Tianyin Pharmaceutical Co., Inc. Updates Fiscal 2010 Guidance and Announces Joint Venture with Sichuan Mingxin Pharmaceutical Co. to Pursue Macrolide Antibiotics Growth Initiative

Tianyin Pharmaceutical Co., Inc. Updates Fiscal 2010 Guidance and Announces
Joint Venture with Sichuan Mingxin Pharmaceutical Co. to Pursue Macrolide
Antibiotics Growth Initiative
-- Company Updates Fiscal 2010 Guidance: Management expects Revenue and Net
Income of $63.6 million and $11.3 million

CHENGDU, China, Oct. 29 /PRNewswire-Asia-FirstCall/ -- Tianyin
Pharmaceutical, Co., Inc., (NYSE Alternext: TPI), a manufacturer and supplier
of modernized traditional Chinese medicine ("TCM") based in Chengdu, China,
today announced it has formed a joint venture with Sichuan Mingxin
Pharmaceutical Co., Ltd ("Mingxin") named Sichuan Jiangchuan Pharmaceutical
Co., Ltd. ("Jiangchuan"). Tianyin owns 77% of Jiangchuan and will utilize this
as the foundation for a broader, longer term strategy to build a significant
presence in the rapidly growing Chinese macrolide antibiotics market, while
diversifying its revenue base of western pharmaceuticals.
Specifically, Jiangchuan will manage research and development activities,
while also manufacturing and selling Active Pharmaceutical Ingredients
("APIs")
that are used to produce macrolide antibiotics. This large and growing class
of drugs in China includes Azithromycin, Clarithromycin and Roxithromycin,
which treat a wide range of bacterial based respiratory tract, urinary tract
and skin infections. According to Yiyao Jingji Newsletter, these three drugs
accounted for 90% of macrolide antibiotics sales in China for 2008. Total
macrolide antibiotics sale in hospitals alone in China were $562 million in
2008 according to Yiyao Jingji Newsletter, while ResearchInChina stated that
China's output and production capacity of antibiotic raw materials ranks
Number 1 in the world.
As part of the transaction, Tianyin purchased two SFDA product approvals
from Mingxin for $3 million which cover the antibiotics Azithromycin and
Roxithromycin and will be contributed to the joint venture. Since APIs are
produced through a two-stage process that combines fermentation followed by a
synthesis process to create the macrolide antibiotics, a new manufacturing
facility will be constructed to meet these specifications. Tianyin will
leverage its sales and marketing expertise, product rationalization
capabilities, extensive distribution channels, and partnership with Kelun
Pharmaceuticals to ensure that a broad based market penetration is achieved.
Tianyin will use the financing proceeds to complete the $4.5 million land
purchase in Sichuan for the joint venture where the new production facility
will be built with full support of the Sichuan Xinjin County Government. Phase
I, which will produce Oral and Injectable grade API for Azithromycin, in
addition to other macrolide antibiotic intermediaries, is expected to be fully
operational by July 2010. Phase II, which will include high output production
of Roxithromycin, Clarithromycin and other macrolide antibiotics is
anticipated to be operational by second half of 2012. Total capital
expenditures for both phases are estimated to total approximately $20 million.
Gross margins from these product lines are expected to range between 25-27%
while the company can leverage its existing SG&A infrastructure to bolster net
margins. The company anticipates this initiative will contribute approximately
$22.5 million in revenue and $1.4 million in net income for fiscal 2011. The
completion of the production facility for the JV alone will enable further
growth and improvements in profitability for fiscal year 2012 with revenue and
net income contributions expected to be $47 million and $6.5 million,
respectively. Once both phases are operating close to full capacity, the
facility will have the potential to generate $12 million in net income on an
annual basis.
Tianyin launched its Azithromycin Dispersible Tablets in October 2008,
which marked its initial entrance into this $350 million plus market. This
product line is sold through its distributors under the company's "Cost
Preference Strategy" and is projected to generate $5.2 million in revenue
during fiscal year 2010.
On August 18, 2009 Azithromycin was added to China's Essential Drug List
("EDL") which was published as a key component of China's$126 billion
healthcare reform. According to Business Monitor International, the price of
antibiotics and APIs have increased as exports surged and new government
environmental protection policies have created further barriers to entry.
Dr. Jiang Guoqing, Tianyin's Chairman and Chief Executive Officer, said,
"After witnessing the rapid market penetration of our Azithromycin tablets, we
completed extensive market research which confirmed that the macrolide
antibiotics product segment is growing rapidly with increased selling prices,
and is currently serviced by a limited number of suppliers with insufficient
production capacity to meet China's demand. The addition of these drugs to
China's "EDL" in addition to the implementation of the Rural Healthcare Reform
will also stimulate additional, and potentially significant, demand. The
recent change in government regulations on API production in India,
traditionally a major source for these critical compounds in addition to
China,
has created a further window of opportunity. We are excited about the
"Jiangchuan" joint venture which is strategically located in Sichuan, a
bridgehead to Western China and historically one of the largest farming bases
for TCM herbs, which will continue to play an important role in our product
portfolio. We believe this initiative provides a significant long term conduit
for future growth, in addition to providing an attractive return on invested
capital, while further diversifying our revenue base."
Financing
In order to complete the SFDA product, land and equipment purchases in a
timely manner, the company completed a $4.987 million equity financing to
complement its current working capital position. The company issued 1,534,570
shares of common stock and 306,914 warrants with a strike price of $4.50.
TriPoint Global Equities, LLC was the placement agent for the financing.
Fiscal 2010 Guidance
Management is revising its fiscal 2010 guidance. The company now
anticipates revenues and net income of $63.3 million and $11.3 million,
representing 48.3% and 43.0% year-over-year growth. Strong growth in the
company's current product portfolio and the opening of the recent
manufacturing facility are the primary drivers for this revised outlook.
Previous guidance was $59 million in revenue and $10.5 million in net income.
For fiscal 2011 and fiscal 2012, management expects significant increases
in revenue and net income. This includes contributions from the company's
current product portfolio and anticipated contributions from the "Jiangchuan"
joint venture. These forecasts do not include future acquisitions, joint
venture agreements, or product acquisitions which could generate incremental
contributions to the financial results.
About TriPoint Global Equities, LLC
TriPoint Global Equities, LLC ("TriPoint Global"), a FINRA member firm, is
a boutique investment bank that provides U.S. and non-U.S. companies of up to
$500 million in revenue with capital raising, corporate finance advisory
services and assistance with navigating the regulatory environment for
companies listing on U.S. markets. TriPoint Global maintains specialized
practices in institutional private placements, mergers and acquisitions, and
corporate finance. TriPoint Global has offices in New York and Washington,
D.C.
For more information visit http://www.tripointglobalequities.com .
About Tianyin Pharmaceuticals
Tianyin is a manufacturer and supplier of modernized traditional Chinese
medicine in China. It was established in 1994 and acquired by the current
management team in August 2003. It has a comprehensive product portfolio of 39
products, 22 of which are listed in the highly selective National Medicine
Catalog of the National Medical Insurance program. Tianyin owns and operates
three GMP manufacturing facilities and an R&D platform supported by leading
Chinese academic institutions. The company has a pipeline of 17 pharmaceutical
products pending approval. Tianyin has an extensive nationwide distribution
network throughout China with a sales force of 720 salespeople. Tianyin is
headquartered in Chengdu, Sichuan Province with three manufacturing facilities
and a total of 1,365 employees. For more information about Tianyin, please
visit http://www.tianyinpharma.com .
Safe Harbor Statement
The Statements which are not historical facts during the presentation are
forward-looking statements that involve certain risks and uncertainties
including but not limited to risks associated with the uncertainty of future
financial results, additional financing requirements, development of new
products, government approval processes, the impact of competitive products or
pricing, technological changes, the effect of economic conditions and other
uncertainties detailed in the company's filings with the Securities and
Exchange Commission.
For more information, please contact:

For the Company:
Allen Tang, Ph.D., MBA, Assistant to the CEO
China
Tel: +86-158-2122-5642
Email: Allen.y.tang@gmail.com

Investors:
Mr. Matthew Hayden, HC International
Tel: +1-561-245-5155
Email: matt.hayden@hcinternational.net
Web: http://www.hcinternational.net

SOURCE Tianyin Pharmaceutical, Co., Inc.

For the Company - Allen Tang, Ph.D., MBA, Assistant to the CEO,
+86-158-2122-5642, Allen.y.tang@gmail.com, Investors - Mr. Matthew Hayden, HC
International, +1-561-245-5155, matt.hayden@hcinternational.net