China-Biotics Inc. Under Investor Investigation Concerning Possible Securities Laws Violations

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Company Name(s): 
China-Biotics
Affected Securities: 
NASDAQ: CHBT

An investigation on behalf of investors in China-Biotics Inc. (NASDAQ:CHBT) over possible violations of Federal Securities Laws by China-Biotics and others was announced.

China-Biotics, Inc. is engaged in the research, development, production, marketing, and distribution of probiotics products, which are products that contain live microbial food supplements. The investigation by a law firm concerns recent market commentators' reports questioning the veracity of China Biotics' claims in U.S. Securities and Exchanges Commission (“SEC”) filings that it has a "network of stores" distributing its products. These reports also question the authenticity of China Biotics' financial reports filed with the SEC regarding China-Biotics cash on hand and the reported accrued interest. Furthermore, there appears, so the investigation, to be material discrepancies between the filings by China Biotics' main operating subsidiary Shanghai Shining Biotechnology Co., Ltd with the State Administration for Industry & Commerce of the People's Republic of China and those filed by China-Biotics with the SEC. China-Biotics Inc. more than doubled its total revenue over the past four years. While China-Biotics reported to the SEC on March 31, 2007 for the past 12 months Total Revenue of $30.61million, China-Biotics announced on March 31, 2010 for the past 12 months Total revenue of $81.36million. Its Net Income increased over the same period from $10.90million to $15.65million. Shares of China-Biotics Inc. (NASDAQ:CHBT) traded recently at $10.22 per share, down from its 52weekHigh of $19.74 per share.