General Update

Taihua plc

("Taihua" or the "Company")

General Update

Taihua has today signed a binding agreement with Xi'an Jianhong Technology Co., Ltd. (the "Developer") to relinquish its rights to the office premises situated at Rooms 701, 801 and 901, Building A, Tianhong Mansion, Xi'an High-tech Technology Development Zone, Xi'an, Shaanxi Province, China (the "Proposed New Office").

Taihua had previously entered into an agreement with the Developer on 3 March 2005 for the building and development of the Proposed New Office, pursuant to which Taihua paid an initial deposit of RMB14,647,296 being 95% of the total purchase price (the "Deposit"). Given the time that has elapsed, and the failure by the Developer to deliver the Proposed New Office to Taihua, Taihua has today agreed to relinquish its rights to the Proposed New Office in return for a payment of the Deposit of which RMB 9million is payable immediately and the remainder is payable by 30 November 2010.

Commenting on this transaction, Nicholas Lyth, Non-Executive Chairman said:

"This office space agreement was entered into by the Company in March 2005. Having reviewed our strategy and plans for the Company's development, the Board feel that the best interests of the shareholders are served by unwinding this agreement and having the cash deposit returned to the Company. The Company has ambitious plans to develop its European and Chinese businesses in Paclitaxel, Homoharringtonine and TCMs. A strong Balance Sheet is an essential component in the Company exploiting its organic and acquisitive growth opportunities."

For more information please contact:

Nicholas Lyth, Taihua plc

0776 990 6686

Katy Mitchell, WH Ireland Limited

+44 161 832 2174