Aida Pharmaceuticals (AIDA)

[BMiles]

wave00, in reference to your question #1, it will be recorded as a one time loss, I don't think you will see it on the financial's to be released this week but on the one to come three months from now. As we have all been discussing in previous posts this last week, our subsidiary Hangzhou Aida Pharmaceutical had the government freeze the assets of Nanwang Information Industry Group Co. in an attempt to recover that $7 million dollars. How much of that $7 million will be recovered through the assets of Nanwang is yet to be determined but whatever does get recovered will be seen as a one time gain at some point in time.

As for your question #2, the purchase of JiangSu is not recorded as a loss. Cash in a financial statement is recorded as an asset. The value of a subsidiary is also recorded as an asset. The purchase of a company with cash is offset on the financial statement by the value of that assets, thus a wash. If the purchase of the asset was done so through financing then the added value of the asset is offset by the amount financed and recorded as a liability. In other words, the purchase of JiangSu has no negative effect on the financial statement.

You also question if AIDA will have the money to finish Phase 3 clinical testing. If you look at AIDA's balance sheet then you will see that their cash position continued to grow quarter after quarter despite Rh-Apo2L going through Phase 1 and Phase 2 clinical testing. For instance, AIDA's cash on hand was $8.1 million at the end of 2006 and grew to $19.8 million by the end of 2007. Despite the cost of Phase 1 and Phase 2 clinical testing, AIDA continued to generate enough cash through operations to cover these costs and still grow their cash position while also continuing to record a real nice profit $2.7 million for the year 2007. I don't see cash being a problem at this point in time.

Brad