LUYE PHARMA GROUP LTD.

(Incorporated in Bermuda) (Registration Number: 33854)

INCREASE IN THE ISSUED AND PAID-UP CAPITAL OF LUYE BIOTECH (SINGAPORE) PTE LTD

The Board of Directors of Luye Pharma Group Ltd (the “Company” or “Luye”) wishes to announce that the issued and paid-up capital of Luye Biotech (Singapore) Pte Ltd (“Luye Biotech”), an indirect wholly-owned subsidiary of the Company, has increased from S$20,000,000 on divided into

20,000,000 ordinary shares to S$26,158,250 dividend into 26,158,250 ordinary shares. Luye Biotech is held through Shandong Luye Pharmaceutical Co. Ltd (“Shandong Luye”), also a wholly-owned subsidiary of the Company.

The aggregate consideration for the issue and allotment of new ordinary shares by Luye Biotech is by way of capitalization of the shareholder’s loan extended by Shandong Luye to Luye Biotech.

The capitalization is not expected to have any material impact on the net tangible assets and earnings per share of the Company for the current financial year ending 31 December 2011.

None of the directors or controlling shareholders of the Company has any interest, direct or indirect in the above transaction.

BY ORDER OF THE BOARD OF LUYE PHARMA GROUP LTD.Liu DianboExecutive Chairman29 July 2011