China Jo-Jo Drugstores Inc, which operates a retail pharmacy chain in China, today announced its financial results for its fiscal second quarter ended September 30, 2009.

Fiscal Second Quarter 2009 Highlights

--- Revenues increased 18.1% period-over-period to $12.3 million

--- Income from operations increased by 13.5% period-over-period to $2.3

million

--- Number of stores increased period-over-period from 13 to 22 stores

"Our revenue increase in the fiscal second quarter ended September 30, 2009 was largely attributable to operating more stores than we did from a year ago," commented Mr. Lei Liu, Chairman and Chief Executive Officer of Jo-Jo Drugstores. "We have grown our chain stores organically from 13 to 22 stores, and expect to grow revenue as our newer stores establish themselves further in their local communities and as we continue to add stores to our retail chain."

For the Three Months Ended September 30, 2009 and 2008

Gross profit for the fiscal second quarter was $3.5 million, up 25.6% from the second quarter of 2008. Gross margin for the quarter was 28.5%, compared with 26.8% in the comparable 2008 period. "We anticipate that our overall gross profit will continue to increase as our sales increase," continued Mr. Liu. "Additionally, as our store number grows, we are confident that our gross margin should increase as we will be able to obtain better pricing terms from our suppliers and achieve further economies of scale."

Total operating expenses for the second fiscal quarter of 2009 were $1.2 million, compared with $0.7 million in the prior period. Selling expenses totaled $0.6 million, or 4.9% of revenues, for the second quarter of 2009 as compared to $0.4 million, or 4.2% of revenues, in the comparable period a year ago. The increase is a result of operating additional stores.

General and administrative expenses increased to $0.6 million, or 4.6% of revenues, in the second quarter of 2009, compared with $0.3 million, or 2.8% of revenues, in the same period of 2008. The increase is primarily a result of stock compensation charges and operating additional stores during the three months ended September 30, 2009. We anticipate general and administrative expenses to increase in future periods as we continue to open new stores and develop our infrastructure, and as the costs associated with being a US public company continue to rise.

Income from operations increased to $2.3 million for the second fiscal quarter of 2009, or 19.1% of revenues, from $2.1 million, or 19.8% of revenues for the same quarter in 2008.

As of September 30, 2009, the Company had approximately $1.1 million in cash and restricted cash, current assets of $16.2 million and total liabilities of $9.5 million.

Business Outlook

"Despite the increasingly competitive environment for drugstores in the Hangzhou area, our stores have continued to perform strongly," stated Mr. Liu. "In the long term, we believe that our customer-centric focus on service and price will continue to enhance our brand recognition and provide a strong base for continued future growth."

Conference Call

The Company will host a conference call to discuss these results on Tuesday, November 17, 2009, at 8:00 a.m. Eastern time. To participate in the conference call, please dial 1-877-485-3104 from the US. Participants dialing in from China can access the call by dialing 1-201-689-8579. Investors may also access a live audio webcast of this conference call under the Investors Relations section of the Company's website at http://www.chinajojodrugstores.com.

A replay of the webcast will be available approximately two hours after the conclusion of the call. The webcast replay will remain available for three months. An audio replay will be made available until November 24, 2009. The audio replay can be accessed by dialing 1-877-660-6853 or 1-201-612-7415 and entering pass-code 337823.

About China Jo-Jo Drugstores, Inc.

China Jo-Jo Drugstores, Inc., through its contractually controlled affiliates Hangzhou Jiuzhou Grand Pharmacy Chain Co., Ltd., Hangzhou Jiuzhou Clinic of Integrated Traditional and Western Medicine General Partnership, and Hangzhou Jiuzhou Medical & Public Health Service Co., Ltd., operates a retail pharmacy chain in China offering both western and traditional Chinese medicine. The chain currently has 22 stores throughout Hangzhou, the provincial capital of Zhejiang Province.