for the Quarter Ended December 31, 2008

• Net revenues decreased to RMB115.2 million ($16.9 million)¹ from RMB179.7 million the year before, reflecting a 37.2% decline in Xianling Gubao (“XLGB”) sales to RMB84.9 million ($12.4 million) and a 46.6% decrease in sales of other core products to RMB14.0 million ($2.1 million).
• Gross margin decreased to 61.2% in the fourth quarter of 2008 from 65.5% in the same period of 2007 and 62.4% in the third quarter of 2008.
• Net loss was RMB79.3 million ($11.6 million), which yielded net loss per ADS of RMB2.36 ($0.36), and net loss per share² of RMB0.59 ($0.09).

Net revenues for the fourth quarter of 2008 were RMB115.2 million ($16.9 million), down by 35.9%, or RMB64.5 million, from RMB179.7 million in the fourth quarter of 2007, and up by 4.3% from RMB110.4 million in the third quarter of 2008. XLGB sales were RMB84.9million ($12.4 million) in the fourth quarter of 2008, compared with RMB135.2 million in the fourth quarter of 2007 and RMB78.9 million in the third quarter of 2008. Revenue performance also reflected a decline in sales of the Company’s other core products, such as Moisturizing and Anti-itching Capsules, Zaoren and Dianbaizhu, which decreased to RMB14.0 million ($2.1 million) from RMB26.2 million in the fourth quarter of 2007 but increased from RMB12.6 million in the third quarter of 2008. Revenue contribution from Guizhou Long-Life Pharmaceutical Company Limited (”Guizhou LLF”) decreased to RMB2.5 million from RMB5.1 million in the third quarter of 2008. Products by Guizhou LLF contributed approximately 2.1% of revenue in the fourth quarter of 2008, compared with 4.6% in the third quarter of 2008.

Xiaochun Wang, Chief Executive Officer and Chairman of Tongjitang, stated, “While we are disappointed with the ongoing decline in our year over year revenue, we are pleased at the initial improvements we made compared to the third quarter of 2008. In the fourth quarter, we continued the restructuring of our sales team for XLGB OTC products. While we may face resistance in these efforts, we expect to improve the sales of XLGB and continue to grow thereafter. Our existing market position, diversified product portfolio, and leading branded products will drive our long-term growth, despite the challenges of the current macroeconomic environment and uncertainty with respect to potential regulatory changes in China’s healthcare industry.”

Gross profit decreased by 40.1% to RMB70.5 million ($10.3 million) in the fourth quarter of 2008 from RMB117.6 million in the fourth quarter of 2007. Gross margin was 61.2% in the fourth quarter of 2008, compared with 65.5% in the same period of 2007 and 62.4% in the third quarter of 2008. Tongjitang’s cost of revenues and the decreased gross margin reflect the reduced revenues from Guizhou LLF (which enjoys a higher margin), lower selling prices of certain non-XLGB core products, and the increased cost of some of the raw materials for products other than XLGB. The price of barrenwort, used in the production of XLGB, remained stable in the fourth quarter of 2008.

Operating loss in the fourth quarter of 2008 was RMB86.5 million ($12.7 million), compared with operating income of RMB0.4 million in the fourth quarter of 2007, primarily reflecting an RMB70.8 million ($10.4 million) asset impairment related to intangible assets, and an RMB28.1 million ($4.1 million) asset impairment related to goodwill, both for Guizhou LLF and Qinghai Pulante. Additionally, Tongjitang recognized approximately RMB2.0 million ($0.3 million) of share-based compensation expenses in the fourth quarter of 2008.

Net loss was RMB79.3 million ($11.6 million), net loss per ADS was RMB2.36 ($0.36), and net loss per share was RMB0.59 ($0.09) in the fourth quarter of 2008. Non-GAAP adjusted EBITDA in the fourth quarter of 2008, which excludes the share-based compensation expenses and the asset impairments described above, was RMB23.3 million ($3.4 million), compared with RMB56.6 million in the fourth quarter of 2007. Non-GAAP adjusted EBITDA per diluted share was RMB0.17 ($0.03) in the fourth quarter of 2008. The number of shares used in the computation of GAAP earnings per share and adjusted EBITDA per share (Non-GAAP) was 134.9 million.

Financial Results for the Twelve Months Ended December 31, 2008

For the twelve months ended December 31, 2008, revenues decreased by 24.3%, to RMB451.0 million ($66.1 million), from RMB596.0 million for the full year 2007. During this same time period, gross profit decreased by 27.3% to RMB283.7 million ($41.6 million) from RMB390.0 million. Gross margin for the full year 2008 was 62.9%, compared with 65.4% in the year before. Loss from operations was RMB78.0 million ($11.4 million), compared with income from operations of RMB120.9 million in the full year 2007, and net loss was RMB52.3 million ($7.7 million), or RMB0.39 ($0.06) per share, compared with net income of RMB171.2 million, or RMB1.35 per share, for the full year 2007. Net loss per ADS was $1.56 for the year ended December 31, 2008. On a year over year basis, the weighted average number of shares outstanding in the full year 2008 increased by 8.3% to 134.8 million.

Additionally, Tongjitang recognized RMB101.0 million ($14.8 million) of asset impairments related to intangible assets and goodwill, and RMB20.4 million ($3.0 million) of share-based compensation expenses in the year of 2008.

Non-GAAP adjusted EBITDA, which excludes the share-based compensation expenses as well as the asset impairments described above, was RMB94.9 million ($13.9 million) for the twelve months ended December 31, 2008, compared with RMB209.0 million in the prior year. Non-GAAP adjusted EBITDA per diluted share decreased to RMB0.70 ($0.10) in the year of 2008. The number of shares used in the computation of GAAP earnings per share and adjusted EBITDA per share (Non-GAAP) was 134.8 million. Please refer to the Company’s GAAP to Non-GAAP reconciliation table provided below.

Balance Sheet

As of December 31, 2008, the Company had cash and cash equivalents of RMB516.1 million ($75.6 million). This compares with RMB579.1 million as of September 30, 2008, and RMB797.8 million as of December 31, 2007.

Business Update

On December 16, 2008, the Company announced the appointment of Charles Wang as its Chief Financial Officer. Mr. Wang joined Tongjitang with over 20 years of experience in the field of finance. From 1999 to 2008, he served as the Chief Financial Officer at Asia Renal Care, Ltd., a leading healthcare service provider in the Asia-Pacific region. Prior to 1999, Mr. Wang was a Finance Director at Hanson Pacific Ltd., the Asia Pacific Headquarters of Hanson PLC. Early in his financial career, Mr. Wang was a Corporate Finance Manager at PricewaterhouseCoopers (Hong Kong) and an Assistant Audit Manager at Kingston Smith Chartered Accountants. Mr. Wang received his B.A. with honors in Economics and Accounting from the University of Leeds, England, and has been a member of the Institute of Chartered Accountants of England and Wales since 1991.

Mr. Wang continued, “We are glad that Charles Wang joined our Company as our Chief Financial Officer. His extensive experience in finance and healthcare is very beneficial, and we believe his skill set will contribute greatly to the growth of our business.”

About Non-GAAP Financial Measures

To supplement the Company’s unaudited condensed consolidated financial information presented in accordance with the United States Generally Accepted Accounting Principles ("GAAP"), the Company also provides non-GAAP financial measures, non-GAAP EBITDA and non-GAAP EBITDA per share, all of which exclude asset impairments and share-based compensation expenses recorded under Statement of Financial Accounting Standards 123R, “Share-Based Payment.” The Company’s management believes the non-GAAP financial measures facilitate better understanding of operating results from quarter to quarter and allows the management team to better plan and forecast future periods, as the non-GAAP financial measures provide additional information to the investors. The non-GAAP information is not in accordance with GAAP and may be different from non-GAAP methods of accounting and reporting used by other companies. The presentation of this additional information should not be considered a substitute for the GAAP results. A limitation of using these non-GAAP financial measures is that these non-GAAP measures exclude share-based compensation expenses that have been and will continue to be significant recurring expenses in our business for the foreseeable future. Reconciliations of the Company’s non-GAAP financial data to the most comparable GAAP data are included at the end of this press release.

Conference Call

The Company will hold a conference call on March 20, 2009, at 8:00 a.m. U.S. Eastern Time (8:00 p.m. Beijing/Hong Kong time) to discuss the results. Listeners may access the call by dialing the following numbers:

A replay of the conference call may be accessed after the conclusion of the conference call through March 27, 2009, by dialing the following numbers:

An audio webcast of the call will also be available through the Company’s website at www.tongjitang.com.

About Tongjitang Chinese Medicines Company

Tongjitang Chinese Medicines Company, through its operating subsidiaries Tongjitang Pharmaceutical, Tongjitang Distribution, Tongjitang Chain Stores, Guizhou Long-Life Pharmaceutical Company Limited and Qinghai Pulante, is a vertically integrated and profitable specialty pharmaceutical company focused on the development, manufacturing, marketing and selling of modernized traditional Chinese medicine in China. Tongjitang’s principal executive offices are located in Shenzhen, China.

Tongjitang’s flagship product, Xianling Gubao, is the leading traditional Chinese medicine for the treatment of osteoporosis in China as measured by sales in Renminbi. In addition to Xianling Gubao, the Company manufactures and markets 20 other modernized traditional Chinese medicine products and 22 western medicines. Please visit www.tongjitang.com for more information.

Safe Harbor Statements

This press release contains forward-looking statements that are made pursuant to the safe harbor provisions of the Securities Litigation Reform Act of 1995. Although the Company believes that the expectations reflected in such forward-looking statements are based on reasonable assumptions, such statements are subject to risks and uncertainties that could cause actual results to differ materially from those projected. Although the Company believes that the expectations expressed in these forward-looking statements are reasonable, they cannot assure you that their expectations will turn out to be correct, and investors are cautioned that actual results may differ materially from those described in the forward -looking statements in this press release. A number of factors could cause actual results to differ materially from those contained in any forward-looking statement, including but not limited to the following: if disruptions in the financial markets and other macro-economic challenges currently affecting the economy of the United States and other parts of the world continue or even worsen, it may adversely impact the economy and consumer confidence in China; a further slowdown in the growth of China’s economy; our growth strategy; our future business development, results of operations and financial condition; our heavy dependence on the success of Xianling Gubao; our ability to market Xianling Gubao to hospitals and to retail pharmacies; the retail prices of our principal products’ being subject to price control by the government authorities in China; our products’ inclusion in national and provincial medical catalogs of the National Medical Insurance Program in China; our ability to obtain approval from the State Food and Drug Administration in China to convert a provisional national production standard of our principal products to a national final production standard; our ability to continue having the exclusive production rights for our products; our ability to further improve our barrenwort extraction efficiency; our ability to obtain manufacturing or marketing approval for our future products; our dependence on a limited number of distributors for a significant portion of our net revenues; our ability to protect our intellectual property rights and defend infringement or misappropriation claims by third parties; intense competition in the pharmaceutical market in China; the supply of quality medicinal raw materials; and uncertainties with respect to the legal system in China, including uncertainty with respect to potential regulatory changes in China’s healthcare industry. Further information regarding these and other risks is and will be included in our registration statement on Form F-1, our annual report on Form 20-F and other documents filed and to be filed with the U.S. Securities and Exchange Commission. The Company does not undertake any obligation to update any forward-looking statement, except as required under applicable law. All information provided in this press release is as of the date of this press release, and the Company undertakes no duty to update such information, except as required under applicable law.

1. This announcement contains translations of certain Renminbi amounts into US dollars at specified rates solely for the convenience of readers. Unless otherwise noted, all translations from Renminbi to US dollars as of and for the quarter and year ended December 31, 2008 were made at the noon buying rate on December 31, 2008 in the City of New York for cable transfers in Renminbi per US dollar as certified for customs purposes by the Federal Reserves Bank of New York, which was RMB6.8225 to USD1.00. Tongjitang makes no representation that the Renminbi or US dollar amounts referred to in this release could have been or could be converted into US dollars or Renminbi, as the case may be, at any particular rate or at all.

2. All references to ‘shares’ are to our ordinary shares. Each of our American Depositary Shares, which are traded on the New York Stock Exchange, represents four ordinary shares.

ICR, Inc.
Investor Relations:
Ashley M. Ammon or Christine Duan, 203-682-8200

Tongjitang Chinese Medicines Company (NYSE: TCM), a leading specialty pharmaceutical company focusing on the development, manufacturing, marketing and selling of modernized traditional Chinese medicine in China, today announced that it plans to announce its fourth quarter and full year 2008 financial results before the market opens on Friday, March 20, 2009.

Tongjitang’s management team will hold a conference call the same day at 8:00 a.m. U.S. Eastern Time (8:00 p.m. Beijing/Hong Kong time) following the announcement. Listeners may access the call by dialing the following numbers:

An audio webcast of the call will also be available through the Company’s website at www.tongjitang.com.

About Tongjitang Chinese Medicines Company

Tongjitang Chinese Medicines Company, through its operating subsidiaries Tongjitang Pharmaceutical, Tongjitang Distribution, Tongjitang Chain Stores, Guizhou Long-Life Pharmaceutical Company Limited and Qinghai Pulante, is a vertically integrated and profitable specialty pharmaceutical company focused on the development, manufacturing, marketing and selling of modernized traditional Chinese medicine in China. Tongjitang’s principal executive offices are located in Shenzhen, China.

Tongjitang’s flagship product, Xianling Gubao, is the leading traditional Chinese medicine for the treatment of osteoporosis in China as measured by sales in Renminbi. In addition to Xianling Gubao, the Company manufactures and markets 18 other modernized traditional Chinese medicine products and 38 western medicines. Please visit www.tongjitang.com for more information.

ICR, Inc.
Ashley M. Ammon and Christine Duan
203-682-8200 (Investor Relations)

Source: Business Wire (March 11, 2009 - 9:02 AM EDT)

Mr. Wang joins Tongjitang with over 20 years of experience in the field of finance. Since 1999, he served as Chief Financial Officer at Asia Renal Care, Ltd., a leading healthcare service provider in the Asia-Pacific region. Prior to 1999, Mr. Wang was Finance Director at Hanson Pacific Ltd., the Asia Pacific Headquarters of Hanson PLC, where he structured and executed acquisitions and joint ventures totaling over $100 million in transaction value during his tenure. Early in his financial career, Mr. Wang was Corporate Finance Manager at PricewaterhouseCoopers (Hong Kong), and Assistant Audit Manager at Kingston Smith Chartered Accountants. Mr. Wang received his B.A. with honors in Economics and Accounting from the University of Leeds, England, and has been a member of the Institute of Chartered Accountants of England and Wales since 1991.

Commenting on the appointment, Xiaochun Wang, Chief Executive Officer and Chairman of Tongjitang, said, “Mr. Wang is a seasoned and dynamic finance executive and we are delighted to have him join our Company. His extensive experience in both finance and the healthcare industry, coupled with his proven leadership skills, will play a key role as we continue to make viable acquisitions and grow our business.”

About Tongjitang Chinese Medicines Company

Tongjitang Chinese Medicines Company, through its operating subsidiaries Tongjitang Pharmaceutical, Tongjitang Distribution, Tongjitang Chain Stores, Tongjitang Planting, Guizhou Long-Life Pharmaceutical Company Limited and Qinghai Pulante, is a vertically integrated and profitable specialty pharmaceutical company focused on the development, manufacturing, marketing and selling of modernized traditional Chinese medicine in China. Tongjitang’s principal executive offices are located in Shenzhen, China.

Tongjitang’s flagship product, Xianling Gubao, is the leading traditional Chinese medicine for the treatment of osteoporosis in China as measured by sales in Renminbi. In addition to Xianling Gubao, the Company manufactures and markets 18 other modernized traditional Chinese medicine products and 38 western medicines. Please visit www.tongjitang.com for more information.

Safe Harbor Statement

This press release contains forward-looking statements that are made pursuant to the safe harbor provisions of the Securities Litigation Reform Act of 1995. Although the Company believes that the expectations reflected in such forward-looking statements are based on reasonable assumptions, such statements are subject to risks and uncertainties that could cause actual results to differ materially from those projected. Although the Company believes that the expectations expressed in these forward-looking statements are reasonable, it cannot assure you that its expectations will turn out to be correct, and investors are cautioned that actual results may differ materially from those described in the forward -looking statements in this press release. A number of factors could cause actual results to differ materially from those contained in any forward-looking statement, including but not limited to the following: the Company’s growth strategy; the Company’s future business development, results of operations and financial condition; the Company’s heavy dependence on the success of Xianling Gubao; the Company’s ability to market Xianling Gubao to hospitals and to retail pharmacies; the retail prices of the Company’s principal products’ being subject to price control by the government authorities in China; the Company’s products’ inclusion in national and provincial medical catalogs of the National Medical Insurance Program in China; the Company’s ability to obtain approval from the State Food and Drug Administration in China to convert a provisional national production standard of its principal products to a national final production standard; the Company’s ability to continue having the exclusive production rights for its products; the Company’s ability to further improve its barrenwort extraction efficiency; the Company’s ability to obtain manufacturing or marketing approval for its future products; the Company’s dependence on a limited number of distributors for a significant portion of its net revenues; the Company’s ability to protect its intellectual property rights and defend infringement or misappropriation claims by third parties; intense competition in the pharmaceutical market in China; the supply of quality medicinal raw materials; and uncertainties with respect to the legal system in China. Further information regarding these and other risks is and will be included in the Company’s registration statement on Form F-1, its annual report on Form 20-F and other documents filed and to be filed with the U.S. Securities and Exchange Commission. The Company does not undertake any obligation to update any forward-looking statement, except as required under applicable law. All information provided in this press release is as of the date of this press release, and the Company undertakes no duty to update such information, except as required under applicable law.

Integrated Corporate Relations, Inc.
Ashley Ammon or Christine Duan
203-682-8200 (Investor Relations)

Tongjitang Chinese Medicines Company (NYSE: TCM) (“Tongjitang” or the “Company”), a leading specialty pharmaceutical company focusing on the development, manufacturing, marketing and selling of modernized traditional Chinese medicine in China, today announced its unaudited financial results for the third quarter of 2008, ended September 30, 2008.

Highlights for the Quarter Ended September 30, 2008

• Net revenues decreased 13.0% year over year to RMB110.4 million ($16.3 million),¹ reflecting a 3.8% decline in Xianling Gubao (“XLGB”) sales to RMB78.9 million ($11.6 million), and a 50.6% decline in sales of other core products to RMB12.6 million ($1.8 million). Products by Guizhou Long-Life Pharmaceutical Company Limited (”Guizhou LLF”) contributed approximately 4.6% of revenue in the third quarter, compared with 8.5% in the second quarter.
• Gross margin decreased to 62.4% in the third quarter of 2008 from 63.9% in the same period of 2007 and 66.7% in the second quarter of 2008.
• Net income for the third quarter of 2008 was RMB7.2 million ($1.1 million), which yielded net income per ADS of RMB0.21 ($0.03), and net income per share² of RMB0.05 ($0.01).

Financial Results for the Quarter Ended September 30, 2008

Net revenue for the third quarter of 2008 was RMB110.4 million ($16.3 million), down 13.0%, or RMB16.5 million, from RMB126.9 million in the same period of 2007, and down 7.7% quarter over quarter. XLGB sales decreased 3.8% to RMB78.9 million ($11.6 million) in the third quarter of 2008, compared with RMB82.0 million in the third quarter of 2007 and RMB81.5 million in the second quarter of 2008. Revenue performance also reflected a decline in sales of the Company’s other core products, such as Moisturizing and Anti-itching Capsules, Zaoren and Dianbaizhu, which decreased to RMB12.6 million ($1.8 million) from RMB25.5 million in the third quarter of 2007. Revenue contribution from Guizhou LLF decreased 50.0%, to RMB5.1 million, from RMB10.2 million in the second quarter of 2008.

Xiaochun Wang, Chief Executive Officer and Chairman of Tongjitang, stated, “As we complete the restructuring of our OTC sales team, we expect sales of XLGB products to increase. We also made recent strides in our efforts against counterfeit products when PRC courts banned production and distribution of the counterfeit ‘Xianling Gubao Granules.’ We are confident about our long-term growth prospects, and will continue to develop new products and make viable acquisitions.”

Gross profit decreased 15.0%, to RMB69.0 million ($10.2 million) in the third quarter of 2008, from RMB81.1 million in the third quarter of 2007. Gross margin was 62.4% in the third quarter of 2008, compared with 63.9% in the same period of 2007 and 66.7% in the second quarter of 2008. Tongjitang’s cost of revenues and the decreased gross margin reflected the reduced revenues from Guizhou LLF (which enjoy a higher margin) and the increased cost of raw materials for products other than XLGB and other core products. The price of barrenwort, used in the production of XLGB, remained stable in the third quarter of 2008.

Operating income in the third quarter of 2008 was RMB7.7 million ($1.1 million), compared with RMB 29.4 million in the third quarter of 2007, primarily reflecting revenue performance year over year.

Net income was RMB7.2 million ($1.1 million), net income per ADS was RMB0.21 ($0.03), and net income per share was RMB0.05 ($0.01) in the third quarter of 2008. The Company’s net income per ADS and net income per share are based on a share count of 134.9 million.

Financial Results for the Nine Months Ended September 30, 2008

For the nine months ended September 30, 2008, revenues decreased 19.3%, to RMB335.8 million ($49.5 million), from RMB 416.3 million in the first nine months of 2007. During this same time period, gross profit decreased 21.7%, to RMB213.2 million ($31.4 million), from RMB272.3 million. Income from operations decreased 93.0%, to RMB8.5 million ($1.2 million), from RMB120.5 million in the first nine months of 2007, and net income decreased 82.4%, to RMB27.0 million ($4.0 million), or RMB 0.20 ($0.03) per share, from RMB153.1 million, or RMB1.23 per share, in the first nine months of 2007. Net income per ADS was RMB0.80 ($0.12) in the first nine months of 2008, compared with net income per ADS of RMB4.94 in the first nine months of 2007. On a year over year basis, weighted average number of shares outstanding for the first nine months of 2008 increased 11.2% to 134.7 million.

Tongjitang recognized approximately RMB18.5 million ($2.7 million) of share-based compensation expenses in the first nine months of 2008. Please refer to the attached GAAP to Non-GAAP reconciliation table for additional details.

Balance Sheet

As of September 30, 2008, the Company had cash and cash equivalents of RMB579.1 million ($85.3 million). This compares with RMB731.1 million as of June 30, 2008, and RMB797.8 million as of December 31, 2007.

Business Update

• Tongjitang is in the process of finding a replacement for the position of CFO. Until the right candidate is appointed, Mr. Eric Chan will continue to serve as the Company’s interim CFO.
• On September 9, 2008, the Company announced that it had been approved by its board of directors (the “Board”), but was not obligated, to purchase up to $20 million of its American Depositary Shares ("ADS"). This proposed repurchase plan was approved by the Company shareholders at the Annual General Meeting on November 3, 2008. At the same meeting, shareholders also approved an amendment to the Company’s Articles of Association that authorized the Board to approve and execute future share repurchase plans without shareholder approval, and an amendment to the Company’s share incentive plan to authorize the Board to adjust the exercise prices of outstanding options.
• Tongjitang has filed a lawsuit against Jilin Liaoyuan Yulongyadong Pharmaceutical (“Yulongyadong”) for violation of PRC Intellectual Property Protection laws. The action, filed on May 28, 2008 with Guiyang Intermediate People’s Court in China, seeks to prevent Yulongyadong from infringing upon the Company’s trademark by deliberately copying its product, Xianling Gubao. In mid-November, the Court issued a ruling that banned Yulongyadong or any of its distributors from producing or selling “Xianling Gubao Granules”. Unless Yulongyadong appeals to a higher court, the matter has been resolved.

Mr. Wang continued, “We are pleased that the Guiyang Intermediate People’s Court ruled in our favor, and hope that this ruling will deter other possible infractions. We expect that the sales of XLGB will recover gradually and continue to grow thereafter.”

Financial Outlook

The Company today adjusted its financial expectations for fiscal year 2008:

• Revenue is expected to reach RMB450 million;
• Gross margin is reiterated at levels in the mid-60%; and
• Guidance for 2009 will be issued when the Company releases its full year 2008 financial results.

Additionally, the Company expects to capitalize on incremental revenue opportunities not yet factored into the above guidance, including:

• Acquisitions which enhance the Company’s product portfolio, brand leadership, revenue diversification and profitability;
• Expansion of the sales and marketing network to distribute core products into new pharmacies and hospitals; and
• New product rollouts from the Company’s product pipeline, which currently includes over 11 potential new products.

These forecasts reflect the Company’s current and preliminary view, which is subject to change.

About Non-GAAP Financial Measures

To supplement the Company’s unaudited consolidated financial statements presented in accordance with the United States Generally Accepted Accounting Principles ("GAAP"), the Company also provides non-GAAP financial measures, non-GAAP net income and non-GAAP earnings per share, all of which exclude the share-based compensation expenses recorded under Statement of Financial Accounting Standards 123R, “Share-Based Payment”. The Company’s management believes the non-GAAP financial measures facilitate better understanding of operating results from quarter to quarter and allows the management team to better plan and forecast future periods, as the non-GAAP financial measures provide additional information to the investors. The non-GAAP information is not in accordance with GAAP and may be different from non-GAAP methods of accounting and reporting used by other companies. The presentation of this additional information should not be considered a substitute for the GAAP results. A limitation of using these non-GAAP financial measures is that these non-GAAP measures exclude share-based compensation expenses that have been and will continue to be significant recurring expenses in our business for the foreseeable future. Reconciliations of the Company’s non-GAAP financial data to the most comparable GAAP data are included at the end of this press release.

Conference Call

The Company will hold a conference call on November 25, 2008 at 8:00 a.m. U.S. Eastern Time (9:00 p.m. Beijing/Hong Kong time). Listeners may access the call by dialing the following numbers:

Listeners may access the replay through December 2, 2008, by dialing the following numbers:

An audio webcast of the call will also be available through the Company’s website at www.tongjitang.com.

About Tongjitang Chinese Medicines Company

Tongjitang Chinese Medicines Company, through its operating subsidiaries Tongjitang Pharmaceutical, Tongjitang Distribution, Tongjitang Chain Stores, and Tongjitang Planting, is a vertically integrated and profitable specialty pharmaceutical company focused on the development, manufacturing, marketing and selling of modernized traditional Chinese medicine in China. Tongjitang’s principal executive offices are located in Shenzhen, China.

Tongjitang’s flagship product, Xianling Gubao, is the leading traditional Chinese medicine for the treatment of osteoporosis in China as measured by sales in Renminbi. In addition to Xianling Gubao, the Company manufactures and markets 18 other modernized traditional Chinese medicine products and 38 western medicines. Please visit www.tongjitang.com for more information.

Safe Harbor Statements

This press release contains forward-looking statements that are made pursuant to the safe harbor provisions of the Securities Litigation Reform Act of 1995. Although the Company believes that the expectations reflected in such forward-looking statements are based on reasonable assumptions, such statements are subject to risks and uncertainties that could cause actual results to differ materially from those projected. Although the Company believes that the expectations expressed in these forward-looking statements are reasonable, they cannot assure you that their expectations will turn out to be correct, and investors are cautioned that actual results may differ materially from those described in the forward -looking statements in this press release. A number of factors could cause actual results to differ materially from those contained in any forward-looking statement, including but not limited to the following: if disruptions in the financial markets and other macro-economic challenges currently affecting the economy of the United States and other parts of the world continue or even worsen, it may adversely impact the economy and consumer confidence in China; our growth strategy; our future business development, results of operations and financial condition; our heavy dependence on the success of Xianling Gubao; our ability to market Xianling Gubao to hospitals and to retail pharmacies; the retail prices of our principal products’ being subject to price control by the government authorities in China; our products’ inclusion in national and provincial medical catalogs of the National Medical Insurance Program in China; our ability to obtain approval from the State Food and Drug Administration in China to convert a provisional national production standard of our principal products to a national final production standard; our ability to continue having the exclusive production rights for our products; our ability to further improve our barrenwort extraction efficiency; our ability to obtain manufacturing or marketing approval for our future products; our dependence on a limited number of distributors for a significant portion of our net revenues; our ability to protect our intellectual property rights and defend infringement or misappropriation claims by third parties; intense competition in the pharmaceutical market in China; the supply of quality medicinal raw materials; and uncertainties with respect to the legal system in China. Further information regarding these and other risks is and will be included in our registration statement on Form F-1, our annual report on Form 20-F and other documents filed and to be filed with the U.S. Securities and Exchange Commission. The Company does not undertake any obligation to update any forward-looking statement, except as required under applicable law. All information provided in this press release is as of the date of this press release, and the Company undertakes no duty to update such information, except as required under applicable law.

1. This announcement contains translations of certain Renminbi amounts into US dollars at specified rates solely for the convenience of readers. Unless otherwise noted, all translations from Renminbi to US dollars as of and for the quarter ended September 30, 2008 were made at the noon buying rate on September 30, 2008 in the City of New York for cable transfers in Renminbi per US dollar as certified for customs purposes by the Federal Reserves Bank of New York, which was RMB6.7899 to USD1.00. Tongjitang makes no representation that the Renminbi or US dollar amounts referred to in this release could have been or could be converted into US dollars or Renminbi, as the case may be, at any particular rate or at all.

2. All references to ‘shares’ are to our ordinary shares. Each of our American Depositary Shares, which are traded on the New York Stock Exchange, represents four ordinary shares.