10-Q

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM 10-Q

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended June 30, 2023

or

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from ___________ to ___________

Commission File Number: 000-50155

BIMI International Medical Inc.

(Exact name of registrant as specified in its charter)

Delaware	02-0563302
(State of Incorporation)	(I.R.S. Employer ID Number)

725 5th Avenue, 15th Floor, Suite 15-01 New York NY	400010
(Address of Principal Executive Offices)	(Zip Code)

212 542 0028

(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:

Title of Each Class	Trading Symbol(s)	Name of Each Exchange on Which Registered
Common Stock, $0.001 par value	BIMI	The NASDAQ Capital Market

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. ☒ Yes ☐ No

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). ☒ Yes ☐ No

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer	☐	Accelerated filer	☐
Non-accelerated filer	☐	Smaller reporting company	☒
		Emerging growth company	☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). ☐ Yes ☒ No

As of November 15, 2023, the registrant had 6,589,569 shares of Common Stock, par value $0.001 per share, issued and shares outstanding.

TABLE OF CONTENTS

		Page
PART I	FINANCIAL INFORMATION	1
Item 1	Financial Statements	1
Item 2	Management’s Discussion and Analysis of Financial Condition and Results of Operations	49
Item 3	Quantitative and Qualitative Disclosures About Market Risk	70
Item 4	Controls and Procedures	70
PART II	OTHER INFORMATION	73
Item 1	Legal Proceedings	73
Item 1A	Risk Factors	73
Item 2	Unregistered Sales of Equity Securities and Use of Proceeds	73
Item 3	Defaults Upon Senior Securities	73
Item 4	Mine Safety Disclosures	73
Item 5	Other Information.	73
Item 6	Exhibits.	74
Signatures		75

i

PART I. FINANCIAL INFORMATION

Item 1. Financial Statements

BIMI INTERNATIONAL MEDICAL, INC. AND ITS SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(UNAUDITED)

(RESTATED)

	June 30,			December 31,
	2023			2022
ASSETS
CURRENT ASSETS
Cash and cash equivalents	$	1,931,744		$	2,336,636
Accounts receivable, net		6,380,387			3,208,286
Advances to suppliers		7,017,279			6,589,759
Inventories, net		7,182,524			7,654,242
Prepayments and other receivables		1,350,124			1,527,079	*
Current assets from discontinued operations-held for sale		2,133,382			2,099,673
Total current assets		25,995,440			23,415,675
NON-CURRENT ASSETS
Deferred tax assets		183,259			190,132
Property, plant and equipment, net		1,690,107			1,703,420
Intangible assets-net		448,931			16,183
Operating lease-right of use assets		2,835,992			2,942,265
Goodwill		2,065,666			2,065,666
Non-current assets from discontinued operations-held for sale		3,439,099			3,761,149
Total non-current assets		10,663,054			10,678,815	*
TOTAL ASSETS	$	36,658,494		$	34,094,490	*
LIABILITIES AND EQUITY
CURRENT LIABILITIES
Short-term loans	$	1,134,822		$	818,425
Long-term loans due within one year		101,244			105,965
Convertible promissory notes, net		-			1,108,785
Accounts payable, trade		9,605,089			10,785,531
Advances from customers		524,789			923,131
Amount due to related parties		1,018,832			2,980,441	*
Taxes payable		16,644			71,915
Other payables and accrued liabilities		3,204,970			3,175,574
Lease liabilities		650,661			532,630
Current liabilities from discontinued operations-held for sale		3,133,747			3,239,950
Total current liabilities		19,390,798			23,742,347	*
NON-CURRENT LIABILITIES
Lease liabilities		2,414,883			2,574,751
Long-term loans		126,284			314,786
Non-current liabilities from discontinued operations-held for sale		2,214,033			2,245,373
Total non-current liabilities		4,755,200			5,134,910
TOTAL LIABILITIES		24,145,998			28,877,257	*
STOCKHOLDERS’ EQUITY
Common Stock, $0.001 par value; 200,000,000 shares authorized; 6,258,962 and 3,764,780 shares issued and outstanding as of June 30, 2023, and December 31, 2022, respectively **		6,259			3,765
Additional paid-in capital		77,417,369			71,899,271
Statutory reserves		2,263,857			2,263,857
Accumulated deficit		(68,298,681	)		(70,143,785	)
Accumulated other comprehensive income (loss)		(501,876	)		24,583
Total BIMI International Medical Inc.’s equity		10,886,928			4,047,691
NON-CONTROLLING INTERESTS		1,625,568			1,169,542
Total stockholders’ equity		12,512,496			5,217,233
Total liabilities and stockholders’ equity	$	36,658,494		$	34,094,490	*

*

In our financial statements for the year ended December 31, 2022, we incorrectly accounted for the acquisition of Phenix Bio Inc. On July 5, 2022, we entered into a stock purchase agreement, which was subsequently amended, pursuant to which we agreed to acquire Phenix and paid a deposit of $180,000 on July 7, 2022. The closing did not occur until March 15, 2023.  As of December 31, 2022, the accounting for the Phenix acquisition was incorrectly recorded as follows: (1) a long-term equity investment as a debit entry, (2) cash as a credit, and (3) other payables as a credit entry. Since the Phenix acquisition had not taken place as of December 31, 2022, it should not have been recorded as a long-term equity investment. As such, we reversed the long-term equity investment account and other payables account and recorded the deposit as a prepayment.

**

On February 2, 2022, we effected a reverse stock split of Common Stock at a ratio of 1-to-5 and on December 9, 2022, we effected a reverse stock split of Common Stock at a ratio of 1-to-10 (collectively, the “Reverse Splits”).

The accompanying notes are an integral part of the condensed consolidated financial statements.

1

BIMI INTERNATIONAL MEDICAL, INC. AND ITS SUBSIDIARIES CONDENSED CONSOLIDATED
STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS)
(UNAUDITED)

(RESTATED)

	For three months ended June, 30						For six months ended June 30,
	2023			2022			2023			2022
REVENUES	$	5,557,666		$	2,829,034		$	8,755,303		$	5,543,745
COST OF REVENUES		2,673,586			2,356,455			4,180,982			4,698,822
GROSS PROFIT		2,884,080			472,579			4,574,321			844,923
OPERATING EXPENSES:
Sales and marketing		236,155			296,063			492,313			641,627
General and administrative		1,348,481			2,943,302	*		2,127,465			5,119,784	*
Total operating expenses		1,584,636			3,239,365	*		2,619,778			5,761,411
INCOME (LOSS) FROM OPERATIONS		1,299,444			(2,766,786	)*		1,954,543			(4,916,488	)*
OTHER INCOME (EXPENSE)
Interest income		68			207	*		326			353	*
Interest expense		(34,615	)		(48,581	)		(69,530	)		(96,718	)
Exchange gain (loss)		(2,542	)		(3,170	)*		(2,284	)		(6,436	)*
Amortization of convertible notes (1)		-			(771,124	)		-			(1,542,248	)
Investment income (expense)		(62,617	)		-			197,739			-
Non-operating expense		(25,368	)		(2,613,018	)		(93,303	)		(2,613,018	)
Other income (expense)		-			67,351	*		-			66,720	*
Total other income (expense), net		(125,074	)		(3,368,336	)		32,948			(4,191,347	)*
INCOME (LOSS) BEFORE INCOME TAXES		1,174,370			(6,135,122	)*		1,987,491			(9,107,835	)*
PROVISION FOR INCOME TAXES		-			(4,222	)		-			(7,151	)
NET INCOME (LOSS) FROM CONTINUING OPERATIONS		1,174,370			(6,139,344	)*		1,987,491			(9,114,986	)*
DISCONTINUED OPERATIONS
Loss from discontinued operations-held for sale		(119,793	)		(406,155	)*		(143,102	)		(198,738	)
Income (loss) from discontinued operations		-			(818	)		-			26,928
NET INCOME (LOSS)		1,054,397			(6,546,316	)*		1,844,389			(9,286,796	)*
Less: net loss attributable to noncontrolling interest		272			(1,416	)		715			(2,498	)
NET INCOME (LOSS) ATTRIBUTABLE TO BIMI INTERNATIONAL MEDICIAL INC.		1,054,125			(6,544,900	)*		1,843,674			(9,284,298	)*
OTHER COMPREHENSIVE (LOSS)
Foreign currency translation adjustment		(753,453	)		(417,506	)		(526,459	)		(967,586	)
TOTAL COMPREHENSIVE INCOME (LOSS)		300,944			(6,963,822	)*		1,317,930			(10,254,382	)*
Less: comprehensive income attributable to noncontrolling interest		(568,103	)		(510,069	)		(1,508,627	)		(535,043	)
COMPREHENSIVE INCOME (LOSS) ATTRIBUTABLE TO BIMI INTERNATIONAL MEDICIAL INC.	$	869,047		$	(6,453,753	)*	$	2,826,557		$	(9,719,339	)*
WEIGHTED AVERAGE NUMBER OF COMMON SHARES
Basic and diluted		4,596,440			9,493,512			4,219,675			15,429,754
INCOME (LOSS) PER SHARE
Continuing operations-Basic and diluted		0.26			(0.65	)		0.47			(0.59	)
Discontinued operations-Basic and diluted		(0.03	)		(0.04	)		(0.03	)		(0.01	)
Basic and diluted		0.23			(0.69	)		0.44			(0.60	)

The accompanying notes are an integral part of the condensed consolidated financial statements

2

BIMI INTERNATIONAL MEDICAL, INC. AND ITS SUBSIDIARIES
CONSOLIDATED STATEMENTS OF EQUITY
(UNAUDITED)

(RESTATED)

	Common Stock				Additional Paid-in		Accumulated Other Comprehensive			Statutory		Non Controlling			Accumulated			Total Stockholders’
	Shares**		Amount		Capital		Income			Reserves		Interests			Deficit			Equity
Balance as of December 31, 2022		3,764,780		3,765		71,899,271		24,583			2,263,857		1,169,542			(70,143,785	)		5,217,233
Issuance of Common Stock		270,000		270		376,337		-			-		-			-			376,607	**
Net income		-		-		-		-			-		443			789,549	*		789,992	*
Foreign currency translation adjustment		-		-		-		227,068	*				(112,519	)*		3,187,087	*		3,301,636	*
Discontinued operations and subsidiaries -held for sale								(74	)							(3,186,202	)		(3,186,276	)
Balance as of March 31, 2023		4,034,780		4,035		72,275,608		251,577	*		2,263,857		1,057,466	*		(69,353,351	)*		6,499,192	*
Issuance of Common Stock		2,224,182		2,224		5,141,761		-			-		-			-			5,143,985
Net income		-		-		-		-			-		272			1,504,125			1,054,397
Foreign currency translation adjustment		-		-		-		(757,599	)				567,830			83,320			(106,449	)
Discontinued operations and subsidiaries -held for sale								4,146								(82,775	)		(78,629	)
Balance as of June 30, 2023		6,258,962		6,259		77,417,369		(501,876	)		2,263,857		1,625,568			(68,298,681	)		12,512,496

The accompanying notes are an integral part of the condensed consolidated financial statements.

3

BIMI INTERNATIONAL MEDICAL, INC. AND ITS SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED)

	For the six months ended June 30
	2023			2022
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income (loss)	$	1,844,389		$	(9,286,796	)*
Adjustments to reconcile net loss to cash used in operating activities:
Depreciation and amortization		128,613			125,781
Inventories impairment reserve		26,604			-
Allowance for doubtful accounts		-			(572	)
Stock compensation		-			1,510,000	*
Amortization of discount of convertible promissory notes		-			1,542,248
Gain (loss) on disposal of discontinued operations		197,739			(259,253	)
Change in operating assets and liabilities
Accounts receivable		(3,172,101	)		1,167,803
Advances to suppliers		3,982,685			4,647,888	*
Prepayments and other receivables		176,955			(113,247	)
Inventories		445,113			(494,246	)
Operating lease-right of use assets		106,273			167,698
Accounts payable, trade		(1,180,442	)		(1,399,264	)
Advances from customers		(398,342	)		429,998
Operating lease liabilities		(41,837	)		(140,526	)
Taxes payable		(48,398	)		(117,114	)
Other payables and accrued liabilities		29,396			(1,130,396	)*
Discontinued operations-held for sale of Minkang, Eurasia, Qiangsheng and Zhongshan hospitals Minkang/wuzhou/suzhou/Chaohu zhongshan		150,801			(366,739	)
Net cash provided by (used in) operating activities		2,247,448			(3,689,637	)*
CASH FLOWS FROM FINANCING ACTIVITIES:
Net proceeds from issuance of convertible promissory note to related party		-			5,000,000	*
Issuance of Common Stock		1,600			-
Proceeds from short-term loan		316,397			80,758
Repayment of short-term loans		(4,721	)		-
Repayment of long-term loans		(188,502	)		(399,115	)
Amount repaid to related parties		(1,961,609	)		(227,248	)
Net cash provided by (used in) financing activities		(1,836,835	)		4,454,395
EFFECT OF EXCHANGE RATE ON CASH		(815,505	)		(661,857	)*
NET DECREASE (INCREASE) IN CASH AND CASH EQUIVALENTS		(404,892	)		102,901	*
CASH AND CASH EQUIVALENTS, beginning of period		2,336,636			4,609,431	*
CASH AND CASH EQUIVALENTS, end of period	$	1,931,744		$	4,712,332	*
SUPPLEMENTAL CASH FLOW INFORMATION:
Cash paid for income tax	$	-		$	133,009
Cash paid for interest expense, net of capitalized interest	$	37,549		$	122,539
NON-CASH TRANSACTIONS OF INVESTING AND FINANCING ACTIVITIES
Issuance of Common Stock as a result of the application of the “Floor Amount Issuance” with respect to the conversion of convertible promissory note		894			-
Issuance of Common Stock upon conversion of convertible notes		-			5,491
Lease liabilities arising from acquisition of  right-of-use assets		28,277			30,392	*

4

BIMI INTERNATIONAL MEDICAL INC.
NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

1. ORGANIZATION AND BUSINESS BACKGROUND

BIMI International Medical, Inc. (the “Company” or “BIMI”) was incorporated in the State of Delaware as Galli Process, Inc. on October 31, 2000. On February 7, 2002, the Company changed its name to Global Broadcast Group, Inc. On November 12, 2004, the Company changed its name to Diagnostic Corporation of America. On March 15, 2007, the Company changed its name to NF Energy Saving Corporation of America, and on August 24, 2009, the Company changed its name to NF Energy Saving Corporation. On December 16, 2019, the Company changed its name to BOQI International Medical Inc., to reflect the Company’s refocus of its business from the energy saving industry to the health care industry and on June 21, 2021, we changed our name to BIMI International Medical Inc. Since March 7, 2012, the Common Stock of the Company (the “Common Stock”) has been traded on the Nasdaq Capital Market.

Until October 14, 2019, the Company, through NF Energy Saving Investment Limited and its subsidiaries (the “NF Group”), operated in the energy saving enhancement technology industry in the People’s Republic of China (the “PRC”). The NF Group focused on providing services relating to energy saving technology, optimization design, energy saving reconstruction of pipeline networks and contractual energy management for the electric power, petrochemical, coal, metallurgy, construction, and municipal infrastructure development industries in the PRC and the manufacture and sales of energy-saving flow control equipment. In late 2019, the Company committed to a plan to dispose of all its equity interests in the NF Group and on March 31, 2020, the Company entered into a stock purchase agreement (the “NF SPA”) to sell the NF Group. The sale of the NF Group closed on June 23, 2020.

On October 14, 2019, the Company acquired 100% of the equity interests in Lasting Wisdom Holdings Limited (“Lasting”), a limited company incorporated under the laws of the British Virgin Islands (“BVI”). Lasting has limited operating activities since incorporation except for holding the ownership interest in Pukung Limited (“Pukung”), a company organized under the laws of Hong Kong. Pukung owns 100% of the equity interest in Beijing Xinrongxin Industrial Development Co., Ltd. (“Xinrongxin”), a company organized under the laws of the PRC. Xinrongxin owns all the ownership interest of Dalian Boqi Zhengji Pharmacy Chain Co., Ltd. (“Boqi Zhengji”). Boqi Zhengji operated 16 retail pharmacy stores in China at the time of the acquisition. Lasting, Pukung, Xinrongxin and Boqi Zhengji are hereinafter collectively referred to as the “Boqi Zhengji Group”. Xinrongxin also owns 100% equity interests in Dalian Boyi Technology Co., Ltd. (“Dalian Boyi”), a subsidiary established in January 2020 and responsible for the Company’s R&D and other technology related functions.

On June 24, 2020, the Company established a wholly owned subsidiary Boyi (Liaoning) Technology Co.,Ltd (“Liaoning Boyi”), in order to be qualified to participate in local healthcare projects. On December 22, 2020, the Company established another subsidiary, Bimai Pharmaceutical (Chongqing) Co., Ltd., to replace Xinronxin as the holding company owning all the retail, wholesale and hospital operations in China.

On March 18, 2020, the Company, through its wholly owned subsidiary, Xinrongxin, acquired 100% of the equity interests in Chongqing Guanzan Technology Co., Ltd. (“Guanzan”). Guanzan held an 80% equity interest in Chongqing Shude Pharmaceutical Co., Ltd. (“Shude”, and collectively with Guanzan, the “Guanzan Group”). Guanzan also owns 100% equity interest in Chongqing Lijiantang Pharmaceutical Co. Ltd., a subsidiary established in May 2020. Lijiantang operates 4 retail pharmacy stores in China (collectively, the “Lijiantang Pharmacy Group”). 

On December 11, 2020, the Company entered into a stock purchase agreement to sell Boqi Zhengji. The sale of the Boqi Zhengji closed by the end of 2020 although the government record was not updated until February 2, 2021 due to the Chinese government’s alternative working schedule and other delays caused by COVID-19.

On December 9, 2020, the Company entered into an agreement to acquire 100% of the equity interests in Chongqing Guoyitang Hospital (“Guoyitang”), the owner and operator of a private general hospital in Chongqing City, a city in Southwest China. The transaction closed on February 2, 2021. 

5

On December 15, 2020, the Company entered into an agreement to acquire Chaohu Zhongshan Minimally Invasive Hospital (“Zhongshan”), a private hospital in the Southeast region of China. The transaction closed on February 5, 2021.

On April 9, 2021, the Company entered into an agreement to acquire three private hospitals in the PRC, Wuzhou Qiangsheng Hospital (“Qiangsheng”), Suzhou Eurasia Hospital(“Eurasia”) and Yunnan Yuxi MinKang hospital (“Minkang”). The transaction closed on May 6, 2021.

On April 21, 2021, Bimai Hospital Management (Chongqing) Co. Ltd. was incorporated in the PRC by the Company to manage the operations of the Company’s medical services segment.

On April 21, 2021, Pusheng Pharmaceutical Co., Ltd. was incorporated in the PRC by the Company to manage its wholesale distribution of generic drugs.

On September 10, 2021, the Company entered into an agreement to acquire 100% of the equity interests in Chongqing Zhuoda Pharmaceutical Co., LTD (“Zhuoda”). The transaction closed on October 8, 2021.

On December 20, 2021, the Company entered into a stock purchase agreement to acquire Bengbu Mali OB-GYN Hospital Co., Ltd. (“Mali Hospital”). We agreed to purchase all the issued and outstanding equity interests in Mali Hospital in consideration of $16,750,000. At the signing, 60,000 shares of the Company’s Common Stock (reflecting the Reverse Splits) were delivered as partial consideration for the purchase and on January 4, 2022, we paid RMB 7,227,000 to the seller as partial consideration. The transaction did not close and on December 15, 2022, we entered into a termination agreement with respect to the original purchase agreement. Pursuant to the termination agreement, the original agreement will terminate effective as of the date of the return of the 60,000 shares of the Company’s Common Stock (reflecting the Reverse Splits) previously issued to the sellers and certain third-party beneficiaries. On December 9, 2022, 52,000 shares of Common Stock were returned to the Company and on September 1, 2023, the remaining 8,000 shares of Common Stock were returned to the Company. All cash paid at the time of the acquisition is expected to be returned by December 31, 2023. 

On July 5, 2022, we entered into a stock purchase agreement (as amended on February 27, 2023) with Mr. Fnu Oudom, the Chairman of our board of directors, whereby we agreed to acquire 100% of the equity interests in Phenix Bio Inc. (“Phenix”), a developer and distributor of dietary supplements, in consideration of $1,800,000. The transaction closed effective March 15, 2023. The aggregate purchase price for the equity interests in Phenix was $180,000 in cash, which was paid on July 7, 2022, plus up to 5,270,000 shares of the Company’s Common Stock (reflecting the Reverse Splits), of which 270,000 shares were issued to Mr. Oudom on June 19, 2023, after shareholder approval was obtained. We agreed to issue 5,000,000  shares of Common Stock to Mr. Oudom in the event that Phenix will generate at least $2,500,000 in net profit in calendar year 2023 or in any fiscal quarter of 2023.

As of June 30, 2023, the Company has four operating segments: retail pharmacy, wholesale pharmaceuticals, wholesale medical devices and healthcare products.

The retail pharmacy segment engages in the retail sale of medicine and other healthcare products in the PRC. The retail pharmacy segment sells its medicine and other healthcare products to customers through its directly owned stores. The group offers a wide range of products, including prescription and over the counter (“OTC”) drugs, nutritional supplements, traditional Chinese medicines, personal and family care products and medical devices, as well as miscellaneous items.

The Company’s wholesale segments are engaged in the distribution of medical devices and pharmaceuticals. The wholesale medical devices segment distributes medical devices, including medical consumables to drug stores, private clinics, pharmaceutical dealers, and hospitals. The wholesale pharmaceuticals segment supplies prescription and OTC medicines, TCM, healthcare supplies and sundry items to clinics, third party pharmacies, hospitals, and other drug vendors.

The Company’s healthcare products are developed and distributed by Phenix. Phenix owns its formulas and uses out-sourced facilities in the U.S. and Australia to manufacture its products. To date, Phenix has sold all of its products through Meta Time, an online sales platform. Most of the customers were from Asian countries. Phenix currently offers six categories of dietary supplements, a cardiovascular product, an anti-insomnia and depression product, a male aphrodisiac product, a woman’s menopausal syndrome product, a gout product, and an immunity enhancer.

6

As of June 30, 2022, the Company had four operating segments: wholesale medical devices, wholesale pharmaceuticals, medical services, and retail pharmacy.

As of June 30, 2023, the details of the Company’s subsidiaries are as follows:

Name	Place of incorporation and kind of legal entity	Principal activities and Type of operation	Effective ownership interest held
Lasting Wisdom Holdings Limited (“Lasting”)	British Virgin Island, a limited liability company	Investment holding		100	%
Phenix Bio Inc. (“Phenix”)	California, a corporation	Distribution of healthcare products		100	%
Pukung Limited (“Pukung”)	Hong Kong, a limited liability company	Investment holding		100	%
Beijing Xinrongxin Industrial Development Co., Ltd. (“Xinrongxin”)	The PRC, a limited liability company	Investment holding		100	%
Boyi (Liaoning) Technology Co., Ltd (“Liaoning Boyi”)	The PRC, a limited liability company	IT Technology service research and development		100	%
Dalian Boyi Technology Co., Ltd (“Dalian Boyi”)	The PRC, a limited liability company	IT Technology service research and development		100	%
Chongqing Guanzan Technology Co., Ltd. (“Guanzan”)	The PRC, a limited liability company	Wholesale distribution of medical devices in the PRC		100	%
Chongqing Shude Pharmaceutical Co., Ltd.(“Shude”)	The PRC, a limited liability company	Wholesale distribution of generic drugs in the PRC		95	%
Chongqing Lijiantang Pharmaceutical Co., Ltd.(“Lijiantang”)	The PRC, a limited liability company	Wholesale distribution of generic drugs in the PRC		100	%
Bimai Pharmaceutical (Chongqing) Co., Ltd.	The PRC, a limited liability company	Investment holding		100	%
Chongqing Guoyitang Hospital Co., Ltd.	The PRC, a limited liability company	Hospital in the PRC		100	%
Chongqing Huzhongtang Healthy Technology Co., Ltd.	The PRC, a limited liability company	Wholesale distribution of generic drugs in the PRC		100	%
Chaohu Zhongshan Minimally Invasive Hospital Co.,Ltd.	The PRC, a limited liability company	Hospital in the PRC		100	%
Yunnan Yuxi Minkang Hospital Co., Ltd.	The PRC, a limited liability company	Hospital in the PRC		100	%
Wuzhou Qiangsheng Hospital Co., Ltd.	The PRC, a limited liability company	Hospital in the PRC		100	%
Suzhou Eurasia Hospital Co., Ltd.	The PRC, a limited liability company	Hospital in the PRC		100	%
Bimai Hospital Management (Chongqing) Co. Ltd	The PRC, a limited liability company	Hospital management in the PRC		100	%
Pusheng Pharmaceutical Co., Ltd	The PRC, a limited liability company	Wholesale distribution of generic drugs in the PRC		100	%

7

2. GOING CONCERN UNCERTAINTIES

The accompanying unaudited condensed consolidated financial statements have been prepared assuming that the Company will continue as a going concern, which contemplates the realization of assets and the discharge of liabilities in the normal course of business for the foreseeable future.

As reflected in the accompanying unaudited condensed consolidated financial statements, the Company incurred significant net losses of $1,844,389 and $9,286,796 during the six months ended June 30, 2023, and 2022, respectively. As of June 30, 2023, the Company had an accumulated deficit of $68.3 million. Management believes these factors raise substantial doubt about the Company’s ability to continue as a going concern for the next twelve months.

The continuation of the Company as a going concern through the next twelve months is dependent upon (1) the continued financial support from its stockholders or its ability to obtain external financing, and (2) further implementation of management’s business plan to expand its operations and generate sufficient revenues to meet its obligations. While the Company believes in the viability of its strategy to increase sales volume and in its ability to raise additional funds, there can be neither any assurances to that effect, nor any assurance that the Company will be successful in securing sufficient funds to sustain the operations.

These unaudited condensed financial statements do not include any adjustments to reflect the possible future effect on the recoverability and classification of assets or the amounts and classifications of liabilities that may result from the outcome of these uncertainties. Management believes that the actions presently being taken to obtain additional funding and implement its strategic plan provides the opportunity for the Company to continue as a going concern.

We are in the process of restating our financial statements for year ended December 31, 2022 and the quarterly periods ended March 31, 2022, June 30, 2022, September 30, 2022 and March 31, 2023, to correct errors identified in our prior financial statements. We have concluded that the restatements do not materially affect our liquidity or our compliance with debt covenants or other financial obligations.

(1)     We are in the process of restating the Consolidated Statements of Equity for the quarterly periods ended June 30, 2022 and September 30, 2022. The restatement relates to the stockholders’ equity and noncontrolling interests presented in the consolidated balance sheets, as of June 30, 2022 and September 30, 2022, which had been presented in the form of a reconciliation of the beginning balance to the ending balance for each period for which a consolidated statement of comprehensive income was required to be filed.  We will provide reconciliations for the interim periods covered by the Consolidated Statement of Equity for the periods ended June 30, 2022 and September 30, 2022.  This restatement should not have any effect on net income, per-share amount, or retained earnings and other components of equity or net assets for prior filing and current filing. We have concluded that the restatement does not materially affect our liquidity or our compliance with debt covenants or other financial obligations.

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(2)     On June 9, 2022, the Company issued a $5 million subordinated promissory note, which was converted into 1,250,000 shares of the Company’s Common Stock (post the December 2022 1 to 10 reverse split) on July 18, 2022, upon obtaining shareholder approval for the transaction. We erroneously reflected the proceeds of the promissory note in the Consolidated Statements of Cash Flows as “Issuance of Common Stock” for the six month period ended June 30, 2022.   We failed to reflect this promissory note as a note payable as of June 30, 2022. As a result, we are in the process of restating our financial statements for the quarterly period ended June 30, 2022. This restatement did not effect our net income, per-share amounts, retained earnings or other components of equity or net assets for prior filings and the current filing. We have concluded that the restatement does not materially affect our liquidity or our compliance with debt covenants or other financial obligations.

(3)     We restated our financial statements for the year ended December 31, 2021 and are in the process of restating the our financial statements for the quarterly period ended June 30, 2022 to correct errors identified in our prior financial statements. In the year ended December 31, 2021 and the quarterly periods ended March 31, 2022 and June 30, 2022, we recorded amortization of convertible notes as a general and administrative expense in error. We have revised the financial statements for the year ended December 31, 2021 and the six months ended June 30, 2022 and are in the process of revising our financial statements for the quarterly period ended March 31, 2022 to record the amortization of convertible notes as an “other expense”. The impact of the restatement on our financial statements is the reclassification of such expense as an “other expense”. The reclassification also affected the classification of such expense in the Consolidated Statements of Cash Flows. We have also amended various footnotes to the financial statements. We restated our financial statements for the year ended December 31, 2021 and are in the process of restating the financial statements for the year ended December 31, 2022 and the quarterly periods ended March 31, 2022, June, 30, 2022 and September 30, 2022 to correct this issue. This restatement did not affect our net income (loss) , net income (loss) per-share, retained earnings or other components of equity or net assets for our prior filings and the current filing. We have concluded that the restatement does not materially affect our liquidity or our compliance with debt covenants or other financial obligations.

(4)     We are in the process of restating our financial statements for the year ended December 31, 2022, where we incorrectly accounted for the acquisition of Phenix. On July 5, 2022, we entered into a stock purchase agreement, which was subsequently amended, pursuant to which we agreed to acquire Phenix and paid a deposit of $180,000 on July 7, 2022. The closing did not occur until March 15, 2023.  As of December 31, 2022, the accounting for the Phenix acquisition was incorrectly recorded as follows: (1) a long-term equity investment as a debit entry, (2) cash as a credit, and (3) other payables as a credit entry. Since the Phenix acquisition had not taken place as of December 31, 2022, it should not have been recorded as a long-term equity investment. As such, we reversed the long-term equity investment account and other payables account and recorded the deposit as a prepayment. This restatement did not affect our net income, per-share amounts, or retained earnings, but affected the net assets in the quarterly period ended March 31, 2023. We have concluded that the restatement does not materially affect our liquidity or other financial obligations.

(5)       We are in the process of restating the Consolidated Statements of Cash Flows for the quarterly periods ended June 30, 2022, September 30, 2022, March 31, 2023 and for the year ended December 31, 2022. The restatement relates to the discontinued entities' cashflow presented in the Consolidated Statements of Cash Flows, for the quarterly periods ended June 30, 2022, September 30, 2022, March 31, 2023, and for the year ended December 31, 2022, which have not presented in the prior period filling. In the restated Consolidated Statements of Cash Flows, we will present the discontinued entities’ cash flows in the Consolidated Statements of Cash Flows instead of zero. This restatement does not affect net income (loss), net income (loss) per-share, or retained earnings and other components of equity or net assets in our prior filings or in our current filing. We have concluded that the restatement does not materially affect our liquidity or our compliance with debt covenants or other financial obligations.  

We are taking steps to address the causes of the restatements and to improve our internal controls over financial reporting. We are in the process of hiring a new third-party consulting firm to assist us in strengthening our daily internal controls and financial reporting process review. We also aim to improve our internal accounting department management as well. We are committed to maintaining the integrity of our financial statements and to provide accurate and transparent financial information to our investors.

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3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

● Basis of presentation and consolidation

These accompanying unaudited condensed consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States of America (“US GAAP”). These unaudited condensed consolidated financial statements include the financial statements of the Company and its subsidiaries. All significant inter-company balances and transactions within the Company have been eliminated upon consolidation.

The unaudited condensed consolidated financial information as of June 30, 2023, and for the three and six months ended June 30, 2023, and 2022 have been prepared, pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”). Certain information and footnote disclosures, which are normally included in annual consolidated financial statements prepared in accordance with US GAAP, have been omitted pursuant to those rules and regulations. The unaudited interim condensed consolidated financial information should be read in conjunction with the consolidated financial statements and the notes thereto, included in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2022, filed with the SEC on May 4, 2023.

In the opinion of management, all adjustments (which include normal recurring adjustments) necessary to present a fair statement of the Company’s unaudited condensed consolidated financial position as of June 30, 2023 and its unaudited condensed consolidated results of operations for the three and six months ended June 30, 2023 and 2022, and its unaudited condensed consolidated cash flows for the three and six months ended June 30, 2023 and 2022, as applicable, have been made. The results of operations are not necessarily indicative of the operating results for the fiscal year or any future periods.

● Use of estimates

The preparation of these condensed consolidated financial statements in conformity with the US GAAP requires management to make estimates and judgments that affect the reported amounts of assets and liabilities, disclosures of contingent assets and liabilities on the date of these condensed consolidated financial statements and the reported amounts of revenues and expenses during the reporting periods. The Company bases its estimates and judgments on historical experience and on various other assumptions and information that are believed to be reasonable under the circumstances. Estimates and assumptions of future events and their effects cannot be perceived with certainty and, accordingly, these estimates may change as new events occur, as more experience is acquired, as additional information is obtained and as our operating environment changes. Significant estimates and assumptions made by management include, among others, useful lives and impairment of long-lived assets, collectability of accounts receivable, advances to suppliers, allowance for doubtful accounts, reserve for inventory obsolescence, fair value of goodwill and valuation of derivative liabilities. While the Company believes that the estimates and assumptions used in the preparation of these condensed consolidated financial statements are appropriate, actual results could differ from those estimates. Estimates and assumptions are periodically reviewed, and the effects of revisions are reflected in the consolidated financial statements in the period they are determined to be necessary.

● Business combinations

The Company accounts for its business combinations using the acquisition method of accounting in accordance with ASC 805 “Business Combinations”. The cost of an acquisition is measured as the aggregate of the acquisition date fair values of the assets transferred and liabilities incurred by the Company to the sellers and equity instruments issued. Transaction costs directly attributable to the acquisition are expensed as incurred. Identifiable assets and liabilities acquired or assumed are measured separately at their fair values as of the acquisition date, irrespective of the extent of any non-controlling interests. The excess of (i) the total costs of acquisition, fair value of the non-controlling interests and acquisition date fair value of any previously held equity interest in the acquiree over (ii) the fair value of the identifiable net assets of the acquiree is recorded as goodwill. If the cost of acquisition is less than the acquisition date amounts of the net assets of the subsidiary acquired, the difference is recognized directly in the consolidated income statements. During the measurement period, which can be up to one year from the acquisition date, the Company may record adjustments to the assets acquired and liabilities assumed with the corresponding offset to goodwill. Subsequent to the conclusion of the measurement period or final determination of the values of assets acquired or liabilities assumed, whichever comes first, any further adjustments are recorded in the consolidated income statements.

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In a business combination achieved in stages, the Company re-measures the previously held equity interest in the acquiree immediately before obtaining control at its acquisition date fair value and the re-measurement gain or loss, if any, is recognized in the consolidated income statements.

When there is a change in ownership interests or a change in contractual arrangements that results in a loss of control of a subsidiary, the Company deconsolidates the subsidiary from the date control is lost. Any retained non-controlling investment in the former subsidiary is measured at fair value and is included in the calculation of the gain or loss upon deconsolidation of the subsidiary.

● Cash and cash equivalents

Cash and cash equivalents consist primarily of cash on hand and cash in banks which is readily available in checking and saving accounts. The Company maintains cash with various financial institutions in the PRC where its accounts are uninsured. The Company has not experienced any losses from funds held in bank accounts and believes it is not exposed to any risk on its bank accounts.

● Accounts receivable and allowance for doubtful accounts

Accounts receivable are recorded at the invoiced amount and do not bear interest, which are due within contractual payment terms, generally 30 to 90 days from delivery. Credit is extended based on evaluation of a customer’s financial condition, the customer creditworthiness and their payment history. Accounts receivable outstanding longer than the contractual payment terms are considered past due. Past due balances over 90 days and over a specified amount are reviewed individually for collectability. At the end of each period, the Company specifically evaluates individual customer’s financial condition, credit history, and the current economic conditions to monitor the progress of the collection of accounts receivables. For the receivables that are past due or not being paid according to payment terms, the appropriate actions are taken to exhaust all means of collection, including seeking legal resolution in a court of law. Account balances are charged off against the allowance after all means of collection have been exhausted and the potential for recovery is considered remote. We do not have any off-balance-sheet credit exposure related to its customers.

● Advances to suppliers

Advances to suppliers consist of prepayments to the Company’s vendors, such as pharmaceutical manufacturers and medicine suppliers. The Company typically prepays for the purchase of our merchandise, especially for those salable, scarce, personalized medicine or medical devices. The Company typically receive products from vendors within three to nine months after making prepayments. The Company continuously monitor delivery from, and payments to, the vendors while maintaining a provision for estimated credit losses based upon historical experience and any specific supplier issues, such as discontinuing of inventory supply, that have been identified. If the Company has difficulty receiving products from a vendor, the Company will cease purchasing products from such vendor, request return of our prepayment promptly, and if necessary, take legal action. The Company has not taken such type of legal action during the reporting periods. If none of these steps are successful, management will then determine whether the prepayments should be reserved or written off. As of June 30, 2023 and December 31, 2022, the allowance for doubtful accounts was Nil.

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● Businesses held for sale

In late 2022, we committed to a plan to dispose of the Zhongshan, Minkang, Qiangsheng and Eurasia hospitals and ceased the operation of the Guoyitang hospital. A An impairment is recorded, if necessary, on an annual basis or at the point of sale, based on an impairment assessment report by a third party.

When we acquire a business, a substantial portion of the purchase price of the acquisition may be allocated to goodwill and other identifiable intangible assets. The amount of the purchase price which is allocated to goodwill and other intangible assets is determined by the excess of the purchase price over the net identifiable assets acquired. The current accounting standards require that goodwill and intangible assets should be deemed to have indefinite lives, which should be tested for impairment at least annually (or more frequently if impairment indicators arise). Other intangible assets are amortized over their useful lives. In 2022, we recorded impairment losses totaling approximately $5.4 million with respect to the goodwill relating to our acquisitions of the Guanzan Group, Zhongshan, Guoyitang, Minkang, Qiangsheng and Eurasia.

On December 28, 2022, the Company entered into an agreement to transfer 87% of the equity interests in Zhongshan to the prior owner and retain 13% of the equity interests in Zhongshan. As consideration for the transfer and pursuant to an amendment to the original stock purchase agreement, the original seller agreed to return the 40,037 shares of Common Stock previously issued (reflecting the Reverse Splits) and RMB 40,000,000 in cash (approximately ($6,116,207) previously paid upon the acquisition of Zhongshan. The former owner also agreed to release the Company from any and all claims relating to two earn out payments that were payable under the original purchase agreement. The Company received a put option to sell part or all of its 13% interest in Zhongshan before December 31, 2032, based on a valuation determined by a reputable third-party appraisal firm jointly chosen by the two parties. On September 1, 2023, 39,037 shares of Common Stock were returned to the Company. The remaining 1,000 shares were returned in the form of $3,055 in cash because the shares were sold by the original seller. The transaction is expected to close by December 31, 2023, at which time the cash paid at the time of the transaction will also be returned.

On December 28, 2022, the Company entered into an agreement to transfer 90% of the equity interests in the Qiangsheng, Eurasia and Minkang hospitals to their former owners. Pursuant to the agreement, the Company will transfer 90% of the equity interests in each of the three hospitals and continue to own 10% of the equity interests in each hospital. As consideration for the transfer and pursuant to an amendment to the original stock purchase agreement, the original sellers agreed to return the 80,000 shares of Common Stock previously issued (reflecting the Reverse Splits) and RMB 20,000,000 (approximately $2,767,860) in cash previously paid upon the acquisition of the three hospitals. The former owner also agreed to release the Company from any and all claims relating to two earn out payments that were payable under the original purchase agreement. The Company received a put option to sell part or all of its 10% interest in each of the three hospitals to the former owner before December 31, 2032, based on a valuation determined by a reputable third-party appraisal firm jointly chosen by the parties. On December 9, 2022, 43,600 shares of Common Stock were returned to the Company and on September 1, 2023, 36,400 shares of Common Stock were returned to the Company. The transaction is expected to close by December 31, 2023, at which time the cash paid at the time of the transaction will also be returned.

The Company determined that the plan and the subsequent actions taken to dispose of the four hospitals qualified as held for sale operations under the criteria set forth in the ASC 205-20 Presentation of Financial Statements – Discontinued Operation.

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The carrying amount of the major classes of assets and liabilities of the businesses held for sale as of June 30, 2023 and December 31, 2022 consist of the following:

	June 30,			December 31,
	2023			2022
Assets from held for sale
Current assets
Cash and cash equivalents	$	154,503		$	53,928
Accounts receivable, net		516,287			501,054
Advances to suppliers		197,737			211,335
Amount due from related parties		337,904			350,577
Inventories, net		153,977			155,736
Prepayments and other receivables		772,974			827,043
Total current assets		2,133,382			2,099,673
Non-current assets
Deferred tax assets		(128	)		(133	)
Property, plant and equipment, net		1,191,554			1,254,328
Operating lease-right of use assets		2,247,673			2,506,954
Goodwill		-			-
Total non-current assets		3,439,099			3,761,149
Total assets held for sale	$	5,572,481		$	5,860,822
Liabilities of held for sale businesses
Current liabilities
Short-term loans	$	207,589		$	215,375
Long-term loans due within one year		-			-
Accounts payable, trade		1,375,938			1,480,098
Advances from customers		2,668			1,537
Taxes payable		324,582			336,755
Other payables and accrued liabilities		766,601			739,873
Lease liability-current		456,369			466,312
Total current liabilities		3,133,747			3,239,950
Non-current liabilities
Lease liability-non current		2,214,033			2,245,373
Total non-current liabilities		2,214,033			2,245,373
Total liabilities		5,347,780			5,485,323

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The summarized operating results of the businesses held for sale included in the Company’s consolidated statements of operations consist of the following:

	For the six months ended June 30,
	2023			2022
Revenues	$	330,281			2,850,027
Cost of revenues		149,253			1,233,688
Gross profit		181,028			1,616,339
Operating expense		253,107			1,598,666
Other expense		(70,288	)		(194,199	)
Loss before income taxes		(142,367	)		(176,526	)
Income tax expense		735			22,212
Loss from businesses held for sale	$	(143,102	)	$	(198,738	)

● Inventories

Inventories are stated at the lower of cost or market value. Cost is determined using the weighted average method, and market value is the middle (the second highest) value among an inventory item’s replacement cost, market celling and market floor. The Company carries out physical inventory counts on a monthly basis at each store and warehouse location. The Company reviews historical sales activity quarterly to determine excess, slow-moving items and potentially obsolete items. The Company provides inventory reserve based on the excess quantities on hand equal to the difference, if any, between the cost of the inventory and its estimated market value, or obsolescence of inventories determined principally by customer demand. As of June 30, 2023 and December 31, 2022, the Company recorded an allowance for obsolete inventories, which mainly consists of expired medicine, of $26,604 and $59,567, respectively.

● Property, plant and equipment

Property, plant, and equipment are stated at cost less accumulated depreciation and impairment, if any. Depreciation is calculated on the straight-line basis over the following expected useful lives from the date on which they become fully operational and after taking into account their estimated residual values:

Items	Expected useful lives	Residual value
Building	20 years		5	%
Office equipment	3 years		5	%
Electronic equipment	3 years		5	%
Furniture	5 years		5	%
Medical equipment	10 years		5	%
Vehicles	4 years		5	%
Leasehold Improvement	Shorter of lease term or useful life		5	%

Expenditures for repairs and maintenance are expensed as incurred. When assets have been retired or sold, the cost and related accumulated depreciation are removed from the accounts and any resulting gain or loss is recognized in the results of operations.

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● Leases

On January 1, 2020, the Company adopted Accounting Standards Update (“ASU”) 2016-02. For all leases that were entered into prior to the effective date of ASC 842, we elected to apply the package of practical expedients. Based on this guidance, the Company did not reassess the following: (1) whether any expired or existing contracts are or contain leases; (2) the lease classification for any expired or existing leases; and (3) initial direct costs for any existing leases.

The Company determines if an arrangement is a lease at inception. Operating leases are included in operating lease right-of-use (“ROU”) assets, current portion of obligations under operating leases, and obligations under operating leases, non-current on the Company’s consolidated balance sheets. Finance leases are included in property and equipment, net, current portion of obligations under capital leases, and obligations under capital leases, non-current on our consolidated balance sheets.

Operating lease ROU assets and operating lease liabilities are recognized based on the present value of the future minimum lease payments over the lease term at commencement date, adjusted by the deferred rent liabilities at the adoption date. As most of the Company’s leases do not provide an implicit rate, the Company uses its incremental borrowing rate based on the information available at commencement date in determining the present value of future payments. The operating lease ROU asset also includes any lease payments made and excludes lease incentives and initial direct costs incurred. The Company’s terms may include options to extend or terminate the lease when it is reasonably certain that the Company will exercise that option. Operating lease expense is recognized on a straight-line basis over the lease term.

● Goodwill

Goodwill represents the excess of the consideration paid of an acquisition over the fair value of the net identifiable assets of the acquired subsidiary at the date of acquisition. Goodwill is not amortized, and is tested for impairment at least annually, more often when circumstances indicate impairment may have occurred. Goodwill is carried at cost less accumulated impairment losses. If impairment exists, goodwill is immediately written off to its fair value and the loss is recognized in the consolidated statements of operations and comprehensive loss. Impairment losses on goodwill are not reversed.

The Company reviews the carrying value of intangible assets not subject to amortization, including goodwill, to determine whether impairment may exist annually or more frequently if events and circumstances indicate that it is more likely than not that an impairment has occurred. The Company has the opinion to assess qualitative factors to determine whether it is necessary to perform the two-step in accordance with ASC 350-20. If the Company believes, as a result of the qualitative carrying amount, the two-step quantities impairment test described below is required.

The first step compares the fair values of each reporting unit to its carrying amount, including goodwill. If the fair value of each reporting unit exceeds its carrying amount, goodwill is not considered to be impaired and the second step will not be required.

If the carrying amount of a reporting unit exceeds its fair value, the second step compares the implied fair value of goodwill to the carrying value of a reporting unit’s goodwill. The implied fair value of goodwill is determined in a manner similar to accounting for a business acquisition with the allocation of the assessed fair value determined in the first step to the assets and liabilities of the reporting unit. The excess of the fair value of the reporting unit. over the amounts assigned to the assets and liabilities is the implied fair value of goodwill. Estimating fair value is performed by utilizing various valuation techniques, with the primary technique being a discounted cash flow. The fair value of discounted cash flow was determined using management’s estimates and assumptions.

Management evaluates the recoverability of goodwill, with the assistance of a third party evaluation firm, by performing a qualitative assessment before using a two-step impairment test approach at the reporting unit level. If the Company reorganizes its reporting structure in a manner that changes the composition of one or more of its reporting units, goodwill will be reassigned based on the relative fair value of each of the affected reporting units. An impairment is recorded, if necessary, at the end of each year, based on an annual impairment assessment report by a third party.

15

As of June 30, 2023 and December 31, 2022, the Company recorded impairments for goodwill of Nil and $5,385,811, respectively.

As a result of the impairments recognized on December 31, 2022, the remaining goodwill of the Company was related to the acquisitions of Guanzan and Zhongshan. The remaining goodwill of Guanzan was $1,392,449, and the remaining goodwill of Zhongshan was $673, 217 as of December 31, 2022 and June 30, 2023. As of June 30, 2023, the fair value of these businesses was at risk for future goodwill impairments, based on the continuation of negative macroeconomic conditions, which could represent potential indicators of impairment requiring further impairment analysis in 2023. The Company continues to monitor for potential impairment should impairment indicators arise.

● Impairment of long-lived assets and intangibles

In accordance with the provisions of ASC Topic 360, “Impairment or Disposal of Long-Lived Assets”, all long-lived assets such as property, plant and equipment held and used by the Company are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability of assets to be held and used is evaluated by a comparison of the carrying amount of an asset to its estimated future undiscounted cash flows expected to be generated by the asset. If such assets are considered to be impaired, the impairment to be recognized is measured by the amount by which the carrying amounts of the assets exceed the fair value of the assets.

Intangible assets that are considered to have a definite useful life are amortized over their useful lives using a method of amortization that reflects the pattern in which the economic benefits of the intangible assets are consumed or otherwise used up in accordance with ASC No. 350, “Intangibles - Goodwill and other” (“ASC 350”). The Company’s identifiable intangibles are reviewed for impairment in accordance with ASC 360 whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability of assets to be held and used is measured by a comparison of the carrying amount of an asset to the future undiscounted cash flows expected to be generated by the assets. If such assets are considered to be impaired, the impairment is measured by the amount by which the carrying amount of the assets exceeds the fair value of the assets.

Goodwill and other certain purchased intangible assets have been recorded in the Company’s financial statements as a result of acquisitions. Goodwill represents the excess of the purchase price in a business combination over the fair value of the net tangible and intangible assets acquired. Under ASC 350 goodwill is not amortized, but rather is subject to an annual impairment test.

ASC 350 requires goodwill to be tested for impairment at the reporting unit level at least annually or between annual tests in certain circumstances and written down when impaired. Goodwill is tested for impairment by comparing the fair value of the reporting unit with its carrying value.

ASC 350 allows an entity to first assess qualitative factors to determine whether it is necessary to perform the two-step quantitative goodwill impairment test. If the qualitative assessment does not result in a more likely than not indication of impairment, no further impairment testing is required. If it does result in a more likely than not indication of impairment, the two-step impairment test is performed. Alternatively, ASC 350 permits an entity to bypass the qualitative assessment for any reporting unit and proceed directly to performing the first step of the goodwill impairment test.

● Revenue recognition

We adopted Accounting Standard Codification (“ASC”) Topic 606, Revenues from Contract with Customers (“ASC 606”) for all periods presented with respect to each of our segments. Under ASC 606, revenue is recognized when control of the promised goods and services is transferred to the Company’s customers, in an amount that reflects the consideration that the Company expects to be entitled to in exchange for those goods and services, net of value-added tax. The Company determines revenue recognition through the following steps:

● Identify the contract with a customer;

● Identify the performance obligations in the contract;

16

● Determine the transaction price;

● Allocate the transaction price to the performance obligations in the contract; and

● Recognize revenue when (or as) the entity satisfies a performance obligation.

The transaction price is allocated to each performance obligation on a relative standalone selling price basis. The transaction price allocated to each performance obligation is recognized when that performance obligation is satisfied by the control of the promised goods and services is transferred to the customers, which at a point in time or over time as appropriate.

The Company’s revenue is net of value added tax (“VAT”) collected on behalf of PRC tax authorities in respect to the sales of products. VAT collected from customers, net of VAT paid for purchases, is recorded as a liability in the accompanying consolidated balance sheets until it is paid to the relevant PRC tax authorities.

● Cost of revenue

Cost of revenue consists primarily of cost of goods purchased from suppliers plus direct material costs for packaging and storage, direct labor, which are directly attributable to the acquisition and maintaining of products for sales. Cost of revenues also include impairment loss of our products which are obsolete or expired for sale, if any. Shipping and handling costs, associated with the distribution of finished products to customers, are borne by the customers.

● Comprehensive income

ASC Topic 220, “Comprehensive Income”, establishes standards for reporting and display of comprehensive income, its components and accumulated balances. Comprehensive income as defined includes all changes in equity during a period from non-owner sources. Accumulated other comprehensive income, as presented in the accompanying condensed consolidated statement of stockholders’ equity, consists of changes in unrealized gains and losses on foreign currency translation. This comprehensive income is not included in the computation of income tax expense or benefit.

● Income taxes

Income taxes are determined in accordance with the provisions of ASC Topic 740, “Income Taxes” (“ASC 740”). Under this method, deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax basis. Deferred tax assets and liabilities are measured using enacted income tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. Any effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date.

ASC 740 prescribes a comprehensive model for how companies should recognize, measure, present, and disclose in their financial statements uncertain tax positions taken or expected to be taken on a tax return. Under ASC 740, tax positions must initially be recognized in the financial statements when it is more likely than not the position will be sustained upon examination by the tax authorities. Such tax positions must initially and subsequently be measured as the largest amount of tax benefit that has a greater than 50% likelihood of being realized upon ultimate settlement with the tax authority assuming full knowledge of the position and relevant facts.

For the six months ended June 30, 2023 and 2022, the Company did not incur any interest or penalties associated with the tax positions it has taken. As of June 30, 2023, the Company did not have any significant unrecognized uncertain tax positions.

● Value added tax

Sales revenue represents the invoiced value of goods sold, net of VAT. All of the Company’s products that are sold in the PRC are subject to a VAT on the gross sales price. The VAT rates range up to 13%, depending on the type of products sold. The VAT may be offset by VAT paid by the Company on its purchase activities of merchandises, raw materials, utilities, and other materials which cost was included in the cost of producing or acquiring its products for sales. The Company records a VAT payable net of payments if the VAT payable on the gross sales is larger than VAT paid by the Company on purchase of finished goods; on the other hand, the Company records a VAT deductible in the accompanying financial statements net of any VAT payable at the end of reporting period.

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● Convertible promissory notes

The Company records debt net of debt discount for beneficial conversion features and warrants, on a relative fair value basis. Beneficial conversion features are recorded pursuant to the Beneficial Conversion and Debt Topics of the FASB Accounting Standards Codification. The amounts allocated to warrants and beneficial conversion rights are recorded as debt discount and as additional paid-in-capital. Debt discount is amortized to interest expense over the life of the debt.

● Debt issuance costs and debt discounts

The Company may record debt issuance costs and/or debt discounts in connection with raising funds through the issuance of debt. These costs may be paid in the form of cash, or equity (such as warrants). These costs are amortized to interest expense through the maturity of the debt. If a conversion of the underlying debt occurs prior to maturity a proportionate share of the unamortized amounts is immediately expensed.

● Beneficial conversion feature

The Company evaluates the conversion feature of its convertible promissory notes to determine whether it was beneficial as described in ASC 470-20. The intrinsic value of a beneficial conversion feature inherent to a convertible note payable, which is not bifurcated and accounted for separately from the convertible notes payable and may not be settled in cash upon conversion, is treated as a discount to the convertible notes payable. This discount is amortized over the period from the date of issuance to the date the notes is due using the effective interest method. If the notes payable are retired prior to the end of their contractual term, the unamortized discount is expensed in the period of retirement to interest expense. In general, the beneficial conversion feature is measured by comparing the effective conversion price, after considering the relative fair value of detachable instruments included in the financing transaction, if any, to the fair value of the shares of Common Stock at the commitment date to be received upon conversion.

● Discontinued operations

In accordance with ASC 205-20, Reporting Discontinued Operations and Disclosures of Disposals of Components of an Entity, a disposal of a component of an entity or a group of components of an entity is required to be reported as a discontinued operation if the disposal represents a strategic shift that has (or will have) a major effect on an entity’s operations and financial results when the components of an entity meets the criteria in paragraph 205-20-45-1E to be classified as held for sale. When all of the criteria to be classified as held for sale are met, including management, having the authority to approve the action, commits to a plan to sell the entity, the major current assets, other assets, current liabilities, and non-current liabilities shall be reported as components of total assets and liabilities separate from those balances of the continuing operations. At the same time, the results of all discontinued operations, less applicable income taxes (benefit), shall be reported as components of net income (loss) separate from the net income (loss) of continuing operations in accordance with ASC 205-20-45.

On October 19, 2022, the Company’s wholly owned Guanzan subsidiary agreed to sell its 100% equity interest in Zhuoda and Zhuoda’s wholly owned subsidiary, Qianmei, to the former owner. Guanzan had previously purchased Zhuoda for 44,000 of shares of Common Stock (post the Reverse Splits). As consideration for the sale, the buyer agreed to return the 44,000 shares of Common Stock to the Company. The transaction closed effective November 23, 2022, when 100% of the equity interests in Zhuoda were transferred to the former owners and the 44,000 shares of Common Stock were returned to the Company.

On December 28, 2022, the Company entered into an agreement to transfer 87% of the equity interests in Zhongshan to the prior owner. Pursuant to the agreement, the Company agreed to transfer 87% of the equity interests in Zhongshan to the former owner and will retain 13% of the equity interests in Zhongshan. As consideration for the transfer and pursuant to an amendment to the original stock purchase agreement, the original seller agreed to return the 40,037 shares of Common Stock previously issued (reflecting Two Reverse Splits) and RMB 40,000,000 in cash (approximately ($6,116,207) previously paid upon the acquisition of Zhongshan. The former owner also agreed to release the Company from any and all claims relating to two earn out payments that were payable under the original purchase agreement. The Company received a put option to sell part or all of its 13% interest in Zhongshan before December 31, 2032, based on a valuation determined by a reputable third-party appraisal firm jointly chosen by the two parties. On September 1, 2023, 39,037 shares of Common Stock were returned to the Company. The remaining 1,000 shares were returned in the form of a cash payment of $3,055 because the shares were sold by the original seller. The transaction is expected to close by December 31, 2023, at which time the cash paid at the time of the transaction will also be returned.

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On December 28, 2022, the Company entered into an agreement to transfer 90% of the equity interests in the Qiangsheng, Eurasia and Minkang hospitals to their former owners. Pursuant to the agreement, the Company will transfer 90% of the equity interests in each of the three hospitals and continue to own 10% of the equity interests in each hospital. As consideration for the transfer and pursuant to an amendment to the original stock purchase agreement, the original sellers agreed to return the 80,000 shares of Common Stock previously issued (reflecting the Reverse Splits) and RMB 20,000,000 (approximately $2,767,860 in cash previously paid upon the acquisition of the three hospitals. The former owner also agreed to release the Company from any and all claims relating to two earn out payments that were payable under the original purchase agreement. The Company received a put option to sell part or all of its 10% interest in each of the three hospitals to the former owner before December 31, 2032, based on a valuation determined by a reputable third-party appraisal firm jointly chosen by the parties. On December 9, 2022, 43,600 shares of Common Stock were returned to the Company and on September 1, 2023, 36,400 shares of Common Stock were returned to the Company. The transaction is expected to close by December 31, 2023, at which time the cash paid at the time of the transaction will also be returned.

● Derivative instruments

The Company has entered into financing arrangements that consist of freestanding derivative instruments or are hybrid instruments that contain embedded derivative features. The Company accounts for these arrangements in accordance with Accounting Standards Codification Topic 815, Accounting for Derivative Instruments and Hedging Activities (“ASC 815”) as well as related interpretation of this standard. In accordance with this standard, derivative instruments are recognized as either assets or liabilities in the balance sheet and are measured at fair values with gains or losses recognized in earnings. Embedded derivatives that are not clearly and closely related to the host contract are bifurcated and are recognized at fair value with changes in fair value recognized as either a gain or loss in earnings. The Company determines the fair value of derivative instruments and hybrid instruments based on available market data using appropriate valuation models, giving consideration to all of the rights and obligations of each instrument.

The Company estimates fair values of derivative financial instruments using various techniques (and combinations thereof) that are considered to be consistent with the objective measuring fair values. In selecting the appropriate technique, we consider, among other factors, the nature of the instrument, the market risks that it embodies and the expected means of settlement. For less complex derivative instruments, such as free-standing warrants, we generally use the Black-Scholes model, adjusted for the effect of dilution, because it embodies all of the requisite assumptions (including trading volatility, estimated terms, dilution and risk-free rates) necessary to fair value these instruments. Estimating fair values of derivative financial instruments requires the development of significant and subjective estimates that may, and are likely to, change over the duration of the instrument with related changes in internal and external market factors. In addition, option-based techniques (such as Black-Scholes model) are highly volatile and sensitive to changes in the trading market price of our Common Stock. Since derivative financial instruments are initially and subsequently carried at fair values, our income (expense) going forward will reflect the volatility in these estimate and assumption changes. Under the terms of the new accounting standard, increases in the trading price of the Common Stock and increases in fair value during a given financial quarter result in the application of non-cash derivative expense. Conversely, decreases in the trading price of the Common Stock and decreases in trading fair value during a given financial quarter result in the application of non-cash derivative income. 

● Net loss per share

The Company calculates net loss per share in accordance with ASC Topic 260, “Earnings per Share.” Basic income per share is computed by dividing the net income by the weighted-average number of shares of Common Stock outstanding during the period. Diluted income per share is computed similar to basic income per share except that the denominator is increased to include the number of additional shares of Common Stock that would have been outstanding if the potential Common Stock equivalents had been issued and if the additional shares of Common Stock were dilutive.

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● Foreign currencies translation

Transactions denominated in currencies other than the functional currency are translated into the functional currency at the exchange rates prevailing at the dates of the transaction. Monetary assets and liabilities denominated in currencies other than the functional currency are translated into the functional currency using the applicable exchange rates at the balance sheet dates. The resulting exchange differences are recorded in the statement of operations.

The reporting currency of the Company is the United States Dollar (“US$”). The Company’s subsidiaries in the PRC maintain their books and records in their local currency, the Renminbi Yuan (“RMB”), which is the functional currency as being the primary currency of the economic environment in which these entities operate.

In general, for consolidation purposes, assets and liabilities of its subsidiaries whose functional currency is not the US$ are translated into US$, in accordance with ASC Topic 830-30, “Translation of Financial Statement”, using the exchange rate on the balance sheet date. Revenues and expenses are translated at average rates prevailing during the period. The gains and losses resulting from translation of financial statements of foreign subsidiaries are recorded as a separate component of accumulated other comprehensive income within the statement of stockholders’ equity.

Translation of amounts from RMB into US$ has been made at the following exchange rates for the respective period:

	June 30, 2023		June 30, 2022
Period-end RMB:US$1 exchange rate		7.2258		6.7114
Six months end average RMB:US$1 exchange rate		6.9291		6.4835

● Related parties

Parties, which can be a corporation or an individual, are considered to be related if the Company has the ability, directly or indirectly, to control the other party or exercise significant influence over the other party in making financial and operational decisions. Companies are also considered to be related if they are subject to common control or common significant influence.

● Segment reporting

ASC Topic 280, “Segment Reporting” establishes standards for reporting information about operating segments on a basis consistent with the Company’s internal organization structure as well as information about the type of products and services, geographical areas, business strategies and major customers in business components. For the six months ended June 30, 2023, and 2022, the Company operated in four reportable segments in the PRC.

As of June 30, 2023, the Company had four reportable segments, which consisted of retail pharmacy, wholesale pharmaceuticals, wholesale medical devices and healthcare products.

As of June 30, 2022, the Company had four reportable segments, which consisted of wholesale medical devices, wholesale pharmaceuticals, medical services and retail pharmacies.

● Fair value of financial instruments

The carrying value of the Company’s financial instruments (excluding short-term bank borrowing and convertible promissory notes): cash and cash equivalents, accounts and retention receivable and other receivables, accounts payable, amounts due to related parties, other payables and accrued liabilities approximate their fair values because of the short-term nature of these financial instruments.

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Management believes, based on the current market prices or interest rates for similar debt instruments, the fair value of its obligations under its finance lease and short-term bank borrowing approximates the carrying amount.

The Company also follows the guidance of the ASC Topic 820-10, “Fair Value Measurements and Disclosures” (“ASC 820-10”), with respect to financial assets and liabilities that are measured at fair value. ASC 820-10 establishes a three-tier fair value hierarchy that prioritizes the inputs used in measuring fair value as follows:

● Level 1: Inputs are based upon unadjusted quoted prices for identical instruments traded in active markets;

● Level 2: Inputs are based upon quoted prices for similar instruments in active markets, quoted prices for identical or similar instruments in markets that are not active, and model-based valuation techniques (e.g., Black-Scholes Option-Pricing model) for which all significant inputs are observable in the market or can be corroborated by observable market data for substantially the full term of the assets or liabilities. Where applicable, these models project future cash flows and discount the future amounts to a present value using market-based observable inputs; and

● Level 3: Inputs are generally unobservable and typically reflect management’s estimates of assumptions that market participants would use in pricing the asset or liability. The fair values are therefore determined using model-based techniques, including option pricing models and discounted cash flow models.

Fair value estimates are made at a specific point in time based on relevant market information about the financial instrument. These estimates are subjective in nature and involve uncertainties and matters of significant judgment and, therefore, cannot be determined with precision. Changes in assumptions could significantly affect the estimates.

The Company measures the fair value of the following assets and liabilities:

Financial assets and liabilities for which carrying value approximates fair value - Cash and cash equivalents, deposits, receivables, repurchase agreements, payables, and other assets and liabilities are reflected in the consolidated balance sheets at their cost, which, due to the short-term nature of these instruments and their limited inherent credit risk, approximates fair value.

Convertible promissory note - As of June 30, 2023, and 2022, the carrying value of the Company’s convertible promissory notes was $0 and $6,320,075, respectively. The Company’s estimate of the fair value of convertible promissory note is $0 and $6,320,075 as of June 30, 2023, and 2022, respectively. The Company’s convertible promissory note, which are publicly traded on the Nasdaq Stock Exchange, are classified within Level 1 of the fair value hierarchy.

Recent accounting pronouncements

In August 2020, the FASB issued ASU No. 2020-06 (“ASU 2020-06”) “Debt—Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging—Contracts in Entity’s Own Equity (Subtopic 815-40): Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity.” ASU 2020-06 will simplify the accounting for convertible instruments by reducing the number of accounting models for convertible debt instruments and convertible preferred stock. For public business entities, the amendments in ASU 2020-06 are effective for public entities which meet the definition of a smaller reporting company are effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2023. The Company will adopt ASU 2020-06 effective January 1, 2024. Management is currently evaluating the effect of the adoption of ASU 2020-06 on the consolidated financial statements. The effect will largely depend on the composition and terms of the financial instruments at the time of adoption.

In October 2021, the FASB issued ASU No. 2021-08, “‘Business Combinations (Topic 805): Accounting for Contract Assets and Contract Liabilities from Contracts with Customers” (“ASU 2021-08”). This ASU requires entities to apply Topic 606 to recognize and measure contract assets and contract liabilities in a business combination. The amendments improve comparability after the business combination by providing consistent recognition and measurement guidance for revenue contracts with customers acquired in a business combination and revenue contracts with customers not acquired in a business combination. The amendments are effective for the Company beginning after December 15, 2023, and are applied prospectively to business combinations that occur after the effective date. The Company does not expect the adoption of ASU 2021-04 will have a material effect on the consolidated financial statements.

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Other accounting standards that have been issued or proposed by the FASB or other standards-setting bodies that do not require adoption until a future date are not expected to have a material impact on the Company’s consolidated financial statements upon adoption. The Company does not discuss recent pronouncements that are not anticipated to have an impact on or are unrelated to its consolidated financial condition, results of operations, cash flows or disclosures.

4. THE ACQUISITION OF THE GUANZAN GROUP

On February 1, 2020, the Company entered into a stock purchase agreement to purchase Guanzan, (the “Guanzan SPA”). Guanzan is a distributor of medical devices whose customers are primarily drug stores, private clinics, pharmaceutical dealers and hospitals in the Southwest of China. Guanzan holds business licenses in the PRC such as a Business Permit for Medical Devices and a Recordation Certificate for Business Activities Involving Class II Medical Devices, etc., which qualify Guanzan to engage in the distribution of medical devices in the PRC. Pursuant to the Guanzan SPA, we agreed to purchase all the issued and outstanding shares of Guanzan for RMB 100,000,000 (approximately $14,285,714) to be paid by the issuance of 19,000 shares of Common Stock (post the Reverse Splits) and the payment of RMB 80,000,000 (approximately $11,428,571) in cash. The stock consideration was payable at closing and the cash consideration, which was subject to post-closing adjustments based on the performance of Guanzan in the years ending December 31, 2020, and 2021, respectively, was to be paid pursuant to a post-closing payment schedule. The transaction closed on March 18, 2020. Upon the closing, 100% of the shares of Guanzan were transferred to the Company and the stock consideration was issued to the seller.

The following summarizes the identified assets acquired and liabilities assumed pursuant to the Guanzan acquisition as of March 18, 2020:

Items	Amount
Assets
Cash and cash equivalents	$	95,220
Accounts receivable		1,835,981
Advances to suppliers		1,222,986
Amount due from related parties		410,943
Inventories		950,225
Prepayments and other receivables		90,256
Property, plant and equipment		707,289
Intangible assets		254,737
Goodwill		6,686,053
Liabilities
Short-term bank borrowings		(838,926	)
Long-term loans due within one year		(250,663	)
Accounts payable, trade		(1,303,399	)
Advances from customers		(1,350,126	)
Amount due to related parties		(106,720	)
Taxes payable		(406,169	)
Other payables and accrued liabilities		(390,593	)
Long-term loans – noncurrent portion		(186,796	)
Non-controlling interests		(46,295	)
Total-net assets	$	7,374,000

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On November 20, 2020, the parties to the Guanzan SPA entered into a prepayment and amendment agreement (the “Prepayment Agreement”) for the prepayment of a portion of the cash consideration in the amount of RMB 20,000,000, in the form of shares of Common Stock valued at $3.00 per share, in light of Guanzan’s performance during the period from March 18, 2020, to September 30, 2020. On November 30, 2020, 20,000 shares (after the Reverse Splits) of our Common Stock were issued to the designated assignees of the seller as the prepayment. Upon the approval of the Company’s shareholders, on August 27, 2021, the Company issued 92,000 shares (after the Reverse Splits) of Common Stock as payment in full for the balance of the post-closing consideration for the acquisition of Guanzan.

The following reconciles the identified assets acquired and liabilities assumed pursuant to the Guanzan SPA, and the Prepayment and Amendment Agreement made on November 20, 2020:

The determination of the value of the shares issued was determined according to the closing price on the day the shares issued. On March 12, 2020, the price was $2.86 per share.

The fair value of the shares issued on March 12, 2020	$	2,717,000
The fair value of the shares issued on November 19, 2020		1,820,000
Cash		3,065,181
Total consideration	$	7,602,181
Net assets		(687,949	)
Goodwill	$	6,914,232

The fair value of all assets acquired, and liabilities assumed is the estimated book value of Guanzan. Goodwill represents the excess of the fair value of purchase price over the amounts assigned to the fair value of the assets acquired and the liabilities assumed of Guanzan at the acquisition date. Upon the acquisition of Guanzan, the Company recognized its non-controlling interest in Shude in the amount of $46,295, representing the 20% non-controlling equity interest in Shude. Shude is a pharmaceuticals distributor. Shude’s customers include a wide range of clinics, private and public hospitals, and pharmacies in the PRC.  On April 9, 2021, the Company increased its equity interest in Shude from 80% to 95.2% by making a direct capital investment of $4,892,293 in Shude.

5. THE ACQUISITION OF THE GUOYITANG HOSPITAL

On December 9, 2020, the Company entered into an agreement to acquire all of the outstanding equity of Guoyitang, the owner and operator of a private general hospital in Chongqing City, a southwest city of China, with 100 hospital beds. The aggregate purchase price for Guoyitang was RMB 100,000,000 (approximately $15,251,807). Upon signing the agreement, 40,000 shares of Common Stock (post the Reverse Splits) and RMB 20,000,000 (approximately $3,096,119) were paid as partial consideration for the purchase of Guoyitang. The transaction closed on February 2, 2021. The balance of the purchase price of RMB 40,000,000 (approximately $6,100,723) was subject to post-closing adjustments based on the performance of Guoyitang in 2021 and 2022. As the future performance of Guoyitang in 2021 and 2022 was uncertain, the total acquired consideration at the acquisition date was calculated based on the value of the closing payment without taking into consideration of potential payments based on future performance. As a result of the performance failure of Guoyitang in 2021, the sellers were not eligible to receive any contingent payments.

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The following summarizes the identified assets acquired and liabilities assumed pursuant to the Guoyitang Acquisition as of February 2, 2021:

Items	Amount
Assets
Cash and cash equivalents	$	28,457
Accounts receivable		11,797
Advances to suppliers		12,670
Amount due from related parties		41,598
Inventories		167,440
Prepayments and other receivables		61,102
Property, plant and equipment		528,814
Right-of-use asset		441,150
Goodwill		7,154,393
Liabilities
Accounts payable, trade		(599,391	)
Amount due to related parties		(183,796	)
Taxes payable		(121	)
Other payables and accrued liabilities		(231,375	)
Lease liability-current		(161,707	)
Lease liability-non current		(354,912	)
Total-net assets	$	6,916,119

The fair value of all assets acquired and liabilities assumed was the estimated book value of Guoyitang. Goodwill represents the excess of the fair value of purchase price over the amounts assigned to the fair value of the assets acquired and the liabilities assumed of Guoyitang at the acquisition date.

The determination of the share value was determined according to the closing price of the Company’s Common Stock on the day the shares were issued.

The value of the shares issued on February 2, 2021		3,820,000
Cash		3,096,119
Total consideration	$	6,916,119
Net assets		(238,274	)
Goodwill		7,154,393

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6. THE ACQUISITION OF THE ZHONGSHAN HOSPITAL

On December 15, 2020, the Company entered into an agreement to acquire Zhongshan, a private hospital in the east region of China with 65 hospital beds. Zhongshan is a general hospital known for its complex minimally invasive surgeries. Pursuant to the agreement, the Company agreed to purchase all the issued and outstanding equity interests in Zhongshan in consideration of RMB 120,000,000. The cash consideration of RMB 40,000,000 (approximately $6,116,207) was paid to the seller in December 2020. On February 12, 2021, we issued 40,037 shares of Common Stock (post the Reverse Splits) then valued at RMB 40,000,000 (approximately $6,116,207) to the seller as part of the consideration. The balance of the purchase price in the amount of RMB 40,000,000 (approximately $6,116,207) was subject to post-closing adjustments based on the performance of Zhongshan in 2021 and 2022. The transaction closed on February 5, 2021. As the future performance of Zhongshan in 2021 and 2022 was uncertain, the total acquired consideration at the acquisition date was calculated based on the value of the closing payment without taking into consideration of potential payments based on future performance.

As a result of the performance failure of Zhongshan in the year ended December 31, 2021, the seller was not eligible to receive any contingent payments.

The following summarizes the identified assets acquired and liabilities assumed pursuant to the Zhongshan acquisition as of February 5, 2021:

Items	Amount
Assets
Cash and cash equivalents	$	46,748
Accounts receivable		92,900
Inventories		108,413
Prepayments and other receivables		432,231
Property, plant and equipment		344,208
Right-of-use asset		1,188,693
Goodwill		10,443,494
Liabilities
Short-term bank borrowings		(154,701	)
Accounts payable, trade		(928,640	)
Advances from customers		(5,603	)
Amount due to related parties		(217,203	)
Other payables and accrued liabilities		(435,290	)
Lease liability-current		(160,774	)
Lease liability-non current		(1,102,589	)
Total-net assets	$	9,651,887

The fair value of all assets acquired, and liabilities assumed is the estimated book value of the Zhongshan. Goodwill represents the excess of the fair value of purchase price over the amounts assigned to the fair value of the assets acquired and the liabilities assumed of Zhongshan Hospital at the acquisition date.

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The determination of the share value was determined according to the closing price of the Company’s Common Stock on the day the shares were issued,

The value of the shares issued on February 12, 2021		3,480,000
Cash payment in December 2020		6,171,887
Total consideration	$	9,651,887
Net assets		(791,607	)
Goodwill		10,443,494

On December 28, 2022, we entered into an agreement to transfer 87% of the equity interests in Zhongshan to the prior owner. As consideration for the transfer and pursuant to an amendment to the original stock purchase agreement, the original seller agreed to return the 40,037 shares of Common Stock previously issued and RMB 40,000,000 in cash (approximately $6,116,207) previously paid upon the acquisition of Zhongshan. On September 1, 2023, 39,037 shares of Common Stock were returned to the Company. The remaining 1,000 shares were returned in the form of cash because the shares were sold by the original seller. The transaction is expected to close by December 31, 2023, at which time the cash paid at the time of the transaction will also be returned.

7. THE ACQUISITION OF THE QIANGSHENG, EURASIA AND MINKANG HOSPITALS

On April 9, 2021, the Company and Chongqing Bimai entered into a stock purchase agreement to acquire three private hospitals in the PRC, Qiangsheng, Eurasia and Minkang. Pursuant to the agreement, the Company agreed to purchase all the issued and outstanding equity interests in Qiangsheng, Eurasia and Minkang in consideration of approximately RMB162,000,000 (approximately $25,023,555) to paid by the issuance of 80,000 shares of Common Stock (post the Reverse Splits), the value of which was agreed to be RMB 78 million (approximately $12 million) and the payment of RMB 84,000,000 (approximately $13,008,734) in cash (the “Cash Consideration”). The first payment of the Cash Consideration was RMB 20,000,000 (approximately $3,097,317). The second and third payments of the Cash Consideration of RMB 64,000,000 (approximately $9,911,416) were subject to post-closing adjustments based on the performance of Qiangsheng, Eurasia and Minkang in 2021 and 2022. The sellers had the choice to receive the second and third payments in the form of the shares of Common Stock valued at $15 per share (post the Reverse Splits) or in cash. The transaction closed on May 6, 2021; at which time the 16,000 shares of Common Stock were issued. As the future performance of the three hospitals was uncertain, the total acquired consideration at the acquisition date was calculated based on the value of the closing payment without taking into consideration of potential payments based on future performance. As a result of the performance failure by the three hospitals for the year ended December 31, 2021, the sellers were not eligible to receive any contingent payments.

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The following summarizes the identified assets acquired and liabilities assumed pursuant to the Qiangsheng, Eurasia and Minkang acquisitions as of May 6, 2021:

Items	Amount
Assets
Cash and cash equivalents	$	12,341
Accounts receivable		41,836
Inventories		156,576
Advances and other receivables		40,620
Property, plant and equipment		653,104
Right of use assets		2,168,709
Goodwill		9,067,529
Liabilities
Accounts payable		(355,980	)
Advances from customers		(36,798	)
Tax payable		(345,870	)
Other payables and accrued liabilities		(311,174	)
Lease liability-current		(365,788	)
Lease liability-non-current		(1,988,195	)
Total net assets	$	8,736,910

The fair value of all assets acquired, and liabilities assumed is the estimated book value of the Qiangsheng, Eurasia and Minkang hospitals. Goodwill represents the excess of the fair value of purchase price over the amounts assigned to the fair value of the assets acquired and the liabilities assumed of Qiangsheng, Eurasia and Minkang Hospitals at the acquisition date.

The determination of the share value was determined according to the closing price of the Company’s Common Stock on the day the shares were issued.

The value of the shares issued on April 20, 2021		5,600,000
Cash payment on December 2021		3,136,910
Total consideration	$	8,736,910
Net assets		(330,619	)
Goodwill		9,067,529

On December 28, 2022, we entered into an agreement to transfer 90% of the equity interests in Qiangsheng, Minkang and Eurasia to the previous owners. As consideration for the transfer and pursuant to an amendment to the original stock purchase agreement, the original sellers agreed to return the 80,000 shares of Common Stock previously issued and RMB 20,000,000 (approximately $2,767,860) in cash previously paid upon the acquisition of the three hospitals. On December 9, 2022, 43,600 shares of Common Stock were returned to the Company and on September 1, 2023, 36,400 shares of Common Stock were returned to the Company. The sales of Qiangsheng, Minkang and Eurasia are expected to close by December 31, 2023 at which time the RMB 20,000,000 will also be returned.

8. THE ACQUISITION OF ZHUODA

On September 10, 2021, Guanzan entered into an agreement to acquire Zhuoda. Pursuant to the agreement, Guanzan agreed to purchase all the issued and outstanding equity interests in Zhuoda in consideration of RMB 75,240,000 (approximately $11,400,000). The entire purchase consideration was payable in shares of Common Stock. At the closing on September 22, 2021, 44,000 shares of Common Stock (post the Reverse Splits) valued at RMB 43,560,000 (approximately $6,600,000) were issued as partial consideration for the purchase. The remainder of the purchase price of RMB 31,680,000 (approximately $4,800,000), was subject to post-closing adjustments based on the performance of Zhuoda in 2022 and 2023. The transaction closed on October 8, 2021. As the future performance of Zhuoda in 2022 and 2023 was uncertain, the total acquired consideration at the acquisition date and at December 31, 2021 was calculated based on the value of the closing payment without taking into consideration of potential payments based on future performance.  

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The following summarizes the identified assets acquired and liabilities assumed pursuant to the Zhuoda acquisition as of October 8, 2021:

Items	Amount
Assets
Cash and cash equivalents	$	102,350
Accounts receivable		804,083
Inventories		131,456
Advances and other receivables		886,370
Property, plant and equipment		6,579
Right of use assets		17,160
Goodwill		924,740
Liabilities
Short term loan		(773,737	)
Accounts payable		(56,887	)
Advances from customers		(3,778	)
Tax payable		(24,787	)
Other payables and accrued liabilities		(493,868	)
Lease liability-current		(7,217	)
Lease liability-non-current		(14,265	)
Total net assets	$	1,498,199

The fair value of all assets acquired, and liabilities assumed is the estimated book value of the Zhuoda. Goodwill represents the excess of the fair value of purchase price over the amounts assigned to the fair value of the assets acquired and the liabilities assumed of Zhuoda at the acquisition date.

The determination of the share value was determined according to the closing price of the Company’s Common Stock on the day the shares were issued.

The value of the shares issued on September 6, 2021	$	1,498,200
Total consideration	$	1,498,200
Net assets		573,458
Goodwill	$	924,742

9. THE SALE OF ZHUODA

On October 19, 2022, the Company’s wholly owned Guanzan subsidiary agreed to sell its 100% equity interest in Zhuoda and Zhuoda’s wholly owned subsidiary, Qianmei, to the former owner. Guanzan had previously purchased Zhuoda for 44,000 shares of Common Stock (reflecting the December 1 to 10 reverse split). As consideration for the sale, the buyer agreed to return the 44,000 shares of Common Stock to the Company. The transaction closed effective November 23, 2022, when 100% of the equity interests in Zhuoda were transferred to the former owners and the 44,000 shares of Common Stock were returned to us.

28

The summarized operating results of the Zhuoda and its subsidiary in the Company’s condensed consolidated statements of operations for the period of January 1 to November 23, 2022, consisted of the following:

	For the period ended November 23, 2022
Revenues	$	2,713,818
Cost of revenues		2,314,877
Gross profit		398,941
Operating expense		392,875
Other income (expense)		(45,146	)
Loss before income taxes		(39,080	)
Income tax expense		1,425
Net income/(loss) from discontinued operations	$	(40,505	)

The assets and liabilities of the discontinued operations of Zhuoda consisted of the following items as of November 23, 2022, and December 31, 2021:

	November 23,		December 31,
	2022		2021
Assets from discontinued operations
Current assets
Cash and cash equivalents	$	13,922	$	100,678
Accounts receivable, net		1,951,997		984,030
Advances to suppliers		67,561		118,365
Amount due from related parties		-		-
Inventories, net		101,059		162,882
Prepayments and other receivables		720,365		725,881
Operating lease-right of use assets		-		-
Total current assets		2,854,904		2,091,836
Non-current assets
Deferred tax assets		-		-
Property, plant and equipment, net		1,442		2,507
Intangible assets, net		-		-
Operating lease-right of use assets		10,044		15,959
Goodwill		-		-
Long-term investment		-		-
Total non-current assets		11,486		18,466
Total assets from discontinued operations	$	2,866,390	$	2,110,302
Liabilities from discontinued operations
Current liabilities
Short-term loans	$	154,288	$	795,583
Long-term loans due within one year		-		-
Convertible promissory notes, net		-		-
Accounts payable, trade		1,301,712		265,731
Advances from customers		-		723
Amount due to related parties		-		-
Taxes payable		441		218
Other payables and accrued liabilities		162,362		468,970
Lease liability-current		7,693		8,102
Total current liabilities		1,626,496		1,539,327
Non-current liabilities
Lease liability-non current		6,976		12,727
Long-term loans – non-current		330,242		-
Total non-current liabilities		337,218		12,727
Total liabilities		1,963,714		1,552,054

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10. THE ACQUISITION OF PHENIX

On July 5, 2022, we entered into a stock purchase agreement (as amended on February 27, 2023) with Mr. Fnu Oudom, the Chairman of our board of directors, whereby we agreed to acquire 100% of the equity interests in Phenix Bio Inc. (Phenix”), a developer and distributor of dietary supplements, in consideration of $1,800,000, consisting of $180,000 in cash (paid on July 7, 2022) and the issuance of 270,000 shares of Common Stock (reflecting the December 2022 reverse split). In a further amendment to the agreement dated February 27, 2023, we agreed to issue an additional 5,000,000 shares of Common Stock to Mr. Oudom if the aggregate net profit generated by Phenix is at least $2,500,000 in calendar year 2023 or in any fiscal quarter of 2023. Upon obtaining shareholder approval for the transaction, we issued 270,000 shares of Common Stock to Mr. Oudom on June 19, 2023 .

The Company’s healthcare products are developed and distributed by Phenix. Phenix owns its formulas and uses out-sourced facilities in the U.S. and Australia to manufacture its products. In the first six months of 2023, Phenix sold all its products through one online sales platform. Most of the customers were from Asian countries. Phenix currently offers six categories of dietary supplements, a cardiovascular product, an anti-insomnia and depression product, a male aphrodisiac product, a woman’s menopausal syndrome product, a gout product, and an immunity enhancer.

The following summarizes the identified assets acquired and liabilities assumed pursuant to Phenix acquisition as of March 15, 2023:

Items	Amount
Assets
Cash and cash equivalents	$	1,511,220
Accounts receivable		346
Inventories		892,214
Advances and other receivables		386,965
Fixed assets		99,599
Intangible assets		500,000
Liabilities
Accounts payable		(6,650	)
Other payables and accrued liabilities		(13,883	)
Advance from customer		(1,028,004	)
Total net assets	$	2,341,807

The fair value of all assets acquired, and liabilities assumed is the estimated book value of the Phenix.

The determination of the share value was determined according to the closing price of the Company’s Common Stock on the day the shares were issued.

Cash payment on July 7,2022	$	180,000
The value of the 270,000 shares issued on June 19, 2023	$	291,600
Total consideration	$	471,600
Net assets	$	2,341,807
Additional paid in capital	$	1,870,207

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11. ACCOUNTS RECEIVABLE

The revenues of the Company’s pharmacy segment are derived from cash sales, except for sales to the government social security bureaus or commercial health insurance programs, which typically settle once a month.

The revenues of the Company’s wholesale pharmaceuticals segment are recognized when the goods are transferred to the customer, Generally, the receivables are collected within 30 to 60 days.

The revenues of the Company’s wholesale medical devices segment are recognized when the goods are transferred to the customers, Generally, the receivables are collected within 30 to 60 days.

The revenues of the Company’s healthcare products segment are recognized when the goods are transferred to the customers. Payment terms generally provide for payment within 30 to 60 days.

The Company routinely evaluates the need for allowance for doubtful accounts based on specifically identified amounts that the management believes to be uncollectible. If the actual collection experience changes, revisions to the allowance may be required. As of June 30, 2023, and December 31, 2022, accounts receivable consisted of the following:

	June 30, 2023			December 31, 2022
Accounts receivable, cost	$	7,927,248		$	4,813,160
Less: allowance for doubtful accounts		(1,546,861	)		(1,604,874	)
Accounts receivable, net	$	6,380,387		$	3,208,286

Movements of allowance for accounts receivable are as follows:

	June 30, 2023			December 31, 2022
Beginning balance	$	1,604,874		$	322,145
Addition		-			1,282,729
Reversal		(58,013	)		-
Ending Balance	$	1,546,861		$	1,604,874

12. ADVANCES TO SUPPLIERS

Advances to suppliers represent the amount the Company prepaid to its suppliers for merchandises for sale in the ordinary course of business. As of June 30, 2023, and December 31, 2022, the Company reported advances to suppliers as follow:

	June 30, 2023		December 31, 2022
Advances to suppliers	$	7,017,279	$	6,589,759

No bad debt expenses were accrued for doubtful accounts relating to advances to suppliers for the six months ended June 30, 2023, and 2022, respectively.

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13. INVENTORIES

The Company’s inventories consist of medicine, medical devices and healthcare products that are sold either on a retail or wholesale basis. Inventories consisted of the following:

	June 30, 2023			December 31, 2022
Pharmaceuticals	$	6,672,082		$	7,067,613
Healthcare products		323,095			-
Medical devices		213,952			614,231
Less: allowance for obsolete and expired inventory		(26,605	)		(27,602	)
	$	7,182,524		$	7,654,242

Movements of inventory reserves are as follows:

	June 30, 2023			December 31, 2022
Beginning balance	$	27,602		$	103,178
Reversal		(997	)		(75,576	)
Ending Balance	$	26,605		$	27,602

For the six months ended June 30, 2023, and 2022, the Company had accrued allowances of $26,604 and $28,644, respectively, for obsolete and expired items.

14. PREPAYMENTS AND OTHER RECEIVABLES

Prepayments and other receivables represent the amount that the Company prepaid as rent deposits for its retail stores, hospitals and office space, special medical device purchase deposits, prepaid rental fee and professional services, advances to employees in the ordinary course of business, VAT deductibles and other miscellaneous receivables. The table below sets forth the balances as of June 30, 2023, and December 31, 2022.

	June 30, 2023			December 31, 2022
Deposit for rentals	$	142,088		$	132,960
Prepaid expenses and improvements of offices		54,092			56,121
Prepaid for acquisition of phenix		-			180,000
Deposit for purchase of medical devices		160,737			166,765
Deposit for sales platform		20,399			24,337
Receivables form third party		118,625			66,986
VAT deductibles		825,095			881,014
Others		52,100			42,771
Less: allowance for doubtful accounts		(23,012	)		(23,875	)
Prepayments and other receivables, net	$	1,350,124			1,527,079

Movements of allowance for doubtful accounts are as follows:

	June 30, 2023			December 31, 2022
Beginning balance	$	23,875		$	26,080
Reversal		(863	)		(2,205	)
Ending Balance	$	23,012		$	23,875

Management evaluates the recoverable value of these balances periodically according to the Company’s policy of credit and allowance for doubtful accounts. For the six months ended June 30, 2023, and 2022, the Company recorded bad debt allowances of $23,012 and $24,776, respectively.

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15. PROPERTY, PLANT AND EQUIPMENT

Property, plant, and equipment consisted of the following:

	June 30, 2023			December 31, 2022
Buildings	$	722,432		$	749,526
Office equipment		227,867			132,329
Electronic equipment		35,910			37,257
Furniture		29,651			30,764
Vehicles		145,747			168,512
Medical equipment		891,834			925,281
Leasehold improvements		596,048			598,677
		2,649,489			2,642,346
Less: accumulated depreciation		(959,382	)		(938,926	)
Property, plant and equipment, net	$	1,690,107		$	1,703,420

Depreciation expense for the six months ended June 30, 2023, and 2022 were $58,107 and $89,159, respectively.

16. INTANGIBLE ASSETS

	June 30, 2023			December 31, 2022
Software	$	18,967		$	19,679
Trademark use rights		500,000			-
Less: accumulated amortization		(70,036	)		(3,496	)
Intangible assets, net	$	448,931		$	16,183

The trademark use rights acquired in the six months ended June 30, 2023, relate to the trademarks for products being sold by Phenix. The trademarks relate to nine healthcare products, such as general recovery, cardiovascular and cerebrovascular disease prevention, male health care, female health care, and memory enhancement for the elderly. Amortization expense for the six months ended June 30, 2023, and 2022 were $70,036 and $3,627, respectively.

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17. LEASES

Balance sheet information related to the Company’s operating leases was as follows*:

	June 30, 2023		December 31, 2022
Operating Lease Assets
Operating lease	$	2,835,992	$	2,942,265
Total operating lease assets	$	2,835,992	$	2,942,265
Operating Lease Obligations
Current operating lease liabilities	$	650,661		532,630
Non-current operating lease liabilities	$	2,414,883		2,574,751
Total Lease Liabilities	$	3,065,544		3,107,381

* The Company’s operating leases include the leases of operating companies only and do not include discontinued operations-held for sale.

Lease liability maturities as of June 30, 2023, are as follows:

	June 30, 2023
2023		805,746
2024		816,021
2025		797,854
2026		776,996
2027 and thereafter		438,800
Total minimum lease payments		3,635,417
Less: Amount representing interest		(569,873	)
Total		3,065,544

18. GOODWILL

Changes in the carrying amount of goodwill consisted of the following:

	June 30, 2023		December 31, 2022
Beginning balance	$	2,065,666	$	8,376,217
Disposal of Zhuoda		-		(924,740	)
Impairment during the year		-		(5,385,811	)
Goodwill	$	2,065,666	$	2,065,666

As a result of the impairments recognized on December 31, 2022, the remaining goodwill of the Company was related to the acquisitions of Guanzan and Zhongshan. The remaining goodwill of Guanzan was $1,392,449, and the remaining goodwill of Zhongshan was $673,217 as of December 31, 2022 and June 30, 2023, respectively. As of June 30, 2023, the fair value of these businesses was at risk for future goodwill impairments. The Company continues to monitor for potential impairment should impairment indicators arise.

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19. LOANS

Short-term loans

	June 30, 2023		December 31, 2022
China Minsheng Bank	$	110,714	$	114,867
Postal Savings Bank of China		678,126		703,558
Pingan Bank of China		345,982		-
Total	$	1,134,822	$	818,425

For the six months ended June 30, 2023 and 2022, interest expense on short-term loans amounted to $14,408 and $63,847, respectively.

Pusheng borrowed $345,982 from Pingan Bank of China on May 29, 2023. The loan is due on May 20, 2024, with an interest rate of 8.91%. Pusheng borrowed $110,714 from China Minsheng Banking Corp. Ltd. on March 24, 2023, which is due on March 21, 2024, with an interest rate of 5.50%. Guanzan borrowed $678,126 from Postal Savings Bank of China on December 22, 2022, which is due on December 20, 2023, with an interest rate of 4.50% and the real estate right of Guanzan as the right holder provided a mortgage loan.

Guanzan borrowed $678,126 from Postal Savings Bank of China on December 22, 2022, which is due on December 20, 2023, with an interest rate of 4.50%.

Long-term loans

	June 30, 2023			December 31, 2022
China Construction Bank Chongqing Zhongxian, Sub-branch		-			59,926
We Bank		227.528			360,825
Subtotal of long-term loans		227,528			420,751
Less: current portion		(101,244	)		(105,965	)
Total Long-term loans – noncurrent portion	$	126,284		$	314,786

For the six months ended June 30, 2023 and 2022, interest expense on long-term loans amounted to $23,141 and $41,387, respectively.

Guanzan borrowed $912,500 from We Bank on September 6, 2022, for a term of two years, with an interest rate of 14.40%. Guanzan borrowed $148,571 from Huaneng Guicheng Trust Co., LTD on October 7, 2021, which is due on September 26, 2023, with an interest rate of 12.96% and the general manager of Guanzan provided a personal guarantee for the loan. Guanzan borrowed $300,000 from We Bank on April 26, 2022, which is due on March 26, 2024, with an interest rate of 9.45%. Guanzan borrowed $39,839 from We Bank on July 24, 2021, for a term of two years, with an interest rate of 13.68%. Guanzan borrowed $243,154 from Fudan Bank on February 25, 2021, for a term of three years, with an interest rate of 8.00%.

The combined aggregate amount of interest expenses for all long-term borrowings for each of the five years as of June 30, 2023, are as follows:

	June 30, 2023
July 1, 2023 to June 30, 2024		18,963
July 1, 2024 to June 30, 2025		3,616
Total		22,579

35

20. CONVERTIBLE PROMISSORY NOTES AND EMBEDDED DERIVATIVE INSTRUCTIONS

On May 18, 2020, we entered into a securities purchase agreement (the “May SPA”) with two institutional investors (the “Institutional Investors”) to sell convertible notes having a face amount of up to $6,550,000 at an aggregate original issue discount of 19.85% (the “2020 Notes”) and ranking senior to all outstanding and future indebtedness of the Company. The 2020 Notes did not bear interest except upon the occurrence of an event of default. Each Institutional Investor also received a warrant (the “Institutional Investor 2020 Warrant”) to purchase 13,000 shares of Common Stock (post the Reverse Splits) at an initial exercise price of $142.25 per share (post the Reverse Splits price and subject to the Event Market Price Adjustment). The placement agent for the private placement received a warrant (the “Placement Agent 2020 Warrant”, together with the Institutional Investor 2020 Warrant, the “2020 Warrants”) to purchase up to 10% of the aggregate number of shares of Common Stock at an initial exercise price of $142.25 per share (post the Reverse Splits price and subject to the Event Market Price Adjustment), subject to increase based on the number of shares Common Stock issued pursuant to the 2020 Notes.

Pursuant to the May SPA, two 2020 Notes each in the face amount of $2,225,000 were issued to the Institutional Investors in consideration of the payment of $1,750,000 in cash for each 2020 Note. Pursuant to the May SPA, additional convertible notes in an aggregate original face amount not to exceed $2,100,000 (the “Additional Notes”) could also be issued to the Institutional Investors under certain circumstances.

The May SPA, the 2020 Notes and the warrants provided that each and every reference to share prices, shares of Common Stock and any other numbers therein that relate to the Common Stock will be automatically adjusted for any stock splits, stock dividends, stock combinations, recapitalizations or other similar transactions that occur with respect to the Common Stock (each, a “Stock Combination Event”, and such date thereof, the “Stock Combination Event Date”) thereafter. The May SPA, the 2020 Notes and the 2020 Warrants further provided if after a Stock Combination Event, the Event Market Price is less than the conversion price (in the case of the Convertible Notes) or the exercise price (in the case of the warrants) then in effect (after giving effect to the above adjustments), then on the sixteenth (16th) trading day immediately following such Stock Combination Event Date, the conversion price or exercise then in effect on such sixteenth (16th) trading day (after giving effect to the above adjustments) will be reduced (but in no event increased) to the Event Market Price. “Event Market Price” means, with respect to any Stock Combination Event Date, the quotient determined by dividing (x) the sum of the dollar volume-weighted average price of the Common Stock for each of the five (5) trading days with the lowest dollar volume-weighted average price of the Common Stock during the fifteen (15) consecutive trading day period ending and including the trading day immediately preceding the sixteenth (16th) trading day after such Stock Combination Event Date, divided by (y) five (5). The price adjustment described in this paragraph is hereinafter referred to as the “Event Market Price Adjustment.”

On February 24, 2021, we entered into an amendment to the May SPA with the Institutional Investors to increase the amount of the Additional Notes by $3,300,000 to $5,400,000. On February 26, 2021, Additional Notes in an aggregate original principal amount of $5,400,000 were issued to the Institutional Investors, together with the issuance of warrants to acquire an aggregate of 14,400 shares of Common Stock (post the Reverse Splits) at an initial exercise price of $129.50 per share (post the Reverse Splits price and subject to the Event Market Price Adjustment). The placement agent for the private placement received a warrant to purchase up to 3,475 shares of our Common Stock (post the Reverse Splits) at an initial exercise price of $142.25 per share ((post the Reverse Splits Price and subject to the Event Market Price Adjustment), subject to increase based on the number of shares of Common Stock issued pursuant to the Additional Notes.

36

On November 18, 2021, we entered into a securities purchase agreement (the “November SPA”) with the same two Institutional Investors to sell them in a private placement a series of senior convertible notes (the “2021 Notes”) with an original issue discount of 20% and ranking senior to all outstanding and future indebtedness of the Company. Each Institutional Investor paid $3,250,000 in cash for a 2021 Note in the face amount of $3,900,000. The November SPA also provided for the issuance of additional 2021 Notes in an aggregate original principal amount not to exceed $3,900,000 under certain circumstances. The November SPA also contains provisions about the Market Event Price. The 2021 Notes, which were issued on November 22, 2021, matured on the eighteen-month anniversary of the issuance date, were payable by the Company in installments and convertible at the election of the Institutional Investors at the conversion price of $32.5 (post the Reverse Splits and subject to the Event Market Price Adjustment), which was subject to adjustment in the event of default. Each Institutional Investor also received a warrant (the “Institutional Investor 2021 Warrant”) to purchase 180,000 shares of Common Stock at an initial exercise price of $35.5 per share (post the Reverse Splits and subject to the Event Market Price Adjustment). The placement agent for the private placement received a warrant (the “Placement Agent 2021 Warrant”, together with the Institutional Investor 2021 Warrant, the “2021 Warrants”) to purchase up to 8% of the aggregate number of shares of Common Stock at an initial exercise price of $35.5 per share (post the Reverse Splits and subject to the Event Market Price Adjustment), subject to increase based on the number of shares Common Stock issued pursuant to the 2021 Notes.

The Company implemented a reverse stock split on February 2, 2022, at the ratio of 5 to 1. The 2020 Notes and Additional Notes were fully converted before the February reverse split, and therefore no price adjustment was implemented at the conversion, although the price information provided above about the 2020 Notes and Additional Notes was post-split price. The conversion price of the 2021 Notes and the exercise price of the 2020 Warrants and the 2021 Warrants will be adjusted pursuant to the Event Market Price formula upon conversion or exercise.

Upon evaluation, the Company determined that the two agreements contained embedded beneficial conversion features which met the definition of Debt with Conversion and Other Options covered under the Accounting Standards Codification topic 470 (“ASC 470”). According to ASC 470, an embedded beneficial conversion feature present in a convertible instrument shall be recognized separately at issuance by allocating a portion of the proceeds equal to the intrinsic value of that feature to additional paid-in capital.

	June 30, 2023		December 31, 2022
Convertible note – principal	$	-	$	1,108,785
	$	-	$	1,108,785

Additionally, the Company accounted for the embedded conversion option liability in accordance with the Accounting Standards Codification topic 815, Accounting for Derivative Instruments and Hedging Activities (“ASC 815”) as well as related interpretation of this standard. In accordance with these standards, derivative instruments are recognized as either assets or liabilities in the balance sheet and are measured at fair values with gains or losses recognized in earnings. Embedded derivatives that are not clearly and closely related to the host contract are bifurcated and are recognized at fair value with changes in fair value recognized as either a gain or loss in earnings. The Company determines the fair value of derivative instruments and hybrid instruments based on available market data using appropriate valuation models, giving consideration to all of the rights and obligations of each instrument. The initial fair value of the embedded conversion option liability associated with each Note was valued using the Black-Scholes model. The assumptions used in the Black-Scholes option pricing model are as follows:

	June 30, 2023			December 31, 2022
Dividend yield	$	0	%	$	0	%
Expected volatility		171	%		171	%
Risk free interest rate		0.87	%		0.87	%
Expected life (years)		1.42			1.42

37

The value of the conversion option liability underlying the 2020 Notes, Additional Notes, and 2021 Notes as of June 30, 2023, and December 31, 2022 were nil. The Company recognized a loss from the increase in the fair value of the conversion option liability in the amount of Nil for the six months ended June 30, 2023, and 2022.

Pursuant to the convertible note agreement between the Company and the Institutional Investors, the “Installment Conversion Price” is used for each note conversion except for conversions made when there is an Event of Default as defined in the convertible note agreement, in which event an Alternate Conversion Price is used.

“Installment Conversion Price” means, with respect to a particular date of determination, the lowest of (i) the conversion price fixed in the convertible note agreement, then in effect (the “Conversion Price”), (ii) the greater of (x) the floor price fixed in the note agreement (the “Floor Price”) and (y) 78% of the lowest VWAP of the Common Stock during the ten (10) consecutive trading day period ending and including the trading day immediately preceding the applicable conversion date (the “VWAP Price”).

For any particular conversion, if (y) becomes applicable (i.e. the VWAP Price is lower than the Conversion Price and the Floor Price), because of the mandatory application of the Floor Price, the Floor Price has to be used for the conversion. As a result, the note holder is entitled to a cash amount equal to the value of the difference between the number of shares of Common Stock the note holder would have received if the VWAP Price was used for the conversion, and the number of shares of Common Stock the note holder actually received due to the application of the application of the Floor Price (the “Conversion Installment Floor Amount”).

In 2022 and 2023, instead of paying the Conversion Installment Floor Amount in cash as provided for in the convertible note agreements, the Company paid such amount by issuing shares of Common Stock using the Conversion Price. (the “Floor Amount Issuance”).

As of December 31, 2022, one of the Institutional Investors had converted all of its 2021 Notes into shares of Common Stock while the other Institutional Investor held $3,000 of the 2021 Notes.

In 2022, one of the Institutional Investors received 275,000 shares of Common Stock having a then market value of $200,000 as a result of the application of the of the Floor Amount Issuance and the other Institutional Investor received 1,234,715 shares of Common Stock having a then market value of $493,886 as a result of the application of the Floor Amount Issuance.

In 2022, one of the institutional investors exercised 100,000 warrants on a cashless exercise basis into 44,445 shares of Common Stock having a then market value of $100,000.

During the three months ended March 31, 2023, no shares of Common Stock were issued to the Institutional Investors upon conversion of convertible notes. However, 270,000 shares of Common Stock having a value of $334,800 were issued to one of the Institutional Investors due to the application of the Floor Amount Issuance.

During the three months ended March 31,2023, none of the warrants held by the Institutional Investors were exercised.

During the three months ended June 30, 2023, 2,420 shares were issued to one institutional Investor upon conversion of $3,000 of the 2021 Notes. In addition, 621,762 shares of Common Stock having a value of $770,985 were issued to one Institutional Investor due to the application of the Floor Amount Issuance.

During the three and six month periods ended June 30, 2023, no shares of Common Stock were issued to the two Institutional Investors upon exercise of warrants.

During the six months ended June 30, 2023, 2,420 shares of Common Stock were issued to one Institutional Investor upon conversion of $3,000 of the 2021 Notes. In addition, 891,762 shares of Common Stock having a value of $1,105,785 were issued to the other Institutional Investor due to the application of the Floor Amount Issuance.

38

21. OTHER PAYABLES AND ACCRUED LIABILITIES

Other payables and accrued liabilities consisted of the following:

	June 30, 2023			December 31, 2022
Salary payable	$	331,136		$	411,043
Salary payable – related parties (1)		2,285,333			2,135,333
Accrued operating expenses		(900	)		(900	)
Other payables		589,401			630,097
	$	3,204,970		$	3,175,574

The Company entered into an employment agreement with Mr. Tiewei Song dated October 1, 2019, to serve as its Chief Executive Officer for a term of two years commencing on October 1, 2019, with base annual cash compensation of $500,000. The agreement was renewed on October 28, 2021, for one year with an annual base salary of $1,000,000 in cash and annual stock compensation of 100,000 shares of the Company’s Common Stock (reflecting a 1-to-10 reverse stock split on December 9, 2022). The 100,000 shares of the Company’s Common Stock were issued on January 24, 2022. Mr. Song’s annual compensation was reduced to $300,000 in cash beginning in October 2022 pursuant to an amendment agreement dated June 9, 2022. As of June 30, 2023, the total accrued compensation payable to Mr. Song was $1.5 million.

The Company entered into the employment Agreement with Ms. Baiqun Zhong dated January 27, 2022, as the Interim CFO from May 21, 2021, until July 14, 2021. Ms. Zhong assumed such role once again on September 27, 2021, and her base annual compensation was set at $250,000. Since January 1, 2023, Ms. Baiqun Zhong has been paid a monthly salary of RMB 7,000. As of June 30, 2023, the accrued compensation payable to Ms. Zhong was $265,833. On January 27, 2022, the Company entered into an employment agreement with Mr. Xiaoping Wang for a term of one-year, effective January 1, 2022. Mr. Wang’s compensation consisted of an annual salary of $500,000 in cash and stock compensation of 10,000 shares of the Company’s Common Stock (post the Reverse Splits). We issued 10,000 shares of our Common Stock to Mr. Wang on February 1, 2022. We have not paid any cash compensation to Mr. Wang as of the date of this quarterly report. The Company did not renew the employment agreement with Mr. Wang for 2023. As of June 30, 2023, the accrued compensation payable to Mr. Wang was $500,000.  

On December 23, 2022, Mr. Song and Mr. Wang provided written performance pledges to the Company, whereby they pledged to use their best efforts to ensure that the aggregate amount of the available cash (excluding cash received as loans or capital infusions or cash held in restricted accounts or otherwise unavailable for unrestricted use for any reason) of Chongqing Bimai Pharmaceutical Technology Group Co., Ltd., a subsidiary of Bimai Pharmaceutical (Chongqing) Co., Ltd., and its subsidiaries, as of December 31, 2023, held in bank accounts of financial banking institutions, as audited by the Company’s independent auditors will be not less than $2 million (the “Performance Target”). If the Performance Target is not met by December 31, 2023, Mr. Song will forfeit his unpaid cash salary accrued from October 1, 2021 to September 30, 2022 in the amount of $1 million, and Mr. Wang will forfeit all his unpaid cash salary accrued through the end of 2023 and will return to the Company the 50,000 shares of the Company’s Common Stock he previously received as salary. 

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22. RELATED PARTIES AND RELATED PARTY TRANSACTIONS

Amounts due to related parties and management team.

As of June 30, 2023, and December 31,2022, the total amounts payable to related parties and mid-level management team was $1,018,832 and $2,980,441, respectively, which included:

1. As of June 30, 2023, and December 31, 2022, the amount payable to Mr. Yongquan Bi, the former Chief Executive Officer and Chairman of the Board of directors of the Company was Nil and $27,699, respectively, free of interest and due on demand. The $27,699 represents the remaining balance that Mr. Bi advanced for third party services on behalf of Xinrongxin during the ordinary course of business of Xinrongxin since the beginning of 2018. As the amount was owed by Xinrongxin, which was dissolved as of January 3, 2023, the Company believes that it no longer has any liability for this debt.

2. As of June 30, 2023, and December 31, 2022, the amounts payable to Mr. Li Zhou, the legal representative (general manager) of Guanzan, were Nil and $248,690, respectively. The $248,690 was used for daily operations and payment of third-party professional fees and were interest-free.

3. As of June 30, 2023, and December 31, 2022, the amounts payable to Mr. Fuqing Zhang, the Chief Executive Officer of Xinrongxin, were $Nil and $172,730, respectively. The $172,730 was free of interest and due on demand. The amount due to Mr. Fuqing Zhang represents reimbursable operating expenses that Xinrongxin owed to Mr. Zhang prior to the acquisition of of Xinrongxin. As the amount was owed by Xinrongxin, which was dissolved as of January 3, 2023, the Company believes that it no longer has any liability for this debt.

4. As of June 30, 2023, and December 31, 2022, the amounts payable to Mr. Youwei Xu, the former financial manager of Xinrongxin, were $11,943 and $11,784, respectively. These sums are free of interest and due on demand. The outstanding amounts owed to Mr. Xu is in connection with reimbursable operating expenses that were incurred prior to the acquisition of of Xinrongxin, As the amounts were owed by Xinrongxin, which was dissolved as of January 3, 2023, the Company believes that it no longer has any liability for this debt.

5. As of June 30, 2023, and December 31, 2022, the amounts payable to Shaohui Zhuo, the general manager of Guoyitang, were $4,502 and $4,671, respectively, which amounts were used for daily operations and do not bear any interest.

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6. As of June 30, 2023, and December 31, 2022, the amounts payable to Nanfang Xiao, a director of Guoyitang, were $10,102 and $10,482, respectively. These funds were used for daily operations and were not subject to any interest.

7. As of June 30, 2023, and December 31, 2022, the amounts payable to Jia Song, the manager of Guoyitang, were $4,228 and $4,385, respectively, which amounts were used for daily operations and do not bear any interest.

8. As of December 31, 2022, we owed $2 million to Mr. Fnu Oudom pursuant to a $ 2 million convertible note that was issued on December 6, 2022. The convertible note provided for annual interest of 6%, which was payable together with the principal amount one year after the date of issuance. Mr. Oudom had a conversion right with respect to the principal and interest due on the note at a conversion price of $4.00 per share (reflecting a 1-to-10 reverse stock split on December 9, 2022). The (post reverse split) conversion price of $4.00 reflected a 60% premium on the closing price of the Common Stock on Nasdaq on the date of issuance of the note, which was $0.25. On February 27, 2023, the Company and Mr. Oudom entered into an agreement whereby the Company agreed to exercise its prepayment right under the convertible note by issuing shares of its Common Stock. In consideration of Mr. Oudom’s agreement to convert the convertible note into shares of Common Stock and to waive his right to any and all interest accrued and to be accrued, the Company agreed to issue 1,330,000 shares of Common Stock at a conversion price of $1.50 per share, subject to shareholder approval, as full payment of the $2,000,000 principal and accrued interest. Such issuance was approved by the Company’s shareholders on April 13, 2023, and the shares were issued to Mr. Oudom on June 19, 2023.

9. On July 18, 2022, 1,250,000 shares of Common Stock (reflecting the Reverse Splits) were issued to Mr. Oudom in consideration of the payment $5 million after obtaining the approval of shareholders at the Company’s 2022 annual meeting of shareholders.

10. On February 27, 2023, the Company entered into a stock purchase Agreement with Mr. Oudom, whereby the Company agreed to sell 2,000,000 shares of Common Stock to Mr. Oudom for $3,000,000 in cash, based on a purchase price of $1.50 per share, subject to shareholder approval of the issuance of such shares. The transaction was approved by the Company’s shareholders on April 13, 2023. The Company expects to receive the $3,000,000 in cash from Mr. Oudom and to issue the shares to him by December 2023.

11. On July 5, 2022, we entered into a stock purchase agreement (as amended on February 27, 2023) with Mr. Fnu Oudom, whereby we agreed to acquire 100% of the equity interests in Phenix in consideration of $1,800,000. The transaction closed effective March 15, 2023. The aggregate purchase price for the equity interests in Phenix was $180,000 in cash, which was paid on July 7,2022 and 270,000 shares of Common Stock (reflecting the Reverse Splits), which were issued to Mr. Oudom on June 19,2023 after we obtained shareholder consent. We also agreed to issue an additional 5,000,000 shares of Common Stock if the aggregate net profit generated by Phenix is at least $2,500,000 in calendar year 2023 or in any fiscal quarter of 2023.

12. On October 28, 2022, Mr. Song, the CEO of the Company, loaned the Company $ 500,000. The loan originally had a term of three months from November 3, 2022, to February 3, 2023. No interest was payable if the loan was repaid on time. This loan has not been repaid and pursuant to the agreement, the loan is automatically extended until the principal amount and all accrued interest is paid in full. 1% interest has accrued since March 3, 2023.

23. STOCKHOLDERS’ EQUITY

The Company is authorized to issue 200,000,000 shares of Common Stock, $0.001 par value. As of June 30, 2023, and December 31,2022, there were 6,258,926 shares and 3,764,780 shares outstanding, respectively.

From January 4, 2021, to February 9, 2021, Hudson Bay converted 2020 Notes in the aggregate principal amount of $ 2,150,000 into 276,943 shares of Common Stock.

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From January 4, 2021, to March 1, 2021, CVI converted 2020 Notes in the aggregate principal amount of $ 2,150,000 into 227,731 shares of the Common Stock.

On February 2, 2021, the Company issued 40,000 shares of Common Stock (reflecting the Reverse Splits) in connection with the purchase of Guoyitang Hospital. 

On February 3, 2021, a holder of a convertible note issued on December 16, 2019, converted a part of the note in the aggregate principal amount of $ 74,473 plus interest into 20,706 shares of Common Stock.

On February 11, 2021, the Company issued 100 shares of Common Stock (reflecting the Reverse Splits) to Real Miracle Investments Limited in consideration for consulting services.

On March 26, 2021, the Company issued 40,037 shares of Common Stock (reflecting the Reverse Splits) as part of the Zhongshan acquisition. On September 1, 2023, 39,037 shares of Common Stock were returned to the Company.

On April 20, 2021, the Company issued 80,000 shares of Common Stock (reflecting the Reverse Splits) as partial consideration for the acquisition of the Minkang, Qiangsheng and Eurasia hospitals. On December 9, 2022, 43,600 shares of Common Stock were returned to the Company and on September 1, 2023, 36,400 shares of Common Stock were returned to the Company.

On April 29, 2021, the Company issued 2,00 shares of Common Stock (reflecting the Reverse Splits) as payment for improvements to offices located in Chongqing.

On June 18, 2021, 32,500 shares of Common Stock were issued to an Institutional Investor with respect to its cashless exercise of 650,000 warrants that were issued in 2020.

On July 23, 2021, the Company issued 600 shares of Common Stock (reflecting the Reverse Splits) as payment for salary to three employees.

From August 26, 2021, to November 30, 2021, an Institutional Investor converted $2,400,000 principal amount of the 2020 Notes and Additional Notes into 970,173 shares of Common Stock.

From August 26, 2021, to November 30, 2021, an Institutional Investor converted $3,000,000 principal amount of the 2020 Notes and Additional Notes into 1,183,251 shares of Common Stock.

On August 27, 2021, the Company issued 92,000 shares of Common Stock (reflecting the Reverse Splits) in full payment of the balance of the post-closing consideration for the acquisition of Guanzan.

On September 22, 2021, the Company issued 44,000 shares of Common Stock (reflecting the Reverse Split on February 3, 2022) as the initial consideration for the acquisition of Zhuoda.

On January 7, 2022, the Company issued 60,000 shares of Common Stock (reflecting the Reverse Splits) as the initial consideration for the acquisition of Mali Hospital. On December 9, 2022, 52,000 shares of Common Stock were returned to the Company. And on September 1, 2023, the remaining 8,000 shares of Common Stock were returned to the Company.

On January 24, 2022, the Company issued 100,000 shares of Common Stock (reflecting a 1-to-10 reverse stock split on December 9, 2022) to Mr. Song as part of his compensation.

On January 27, 2022, the Company the Company issued 10,000 shares of Common Stock (post the Reverse Splits) to Mr. Wang as part of his compensation.

On February 1, 2022, the Company issued 1,000 shares of Common Stock (post the Reverse Splits) to Chongqing Jinmujinyang (Jiulongpo) Law Firm (a/k/a in English: Chongqing Kingmoon & Kingyang (Jiulongpo) Law Firm) as payment for services under a legal consulting agreement dated January 1, 2022.

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A 1-for-5 reverse stock split of the Company’s Common Stock became effective on February 3, 2022.

On July 18, 2022, the Company issued 1,250,000 shares of Common Stock (reflecting a 1-to-10 reverse stock split on December 9, 2022) to Mr. Oudom in consideration of an investment of $5 million after obtaining the approval of stockholders at the Company’s 2022 annual meeting of shareholders.

A 1-for-10 reverse stock split of the Company’s Common Stock became effective on December 9, 2022.

On November 23, 2022, the Zhuoda sale transaction closed, when 100% of the equity interests in Zhuoda were transferred to the buyers and 44,000 shares of the Company’s Common Stock (reflecting the Reverse Splits) were returned to the Company as the full consideration.

From January 1, 2022, to December 31, 2022, a converted 2021 Notes in the aggregate principal amount of $2,097,000 into 442,357 shares of Common Stock.

From January 1, 2022, to December 31, 2022, the Institutional Investors. converted $5,700,000 of the 2021 Notes into 1,138,248 shares of Common Stock.

In 2022, one Institutional Investor received 275,000 shares of Common Stock as a result of the Floor Amount Issuance and the other Institutional Investor received 1,234,715 shares; of Common Stock as a result of the Floor Amount Issuance.

In 2022, an Institutional Investor exercised warrants into 44,445 shares of Common Stock.

During the three months ended March 31, 2023, an Institutional Investor was issued  270,000 shares of Common Stock as a result of the Floor Amount Issuance.

During the three months ended June 30, 2023, an Institutional Investor converted $3,000 of 2021 Notes into 2,420 shares of Common Stock.

During the three months ended June 30, 2023, an Institutional Investor was issued 621,762 shares of Common Stock as a result of the Floor Amount Issuance.

On June 19, 2023, Mr. Oudom was issued 270,000 shares of Common Stock (reflecting the Reverse Splits) as partial consideration for the Company’s acquisition of Phenix.

On June 19, 2023, 1,330,000 shares of Common Stock were issued to Mr. Fnu Oudom pursuant to an agreement dated as of February 27, 2023, in consideration for the prepayment of a $2,000,000 convertible promissory note sold by the Company to Mr. Oudom on December 6, 2022.

During the three months ended June 30, 2023, 2,420 shares were issued to an Institutional Investor upon conversion of $3,000 of 2021 Notes. In addition, 621,762 shares were issued to the Institutional Investor due to the Floor Amount Issuance.

During the three months ended June 30, 2023, there is no shares were issued to two institutional investors upon exercise of warrants.

During the six months ended June 30, 2023, 270,000 shares of Common Stock were issued to an Institutional Investor due to the Floor Amount Issuance.

From the legal perspective, the reverse splits applied to the issued shares of Common Stock of the Company did not have any retroactive effect on the Company’s shares prior to those dates. However, for accounting purposes only, references to our Common Stock are stated as having been retroactively adjusted and restated to give effect to the reverse splits, as if the reverse splits had occurred by the relevant earlier date.

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24. NET INCOME (LOSS) PER SHARE

Basic net loss per share is computed using the weighted average number of shares of Common Stock outstanding during the year. The dilutive effect of potential shares of Common Stock outstanding is included in diluted net loss per share. Due to the Company’s net loss from its continuing operations, all potential common share issuances had anti-dilutive effect on net loss per share. The following table sets forth the computation of basic and diluted net loss per share for the six months ended June 30, 2023, and 2022:

	For the six months ended June 30,
	2023			2022
Net income (loss)  from continuing operation attributable to common shareholders	$	1,987,491		$	(9,114,986	)
Net loss from discontinued operation attributable to common shareholders		(143,102	)		(171,810	)
Total net income (loss) attributable to common shareholders		1,844,389			(9,286,796	)
Weighted average number of common shares outstanding – Basic and diluted		4,219,675			15,429,754
loss per share – basic and diluted:
Income (loss) from continuing operations	$	0.47	)	$	(0.59	)
Income (loss) from discontinued operations		(0.03	)		(0.01	)
Total	$	0.44		$	(0.60	)

25. SEGMENTS

General Information of Reportable Segments:

As of June 30, 2023, the Company had four operating segments: retail pharmacy, wholesale pharmaceuticals, wholesale medical devices and healthcare products. The retail pharmacy segment sells prescription and OTC medicines, TCM, healthcare supplies and sundry items to retail customers through its directly owned pharmacies and authorized retail stores. The wholesale pharmaceuticals segment includes supplying prescription and OTC medicines, TCM, healthcare supplies and sundry items to clinics, third party pharmacies, hospitals, and other drug wholesalers. There were no inter-segment revenues between our retail pharmacy and wholesale pharmaceuticals segments. The wholesale medical device segment distributes medical devices, including medical consumables to private clinics, hospitals, third party pharmacies and other medical device dealers. Healthcare products include dietary supplements such as a cardiovascular product, an anti-insomnia and depression product, a male aphrodisiac product, a women’s menopausal syndrome product, a gout product, and an immunity product.

As of June 30, 2022, the Company had four reportable segments: wholesale medical devices, wholesale pharmaceuticals, medical services, and retail pharmacies. The wholesale medical devices segment distributes medical devices, including medical consumables to drug stores, private clinics, pharmaceutical dealers, and hospitals. The wholesale pharmaceuticals segment includes supplying prescription and OTC medicines, TCM, healthcare supplies and sundry items to clinics, third party pharmacies, hospitals, and other drug vendors. The medical services segment included the hospitals acquired in 2021.The retail pharmacy segment sells prescription and OTC medicines, traditional Chinese medicines (“TCM”), healthcare supplies, and sundry items to retail customers through its directly owned pharmacies and authorized retail stores.

To date, there have limited inter-segment revenues between our segments, consisting of wholesale pharmaceuticals and retail pharmacies.

The segments’ accounting policies are the same as those described in the summary of significant accounting policies. The Company’s chief operating decision maker (“CODM”), who is the CEO of the Company, evaluates performance of each of the segments based on profit or loss from continuing operations net of income tax.

The Company’s reportable business segments are strategic business units that offer different products. Each segment is managed independently because they require different operations and markets to distinct classes of customers. 

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Information about Operating Segment Profit or Loss and Segment Assets

BIMI, as the holding company, incurred a significant amount of general operating expenses, such as financing costs, that the Company’s chief operating decision maker did not allocate to segments to evaluate the segments performance and allocate recourses of the Company. In addition, except for depreciation and amortization of long-lived assets, the Company does not allocate the change in fair value of derivative liabilities and the amortization of discount of convertible notes to reporting segments in its reported profit or loss. The following amounts were used by the chief operating decision maker.

For six months ended June 30, 2023	Retail pharmacy			Wholesale medical devices			Wholesale pharmaceuticals			Healthcare products		Medical services			Others			Total
Revenues from external customers	$	480,205		$	1,051,385		$	1,928,388		$	5,295,325	$	-		$	-		$	8,755,303
Cost of revenues	$	357,836		$	805,574		$	1,813,422		$	1,202,013	$	-		$	2,137		$	4,180,982
Depreciation, depletion, and amortization expense	$	9,049		$	11,300		$	-		$	79,449	$	-		$	2,517		$	102,315
Profit (loss)	$	(194,401	)	$	(106,312	)	$	(169,748	)	$	3,842,311	$	(22,309	)	$	(1,362,049	)	$	1,987,492
Total assets	$	294,548		$	3,128,979		$	12,531,453		$	6,372,681	$	998,867		$	7,759,486		$	31,086,014

For six months ended June 30, 2022	Retail pharmacy			Wholesale medical devices		Wholesale pharmecuticals			Medical services			Others			Total
Revenues from external customers	$	505,003		$	2,828,557	$	2,055,417		$	-		$	154,768		$	5,543,745
Cost of revenues	$	223,032		$	2,415,231	$	1,962,623		$	123		$	97,813		$	4,698,822
Depreciation, depletion, and amortization expense	$	10,229		$	24,152	$	154		$	-		$	54,624		$	89,159
Profit (loss)	$	(291,344	)	$	1,224	$	(257,769	)	$	(65,421	)	$	(5,136,229	)	$	(5,749,539	)
Total assets	$	337,795		$	3,750,466	$	7,979,593		$	1,102,730		$	18,937,103		$	32,107,687

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26. ENTITY-WIDE INFORMATION AND CONCENTRATIONS OF RISK

Entity-Wide Information

(a) Revenues from each type of products

For the six months ended June 30, 2023, and 2022, respectively, the Company reported revenues for each segment as follows:

	For the six months ended June 30,
	2023		2022
Medical devices	$	1,051,385	$	2,828,557
Healthcare products		5,295,325		-
Wholesale pharmaceuticals		1,928,388		2,055,417
Pharmacy retail		480,205		505,003
Other		-		154,768
Total	$	8,755,303	$	5,543,745

(b) Geographic areas information

For the six months ended June 30, 2023, all of the Company’s revenues were generated in the PRC and the United States, of which, Phenix accounted for $5.29 million of the revenues.

For the six months ended June 30, 2022, all the Company’s revenues were generated in the PRC. There were no long-lived assets located outside of the PRC as of June 30, 2022.

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(c) Major customers

For the six months ended June 30, 2023, one customer accounted for more than 10% of the Company’s revenues:

		For the six months ended
		June 30, 2023
Customers	Segment	Revenue		Percentage of total Revenue
Customer A	Healthcare products	$	5,295,325		60.48	%

(d) Major vendors

For the six months ended June 30, 2023, one vendor accounted for more than 10% of the Company’s purchases as of June 30, 2023:

		For the six months ended					As of June 30,
		June 30, 2023					2023
Vendors	Segment	Purchases		Percentage of total purchases			Accounts payable
Vendor A	Wholesale pharmaceuticals	$	442,323		11.22	%		-

Concentrations of Risk

The Company is exposed to the following concentrations of risk:

(a) Credit risk

Financial instruments that are potentially subject to credit risk consist principally of trade receivables. The Company believes the concentration of credit risk in its trade receivables is substantially mitigated by its ongoing credit evaluation process and relatively short collection terms. The Company does not generally require prepayments or deposits from customers. The Company evaluates the need for an allowance for doubtful accounts based upon factors surrounding the credit risk of specific customers, historical trends, and other information.

(b) Interest rate risk

The Company’s interest-rate risk arises from convertible promissory notes, short-term and long-term loans. The Company manages interest rate risk by varying the issuance and maturity dates, fixing interest rate of debt, limiting the amount of debt, and continually monitoring the effects of market changes in interest rates. As of June 30, 2023, and December 31, 2022, respectively, the Notes, short-term and long-term loans were at fixed rates.

(c) Exchange rate risk

Substantially all of the Company’s revenues and a majority of its costs are denominated in RMB and a significant portion of its assets and liabilities are denominated in RMB. As a result, the Company’s results of operations may be affected by fluctuations in the exchange rate between US$ and RMB. If the RMB depreciates against the US$, the value of RMB revenues and assets as expressed in US$ financial statements will decline. The Company does not hold any derivative or other financial instruments that expose to substantial market risk.

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(d) Economic and political risks

The Company’s operations are conducted in the PRC. Accordingly, the Company’s business, financial condition and results of operation may be influenced by the political, economic, and legal environment in the PRC, and by the general state of the PRC economy. The outbreak of COVID-19 pandemic has expanded all over the world since the beginning of 2020, which has greatly slowed the growth of the global economy, including the PRC, and this effect may continue until the pandemic is controlled, or a vaccine or cure is developed. The slowdown of the growth of the PRC’s economy has adversely effected our current business and future success will be adversely affected if we are unable to capitalize on the opportunities arising from the increasing demand for medicine and medical devices in the markets in which we operate.

The Company’s operations in the PRC are subject to special considerations. These include risks associated with, among others, the political, economic, and legal environment and foreign currency exchange. The Company’s results may be adversely affected by changes in the political and social conditions in the PRC, and by changes in governmental policies with respect to laws and regulations, anti-inflationary measures, currency conversion, remittances abroad, and rates and methods of taxation.

27. SUBSEQUENT EVENTS

On September 1, 2023, 39,037 shares of Common Stock were returned to the Company by the prior owner of Zhongshan pursuant to an agreement dated December 28, 2022 whereby the Company agreed to transfer 87% of the equity interests in Zhongshan to the prior owner. Such shares were partial consideration for the transfer. 1,000 shares of Common Stock were returned in the form of cash on September 30, 2023 because the 1,000 shares were sold by the prior owner.

On September 1, 2023, 36,400 shares of Common Stock were returned to the Company by the prior owner of the Qiangsheng, Eurasia and Minkang hospitals pursuant to an agreement dated December 28, 2022 whereby the agreed to transfer 90% of the equity interests in the Qiangsheng, Eurasia and Minkang hospitals to their prior owners. Such shares were partial consideration for the transfer.

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Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations.

The following discussion of our financial condition and results of operations should be read in conjunction with our unaudited condensed consolidated financial statements and the notes to those financial statements appearing elsewhere in this Report.

Certain statements in this Report constitute forward-looking statements. These forward-looking statements include statements, which involve risks and uncertainties, regarding, among other things, (a) our projected sales, profitability, and cash flows, (b) our growth strategy, (c) anticipated trends in our industry, (d) our future financing plans, and (e) our anticipated needs for, and use of, working capital. They are generally identifiable by use of the words “may,” “will,” “should,” “anticipate,” “estimate,” “plan,” “potential,” “project,” “continuing,” “ongoing,” “expects,” “management believes,” “we believe,” “we intend,” or the negative of these words or other variations on these words or comparable terminology. In light of these risks and uncertainties, there can be no assurance that the forward-looking statements contained in this filing will in fact occur. You should not place undue reliance on these forward-looking statements.

The forward-looking statements speak only as of the date on which they are made, and, except to the extent required by federal securities laws, we undertake no obligation to update any forward-looking statements to reflect events or circumstances after the date on which the statements are made or to reflect the occurrence of unanticipated events.

As used herein the terms “we”, “us”, “our,” “BIMI” and the “Company” mean, BIMI International Medical, Inc., a Delaware corporation and its subsidiaries.

OVERVIEW

From 2007 until October 2019, we, through the NF Group, were engaged in the energy efficiency enhancement business. With the decline in the constructions of power generation plants and municipal water, gas, heat and energy pipelines in China due to a policy change by the PRC government, the demand for our products and services declined markedly. As a result, our energy efficiency enhancement business, incurred operating losses in each of the last seven years, especially in 2018, when the PRC government adopted a series of policies to favor more environmentally friendly projects and products. Our net loss from the operation of the energy efficiency enhancement business was $16.79 million in 2018 and $2.18 million in 2019. We explored many different alternatives in an effort to revive this business, including attempts to expand into international markets, before we determined this business was not sustainable for us. In late 2019, we committed to a plan to dispose of the NF Group and on March 31, 2020, we entered into an agreement for the sale of the NF Group. The sale closed on June 23, 2020 when the $10 million sales price was paid to us in full.

On October 14, 2019, we acquired Boqi Zhengji, an operator of a pharmacy chain business in the PRC. This was the first step of our shift of focus from the energy sector to the healthcare business. Boqi Zhengji, however, suffered significant setbacks during 2020. The COVID-19 pandemic caused the pharmacy stores to record almost no sales for several months due to the national shutdown order and other government orders specifically targeting OTC drugs. To avoid exposing our Company to further risks and potential joint liabilities, we decided to divest the pharmacy chain. On December 11, 2020, we entered into an agreement to sell Boqi Zhengji for $1,700,000 in cash. On December 18, 2020, we received the full consideration from the buyer and the control of the Boqi Zhengji business was transferred. Due to the Chinese government’s alternative working schedule and other delays caused by COVID-19, the government record reflecting the transfer of ownership was not updated until February 2, 2021.

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On March 18, 2020, the Company through its wholly owned subsidiary, Xinrongxin, acquired 100% of the equity interests in Chongqing Guanzan Technology Co., Ltd. (“Guanzan”). Guanzan held an 80% equity interest in Chongqing Shude Pharmaceutical Co., Ltd. (“Shude”, and collectively with Guanzan, the “Guanzan Group”. On April 9, 2021, we increased our equity interest in Shude from 80% to 95.2% by making a direct capital investment in Shude.

In May 2020, Guanzan established Chongqing Lijiantang Pharmaceutical Co. Ltd., a subsidiary which operates four retail pharmacy stores in China (collectively, the “Lijiantang Pharmacy Group”). 

 On February 2, 2021, we acquired Guoyitang, the owner and operator of a private general hospital in Chongqing. The Guoyitang acquisition was the first step in our efforts to build a hospital chain specializing in obstetrics and gynecology.

On February 8, 2021, we acquired Zhongshan, a private hospital in the southeast region of China with. The Zhongshan acquisition was the second step in our effort to establish a nationwide hospital chain specializing in obstetrics and gynecology. 

On April 9, 2021, we acquired three private hospitals operating in China, Wuzhou Qiangsheng Hospital Co.,Ltd.(“Qiangsheng”) in the southeast region of the PRC, Suzhou Eurasia Hospital Co.,Ltd. (“Eurasia”) in the central region of the PRC and Yunan Yuxi Minkang Hospital Co.,Ltd.(“Minkang”) in the southwest region of the PRC.

Our hospitals performed poorly in 2022 due in great measure to the impact of COVID-19 and the PRC’s policies to combat its spread. In response to their poor performance, we entered into agreements to sell back the Zhongshan, Qiangsheng, Eurasia and Minkang hospitals to their original owners and ceased the operation of Guoyitang.

On December 28, 2022, we entered into an agreement to transfer 87% of the equity interests in Zhongshan to the prior owner and will retain 13% of the equity interests in Zhongshan. As consideration for the transfer and pursuant to an amendment to the original stock purchase agreement, the original seller agreed to return the 40,037 shares of Common Stock previously issued (reflecting the two reverse stock splits 1-for- 5 reverse split on February 3, 2022, and a 1-for- 10 reverse split on December 9, 2022 (the “Reverse Splits”)) and RMB 40,000,000 in cash (approximately ($6,116,207) previously paid upon the acquisition of Zhongshan. The former owner also agreed to release the Company from any and all claims relating to two earn out payments that were payable under the original purchase agreement. The Company received a put option to sell part or all of its 13% interest in Zhongshan before December 31, 2032, based on a valuation determined by a reputable third-party appraisal firm jointly chosen by the two parties. On September 1, 2023, 39,037 shares of Common Stock were returned to the Company. The remaining 1,000 shares were returned in the form of a $3,055 cash payment because the shares were sold by the original seller. The transaction is expected to close by December 31, 2023, at which time the cash paid at the time of the acquisition will also be returned.

On December 28, 2022, we entered into an agreement to transfer 90% of the equity interests in the Qiangsheng, Eurasia and Minkang hospitals to their former owners and will retain 10% of the equity interests in each hospital. As consideration for the transfer and pursuant to an amendment to the original stock purchase agreement, the original sellers agreed to return the 80,000 shares of Common Stock previously issued (reflecting the Reverse Splits) and RMB 20,000,000 (approximately $2,767,860) in cash previously paid upon the acquisition of the three hospitals. The former owner also agreed to release the Company from any and all claims relating to two earn out payments that were payable under the original purchase agreement. The Company received a put option to sell part or all of its 10% interest in each of the three hospitals to the former owner before December 31, 2032, based on a valuation determined by a reputable third-party appraisal firm jointly chosen by the parties. On December 9, 2022, 43,600 shares of Common Stock were returned to us and on September 1, 2023, 36,400 shares of Common Stock were returned to us. The transaction is expected to close by December 31, 2023, at which time the cash paid at the time of the acquisitions will also be returned.

The actions taken to dispose of the majority of our ownership interests in the Zhongshan, Qiangsheng, Eurasia and Minkang hospitals resulted in our classifying these hospitals as held for sale operations according to ASC 205-20 Presentation of Financial Statements – Discontinued Operation. As a result, all of the assets and liabilities of the Zhongshan, Qiangsheng, Eurasia and Minkang hospitals were reclassified as assets and liabilities of held for sale operations in the statement of position as of December 31, 2022 and June 30, 2023 and the results of the operation are presented under the line item net loss from held for sale operations for the six months ended June 30, 2023. The Company also hired a third party to perform annual valuation report for these assets. The impairment adjustment was performed based on the valuation report for the year ended December 31, 2022 as well.

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On September 10, 2021, we acquired Chongqing Zhuoda Pharmaceutical Co., Ltd. (“Zhuoda”), a company engaged in the distribution of medical devices and pharmaceuticals, based in Chongqing, the largest city in Southwest region of the PRC.

In response to the poor performance of Zhuoda, whose operations were impacted by COVID-19, we entered into a sale and purchase agreement to sell Zhuoda back to the former owners. Pursuant to the agreement, we sold 100% of the equity interests in Zhuoda in consideration for the return of the 44,000 shares of Common Stock (reflecting the Reverse Split). previously issued to the former owners of Zhuoda. The transaction closed effective November 23, 2022, when the 44,000 shares of Common Stock were returned to us.

On July 5, 2022, we entered into a stock purchase agreement (as amended on February 27, 2023) with Mr. Fnu Oudom, the Chairman of our board of directors, whereby we agreed to acquire 100% of the equity interests in Phenix Bio Inc. (“Phenix”), a distributor of dietary supplements in consideration of $1,800,000. The transaction closed effective March 15, 2023. The aggregate purchase price for the equity interests in Phenix was (i) $180,000 in cash paid on July 7, 2022 and (ii) 270,000 shares of Common Stock (reflecting the Reverse Splits) which were issued on June 19, 2023, following our obtaining shareholder approval the transaction. We also agreed to issue 5,000,000 shares of Common Stock to Mr. Oudom if the aggregate net profit for Phenix is at least $2,500,000 in calendar 2023, or in any fiscal quarter in 2023.

Restatements

We are in the process of restating our financial statements for year ended December 31, 2022 and the quarterly periods ended March 31, 2022, June 30, 2022, September 30, 2022 and March 31, 2023, to correct errors identified in our prior financial statements. We have concluded that the restatements do not materially affect our liquidity or our compliance with debt covenants or other financial obligations.

(1)     We are in the process of restating the Consolidated Statements of Equity for the quarterly periods ended June 30, 2022 and September 30, 2022. The restatement relates to the stockholders’ equity and noncontrolling interests presented in the consolidated balance sheets, as of June 30, 2022 and September 30, 2022, which had been presented in the form of a reconciliation of the beginning balance to the ending balance for each period for which a consolidated statement of comprehensive income was required to be filed.  We will provide reconciliations for the interim periods covered by the Consolidated Statement of Equity for the periods ended June 30, 2022 and September 30, 2022.  This restatement should not have any effect on net income, per-share amount, or retained earnings and other components of equity or net assets for prior filing and current filing. We have concluded that the restatement does not materially affect our liquidity or our compliance with debt covenants or other financial obligations.

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(2)     On June 9, 2022, the Company issued a $5 million subordinated promissory note, which was converted into 1,250,000 shares of the Company’s Common Stock (post the December 2022 1 to 10 reverse split) on July 18, 2022, upon obtaining shareholder approval for the transaction. We erroneously reflected the proceeds of the promissory note in the Consolidated Statements of Cash Flows as “Issuance of Common Stock” for the six month period ended June 30, 2022.   We failed to reflect this promissory note as a note payable as of June 30, 2022. As a result, we are in the process of restating our financial statements for the quarterly period ended June 30, 2022. This restatement did not effect our net income, per-share amounts, retained earnings or other components of equity or net assets for prior filings and the current filing. We have concluded that the restatement does not materially affect our liquidity or our compliance with debt covenants or other financial obligations.

(3)     We restated our financial statements for the year ended December 31, 2021 and are in the process of restating the our financial statements for the quarterly period ended June 30, 2022 to correct errors identified in our prior financial statements. In the year ended December 31, 2021 and the quarterly periods ended March 31, 2022 and June 30, 2022, we recorded amortization of convertible notes as a general and administrative expense in error. We have revised the financial statements for the year ended December 31, 2021 and the six months ended June 30, 2022 and are in the process of revising our financial statements for the quarterly period ended March 31, 2022 to record the amortization of convertible notes as an “other expense”. The impact of the restatement on our financial statements is the reclassification of such expense as an “other expense”. The reclassification also affected the classification of such expense in the Consolidated Statements of Cash Flows. We have also amended various footnotes to the financial statements. We restated our financial statements for the year ended December 31, 2021 and are in the process of restating the financial statements for the year ended December 31, 2022 and the quarterly periods ended March 31, 2022, June, 30, 2022 and September 30, 2022 to correct this issue. This restatement did not affect our net income (loss) , net income (loss) per-share, retained earnings or other components of equity or net assets for our prior filings and the current filing. We have concluded that the restatement does not materially affect our liquidity or our compliance with debt covenants or other financial obligations.

(4)     We are in the process of restating our financial statements for the year ended December 31, 2022, where we incorrectly accounted for the acquisition of Phenix. On July 5, 2022, we entered into a stock purchase agreement, which was subsequently amended, pursuant to which we agreed to acquire Phenix and paid a deposit of $180,000 on July 7, 2022. The closing did not occur until March 15, 2023.  As of December 31, 2022, the accounting for the Phenix acquisition was incorrectly recorded as follows: (1) a long-term equity investment as a debit entry, (2) cash as a credit, and (3) other payables as a credit entry. Since the Phenix acquisition had not taken place as of December 31, 2022, it should not have been recorded as a long-term equity investment. As such, we reversed the long-term equity investment account and other payables account and recorded the deposit as a prepayment. This restatement did not affect our net income, per-share amounts, or retained earnings, but affected the net assets in the quarterly period ended March 31, 2023. We have concluded that the restatement does not materially affect our liquidity or other financial obligations.

(5)       We are in the process of restating the Consolidated Statements of Cash Flows for the quarterly periods ended June 30, 2022, September 30, 2022, March 31, 2023 and for the year ended December 31, 2022. The restatement relates to the discontinued entities' cashflow presented in the Consolidated Statements of Cash Flows, for the quarterly periods ended June 30, 2022, September 30, 2022, March 31, 2023, and for the year ended December 31, 2022, which have not presented in the prior period filling. In the restated Consolidated Statements of Cash Flows, we will present the discontinued entities’ cash flows in the Consolidated Statements of Cash Flows instead of zero. This restatement does not affect net income (loss), net income (loss) per-share, or retained earnings and other components of equity or net assets in our prior filings or in our current filing. We have concluded that the restatement does not materially affect our liquidity or our compliance with debt covenants or other financial obligations.  

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We are taking steps to address the causes of the restatements and to improve our internal controls over financial reporting. We are in the process of hiring a new third-party consulting firm to assist us in strengthening our daily internal controls and financial reporting process review. We also aim to improve our internal accounting department management as well. We are committed to maintaining the integrity of our financial statements and to provide accurate and transparent financial information to our investors.

GOING CONCERN

The accompanying unaudited condensed consolidated financial statements have been prepared assuming that the Company will continue as a going concern, which contemplates the realization of assets and the discharge of liabilities in the normal course of business for the foreseeable future.

We incurred net losses of $22,318,056 and $$34,921,745 in the years ended December 31, 2022 and 2021 and had an. accumulated deficit of $69,249,828 as of June 30, 2023. Management believes these factors raise substantial doubt about the Company’s ability to continue as a going concern for the next twelve months.

The continuation of the Company as a going concern through the next twelve months is dependent upon (1) the continued financial support from our stockholders or external financing. Management believes that our existing stockholders will provide the additional cash necessary to meet our obligations as they become due, and (2) that we will be able to implement our business plan to expand our company’s operations and generate sufficient revenues to meet our obligations. While we believe in the viability of our strategy to increase sales volume and in our ability to raise additional funds, there can be no assurance to that effect, nor that our company will be successful in securing sufficient funds to sustain the operations.

These conditions raise substantial doubt about the Company’s ability to continue as a going concern. These unaudited condensed financial statements do not include any adjustments to reflect the possible future effect on the recoverability and classification of assets or the amounts and classifications of liabilities that may result from the outcome of these uncertainties. Management believes that the actions presently being taken to obtain additional funding and implement its strategic plan provides the opportunity for the Company to continue as a going concern.

CRITICAL ACCOUNTING POLICIES AND ESTIMATES

Our discussion and analysis of our financial condition and results of operations are based on our financial statements, which have been prepared in accordance with U.S. generally accepted accounting principles. The preparation of these financial statements requires us to make estimates and judgments that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting periods. On an on-going basis, we evaluate our estimates and judgments, including those related to revenue, receivable, inventory, and accrued expenses. We base our estimates on historical experience, known trends and events and various other factors that we believe to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions. Changes in estimates are recorded in the period in which they become known.

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We believe the following critical accounting policies affect our more significant judgments and estimates used in the preparation of our consolidated financial statements.

● Use of estimates

The preparation of our consolidated financial statements in conformity with the US GAAP requires management to make estimates and judgments that affect the reported amounts of assets and liabilities, disclosures of contingent assets and liabilities on the date of these condensed consolidated financial statements and the reported amounts of revenues and expenses during the reporting periods. The Company bases its estimates and judgments on historical experience and on various other assumptions and information that are believed to be reasonable under the circumstances. Estimates and assumptions of future events and their effects cannot be perceived with certainty and, accordingly, these estimates may change as new events occur, as more experience is acquired, as additional information is obtained and as our operating environment changes. Significant estimates and assumptions made by management include, among others, useful lives and impairment of long-lived assets, collectability of accounts receivable, advances to suppliers, allowance for doubtful accounts, reserve for inventory obsolescence, fair value of goodwill and valuation of derivative liabilities. While the Company believes that the estimates and assumptions used in the preparation of these condensed consolidated financial statements are appropriate, actual results could differ from those estimates. Estimates and assumptions are periodically reviewed, and the effects of revisions are reflected in the consolidated financial statements in the period they are determined to be necessary.

● Accounts receivable and allowance for doubtful accounts

Accounts receivables are recorded at the invoiced amount and do not bear interest, which are due within contractual payment terms, generally 30 to 90 days from delivery. Credit is extended based on evaluation of a customer’s financial condition, the customer creditworthiness and their payment history. Accounts receivable outstanding longer than the contractual payment terms are considered past due. Past due balances over 90 days and over a specified amount are reviewed individually for collectability. At the end of each period, the Company specifically evaluates individual customer’s financial condition, credit history, and the current economic conditions to monitor the progress of the collection of accounts receivables. For the receivables that are past due or not being paid according to payment terms, the appropriate actions are taken to exhaust all means of collection, including seeking legal resolution in a court of law. Account balances are charged off against the allowance after all means of collection have been exhausted and the potential for recovery is considered remote. We do not have any off-balance-sheet credit exposure related to our customers.

● Advances to suppliers

Advances to suppliers consist of prepayments to the Company’s vendors, such as pharmaceutical manufacturers and medicine suppliers. The Company typically prepays for the purchase of our merchandise, especially for those salable, scarce, personalized medicine or medical devices. The Company typically receive products from vendors within three to nine months after making prepayments. The Company continuously monitor delivery from, and payments to, the vendors while maintaining a provision for estimated credit losses based upon historical experience and any specific supplier issues, such as discontinuing of inventory supply, that have been identified. If the Company has difficulty receiving products from a vendor, the Company will cease purchasing products from such vendor, request return of our prepayment promptly, and if necessary, take legal action. The Company has not taken such type of legal action during the reporting periods. If none of these steps are successful, management will then determine whether the prepayments should be reserved or written off. As of June 30, 2023, and December 31, 2022, the allowance for doubtful accounts were Nil.

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● Inventories

Inventories are stated at the lower of cost or market value. Cost is determined using the weighted average method, and market value is the middle (the second highest) value among an inventory item’s replacement cost, market celling and market floor. The Company carries out physical inventory counts on a monthly basis at each store and warehouse location. The Company reviews historical sales activity quarterly to determine excess, slow-moving items and potentially obsolete items. The Company provides inventory reserve based on the excess quantities on hand equal to the difference, if any, between the cost of the inventory and its estimated market value, or obsolescence of inventories determined principally by customer demand. As of June 30, 2023, and December 31, 2022, the Company recorded an allowance for obsolete inventories, which mainly consists of expired medicine, of $26,604 and $584, respectively.

● Property, plant, and equipment

Property, plant, and equipment are stated at cost less accumulated depreciation and impairment, if any. Depreciation is calculated on the straight-line basis over the following expected useful lives from the date on which they become fully operational and after taking into account their estimated residual values:

Items	Expected useful lives	Residual value
Building	20 years		5	%
Office equipment	3 years		5	%
Electronic equipment	3 years		5	%
Furniture	5 years		5	%
Medical equipment	10 years		5	%
Vehicles	4 years		5	%
Leasehold Improvement	Shorter of lease term or useful life		5	%

Expenditures for repairs and maintenance are expensed as incurred. When assets have been retired or sold, the cost and related accumulated depreciation are removed from the accounts and any resulting gain or loss is recognized in the results of operations.

● Intangible assets

Intangible assets consist primarily of management system software. Intangible assets are stated at cost less accumulated amortization and impairment, if any. Intangible assets are amortized using the straight-line method with the following estimated useful lives:

	Expected useful lives
Software	10 years

● Leases

On January 1, 2020, we adopted Accounting Standards Update (“ASU”) 2016-02. For all leases that were entered into prior to the effective date of ASC 842, we elected to apply the package of practical expedients. Based on this guidance, we did not reassess the following: (1) whether any expired or existing contracts are or contain leases; (2) the lease classification for any expired or existing leases; and (3) initial direct costs for any existing leases.

We determine if an arrangement is a lease at inception. Operating leases are included in operating lease right-of-use (“ROU”) assets, current portion of obligations under operating leases, and obligations under operating leases, non-current on our consolidated balance sheets. Finance leases are included in property and equipment, net, current portion of obligations under capital leases, and obligations under capital leases, non-current on our consolidated balance sheets.

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Operating lease ROU assets and operating lease liabilities are recognized based on the present value of the future minimum lease payments over the lease term at commencement date, adjusted by the deferred rent liabilities at the adoption date. As most of our leases do not provide an implicit rate, we use our incremental borrowing rate based on the information available at commencement date in determining the present value of future payments. The operating lease ROU asset also includes any lease payments made and excludes lease incentives and initial direct costs incurred. The terms may include options to extend or terminate the lease when it is reasonably certain that we will exercise that option. Operating lease expense is recognized on a straight-line basis over the lease term.

● Goodwill

Goodwill represents the excess of the consideration paid of an acquisition over the fair value of the net identifiable assets of the acquired subsidiary at the date of acquisition. Goodwill is not amortized, and is tested for impairment at least annually, more often when circumstances indicate impairment may have occurred. Goodwill is carried at cost less accumulated impairment losses. If impairment exists, goodwill is immediately written off to its fair value and the loss is recognized in the consolidated statements of operations and comprehensive loss. Impairment losses on goodwill are not reversed.

The Company reviews the carrying value of intangible assets not subject to amortization, including goodwill, to determine whether impairment may exist annually or more frequently if events and circumstances indicate that it is more likely than not that an impairment has occurred. The Company has the option to assess qualitative factors to determine whether it is necessary to perform the two-step in accordance with ASC 350-20. If the Company believes, as a result of the qualitative carrying amount, the two-step quantities impairment test described below is required.

The first step compares the fair value of each reporting unit to its carrying amount, including goodwill. If the fair value of each reporting unit exceeds its carrying amount, goodwill is not considered to be impaired and the second step will not be required.

If the carrying amount of a reporting unit exceeds its fair value, the second step compares the implied fair value of goodwill to the carrying value of a reporting unit’s goodwill. The implied fair value of goodwill is determined in a manner similar to accounting for a business acquisition with the allocation of the assessed fair value determined in the first step to the assets and liabilities of the reporting unit. The excess of the fair value of the reporting unit over the amounts assigned to the assets and liabilities is the implied fair value of goodwill. Estimating fair value is performed by utilizing various valuation techniques, with the primary technique being a discounted cash flow. The fair value of discounted cash flow is determined using management’s estimates and assumptions.

Management evaluates the recoverability of goodwill, with the assistance of a third-party evaluation firm. If we reorganize our reporting structure in a manner that changes the composition of one or more of our reporting units, goodwill will be reassigned based on the relative fair value of each of the affected reporting units.

As of June 30, 2023 and December 31, 2022, the Company recorded impairments for goodwill of Nil and $5,385,811, respectively.

As a result of the impairments recognized on December 31, 2022, the remaining goodwill of the Company was related to the acquisitions of Guanzan and Zhongshan. The remaining goodwill of Guanzan was $1,392,449 and the remaining goodwill of Zhongshan was $673, 217 as of December 31, 2022 and June 30,2023. As of June 30,2023, the fair value of these businesses was at risk for future goodwill impairments, based on the continuation of negative macroeconomic conditions, which could represent potential indicators of impairment requiring further impairment analysis in 2023. The Company continues to monitor for potential impairment should impairment indicators arise.

● Impairment of long-lived assets and intangibles

In accordance with the provisions of ASC Topic 360, “Impairment or Disposal of Long-Lived Assets”, all long-lived assets such as property, plant and equipment held and used by the Company are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability of assets to be held and used is evaluated by a comparison of the carrying amount of an asset to its estimated future undiscounted cash flows expected to be generated by the asset. If such assets are considered to be impaired, the impairment to be recognized is measured by the amount by which the carrying amounts of the assets exceed the fair value of the assets.

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Intangible assets that are considered to have a definite useful life are amortized over their useful lives using a method of amortization that reflects the pattern in which the economic benefits of the intangible assets are consumed or otherwise used up in accordance with ASC No. 350, “Intangibles - Goodwill and other” (“ASC 350”). The Company’s identifiable intangibles are reviewed for impairment in accordance with ASC 360 whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability of assets to be held and used is measured by a comparison of the carrying amount of an asset to the future undiscounted cash flows expected to be generated by the assets. If such assets are considered to be impaired, the impairment is measured by the amount by which the carrying amount of the assets exceeds the fair value of the assets.

Goodwill and other certain purchased intangible assets have been recorded in the Company’s financial statements as a result of acquisitions. Goodwill represents the excess of the purchase price in a business combination over the fair value of the net tangible and intangible assets acquired. Under ASC 350 goodwill is not amortized, but rather is subject to an annual impairment test.

ASC 350 requires goodwill to be tested for impairment at the reporting unit level at least annually or between annual tests in certain circumstances and written down when impaired. Goodwill is tested for impairment by comparing the fair value of the reporting unit with its carrying value.

ASC 350 allows an entity to first assess qualitative factors to determine whether it is necessary to perform the two-step quantitative goodwill impairment test. If the qualitative assessment does not result in a more likely than not indication of impairment, no further impairment testing is required. If it does result in a more likely than not indication of impairment, the two-step impairment test is performed. Alternatively, ASC 350 permits an entity to bypass the qualitative assessment for any reporting unit and proceed directly to performing the first step of the goodwill impairment test.

● Revenue recognition

We adopted Accounting Standard Codification (“ASC”) Topic 606, Revenues from Contract with Customers (“ASC 606”) for all periods presented with respect to each of our segments. Under ASC 606, revenue is recognized when control of the promised goods and services is transferred to the Company’s customers, which applied to retail pharmacy, medical device wholesale, drugs wholesale, healthcare products sales and medical service as well, in an amount that reflects the consideration that we expect to be entitled to in exchange for those goods and services, net of value-added tax. We determine revenue recognition through the following steps:

● Identify the contract with a customer;

● Identify the performance obligations in the contract;

● Determine the transaction price;

● Allocate the transaction price to the performance obligations in the contract; and

● Recognize revenue when (or as) the entity satisfies a performance obligation.

The transaction price is allocated to each performance obligation on a relative standalone selling price basis. The transaction price allocated to each performance obligation is recognized when that performance obligation is satisfied by the control of the promised goods and services is transferred to the customers, which at a point in time or over time as appropriate.

Our revenues are net of value added tax (“VAT”) collected on behalf of PRC tax authorities in respect to the sales of merchandise. VAT collected from customers, net of VAT paid for purchases, is recorded as a liability in the accompanying consolidated balance sheets until it is paid to the relevant PRC tax authorities.

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● Businesses Held for Sale

In late 2022, we committed to a plan to dispose of the Zhongshan, Minkang, Eurasia, and Qiangsheng hospitals.

On December 28, 2022, we entered into an agreement to transfer 87% of the equity interests in Zhongshan to the prior owner and will retain 13% of the equity interests in Zhongshan. As consideration for the transfer and pursuant to an amendment to the original stock purchase agreement, the original seller agreed to return the 40,037 shares of Common Stock previously issued (reflecting the Reverse Splits) and RMB 40,000,000 in cash (approximately ($6,116,207) previously paid upon the acquisition of Zhongshan. The former owner also agreed to release the Company from any and all claims relating to two earn out payments that were payable under the original purchase agreement. The Company received a put option to sell part or all of its 13% interest in Zhongshan before December 31, 2032, based on a valuation determined by a reputable third-party appraisal firm jointly chosen by the two parties. On September 1, 2023, 39,037 shares of Common Stock were returned to us. The remaining 1,000 shares were returned in the form of cash because the shares were sold by the original seller. The transaction is expected to close by December 31, 2023, at which time the cash paid at the time of the acquisition will also be returned.

On December 28, 2022, we entered into an agreement to transfer 90% of the equity interests in the Qiangsheng, Eurasia and Minkang hospitals to their former owners and retain 10% of the equity interests in each hospital. As consideration for the transfer and pursuant to an amendment to the original stock purchase agreement, the original sellers agreed to return the 80,000 shares of Common Stock previously issued (reflecting the Reverse Splits) and RMB 20,000,000 (approximately $2,767,860) in cash previously paid upon the acquisition of the three hospitals. The former owner also agreed to release the Company from any and all claims relating to two earn out payments that were payable under the original purchase agreement. The Company received a put option to sell part or all of its 10% interest in each of the three hospitals to the former owner before December 31, 2032, based on a valuation determined by a reputable third-party appraisal firm jointly chosen by the parties. On December 9, 2022, 43,600 shares of Common Stock were returned to the us and on September 1, 2023, 36,400 shares of Common Stock were returned to us. The transaction is expected to close by December 31, 2023, at which time the cash paid at the time of the acquisitions will also be returned.

The Company determined that the plan and the subsequent actions taken to dispose of the four hospitals qualified as a held for sale operation under the criteria set forth in the ASC 205-20 Presentation of Financial Statements – Discontinued Operation.

● Discontinued operations

In accordance with ASC 205-20, Reporting Discontinued Operations and Disclosures of Disposals of Components of an Entity, a disposal of a component of an entity or a group of components of an entity is required to be reported as a discontinued operation if the disposal represents a strategic shift that has (or will have) a major effect on an entity’s operations and financial results when the components of an entity meets the criteria in paragraph 205-20-45-1E to be classified as held for sale. When all of the criteria to be classified as held for sale are met, including management, having the authority to approve the action, commits to a plan to sell the entity, the major current assets, other assets, current liabilities, and non-current liabilities shall be reported as components of total assets and liabilities separate from those balances of the continuing operations. At the same time, the results of all discontinued operations, less applicable income taxes (benefit), shall be reported as components of net income (loss) separate from the net income (loss) of continuing operations in accordance with ASC 205-20-45.

On December 28, 2022, we entered into an agreement to transfer 87% of the equity interests in Zhongshan to the prior owner and will retain 13% of the equity interests in Zhongshan. As consideration for the transfer and pursuant to an amendment to the original stock purchase agreement, the original seller agreed to return the 40,037 shares of Common Stock previously issued (reflecting the Reverse Splits) and RMB 40,000,000 in cash (approximately ($6,116,207) previously paid upon the acquisition of Zhongshan. The former owner also agreed to release the Company from any and all claims relating to two earn out payments that were payable under the original purchase agreement. The Company received a put option to sell part or all of its 13% interest in Zhongshan before December 31, 2032, based on a valuation determined by a reputable third-party appraisal firm jointly chosen by the two parties. On September 1, 2023, 39,037 shares of Common Stock were returned to us. The remaining 1,000 shares were returned in the form of cash because the shares were sold by the original seller. The transaction is expected to close by December 31, 2023, at which time the cash paid at the time of the acquisition will also be returned.

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On December 28, 2022, we entered into an agreement to transfer 90% of the equity interests in the Qiangsheng, Eurasia and Minkang hospitals to their former owners and retain 10% of the equity interests in each hospital. As consideration for the transfer and pursuant to an amendment to the original stock purchase agreement, the original sellers agreed to return the 80,000 shares of Common Stock previously issued (reflecting Two Reverse Splits) and RMB 20,000,000 (approximately $2,767,860) in cash previously paid upon the acquisition of the three hospitals. The former owner also agreed to release the Company from any and all claims relating to two earn out payments that were payable under the original purchase agreement. The Company received a put option to sell part or all of its 10% interest in each of the three hospitals to the former owner before December 31, 2032, based on a valuation determined by a reputable third-party appraisal firm jointly chosen by the parties. On December 9, 2022, 43,600 shares of Common Stock were returned to the us and on September 1, 2023, 36,400 shares of Common Stock were returned to us. The transaction is expected to close by December 31, 2023, at which time the cash paid at the time of the acquisitions will also be returned.

On October 19, 2022, we entered into an agreement to sell Zhuoda to its former owners. Pursuant to the agreement, we agreed to sell 100% of the equity interests in Zhuoda that we previously purchased for 44,000 shares of Common Stock. The transaction closed in November 2022.

● Convertible promissory notes

We record debt net of debt discount for beneficial conversion features and warrants, on a relative fair value basis. Beneficial conversion features are recorded pursuant to the Beneficial Conversion and Debt Topics of the FASB Accounting Standards Codification. The amounts allocated to warrants and beneficial conversion rights are recorded as debt discount and as additional paid-in-capital. Debt discount is amortized over the life of the debt.

● Debt issuance costs and debt discounts

The Company may record debt issuance costs and/or debt discounts in connection with raising funds through the issuance of debt. These costs may be paid in the form of cash, or equity (such as warrants). These costs are amortized through the maturity of the debt. If a conversion of the underlying debt occurs prior to maturity a proportionate share of the unamortized amounts is immediately expensed.

● Beneficial conversion feature

We evaluate the conversion feature of the convertible debt that we issue to determine whether it was beneficial as described in ASC 470-20. The intrinsic value of a beneficial conversion feature inherent to a convertible note payable, which is not bifurcated and accounted for separately from the convertible notes payable and may not be settled in cash upon conversion, is treated as a discount to the convertible notes payable. This discount is amortized over the period from the date of issuance to the date the notes is due using the effective interest method. If the notes payable are retired prior to the end of their contractual term, the unamortized discount is expensed in the period of retirement to interest expense. In general, the beneficial conversion feature is measured by comparing the effective conversion price, after considering the relative fair value of detachable instruments included in the financing transaction, if any, to the fair value of the shares of Common Stock at the commitment date to be received upon conversion.

● Derivative instruments

We enter into financing arrangements that consist of freestanding derivative instruments or are hybrid instruments that contain embedded derivative features. The Company accounts for these arrangements in accordance with ASC Topic 815, Accounting for Derivative Instruments and Hedging Activities (“ASC 815”) as well as related interpretation of this standard. In accordance with this standard, derivative instruments are recognized as either assets or liabilities in the balance sheet and are measured at fair values with gains or losses recognized in earnings. Embedded derivatives that are not clearly and closely related to the host contract are bifurcated and are recognized at fair value with changes in fair value recognized as either a gain or loss in earnings. The Company determines the fair value of derivative instruments and hybrid instruments based on available market data using appropriate valuation models, giving consideration to all of the rights and obligations of each instrument. 

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We estimate fair values of derivative financial instruments using various techniques (and combinations thereof) that are considered to be consistent with the objective measuring fair values. In selecting the appropriate technique, we consider, among other factors, the nature of the instrument, the market risks that it embodies and the expected means of settlement. For less complex derivative instruments, such as free-standing warrants, we generally use the Black-Scholes model, adjusted for the effect of dilution, because it embodies all of the requisite assumptions (including trading volatility, estimated terms, dilution and risk-free rates) necessary to fair value these instruments. Estimating fair values of derivative financial instruments requires the development of significant and subjective estimates that may, and are likely to, change over the duration of the instrument with related changes in internal and external market factors. In addition, option-based techniques (such as Black-Scholes model) are highly volatile and sensitive to changes in the trading market price of our Common Stock. Since derivative financial instruments are initially and subsequently carried at fair values, our income (expense) going forward will reflect the volatility in these estimate and assumption changes. Under the terms of the new accounting standard, increases in the trading price of the Company’s Common Stock and increases in fair value during a given financial quarter result in the application of non-cash derivative expense. Conversely, decreases in the trading price of the company’s Common Stock and decreases in trading fair value during a given financial quarter result in the application of non-cash derivative income.

● Foreign currencies translation

Transactions denominated in currencies other than the functional currency are translated into the functional currency at the exchange rates prevailing at the dates of the transaction. Monetary assets and liabilities denominated in currencies other than the functional currency are translated into the functional currency using the applicable exchange rates at the balance sheet dates. The resulting exchange differences are recorded in the statement of operations. The reporting currency of our company is the United States Dollar (“US$”). Our subsidiaries in the PRC maintain their books and records in their local currency, the Renminbi Yuan (“RMB”), which is the functional currency as it is the primary currency of the economic environment in which these entities operate.

In general, for consolidation purposes, assets, and liabilities of its subsidiaries whose functional currency is not the US$ are translated into US$, in accordance with ASC Topic 830-30, “Translation of Financial Statement”, using the exchange rate on the balance sheet date. Revenues and expenses are translated at average rates prevailing during the period. The gains and losses resulting from translation of financial statements of foreign subsidiaries are recorded as a separate component of accumulated other comprehensive income within the statement of stockholders’ equity.

● Segment reporting

ASC Topic 280, “Segment Reporting” establishes standards for reporting information about operating segments on a basis consistent with the Company’s internal organization structure as well as information about the type of products and services, geographical areas, business strategies and major customers in business components. For the six months ended June 30, 2023, the Company operated in four reportable segments: retail pharmacy, wholesale pharmaceuticals, wholesale medical devices and healthcare products. For the six months ended June 30, 2022, the Company operated in four reportable segments: wholesale medical devices, wholesale pharmaceuticals, medical services, and retail pharmacies.

The Company’s operating segments are strategic business units that offer different products and services. Each segment is managed independently because they require different operations and markets to distinct classes of customers. The segments’ accounting policies are the same as those described in the summary of significant accounting policies. The Company’s chief operating decision maker (“CODM”), who is the CEO of the Company, evaluates performance of each segment based on profit or loss from continuing operations net of income tax. 

● Recent accounting pronouncements

In August 2020, the FASB issued ASU No. 2020-06 (“ASU 2020-06”) “Debt—Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging—Contracts in Entity’s Own Equity (Subtopic 815-40): Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity.” ASU 2020-06 will simplify the accounting for convertible instruments by reducing the number of accounting models for convertible debt instruments and convertible preferred stock. For public business entities, the amendments in ASU 2020-06 are effective for public entities which meet the definition of a smaller reporting company are effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2023. The Company will adopt ASU 2020-06 effective January 1, 2024. Management is currently evaluating the effect of the adoption of ASU 2020-06 on the consolidated financial statements. The effect will largely depend on the composition and terms of the financial instruments at the time of adoption.

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In October 2021, the FASB issued ASU No. 2021-08, “‘Business Combinations (Topic 805): Accounting for Contract Assets and Contract Liabilities from Contracts with Customers” (“ASU 2021-08”). This ASU requires entities to apply Topic 606 to recognize and measure contract assets and contract liabilities in a business combination. The amendments improve comparability after the business combination by providing consistent recognition and measurement guidance for revenue contracts with customers acquired in a business combination and revenue contracts with customers not acquired in a business combination. The amendments are effective for the Company beginning after December 15, 2023, and are applied prospectively to business combinations that occur after the effective date. The Company does not expect the adoption of ASU 2021-04 will have a material effect on the consolidated financial statements.

RECENT DEVELOPMENTS

On July 5, 2022, we entered into a stock purchase agreement (as amended on February 27, 2023) with Mr. Oudom, whereby we agreed to acquire 100% of the equity interests in Phenix Bio Inc. (“Phenix”), a distributor of healthcare products. The transaction closed effective March 15, 2023. The aggregate purchase price for the equity interests in Phenix was $180,000 in cash, which has been paid, plus up to 5,270,000 shares of the Company’s Common Stock (reflecting the Reverse Splits), of which 270,000 shares were issued on June 19, 2023  and the balance of 5,000,000 shares will be issued if the aggregate net profit generated by Phenix is at least $2,500,000 in calendar year 2023 or in any fiscal quarter of 2023. This milestone was reached in the second quarter of 2023 and the 5,000,000 shares of Common Stock are expected to be issued to Mr. Oudom in the fourth quarter of 2023.

On December 6, 2022, we sold a $2,000,000 convertible promissory note (the “Note”) to Mr. Oudom. The Note carried an annual interest rate of 6%, which is payable together with the principal amount one year after issuance. Mr. Oudom had the right to convert the Note into our Common Stock at a conversion price of $4.00 per share (reflecting a 1-to-10 reverse stock split on December 9, 2022). The conversion price of $4.00 (reflecting a 1-to-10 reverse stock split on December 9, 2022) reflected a 60% premium on the closing price of the Common Stock on NASDAQ on the date of issuance, which was $0.25 On February 27, 2023, the Company and Mr. Oudom entered into an agreement whereby it was agreed that the Company will exercise its prepayment right under the Note by issuing shares of Common Stock. In consideration of Mr. Oudom’s agreement to convert the Note into shares of Common Stock and to waive his right to any and all interest accrued and to be accrued under the Note, the Company agreed to issue 1,330,000 shares of Common Stock at a conversion price of $1.50 per share, subject to shareholder approval, as full payment of the $2,000,000 principal and accrued interest of the Note. Such issuance was approved by the Company’s shareholders on April 13, 2023 and the shares were issued to Mr. Oudom on June 19, 2023.

On February 27, 2023, we entered into a stock purchase Agreement with Mr. Oudom, whereby we agreed to sell 2,000,000 shares of Common Stock to him for $3,000,000 in cash, based on a purchase price of $1.50 per share, subject to shareholder approval of the issuance of such shares. The transaction was approved by the Company’s shareholders on April 13, 2023. The Company expects to receive the $3,000,000 in cash from Mr. Oudom and to issue the shares to him by December 31, 2023.

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RESULTS OF OPERATIONS

Comparison of the six months ended June 30, 2023 and 2022:

	For the Six Months Ended June 30,									Comparison
	2023			% of Revenues			2022			Amount increase (decrease)			Percentage increase (decrease)
Revenues	$	8,755,303			100	%	$	5,543,745		$	3,211,558			58	%
Cost of revenues		4,180,982			48	%		4,698,822			(517,840	)		(11	)%
Gross profit		4,574,321			52	%		844,923			3,729,398			441	%
Operating expenses		2,619,778			30	%		5,761,411			(3,141,633	)		(55	)%
Other expenses, net		(32,948	)		(0	)%		(4,191,347	)		4,224,295			(101	)%
Income (loss) before income tax		1,987,491			23	%		(9,107,835	)		11,095,326			(122	)%
Income tax expense		-			0	%		7,151			(7,151	)		(100	)%
Net income (loss) from continuing operations		1,987,491			23	%		(9,114,986	)		11,102,477			(122	)%
Loss from operations of discontinued operations		(143,102	)		2	%		(171,810	)		28,708			(17	)%
Less: non-controlling interest		(715	)		0	%		(2,498	)		1,783			(71	)%
Net income (loss) attributable to BIMI International Medical Inc.	$	1,843,674			21	%	$	(9,284,298	)	$	11,127,972			(120	)%

Revenues

Revenues for the six months ended June 30, 2023 and 2022 were $8,755,303 and $5,543,745, respectively. The revenues for the six months ended June 30, 2023, were primarily attributable to sales of healthcare products by Phenix, which we acquired on March 15, 2023 and the revenues from the wholesale sales of medical devices and drugs. Compared with the same period in 2022, revenue increased by $3,211,558, due to the inclusion of the revenues of Phenix. The revenues of the Zhongshan, Qiangsheng, Eurasia and Minkang hospitals, that were held for sale, were accounted for separately. 

Revenues from wholesale medical devices segment for the six months ended June 30, 2023 and 2022 were $1,051,385 and $2,828,557 respectively. The revenues declined as a result of our switch to online sales in the second quarter of 2023 in an effort to improve our margins due to the high costs of sales.

Revenues from the wholesale pharmaceuticals segment for the six months ended June 30, 2023 and 2022 were $1,928,388 and $2,055,417 respectively. The revenues declined as a result of our switch to online sales in the second quarter in 2023 in an effort to improve our margins.

Revenues from retail pharmacy segment for the six months ended June 30, 2023 and 2022 of $480,205 and $505,003, respectively, were generated by our retail pharmacy stores in Chongqing. The decrease in the retail pharmacy segment in six month ended June 30, 2023 was attributable to the decrease of Covid-19 related pharmacy products.

Revenues from the newly acquired healthcare products segment for the six months ended June 30, 2023, were $5,295,325. These revenues reflect the revenues generated by Phenix, which was acquired on March 15th, 2023.

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Cost of revenues

Cost of revenues for the six months ended June 30, 2023, and 2022 were $4,180,982 and $4,698,822, respectively. The decrease principally reflected the decrease in the costs associated with the operations of the Guanzan Group as it switched to online sales and the low cost of revenues associated with Phenix’s products.

Cost of revenues of our wholesale medical devices segment consists primarily of cost of medical devices, medical consumables and costs related directly to contracts with customers. For the six months ended June 30, 2023 and 2022, the cost of revenues of our wholesale medical devices segment were $805,574 and $2,415,231, respectively. The decrease is mainly due to the decrease in revenue in the current six months period compared to the same period in 2022. During the first two quarters of 2023, the demand for medical devices decreased as a result of the decreasing impact of Covid-19. 

Cost of revenues of our wholesale pharmaceuticals segment consists primarily of the cost of medicines, medical consumables and costs related directly to contracts with customers. For the six months ended June 30, 2023 and 2022, the cost of revenues of our wholesale pharmaceuticals segment were $1,813,422 and $1,962,623, respectively. The decrease is mainly due to the decrease in the revenue in the current six months period compared to the same period in 2022.

Cost of revenues of our retail pharmacy segment consists primarily of the cost of the pharmaceuticals, medical devices, and other products that we sell to customers. For the six months ended June 30, 2023 and June 30, 2022, the cost of revenues of our retail pharmacy segment were $357,836 and $223,032, respectively. During the six months ended June 30, 2023, the epidemic control policy loosened and the mix of products sold changed and the cost of such products were higher than in the 2022 period.

Cost of revenues of our healthcare products segment primarily consists of our purchase of raw material and the costs associated with the production of our products by third-party manufacturers. For the six months ended June 30, 2023, the cost of revenues of our newly acquired healthcare products segment was $1,202,012.

Gross profit (loss)

For the six months ended June 30, 2023 and 2022, we achieved gross margins of 52% and 15%, respectively. For the six months ended June 30, 2023, and 2022, the gross profit margin(s) of our:

(i) the gross margins of the retail pharmacy segment were 25.48% and 55.84%, respectively. In 2022, due to increased market demand, the margin for pharmaceuticals increased, especially for cold medicine, while in 2023, with the decline of Covid -19, the demand decreased causing a decrease in the gross margin;

(ii) the gross margins of the wholesale medical devices segment were 23.38% and 14.61%, respectively. In 2022, due to COVID19, there was very little activity in the wholesale medical devices business, while in 2023, the market bounced back and the wholesale medical devices margin went up;

(iii) the gross margins of the wholesale pharmaceuticals segment were 5.96% and 4.51%, respectively. In 2022, due to COVID19, there was very little activity in the wholesale pharmaceutical business, while in 2023, the market bounced back causing an increase in the gross margin; and

(iv) healthcare products segment was 77.30% in the six months ended June 30, 2023, reflecting the high gross margin of this new activity

Operating expenses

Operating expenses consist mainly of general and administrative expenses including auditing and legal service fees, other professional service fees and promotional expenses. Also included in operating expenses are any impairment charges.

Operating expenses were $2,619,778 for the six months ended June 30, 2023 as compared to $5,761,411 for the same period in 2022, a decrease of $3,141,633, or 55%. Operating expenses for the six months ended June 30, 2023, consisted mainly of general and administrative expenses of $2,127,465 and selling expenses in the amount of $492,313 as compared to general and administrative expenses of $5,119,8784 and selling expenses in the amount of $641,627 for the six months ended June 30, 2022. The decrease is primarily due to reduced salary expenses of our executive officers in the six months ended June 30, 2023 as the employment agreements with two executive officers were not renewed for 2023. We did not renew the employment agreement with our COO and stopped incurring salary expenses for the COO position as of January 1, 2023. We did not renew the employment agreement with our interim CFO but continued her employment as interim CFO at a reduced salary. The salary expense was reduced to $150,000 for our chief executive officer and $6,000 for our interim CFO in the period, as compared to $2.4 million in salary paid or accrued for the same period in 2022 for these officers.

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Operating expenses of the wholesale medical devices segment for the six months ended June 30, 2023 and 2022 were $228,201 and $316,395, respectively. The decrease in operating expenses was primarily attributable to a decrease in promotion expenses and efforts to reduce expenses during the six months ended June 30, 2023.

Operating expenses of the wholesale pharmaceuticals segment for the six months ended June 30, 2023 and 2022 were $282,603 and $379,037, respectively. The decrease in operating expense was primarily attributable to a decrease in salaries of $83,941, which resulted from reduced over-time payments and the use of seasonal part time employees in the six months ended June 30, 2023.

Operating expenses of the retail pharmacy segment for the six months ended June 30, 2023, and 2022 were $299,264 and $252,769, respectively. The increase in operating expense was primarily attributable to an increase in salaries and other expenses, which resulted from increased over-time payments as the economy returned to normal and retail store hours increased in the six months ended June 30, 2023.

Operating expenses of the healthcare products segment for the six months ended June 30, 2023, amounted to $235,278, consisting solely of general and administrative expenses.

Other expense

For the six months ended June 30, 2023 and 2022, we reported other expenses of $32,948 and $4,191,347, respectively.

Other expenses mainly consisted of the amortization of convertible notes and the market value of the shares of Common Stock issued as a result of the application of the Floor Amount Issuance in the convertible notes During the six months ended June 30, 2023, the accrued amount owed due to the application of the Floor Amount Issuance was $1,105,785, which was subsequently converted into 891,762 shares of Common Stock. Interest expense was related to the bank loans of the Guanzan Group and Shude. Other expenses of $4,191,347 for the six months ended June 30, 2022, mainly consisted of the amortization of convertible notes in the amount of $1,542,248, the accumulated application of Floor Amount Issuance with respect to the convertible notes of $2,587,963 and interest expense of $96,718.

Net Income (loss) from continuing operations

Net income from continuing operations was $1,844,389 for the six months ended June 30, 2023, compared to a net loss of $9,286,796 for the six months ended June 30, 2022, which improvement was primarily due to the increase in revenue, the high profit margin achieved by our new healthcare products segment and the decrease in other expenses and general and administrative costs.

Loss from discontinued operations

As a result of the disposition of Zhuoda and its Qianmei subsidiary their businesses were recorded as discontinued operations in accordance with ASC 205-20 Presentation of Financial Statements – Discontinued Operation and the results of the operations of the Zhuoda and Qianmei are presented under the line-item net loss from discontinued operations for the six months ended June 30, 2023.

As a result of the plans to dispose of the Zhongshan, Qiangsheng, Eurasia and Minkang hospitals and the actions taken to fulfill the plans, the businesses of the four hospitals are recorded as held for sale in accordance with ASC 205-20 Presentation of Financial Statements – Discontinued Operation and the results of the operations of the Zhongshan, Qiangsheng, Eurasia and Minkang are presented under the line item net loss from discontinued operations of held for sale businesses for the six months ended June 30, 2023. Loss from the discontinued operation was $143,102 for the six months ended June 30, 2023 compared to $ 171,810 for the six months ended June 30, 2022. The decrease is mainly due to the decrease in salary expense of $69,745 for the six months ended June 30, 2023, compared to $105,682 for the six months ended June 30, 2022.

Foreign currency translation

We reported a negative foreign currency translation adjustment of $526,459 for the six months ended June 30, 2023, compared to a negative foreign currency translation adjustment of $967,586 for the six months ended June 30, 2022 The decrease due to the significant change in the currency exchange rate and our increased activities in the US.

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LIQUIDITY AND CAPITAL RESOURCES

On June 30, 2023, we had cash of $1,931,744 and positive working capital of $6,604,643 as compared to cash of $2,336,636 and negative working capital of $326,672 on December 31, 2022.

In order to fund our operations, we have entered into a number equity and convertible debt transactions and borrowed funds from banks and individuals affiliated with our company and its subsidiaries in recent years.

Beginning on September 27, 2019, we sold $1,534,250 of convertible notes to various investors that matured during the period beginning September 27, 2020 and ending on March 13, 2021. Each of these notes was issued for a term of 12 months, carrying 6% annual interest rate and convertible into Common Stock. According to the applicable agreements, each holder of such notes had the right during the period beginning one hundred eighty (180) calendar days following the date of their issuance and ending on the maturity date, to convert all or any part of the outstanding and unpaid principal into shares of Common Stock. All of these notes were converted into shares of Common Stock during the year ended December 31, 2020.

On February 1, 2020, we entered into a stock purchase agreement to acquire Guanzan. Pursuant to the agreement, we agreed to purchase all the issued and outstanding equity interests in Guanzan and its 80% owned subsidiary, Shude, for RMB 100,000,000 (approximately $14,285,714) to be paid by the issuance of 19,000 shares of Common Stock (reflecting the Reverse Splits), and the cash payment of RMB 80,000,000 (approximately $11,428,571.) On March 18, 2020, we closed the Guanzan acquisition by delivering 19,000 shares of Common Stock. In addition, we assumed bank indebtedness of $1,135,884 in connection with the acquisition. On April 9, 2021, we increased our equity interest in Shude from 80% to 95.2% by making a direct capital investment of $4,892,293 in Shude. 

On May 18, 2020, we entered into a securities purchase agreement (the “May SPA”) with two institutional investors (the “Institutional Investors”) to sell convertible notes having a face amount of up to $6,550,000 at an aggregate original issue discount of 19.85% (the “2020 Notes”) and ranking senior to all outstanding and future indebtedness of the Company. Pursuant to the May SPA, two 2020 Notes each in the face amount of $2,225,000 were issued to two Institutional Investors in consideration of the payment of $1,750,000 in cash for each 2020 Note. The 2020 Notes did not bear interest except upon the occurrence of an event of default. Each Institutional Investor also received a warrant (the “Institutional Investor 2020 Warrant”) to purchase 32,500 shares of Common Stock at an initial exercise price of $142.25 per share (post the Reverse Splits and subject to the Event Market Price Adjustment mechanism applicable to the 2020 Notes). The placement agent for the private placement received a warrant (the “Placement Agent 2020 Warrant”, together with the Institutional Investors 2020 Warrant, the “2020 Warrants”) to purchase up to 10% of the aggregate number of shares of Common Stock at an initial exercise price of $14.225 per share (post the Reverse Splits and subject to the Event Market Price Adjustment), subject to increase based on the number of shares Common Stock issued pursuant to the 2020 Notes.

Pursuant to the May SPA, two 2020 Notes each in the face amount of $2,225,000 were issued to the Institutional Investors in consideration of the payment of $1,750,000 in cash for each 2020 Note.

The May SPA, the 2020 Notes and the warrants provided that each and every reference to share prices, shares of Common Stock and any other numbers therein that relate to the Common Stock will be automatically adjusted for any stock splits, stock dividends, stock combinations, recapitalizations or other similar transactions that occur with respect to the Common Stock (each, a “Stock Combination Event”, and such date thereof, the “Stock Combination Event Date”) thereafter. The May SPA, the 2020 Notes and the 2020 Warrants further provided that if after a Stock Combination Event, the Event Market Price is less than the conversion price (in the case of the Convertible Notes) or the exercise price (in the case of the warrants) then in effect (after giving effect to the above adjustments), then on the sixteenth (16th) trading day immediately following such Stock Combination Event Date, the conversion price or exercise then in effect on such sixteenth (16th) trading day (after giving effect to the above adjustments) will be reduced (but in no event increased) to the Event Market Price. “Event Market Price” means, with respect to any Stock Combination Event Date, the quotient determined by dividing (x) the sum of the dollar volume-weighted average price of the Common Stock for each of the five (5) trading days with the lowest dollar volume-weighted average price of the Common Stock during the fifteen (15) consecutive trading day period ending and including the trading day immediately preceding the sixteenth (16th) trading day after such Stock Combination Event Date, divided by (y) five (5). The price adjustment described in this paragraph is hereinafter referred to as the “Event Market Price Adjustment.”

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The 2020 Notes, which matured on the eighteen-month anniversary of the issuance date, were payable in installments and were convertible at the election of the investors at the conversion price of $129.5 per share (post-Split Price and subject to the Event Market Price Adjustment), subject to adjustment in the event of default. Each investor also received a warrant to purchase 13,000 shares of Common Stock (post thr Reverse Splits) at an initial exercise price of $142.25 per share (post the Reverse Splits price and subject to the Event Market Price Adjustment). The placement agent for the private placement received a warrant to purchase up to 3,437 shares of Common Stock (post the Reverse Splits) at an initial exercise price of $142.25 per share (post the Reverse Splits price and subject to the Event Market Price Adjustment), subject to increase based on the number of shares of Common Stock issued pursuant to the 2020 Notes. Pursuant to the May SPA, additional convertible notes in an aggregate original face amount not to exceed $2,100,000 (the “Additional Notes”) could also be issued to the Institutional Investors under certain circumstances. 

On June 23, 2020, we completed the disposition of the NF Group, at which time we received $10 million from the buyer.

On February 24, 2021, we entered into an amendment to the May SPA with the Institutional Investors to increase the amount of the Additional Notes by $3,300,000 to $5,400,000. On February 26, 2021, Additional Notes in an aggregate original principal amount of $5,400,000 were issued to the two Institutional Investors, together with the issuance of warrants to acquire an aggregate of 15,200 shares of Common Stock (post the Reverse Splits) at an initial exercise price of $142.25 per share (post the Reverse Splits price and subject to the Event Market Price Adjustment). The placement agent for the private placement received a warrant to purchase up to 3,475 shares of our Common Stock (post Two Reverse Splits) at an initial exercise price of $142.25 per share (post the Reverse Splits price and subject to the Event Market Price Adjustment), subject to increase based on the number of shares of Common Stock issued pursuant to the Additional Notes.

On November 18, 2021, we entered into a securities purchase agreement (the “November SPA”) with the same two Institutional Investors to sell them a series of senior convertible notes (the “2021 Notes”) with an original issue discount of 20% and ranking senior to all outstanding and future indebtedness of the Company in a private placement. Each Institutional Investor paid $3,250,000 in cash for a 2021 Note in the face amount of $3,900,000. The November SPA also provided for the issuance of additional 2021 Notes in an aggregate original principal amount not to exceed $3,900,000 under certain circumstances. The November SPA also contained provisions about the Market Event Price. The 2021 Notes, which were issued on November 22, 2021, matured on the eighteen-month anniversary of the issuance date, were payable by the Company in installments and convertible at the election of the Institutional Investors at the conversion price of $32.5 (post the Reverse Splits price and subject to the Event Market Price Adjustment). Each Institutional Investor also received a warrant (the “Institutional Investor 2021 Warrant”) to purchase 18,000 shares of Common Stock (post Two Reverse Splits) at an initial exercise price of $35.5 per share (post the Reverse Splits price and subject to the Event Market Price Adjustment). The placement agent for the private placement received a warrant (the “Placement Agent 2021 Warrant”, together with the Institutional Investor 2021 Warrants, the “2021 Warrants”) to purchase up to 8% of the aggregate number of shares of Common Stock at an initial exercise price of $35.5 per share (post the Reverse Splits price and subject to the Event Market Price Adjustment), subject to increase based on the number of shares Common Stock issued pursuant to the 2021 Notes.

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The Company implemented a reverse stock split on February 2, 2022, at the ratio of 5 to 1. The 2020 Notes and Additional Notes were fully converted before the February reverse split, and therefore no price adjustment was implemented at the conversion, although the price information provided above about the 2020 Notes and Additional Notes was post-split price. The conversion price of the 2021 Notes and the exercise price of the 2020 Warrants and the 2021 Warrants will be adjusted pursuant to the Event Market Price formula upon conversion or exercise.

As of December 31, 2022, one of the Institutional Investors had converted all of its 2021 Notes into shares of Common Stock while the other Institutional Investor held $3,000 of the 2021 Notes.

In 2022, one of the Institutional Investors received 275,000 shares of Common Stock having a then market value of $200,000 as a result of the application of the Floor Amount Issuance and the other Institutional Investor received 1,234,715 shares of Common Stock as a result of this conversion feature having a then market value of $493,886.

In 2022, one of the institutional investors exercised 100,000 warrants on a cashless exercise basis into 44,445 shares of Common Stock having a then market value of $100,000.

During the three months ended March 31, 2023, no shares of Common Stock were issued to the Institutional Investors upon conversion of convertible notes. However, 270,000 shares of Common Stock having a value of $334,800 were issued to one of the Institutional Investors due to the application of the Floor Amount Issuance.

During the three months ended March 31,2023, none of the warrants held by the Institutional Investors were exercised.

During the three months ended June 30, 2023, 2,420 shares were issued to one institutional Investor upon conversion of $3,000 of the 2021 Notes. In addition, 621,762 shares of Common Stock having a value of $770,985 were issued to one Institutional Investor due to the application of the Floor Amount Issuance.

During the three months ended June 30, 2023, no shares of Common Stock were issued to the two Institutional Investors upon exercise of warrants.

During the six months ended June 30, 2023, 2,420 shares of Common Stock were issued to one Institutional Investor upon conversion of $3,000 of the 2021 Notes. In addition, 891,762 shares of Common Stock having a value of $1,105,785 were issued to the other Institutional Investor due to the application of the Floor Amount Issuance. During the six months ended June 30, 2023, none of the warrants held by the Institutional Investors were exercised.

In order to stem the losses that were incurred by Zhuoda and the Zhongshan, Qiangsheng, Eurasia and Minkang hospitals in 2022 because of the impact of Covid-19, we entered into agreements to divest our ownership of Zhouda and our controlling interests in the four hospitals. We have completed the disposition of Zhouda and expect to complete the sales of the controlling interests in the Zhongshan, Qiangsheng, Eurasia and Minkang hospitals in the fourth quarter of 2023.

On July 18, 2022, we issued 1,250,000 shares of Common Stock (post the Reverse Splits) to our Chairman, Mr. Oudom, in consideration of the conversion of a $5 million promissory note after obtaining the approval of shareholders at the Company’s 2022 annual meeting of shareholders.

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On December 6, 2022, we sold a convertible promissory note to Mr. Oudom, for $2 million. The note carried an annual interest rate of 6%, which was payable together with the principal amount one year after issuance. Mr. Oudom had the right to convert the Note into our Common Stock at a conversion price of $4.00 per share (reflecting a 1-to-10 reverse stock split on December 9, 2022). The (post Reverse Splits) conversion price of $4.00 reflected a 60% premium on the closing price of the Common Stock on NASDAQ on the date of issuance, which was $0.25. On February 27, 2023, we and Mr. Oudom entered into an agreement whereby we agreed that we would exercise our prepayment right under the Note by issuing shares of Common Stock. In consideration of Mr. Oudom’s agreement to convert the Note into shares of Common Stock and to waive his right to any and all interest accrued and to be accrued under the Note, the Company agreed to issue 1,330,000 shares of Common Stock at a conversion price of $1.50 per share, subject to shareholder approval, as full payment of the $2,000,000 principal and accrued interest of the note. The issuance was approved by the Company’s shareholders on April 13, 2023, and the shares were issued to Mr. Oudom on June 19, 2023.

On February 27, 2023, we entered into a stock purchase agreement with Mr. Oudom, whereby we agreed to sell 2,000,000 shares of Common Stock to Mr. Oudom for $3 million in cash, based on a purchase price of $1.50 per share, subject to shareholder approval. Such issuance was approved by the Company’s shareholders on April 13, 2023. The transaction is expected to close by December 31, 2023.

We also received a $500,000 loan from our Chief Executive Office, Mr. Song, in December 2022, which remains outstanding and carries annual interest of 1%.

The following is a summary of cash provided by or used in each of the indicated types of activities during the six months ended June 30, 2023, and 2022, respectively.

	For the six months ended June 30,
	2023			2022
Net cash provided by (used in) operating activities	$	2,247,448		$	(3,689,637	)
Net cash provided by (used in) investing activities
Net cash (used in) provided by financing activities		(1,836,835	)		4,454,395
Exchange rate effect on cash		(815,505	)		(661,857	)
Net cash (inflow)	$	(404,892	)	$	102,901

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Operating Activities

Net cash provided by our operating activities was $2,247,448 during the six months ended June 30, 2023 as compared to net cash used in operating activities of $3,689,637 in the six months ended June 30, 2022. During the six months ended June 30, 2023, the increase is attributable to a decrease in accounts receivable of $3.1 million, and the net profit brought by our new subsidiary Phenix. During the six months ended June 30, 2022, the decrease is mainly attributable to a decrease in the amortization of the discount of convertible notes of $1.5 million.

Financing Activities

Cash used in our financing activities was $1,836,835 for the six months ended June 30, 2023 as compared to $4,454,395 provided by financing activities for the six months ended June 30, 2022. During the six months ended June 30, 2023, we repaid $1,961,609 of related party loans and $188,502 of bank loans and obtained $316,397of short-term loans. During the six months ended June 30, 2022, we obtained a $5,000,000 loan from Mr. Oudom that was converted into Common Stock in July 2022 and repaid $399,115 of long-term loans. We also received $80,758 of related party loans from Jiangjin Shen. We also repaid $227,248 of related party loans we owed to Li Zhou. These related party loans were for operating purposes and have no specific terms or interest payments.

Contractual Obligations

On December 28, 2022, the Company entered into an agreement to transfer 87% of the equity interests in Zhongshan to the prior owner. Pursuant to the agreement, the Company agreed to transfer 87% of the equity interests in Zhongshan to the former owner and will continue to own 13% of the equity interests in Zhongshan. As consideration for the transfer and pursuant to an amendment to the original stock purchase agreement, the original seller agreed to return the 40,037 shares of Common Stock previously issued (reflecting the Reverse Splits) and RMB 40,000,000 in cash (approximately ($6,116,207) previously paid upon the acquisition of Zhongshan. The former owner also agreed to release the Company from any and all claims relating to two earn out payments that were payable under the original purchase agreement. The Company received a put option to sell part or all of its 13% interest in Zhongshan before December 31, 2032, based on a valuation determined by a reputable third-party appraisal firm jointly chosen by the two parties. On September 1, 2023, 39,037 shares of Common Stock were returned to the Company. The remaining 1,000 shares were returned in the form of cash because the shares were sold by the original seller. The transaction is expected to close by December 31, 2023, at which time the cash paid at the time of the acquisition will be returned.

On December 28, 2022, the Company entered into an agreement to transfer 90% of the equity interests in the Qiangsheng, Eurasia and Minkang hospitals to their former owners. Pursuant to the agreement, the Company will transfer 90% of the equity interests in each of the three hospitals and continue to own 10% of the equity interests in each hospital. As consideration for the transfer and pursuant to an amendment to the original stock purchase agreement, the original sellers agreed to return the 80,000 shares of Common Stock previously issued (reflecting the Reverse Splits) and RMB 20,000,000 (approximately $2,767,860) in cash previously paid upon the acquisition of the three hospitals. The former owner also agreed to release the Company from any and all claims relating to two earn out payments that were payable under the original purchase agreement. The Company received a put option to sell part or all of its 10% interest in each of the three hospitals to the former owner before December 31, 2032, based on a valuation determined by a reputable third-party appraisal firm jointly chosen by the parties. On December 9, 2022, 43,600 shares of Common Stock were returned to the Company and on September 1, 2023, 36,400 shares of Common Stock were returned to the Company. The transaction is expected to close by December 31, 2023, at which time the cash paid at the time of the acquisitions will be returned.

On July 5, 2022, we entered into a stock purchase agreement (as amended on February 27, 2023) with Mr. Oudom, the Chairman of our board of directors, whereby we agreed to acquire 100% of the equity interests in Phenix, a distributor of healthcare products. The transaction closed effective March 15, 2023. The aggregate purchase price for the equity interests in Phenix was $180,000 in cash, which has been paid, plus up to 5,270,000 shares of our company’s Common Stock (reflecting the Reverse Splits), of which 270,000 shares were issued upon obtaining the approval of our shareholders. The agreement provided that 5,000,000 shares will be issued if the aggregate net profit generated by Phenix is at least $2,500,000 in calendar year 2023 or in any fiscal quarter of 2023, subject to the approval of our shareholders. Such profit metric was met in the second quarter of 2023 and the shares are expected to be issued to Mr. Oudom in the fourth quarter of 2023.

On February 27, 2023, we entered into a stock purchase agreement with Mr. Oudom, whereby we agreed to sell 2,000,000 shares of Common Stock to Mr. Oudom for $3 million in cash, based on a purchase price of $1.50 per share, subject to shareholder approval. Such issuance was approved by the Company’s shareholders on April 13, 2023. The transaction is expected to close by December 31, 2023.

Inflation and Seasonality

We do not believe that our operating results have been materially affected by inflation during the preceding two years. There can be no assurance, however, that our operating results will not be affected by inflation in the future. At present we are able to increase our product sale prices due to the rising prices charged by our suppliers. At present we are able to increase our product sale prices to offset the rising prices charged by our suppliers.

OFF-BALANCE SHEET ARRANGEMENTS

We do not have any material off-balance sheet arrangements.

69

Item 3. Quantitative and Qualitative Disclosures about Market Risk

Not applicable.

Item 4. Controls and Procedures

Conclusion Regarding the Effectiveness of Disclosure Controls and Procedures

Our management is responsible for establishing and maintaining adequate internal control over financial reporting. Internal control over financial reporting is defined in Rule 13a-15(f) under the Exchange Act as a process designed by, or under the supervision of, the company’s principal executive officer and principal financial officer and effected by the Company’s Board of Directors, management and other personnel, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles and includes those policies and procedures that:

● Pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the Company;

● Provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the Company are being made only in accordance with management authorization; and

● Provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of the Company’s assets that could have a material effect on the financial statements.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

We are in the process of restating our financial statements for year ended December 31, 2022 and the quarterly periods ended March 31, 2022, June 30, 2022, September 30, 2022 and March 31, 2023, to correct errors identified in our prior financial statements. We have concluded that the restatements do not materially affect our liquidity or our compliance with debt covenants or other financial obligations.

(1)     We are in the process of restating the Consolidated Statements of Equity for the quarterly periods ended June 30, 2022 and September 30, 2022. The restatement relates to the stockholders’ equity and noncontrolling interests presented in the consolidated balance sheets, as of June 30, 2022 and September 30, 2022, which had been presented in the form of a reconciliation of the beginning balance to the ending balance for each period for which a consolidated statement of comprehensive income was required to be filed.  We will provide reconciliations for the interim periods covered by the Consolidated Statement of Equity for the periods ended June 30, 2022 and September 30, 2022.  This restatement should not have any effect on net income, per-share amount, or retained earnings and other components of equity or net assets for prior filing and current filing. We have concluded that the restatement does not materially affect our liquidity or our compliance with debt covenants or other financial obligations.

70

(2)     On June 9, 2022, the Company issued a $5 million subordinated promissory note, which was converted into 1,250,000 shares of the Company’s Common Stock (post the December 2022 1 to 10 reverse split) on July 18, 2022, upon obtaining shareholder approval for the transaction. We erroneously reflected the proceeds of the promissory note in the Consolidated Statements of Cash Flows as “Issuance of Common Stock” for the six month period ended June 30, 2022.   We failed to reflect this promissory note as a note payable as of June 30, 2022. As a result, we are in the process of restating our financial statements for the quarterly period ended June 30, 2022. This restatement did not effect our net income, per-share amounts, retained earnings or other components of equity or net assets for prior filings and the current filing. We have concluded that the restatement does not materially affect our liquidity or our compliance with debt covenants or other financial obligations.

(3)     We restated our financial statements for the year ended December 31, 2021 and are in the process of restating the our financial statements for the quarterly period ended June 30, 2022 to correct errors identified in our prior financial statements. In the year ended December 31, 2021 and the quarterly periods ended March 31, 2022 and June 30, 2022, we recorded amortization of convertible notes as a general and administrative expense in error. We have revised the financial statements for the year ended December 31, 2021 and the six months ended June 30, 2022 and are in the process of revising our financial statements for the quarterly period ended March 31, 2022 to record the amortization of convertible notes as an “other expense”. The impact of the restatement on our financial statements is the reclassification of such expense as an “other expense”. The reclassification also affected the classification of such expense in the Consolidated Statements of Cash Flows. We have also amended various footnotes to the financial statements. We restated our financial statements for the year ended December 31, 2021 and are in the process of restating the financial statements for the year ended December 31, 2022 and the quarterly periods ended March 31, 2022, June, 30, 2022 and September 30, 2022 to correct this issue. This restatement did not affect our net income (loss) , net income (loss) per-share, retained earnings or other components of equity or net assets for our prior filings and the current filing. We have concluded that the restatement does not materially affect our liquidity or our compliance with debt covenants or other financial obligations.

(4)     We are in the process of restating our financial statements for the year ended December 31, 2022, where we incorrectly accounted for the acquisition of Phenix. On July 5, 2022, we entered into a stock purchase agreement, which was subsequently amended, pursuant to which we agreed to acquire Phenix and paid a deposit of $180,000 on July 7, 2022. The closing did not occur until March 15, 2023.  As of December 31, 2022, the accounting for the Phenix acquisition was incorrectly recorded as follows: (1) a long-term equity investment as a debit entry, (2) cash as a credit, and (3) other payables as a credit entry. Since the Phenix acquisition had not taken place as of December 31, 2022, it should not have been recorded as a long-term equity investment. As such, we reversed the long-term equity investment account and other payables account and recorded the deposit as a prepayment. This restatement did not affect our net income, per-share amounts, or retained earnings, but affected the net assets in the quarterly period ended March 31, 2023. We have concluded that the restatement does not materially affect our liquidity or other financial obligations.

(5)       We are in the process of restating the Consolidated Statements of Cash Flows for the quarterly periods ended June 30, 2022, September 30, 2022, March 31, 2023 and for the year ended December 31, 2022. The restatement relates to the discontinued entities' cashflow presented in the Consolidated Statements of Cash Flows, for the quarterly periods ended June 30, 2022, September 30, 2022, March 31, 2023, and for the year ended December 31, 2022, which have not presented in the prior period filling. In the restated Consolidated Statements of Cash Flows, we will present the discontinued entities’ cash flows in the Consolidated Statements of Cash Flows instead of zero. This restatement does not affect net income (loss), net income (loss) per-share, or retained earnings and other components of equity or net assets in our prior filings or in our current filing. We have concluded that the restatement does not materially affect our liquidity or our compliance with debt covenants or other financial obligations.  

71

We are taking steps to address the causes of the restatements and to improve our internal controls over financial reporting. We are in the process of hiring a new third-party consulting firm to assist us in strengthening our daily internal controls and financial reporting process review. We also aim to improve our internal accounting department management as well. We are committed to maintaining the integrity of our financial statements and to provide accurate and transparent financial information to our investors.

Management also determined that the Company has insufficient written policies and procedures for accounting and financial reporting, which hindered the financial statement closing process.

Management’s Remediation Plan

The Company has taken steps to address the cause of the restatement and to improve our internal controls over financial reporting. The Company hired a consulting firm to assist our accounting department on internal controls and financial reporting. The Company is committed to maintaining the integrity of our financial statements and to providing accurate and transparent financial information to our investors.

While management believes that the financial statements we previously filed in our SEC reports have been properly recorded and disclosed in accordance with US GAAP, based on the control deficiencies identified above, management is currently seeking to engage an outside consultant with considerable public company reporting experience and breadth of knowledge of US GAAP to provide additional training to its accounting personnel in connection with the preparation and review of our financial statements.

We expect to implement the following measures in 2023 to remediate the material weaknesses identified: (1) To establish additional written policies and procedures for accounting and financial reporting to improve the Company’s financial statement closing process; (2) To continue providing applicable training for our financial and accounting staff to enhance their understanding of U.S. GAAP and internal control over financial reporting; (3) To continue providing applicable training for our accounting manager to improve our internal review process.

Changes in Internal Control over Financial Reporting

No change in our internal control over financial reporting occurred during the six months ended June 30, 2023 that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

72

PART II ---- OTHER INFORMATION

Item 1. Legal Proceedings.

Item 1A. Risk Factors

The loss of, or a material reduction in orders from Phenix Bio Inc.’s sole customer, would materially and adversely affect our results of operations and financial condition.

Our new subsidiary, Phenix has generated all of its sales of dietary supplements in the six months ended June 30, 2023 from one customer, Meta Time, an online seller of such products. The loss of this customer, or a material reduction in their purchases, would have a material adverse effect on our financial condition, liquidity, and results of operations.

As of the date of this filing, there have been no other material changes from the risk factors disclosed in Part I, Item 1A (Risk Factors) contained in our Annual Report on Form 10-K for the year ended December 31, 2022.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.

During the six months ended June 30, 2023, 2,420 shares of Common Stock were issued to one Institutional Investor upon conversion of $3,000 of convertible notes. In addition, 891,762 shares of Common Stock having a value of $1,105,785 were issued to the other Institutional Investor due to the application of Floor Amount Issuance contained in the convertible notes.

Item 3. Defaults upon Senior Securities.

None.

Item 4. Mine Safety Disclosures

Not applicable.

Item 5. Other Information.

None.

73

Item 6. Exhibits.

The list of Exhibits required by Item 601 of Regulation S-K to be filed as a part of this Form 10-Q are set forth on the Exhibit Index immediately preceding such Exhibits and is incorporated herein by this reference.

Exhibit Number	Description	Incorporated by Reference to
31.1	Rule 13(a)-14(a)/15(d)-14(a) Certification of principal executive officer
31.2	Rule 13(a)-14(a)/15(d)-14(a) Certification of principal financial officer
32.1	Section 1350 Certification of principal executive officer
32.2	Section 1350 Certification of principal financial officer
101.INS	Inline XBRL Instance Document.
101.SCH	Inline XBRL Taxonomy Extension Schema Document.
101.CAL	Inline XBRL Taxonomy Extension Calculation Linkbase Document.
101.DEF	Inline XBRL Taxonomy Extension Definition Linkbase Document.
101.LAB	Inline XBRL Taxonomy Extension Label Linkbase Document.
101.PRE	Inline XBRL Taxonomy Extension Presentation Linkbase Document.
104	Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101).

74

SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned.

	BIMI International Medical Inc.
	(Registrant)
Date: November 22, 2023	By:	/s/ Tiewei Song
		Tiewei Song
		Chief Executive Officer
Date: November 22, 2023	By:	/s/ Baiqun Zhong
		Baiqun Zhong
		Interim Chief Financial Officer
		(Principal Financial and Accounting Officer)

75

EX-31.1

Exhibit 31.1

CERTIFICATION OF CHIEF EXECUTIVE OFFICER

Pursuant to Rule 13a-14(a) under the Securities Exchange Act of 1934, as amended

I, Tiewei Song, certify that:

1. I have reviewed this quarterly report on Form 10-Q of BIMI International Medical Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the company as of, and for, the periods presented in this report;

4. The company’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13(a)-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the company and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the company, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c) Evaluated the effectiveness of the company’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d) Disclosed in this report any change in the company’s internal control over financial reporting that occurred during the period covered by the quarterly report that has materially affected, or is reasonably likely to materially affect, the company’s internal control over financial reporting; and

5. The company’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the company’s auditors and the audit committee of the company’s board of directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the company’s ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the company’s internal control over financial reporting.

Date: November 22, 2023

/s/ Tiewei Song

Tiewei Song

Chief Executive Officer

EX-31.2

Exhibit 31.2

CERTIFICATION OF CHIEF FINANCIAL OFFICER

Pursuant to Rule 13a-14(a) under the Securities Exchange Act of 1934, as amended

I, Baiqun Zhong, certify that:

1. I have reviewed this quarterly report on Form 10-Q of BIMI International Medical Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the company as of, and for, the periods presented in this report;

4. The company’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13(a)-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the company and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the company, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c) Evaluated the effectiveness of the company’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d) Disclosed in this report any change in the company’s internal control over financial reporting that occurred during the period covered by the quarterly report that has materially affected, or is reasonably likely to materially affect, the company’s internal control over financial reporting; and

5. The company’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the company’s auditors and the audit committee of the company’s board of directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the company’s ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the company’s internal control over financial reporting.

Date: November 22, 2023

/s/ Baiqun Zhong

Baiqun Zhong

Interim Chief Financial Officer

* The originally executed copy of this Certification will be maintained at the Company’s offices and will be made available for inspection upon request.

EX-32.1

Exhibit 32.1

CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350
AS ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly report of BIMI International Medical Inc. (the “Company”) on Form 10-Q for the quarterly period ended June 30, 2023 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Tiewei Song, Chief Executive Officer of the Company, certify, pursuant to 18 U.S.C. § 1350, as adopted pursuant to § 906 of the Sarbanes-Oxley Act of 2002, that:

(1) The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2) The information contained in the Report fairly presents, in all material respects, the financial condition and result of operations of the Company.

/s/ Tiewei Song

Tiewei Song

Chief Executive Officer

November 22, 2023

* The originally executed copy of this Certification will be maintained at the Company’s offices and will be made available for inspection upon request.

EX-32.2

Exhibit 32.2

CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350
AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly report of BIMI International Medical Inc. (the “Company”) on Form 10-Q for the quarterly period ended June 30, 2023 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Baiqun Zhong, Interim Chief Financial Officer of the Company, certify, pursuant to 18 U.S.C. § 1350, as adopted pursuant to § 906 of the Sarbanes-Oxley Act of 2002, that:

(1) The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2) The information contained in the Report fairly presents, in all material respects, the financial condition and result of operations of the Company.

/s/ Baiqun Zhong

Baiqun Zhong

Interim Chief Financial Officer

November 22, 2023

* The originally executed copy of this Certification will be maintained at the Company’s offices and will be made available for inspection upon request.

XML

Document And Entity Information - shares	6 Months Ended
	Jun. 30, 2023	Nov. 15, 2023
Document Information Line Items
Entity Registrant Name	BIMI International Medical Inc.
Trading Symbol	BIMI
Document Type	10-Q
Current Fiscal Year End Date	--12-31
Entity Common Stock, Shares Outstanding		6,589,569
Amendment Flag	false
Entity Central Index Key	0001213660
Entity Current Reporting Status	Yes
Entity Filer Category	Non-accelerated Filer
Document Period End Date	Jun. 30, 2023
Document Fiscal Year Focus	2023
Document Fiscal Period Focus	Q2
Entity Small Business	true
Entity Emerging Growth Company	false
Entity Shell Company	false
Document Quarterly Report	true
Document Transition Report	false
Entity File Number	000-50155
Entity Incorporation, State or Country Code	DE
Entity Tax Identification Number	02-0563302
Entity Address, Address Line One	725 5th Avenue
Entity Address, Address Line Two	15th Floor
Entity Address, Address Line Three	Suite 15-01
Entity Address, City or Town	New York
Entity Address, State or Province	NY
Entity Address, Postal Zip Code	400010
City Area Code	212
Local Phone Number	542 0028
Title of 12(b) Security	Common Stock, $0.001 par value
Security Exchange Name	NASDAQ
Entity Interactive Data Current	Yes

XML

Condensed Consolidated Balance Sheets (Unaudited) - USD ($)		Jun. 30, 2023	Dec. 31, 2022
CURRENT ASSETS
Cash and cash equivalents		$ 1,931,744	$ 2,336,636
Accounts receivable, net		6,380,387	3,208,286
Advances to suppliers		7,017,279	6,589,759
Inventories, net		7,182,524	7,654,242
Prepayments and other receivables		1,350,124	1,527,079	[1]
Current assets from discontinued operations-held for sale		2,133,382	2,099,673
Total current assets		25,995,440	23,415,675
NON-CURRENT ASSETS
Deferred tax assets		183,259	190,132
Property, plant and equipment, net		1,690,107	1,703,420
Intangible assets-net		448,931	16,183
Operating lease-right of use assets		2,835,992	2,942,265
Goodwill		2,065,666	2,065,666
Non-current assets from discontinued operations-held for sale		3,439,099	3,761,149
Total non-current assets		10,663,054	10,678,815	[1]
TOTAL ASSETS		36,658,494	34,094,490	[1]
CURRENT LIABILITIES
Short-term loans		1,134,822	818,425
Long-term loans due within one year		101,244	105,965
Convertible promissory notes, net			1,108,785
Accounts payable, trade		9,605,089	10,785,531
Advances from customers		524,789	923,131
Amount due to related parties		1,018,832	2,980,441	[1]
Taxes payable		16,644	71,915
Other payables and accrued liabilities		3,204,970	3,175,574
Lease liabilities	[2]	650,661	532,630
Current liabilities from discontinued operations-held for sale		3,133,747	3,239,950
Total current liabilities		19,390,798	23,742,347	[1]
NON-CURRENT LIABILITIES
Lease liabilities	[2]	2,414,883	2,574,751
Long-term loans		126,284	314,786
Non-current liabilities from discontinued operations-held for sale		2,214,033	2,245,373
Total non-current liabilities		4,755,200	5,134,910
TOTAL LIABILITIES		24,145,998	28,877,257	[1]
STOCKHOLDERS’ EQUITY
Common Stock, $0.001 par value; 200,000,000 shares authorized; 6,258,962 and 3,764,780 shares issued and outstanding as of June 30, 2023, and December 31, 2022, respectively	[3]	6,259	3,765
Additional paid-in capital		77,417,369	71,899,271
Statutory reserves		2,263,857	2,263,857
Accumulated deficit		(68,298,681)	(70,143,785)
Accumulated other comprehensive income (loss)		(501,876)	24,583
Total BIMI International Medical Inc.’s equity		10,886,928	4,047,691
NON-CONTROLLING INTERESTS		1,625,568	1,169,542
Total stockholders’ equity		12,512,496	5,217,233
Total liabilities and stockholders’ equity		$ 36,658,494	$ 34,094,490	[1]

[1] In our financial statements for the year ended December 31, 2022, we incorrectly accounted for the acquisition of Phenix Bio Inc. On July 5, 2022, we entered into a stock purchase agreement, which was subsequently amended, pursuant to which we agreed to acquire Phenix and paid a deposit of $180,000 on July 7, 2022. The closing did not occur until March 15, 2023.  As of December 31, 2022, the accounting for the Phenix acquisition was incorrectly recorded as follows: (1) a long-term equity investment as a debit entry, (2) cash as a credit, and (3) other payables as a credit entry. Since the Phenix acquisition had not taken place as of December 31, 2022, it should not have been recorded as a long-term equity investment. As such, we reversed the long-term equity investment account and other payables account and recorded the deposit as a prepayment.

[2] The Company’s operating leases include the leases of operating companies only and do not include discontinued operations-held for sale.

[3] On February 2, 2022, we effected a reverse stock split of Common Stock at a ratio of 1-to-5 and on December 9, 2022, we effected a reverse stock split of Common Stock at a ratio of 1-to-10 (collectively, the “Reverse Splits”).

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Condensed Consolidated Balance Sheets (Unaudited) (Parentheticals) - $ / shares	Jun. 30, 2023	Dec. 31, 2022
Statement of Financial Position [Abstract]
Common stock, par value (in Dollars per share)	$ 0.001	$ 0.001
Common stock, shares authorized	200,000,000	200,000,000
Common stock, shares issued	6,258,962	3,764,780
Common stock, shares outstanding	6,258,962	3,764,780

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Condensed Consolidated Statements of Operations and Comprehensive Income (Loss) (Unaudited) - USD ($)	3 Months Ended		6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022	Jun. 30, 2023	Jun. 30, 2022
Income Statement [Abstract]
REVENUES	$ 5,557,666	$ 2,829,034	$ 8,755,303	$ 5,543,745
COST OF REVENUES	2,673,586	2,356,455	4,180,982	4,698,822
GROSS PROFIT	2,884,080	472,579	4,574,321	844,923
OPERATING EXPENSES:
Sales and marketing	236,155	296,063	492,313	641,627
General and administrative	1,348,481	2,943,302	2,127,465	5,119,784
Total operating expenses	1,584,636	3,239,365	2,619,778	5,761,411
INCOME (LOSS) FROM OPERATIONS	1,299,444	(2,766,786)	1,954,543	(4,916,488)
OTHER INCOME (EXPENSE)
Interest income	68	207	326	353
Interest expense	(34,615)	(48,581)	(69,530)	(96,718)
Exchange gain (loss)	(2,542)	(3,170)	(2,284)	(6,436)
Amortization of convertible notes		(771,124)		(1,542,248)
Investment income (expense)	(62,617)		197,739
Non-operating expense	(25,368)	(2,613,018)	(93,303)	(2,613,018)
Other income (expense)		67,351		66,720
Total other income (expense), net	(125,074)	(3,368,336)	32,948	(4,191,347)
INCOME (LOSS) BEFORE INCOME TAXES	1,174,370	(6,135,122)	1,987,491	(9,107,835)
PROVISION FOR INCOME TAXES		(4,222)		(7,151)
NET INCOME (LOSS) FROM CONTINUING OPERATIONS	1,174,370	(6,139,344)	1,987,491	(9,114,986)
DISCONTINUED OPERATIONS
Loss from discontinued operations-held for sale	(119,793)	(406,155)	(143,102)	(198,738)
Income (loss) from discontinued operations		(818)		26,928
NET INCOME (LOSS)	1,054,397	(6,546,316)	1,844,389	(9,286,796)
Less: net loss attributable to noncontrolling interest	272	(1,416)	715	(2,498)
NET INCOME (LOSS) ATTRIBUTABLE TO BIMI INTERNATIONAL MEDICIAL INC.	1,054,125	(6,544,900)	1,843,674	(9,284,298)
OTHER COMPREHENSIVE (LOSS)
Foreign currency translation adjustment	(753,453)	(417,506)	(526,459)	(967,586)
TOTAL COMPREHENSIVE INCOME (LOSS)	300,944	(6,963,822)	1,317,930	(10,254,382)
Less: comprehensive income attributable to noncontrolling interest	(568,103)	(510,069)	(1,508,627)	(535,043)
COMPREHENSIVE INCOME (LOSS) ATTRIBUTABLE TO BIMI INTERNATIONAL MEDICIAL INC.	$ 869,047	$ (6,453,753)	$ 2,826,557	$ (9,719,339)
WEIGHTED AVERAGE NUMBER OF COMMON SHARES
Basic (in Shares)	4,596,440	9,493,512	4,219,675	15,429,754
INCOME (LOSS) PER SHARE
Continuing operations-Basic (in Dollars per share)	$ 0.26	$ (0.65)	$ 0.47	$ (0.59)
Discontinued operations-Basic (in Dollars per share)	(0.03)	(0.04)	(0.03)	(0.01)
Basic (in Dollars per share)	$ 0.23	$ (0.69)	$ 0.44	$ (0.6)

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Condensed Consolidated Statements of Operations and Comprehensive Income (Loss) (Unaudited) (Parentheticals) - $ / shares	3 Months Ended		6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022	Jun. 30, 2023	Jun. 30, 2022
Income Statement [Abstract]
Diluted (in Shares)	4,596,440	9,493,512	4,219,675	15,429,754
Continuing operations-Diluted	$ 0.26	$ (0.65)	$ 0.47	$ (0.59)
Discontinued operation-Diluted	(0.03)	(0.04)	(0.03)	(0.01)
Diluted	$ 0.23	$ (0.69)	$ 0.44	$ (0.60)

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Consolidated Statements of Shareholders' Equity (Unaudited) - USD ($)	Common Stock	Additional Paid-in Capital	Accumulated Other Comprehensive Income	Statutory Reserves	Non Controlling Interests	Accumulated Deficit	Total
Balance at Dec. 31, 2022	$ 3,765	$ 71,899,271	$ 24,583	$ 2,263,857	$ 1,169,542	$ (70,143,785)	$ 5,217,233
Balance (in Shares) at Dec. 31, 2022	3,764,780
Issuance of Common Stock	$ 270	376,337					376,607
Issuance of Common Stock (in Shares)	270,000
Net income					443	789,549	789,992
Foreign currency translation adjustment			227,068		(112,519)	3,187,087	3,301,636
Discontinued operations and subsidiaries -held for sale			(74)			(3,186,202)	(3,186,276)
Balance at Mar. 31, 2023	$ 4,035	72,275,608	251,577	2,263,857	1,057,466	(69,353,351)	6,499,192
Balance (in Shares) at Mar. 31, 2023	4,034,780
Issuance of Common Stock	$ 2,224	5,141,761					5,143,985
Issuance of Common Stock (in Shares)	2,224,182
Net income					272	1,504,125	1,054,397
Foreign currency translation adjustment			(757,599)		567,830	83,320	(106,449)
Discontinued operations and subsidiaries -held for sale			4,146			(82,775)	(78,629)
Balance at Jun. 30, 2023	$ 6,259	$ 77,417,369	$ (501,876)	$ 2,263,857	$ 1,625,568	$ (68,298,681)	$ 12,512,496
Balance (in Shares) at Jun. 30, 2023	6,258,962

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Consolidated Statements of Cash Flows (Unaudited) - USD ($)	6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income (loss)	$ 1,844,389	$ (9,286,796)
Adjustments to reconcile net loss to cash used in operating activities:
Depreciation and amortization	128,613	125,781
Inventories impairment reserve	26,604
Allowance for doubtful accounts		(572)
Stock compensation		1,510,000
Amortization of discount of convertible promissory notes		1,542,248
Gain (loss) on disposal of discontinued operations	197,739	(259,253)
Change in operating assets and liabilities
Accounts receivable	(3,172,101)	1,167,803
Advances to suppliers	3,982,685	4,647,888
Prepayments and other receivables	176,955	(113,247)
Inventories	445,113	(494,246)
Operating lease-right of use assets	106,273	167,698
Accounts payable, trade	(1,180,442)	(1,399,264)
Advances from customers	(398,342)	429,998
Operating lease liabilities	(41,837)	(140,526)
Taxes payable	(48,398)	(117,114)
Other payables and accrued liabilities	29,396	(1,130,396)
Discontinued operations-held for sale of Minkang, Eurasia, Qiangsheng and Zhongshan hospitals Minkang/wuzhou/suzhou/Chaohu zhongshan	150,801	(366,739)
Net cash provided by (used in) operating activities	2,247,448	(3,689,637)
CASH FLOWS FROM FINANCING ACTIVITIES:
Net proceeds from issuance of convertible promissory note to related party		5,000,000
Issuance of Common Stock	1,600
Proceeds from short-term loan	316,397	80,758
Repayment of short-term loans	(4,721)
Repayment of long-term loans	(188,502)	(399,115)
Amount repaid to related parties	(1,961,609)	(227,248)
Net cash provided by (used in) financing activities	(1,836,835)	4,454,395
EFFECT OF EXCHANGE RATE ON CASH	(815,505)	(661,857)
NET DECREASE (INCREASE) IN CASH AND CASH EQUIVALENTS	(404,892)	102,901
CASH AND CASH EQUIVALENTS, beginning of period	2,336,636	4,609,431
CASH AND CASH EQUIVALENTS, end of period	1,931,744	4,712,332
SUPPLEMENTAL CASH FLOW INFORMATION:
Cash paid for income tax		133,009
Cash paid for interest expense, net of capitalized interest	37,549	122,539
NON-CASH TRANSACTIONS OF INVESTING AND FINANCING ACTIVITIES
Issuance of Common Stock as a result of the application of the “Floor Amount Issuance” with respect to the conversion of convertible promissory note	894
Issuance of Common Stock upon conversion of convertible notes		5,491
Lease liabilities arising from acquisition of  right-of-use assets	$ 28,277	$ 30,392

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Organization and Business Background

6 Months Ended

Jun. 30, 2023

Organization and Business Background [Abstract]

ORGANIZATION AND BUSINESS BACKGROUND

1. ORGANIZATION AND BUSINESS BACKGROUND

BIMI International Medical, Inc. (the “Company” or “BIMI”) was incorporated in the State of Delaware as Galli Process, Inc. on October 31, 2000. On February 7, 2002, the Company changed its name to Global Broadcast Group, Inc. On November 12, 2004, the Company changed its name to Diagnostic Corporation of America. On March 15, 2007, the Company changed its name to NF Energy Saving Corporation of America, and on August 24, 2009, the Company changed its name to NF Energy Saving Corporation. On December 16, 2019, the Company changed its name to BOQI International Medical Inc., to reflect the Company’s refocus of its business from the energy saving industry to the health care industry and on June 21, 2021, we changed our name to BIMI International Medical Inc. Since March 7, 2012, the Common Stock of the Company (the “Common Stock”) has been traded on the Nasdaq Capital Market.

Until October 14, 2019, the Company, through NF Energy Saving Investment Limited and its subsidiaries (the “NF Group”), operated in the energy saving enhancement technology industry in the People’s Republic of China (the “PRC”). The NF Group focused on providing services relating to energy saving technology, optimization design, energy saving reconstruction of pipeline networks and contractual energy management for the electric power, petrochemical, coal, metallurgy, construction, and municipal infrastructure development industries in the PRC and the manufacture and sales of energy-saving flow control equipment. In late 2019, the Company committed to a plan to dispose of all its equity interests in the NF Group and on March 31, 2020, the Company entered into a stock purchase agreement (the “NF SPA”) to sell the NF Group. The sale of the NF Group closed on June 23, 2020.

On October 14, 2019, the Company acquired 100% of the equity interests in Lasting Wisdom Holdings Limited (“Lasting”), a limited company incorporated under the laws of the British Virgin Islands (“BVI”). Lasting has limited operating activities since incorporation except for holding the ownership interest in Pukung Limited (“Pukung”), a company organized under the laws of Hong Kong. Pukung owns 100% of the equity interest in Beijing Xinrongxin Industrial Development Co., Ltd. (“Xinrongxin”), a company organized under the laws of the PRC. Xinrongxin owns all the ownership interest of Dalian Boqi Zhengji Pharmacy Chain Co., Ltd. (“Boqi Zhengji”). Boqi Zhengji operated 16 retail pharmacy stores in China at the time of the acquisition. Lasting, Pukung, Xinrongxin and Boqi Zhengji are hereinafter collectively referred to as the “Boqi Zhengji Group”. Xinrongxin also owns 100% equity interests in Dalian Boyi Technology Co., Ltd. (“Dalian Boyi”), a subsidiary established in January 2020 and responsible for the Company’s R&D and other technology related functions.

On June 24, 2020, the Company established a wholly owned subsidiary Boyi (Liaoning) Technology Co.,Ltd (“Liaoning Boyi”), in order to be qualified to participate in local healthcare projects. On December 22, 2020, the Company established another subsidiary, Bimai Pharmaceutical (Chongqing) Co., Ltd., to replace Xinronxin as the holding company owning all the retail, wholesale and hospital operations in China.

On March 18, 2020, the Company, through its wholly owned subsidiary, Xinrongxin, acquired 100% of the equity interests in Chongqing Guanzan Technology Co., Ltd. (“Guanzan”). Guanzan held an 80% equity interest in Chongqing Shude Pharmaceutical Co., Ltd. (“Shude”, and collectively with Guanzan, the “Guanzan Group”). Guanzan also owns 100% equity interest in Chongqing Lijiantang Pharmaceutical Co. Ltd., a subsidiary established in May 2020. Lijiantang operates 4 retail pharmacy stores in China (collectively, the “Lijiantang Pharmacy Group”). 

On December 11, 2020, the Company entered into a stock purchase agreement to sell Boqi Zhengji. The sale of the Boqi Zhengji closed by the end of 2020 although the government record was not updated until February 2, 2021 due to the Chinese government’s alternative working schedule and other delays caused by COVID-19.

On December 9, 2020, the Company entered into an agreement to acquire 100% of the equity interests in Chongqing Guoyitang Hospital (“Guoyitang”), the owner and operator of a private general hospital in Chongqing City, a city in Southwest China. The transaction closed on February 2, 2021. 

On December 15, 2020, the Company entered into an agreement to acquire Chaohu Zhongshan Minimally Invasive Hospital (“Zhongshan”), a private hospital in the Southeast region of China. The transaction closed on February 5, 2021.

On April 9, 2021, the Company entered into an agreement to acquire three private hospitals in the PRC, Wuzhou Qiangsheng Hospital (“Qiangsheng”), Suzhou Eurasia Hospital(“Eurasia”) and Yunnan Yuxi MinKang hospital (“Minkang”). The transaction closed on May 6, 2021.

On April 21, 2021, Bimai Hospital Management (Chongqing) Co. Ltd. was incorporated in the PRC by the Company to manage the operations of the Company’s medical services segment.

On April 21, 2021, Pusheng Pharmaceutical Co., Ltd. was incorporated in the PRC by the Company to manage its wholesale distribution of generic drugs.

On September 10, 2021, the Company entered into an agreement to acquire 100% of the equity interests in Chongqing Zhuoda Pharmaceutical Co., LTD (“Zhuoda”). The transaction closed on October 8, 2021.

On December 20, 2021, the Company entered into a stock purchase agreement to acquire Bengbu Mali OB-GYN Hospital Co., Ltd. (“Mali Hospital”). We agreed to purchase all the issued and outstanding equity interests in Mali Hospital in consideration of $16,750,000. At the signing, 60,000 shares of the Company’s Common Stock (reflecting the Reverse Splits) were delivered as partial consideration for the purchase and on January 4, 2022, we paid RMB 7,227,000 to the seller as partial consideration. The transaction did not close and on December 15, 2022, we entered into a termination agreement with respect to the original purchase agreement. Pursuant to the termination agreement, the original agreement will terminate effective as of the date of the return of the 60,000 shares of the Company’s Common Stock (reflecting the Reverse Splits) previously issued to the sellers and certain third-party beneficiaries. On December 9, 2022, 52,000 shares of Common Stock were returned to the Company and on September 1, 2023, the remaining 8,000 shares of Common Stock were returned to the Company. All cash paid at the time of the acquisition is expected to be returned by December 31, 2023. 

On July 5, 2022, we entered into a stock purchase agreement (as amended on February 27, 2023) with Mr. Fnu Oudom, the Chairman of our board of directors, whereby we agreed to acquire 100% of the equity interests in Phenix Bio Inc. (“Phenix”), a developer and distributor of dietary supplements, in consideration of $1,800,000. The transaction closed effective March 15, 2023. The aggregate purchase price for the equity interests in Phenix was $180,000 in cash, which was paid on July 7, 2022, plus up to 5,270,000 shares of the Company’s Common Stock (reflecting the Reverse Splits), of which 270,000 shares were issued to Mr. Oudom on June 19, 2023, after shareholder approval was obtained. We agreed to issue 5,000,000  shares of Common Stock to Mr. Oudom in the event that Phenix will generate at least $2,500,000 in net profit in calendar year 2023 or in any fiscal quarter of 2023.

As of June 30, 2023, the Company has four operating segments: retail pharmacy, wholesale pharmaceuticals, wholesale medical devices and healthcare products.

The retail pharmacy segment engages in the retail sale of medicine and other healthcare products in the PRC. The retail pharmacy segment sells its medicine and other healthcare products to customers through its directly owned stores. The group offers a wide range of products, including prescription and over the counter (“OTC”) drugs, nutritional supplements, traditional Chinese medicines, personal and family care products and medical devices, as well as miscellaneous items.

The Company’s wholesale segments are engaged in the distribution of medical devices and pharmaceuticals. The wholesale medical devices segment distributes medical devices, including medical consumables to drug stores, private clinics, pharmaceutical dealers, and hospitals. The wholesale pharmaceuticals segment supplies prescription and OTC medicines, TCM, healthcare supplies and sundry items to clinics, third party pharmacies, hospitals, and other drug vendors.

The Company’s healthcare products are developed and distributed by Phenix. Phenix owns its formulas and uses out-sourced facilities in the U.S. and Australia to manufacture its products. To date, Phenix has sold all of its products through Meta Time, an online sales platform. Most of the customers were from Asian countries. Phenix currently offers six categories of dietary supplements, a cardiovascular product, an anti-insomnia and depression product, a male aphrodisiac product, a woman’s menopausal syndrome product, a gout product, and an immunity enhancer.

As of June 30, 2022, the Company had four operating segments: wholesale medical devices, wholesale pharmaceuticals, medical services, and retail pharmacy.

As of June 30, 2023, the details of the Company’s subsidiaries are as follows:

Name	Place of incorporation and kind of legal entity	Principal activities and Type of operation	Effective ownership interest held
Lasting Wisdom Holdings Limited (“Lasting”)	British Virgin Island, a limited liability company	Investment holding		100	%
Phenix Bio Inc. (“Phenix”)	California, a corporation	Distribution of healthcare products		100	%
Pukung Limited (“Pukung”)	Hong Kong, a limited liability company	Investment holding		100	%
Beijing Xinrongxin Industrial Development Co., Ltd. (“Xinrongxin”)	The PRC, a limited liability company	Investment holding		100	%
Boyi (Liaoning) Technology Co., Ltd (“Liaoning Boyi”)	The PRC, a limited liability company	IT Technology service research and development		100	%
Dalian Boyi Technology Co., Ltd (“Dalian Boyi”)	The PRC, a limited liability company	IT Technology service research and development		100	%
Chongqing Guanzan Technology Co., Ltd. (“Guanzan”)	The PRC, a limited liability company	Wholesale distribution of medical devices in the PRC		100	%
Chongqing Shude Pharmaceutical Co., Ltd.(“Shude”)	The PRC, a limited liability company	Wholesale distribution of generic drugs in the PRC		95	%
Chongqing Lijiantang Pharmaceutical Co., Ltd.(“Lijiantang”)	The PRC, a limited liability company	Wholesale distribution of generic drugs in the PRC		100	%
Bimai Pharmaceutical (Chongqing) Co., Ltd.	The PRC, a limited liability company	Investment holding		100	%
Chongqing Guoyitang Hospital Co., Ltd.	The PRC, a limited liability company	Hospital in the PRC		100	%
Chongqing Huzhongtang Healthy Technology Co., Ltd.	The PRC, a limited liability company	Wholesale distribution of generic drugs in the PRC		100	%
Chaohu Zhongshan Minimally Invasive Hospital Co.,Ltd.	The PRC, a limited liability company	Hospital in the PRC		100	%
Yunnan Yuxi Minkang Hospital Co., Ltd.	The PRC, a limited liability company	Hospital in the PRC		100	%
Wuzhou Qiangsheng Hospital Co., Ltd.	The PRC, a limited liability company	Hospital in the PRC		100	%
Suzhou Eurasia Hospital Co., Ltd.	The PRC, a limited liability company	Hospital in the PRC		100	%
Bimai Hospital Management (Chongqing) Co. Ltd	The PRC, a limited liability company	Hospital management in the PRC		100	%
Pusheng Pharmaceutical Co., Ltd	The PRC, a limited liability company	Wholesale distribution of generic drugs in the PRC		100	%

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Going Concern Uncertainties

6 Months Ended

Jun. 30, 2023

Going Concern Uncertainties [Abstract]

GOING CONCERN UNCERTAINTIES

2. GOING CONCERN UNCERTAINTIES

The accompanying unaudited condensed consolidated financial statements have been prepared assuming that the Company will continue as a going concern, which contemplates the realization of assets and the discharge of liabilities in the normal course of business for the foreseeable future.

As reflected in the accompanying unaudited condensed consolidated financial statements, the Company incurred significant net losses of $1,844,389 and $9,286,796 during the six months ended June 30, 2023, and 2022, respectively. As of June 30, 2023, the Company had an accumulated deficit of $68.3 million. Management believes these factors raise substantial doubt about the Company’s ability to continue as a going concern for the next twelve months.

The continuation of the Company as a going concern through the next twelve months is dependent upon (1) the continued financial support from its stockholders or its ability to obtain external financing, and (2) further implementation of management’s business plan to expand its operations and generate sufficient revenues to meet its obligations. While the Company believes in the viability of its strategy to increase sales volume and in its ability to raise additional funds, there can be neither any assurances to that effect, nor any assurance that the Company will be successful in securing sufficient funds to sustain the operations.

These unaudited condensed financial statements do not include any adjustments to reflect the possible future effect on the recoverability and classification of assets or the amounts and classifications of liabilities that may result from the outcome of these uncertainties. Management believes that the actions presently being taken to obtain additional funding and implement its strategic plan provides the opportunity for the Company to continue as a going concern.

We are in the process of restating our financial statements for year ended December 31, 2022 and the quarterly periods ended March 31, 2022, June 30, 2022, September 30, 2022 and March 31, 2023, to correct errors identified in our prior financial statements. We have concluded that the restatements do not materially affect our liquidity or our compliance with debt covenants or other financial obligations.

(1)     We are in the process of restating the Consolidated Statements of Equity for the quarterly periods ended June 30, 2022 and September 30, 2022. The restatement relates to the stockholders’ equity and noncontrolling interests presented in the consolidated balance sheets, as of June 30, 2022 and September 30, 2022, which had been presented in the form of a reconciliation of the beginning balance to the ending balance for each period for which a consolidated statement of comprehensive income was required to be filed.  We will provide reconciliations for the interim periods covered by the Consolidated Statement of Equity for the periods ended June 30, 2022 and September 30, 2022.  This restatement should not have any effect on net income, per-share amount, or retained earnings and other components of equity or net assets for prior filing and current filing. We have concluded that the restatement does not materially affect our liquidity or our compliance with debt covenants or other financial obligations.

(2)     On June 9, 2022, the Company issued a $5 million subordinated promissory note, which was converted into 1,250,000 shares of the Company’s Common Stock (post the December 2022 1 to 10 reverse split) on July 18, 2022, upon obtaining shareholder approval for the transaction. We erroneously reflected the proceeds of the promissory note in the Consolidated Statements of Cash Flows as “Issuance of Common Stock” for the six month period ended June 30, 2022.   We failed to reflect this promissory note as a note payable as of June 30, 2022. As a result, we are in the process of restating our financial statements for the quarterly period ended June 30, 2022. This restatement did not effect our net income, per-share amounts, retained earnings or other components of equity or net assets for prior filings and the current filing. We have concluded that the restatement does not materially affect our liquidity or our compliance with debt covenants or other financial obligations.

(3)     We restated our financial statements for the year ended December 31, 2021 and are in the process of restating the our financial statements for the quarterly period ended June 30, 2022 to correct errors identified in our prior financial statements. In the year ended December 31, 2021 and the quarterly periods ended March 31, 2022 and June 30, 2022, we recorded amortization of convertible notes as a general and administrative expense in error. We have revised the financial statements for the year ended December 31, 2021 and the six months ended June 30, 2022 and are in the process of revising our financial statements for the quarterly period ended March 31, 2022 to record the amortization of convertible notes as an “other expense”. The impact of the restatement on our financial statements is the reclassification of such expense as an “other expense”. The reclassification also affected the classification of such expense in the Consolidated Statements of Cash Flows. We have also amended various footnotes to the financial statements. We restated our financial statements for the year ended December 31, 2021 and are in the process of restating the financial statements for the year ended December 31, 2022 and the quarterly periods ended March 31, 2022, June, 30, 2022 and September 30, 2022 to correct this issue. This restatement did not affect our net income (loss) , net income (loss) per-share, retained earnings or other components of equity or net assets for our prior filings and the current filing. We have concluded that the restatement does not materially affect our liquidity or our compliance with debt covenants or other financial obligations.

(4)     We are in the process of restating our financial statements for the year ended December 31, 2022, where we incorrectly accounted for the acquisition of Phenix. On July 5, 2022, we entered into a stock purchase agreement, which was subsequently amended, pursuant to which we agreed to acquire Phenix and paid a deposit of $180,000 on July 7, 2022. The closing did not occur until March 15, 2023.  As of December 31, 2022, the accounting for the Phenix acquisition was incorrectly recorded as follows: (1) a long-term equity investment as a debit entry, (2) cash as a credit, and (3) other payables as a credit entry. Since the Phenix acquisition had not taken place as of December 31, 2022, it should not have been recorded as a long-term equity investment. As such, we reversed the long-term equity investment account and other payables account and recorded the deposit as a prepayment. This restatement did not affect our net income, per-share amounts, or retained earnings, but affected the net assets in the quarterly period ended March 31, 2023. We have concluded that the restatement does not materially affect our liquidity or other financial obligations.

(5)       We are in the process of restating the Consolidated Statements of Cash Flows for the quarterly periods ended June 30, 2022, September 30, 2022, March 31, 2023 and for the year ended December 31, 2022. The restatement relates to the discontinued entities' cashflow presented in the Consolidated Statements of Cash Flows, for the quarterly periods ended June 30, 2022, September 30, 2022, March 31, 2023, and for the year ended December 31, 2022, which have not presented in the prior period filling. In the restated Consolidated Statements of Cash Flows, we will present the discontinued entities’ cash flows in the Consolidated Statements of Cash Flows instead of zero. This restatement does not affect net income (loss), net income (loss) per-share, or retained earnings and other components of equity or net assets in our prior filings or in our current filing. We have concluded that the restatement does not materially affect our liquidity or our compliance with debt covenants or other financial obligations.  

We are taking steps to address the causes of the restatements and to improve our internal controls over financial reporting. We are in the process of hiring a new third-party consulting firm to assist us in strengthening our daily internal controls and financial reporting process review. We also aim to improve our internal accounting department management as well. We are committed to maintaining the integrity of our financial statements and to provide accurate and transparent financial information to our investors.

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Summary of Significant Accounting Policies

6 Months Ended

Jun. 30, 2023

Summary of Significant Accounting Policies [Abstract]

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

● Basis of presentation and consolidation

These accompanying unaudited condensed consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States of America (“US GAAP”). These unaudited condensed consolidated financial statements include the financial statements of the Company and its subsidiaries. All significant inter-company balances and transactions within the Company have been eliminated upon consolidation.

The unaudited condensed consolidated financial information as of June 30, 2023, and for the three and six months ended June 30, 2023, and 2022 have been prepared, pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”). Certain information and footnote disclosures, which are normally included in annual consolidated financial statements prepared in accordance with US GAAP, have been omitted pursuant to those rules and regulations. The unaudited interim condensed consolidated financial information should be read in conjunction with the consolidated financial statements and the notes thereto, included in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2022, filed with the SEC on May 4, 2023.

In the opinion of management, all adjustments (which include normal recurring adjustments) necessary to present a fair statement of the Company’s unaudited condensed consolidated financial position as of June 30, 2023 and its unaudited condensed consolidated results of operations for the three and six months ended June 30, 2023 and 2022, and its unaudited condensed consolidated cash flows for the three and six months ended June 30, 2023 and 2022, as applicable, have been made. The results of operations are not necessarily indicative of the operating results for the fiscal year or any future periods.

● Use of estimates

The preparation of these condensed consolidated financial statements in conformity with the US GAAP requires management to make estimates and judgments that affect the reported amounts of assets and liabilities, disclosures of contingent assets and liabilities on the date of these condensed consolidated financial statements and the reported amounts of revenues and expenses during the reporting periods. The Company bases its estimates and judgments on historical experience and on various other assumptions and information that are believed to be reasonable under the circumstances. Estimates and assumptions of future events and their effects cannot be perceived with certainty and, accordingly, these estimates may change as new events occur, as more experience is acquired, as additional information is obtained and as our operating environment changes. Significant estimates and assumptions made by management include, among others, useful lives and impairment of long-lived assets, collectability of accounts receivable, advances to suppliers, allowance for doubtful accounts, reserve for inventory obsolescence, fair value of goodwill and valuation of derivative liabilities. While the Company believes that the estimates and assumptions used in the preparation of these condensed consolidated financial statements are appropriate, actual results could differ from those estimates. Estimates and assumptions are periodically reviewed, and the effects of revisions are reflected in the consolidated financial statements in the period they are determined to be necessary.

● Business combinations

The Company accounts for its business combinations using the acquisition method of accounting in accordance with ASC 805 “Business Combinations”. The cost of an acquisition is measured as the aggregate of the acquisition date fair values of the assets transferred and liabilities incurred by the Company to the sellers and equity instruments issued. Transaction costs directly attributable to the acquisition are expensed as incurred. Identifiable assets and liabilities acquired or assumed are measured separately at their fair values as of the acquisition date, irrespective of the extent of any non-controlling interests. The excess of (i) the total costs of acquisition, fair value of the non-controlling interests and acquisition date fair value of any previously held equity interest in the acquiree over (ii) the fair value of the identifiable net assets of the acquiree is recorded as goodwill. If the cost of acquisition is less than the acquisition date amounts of the net assets of the subsidiary acquired, the difference is recognized directly in the consolidated income statements. During the measurement period, which can be up to one year from the acquisition date, the Company may record adjustments to the assets acquired and liabilities assumed with the corresponding offset to goodwill. Subsequent to the conclusion of the measurement period or final determination of the values of assets acquired or liabilities assumed, whichever comes first, any further adjustments are recorded in the consolidated income statements.

In a business combination achieved in stages, the Company re-measures the previously held equity interest in the acquiree immediately before obtaining control at its acquisition date fair value and the re-measurement gain or loss, if any, is recognized in the consolidated income statements.

When there is a change in ownership interests or a change in contractual arrangements that results in a loss of control of a subsidiary, the Company deconsolidates the subsidiary from the date control is lost. Any retained non-controlling investment in the former subsidiary is measured at fair value and is included in the calculation of the gain or loss upon deconsolidation of the subsidiary.

● Cash and cash equivalents

Cash and cash equivalents consist primarily of cash on hand and cash in banks which is readily available in checking and saving accounts. The Company maintains cash with various financial institutions in the PRC where its accounts are uninsured. The Company has not experienced any losses from funds held in bank accounts and believes it is not exposed to any risk on its bank accounts.

● Accounts receivable and allowance for doubtful accounts

Accounts receivable are recorded at the invoiced amount and do not bear interest, which are due within contractual payment terms, generally 30 to 90 days from delivery. Credit is extended based on evaluation of a customer’s financial condition, the customer creditworthiness and their payment history. Accounts receivable outstanding longer than the contractual payment terms are considered past due. Past due balances over 90 days and over a specified amount are reviewed individually for collectability. At the end of each period, the Company specifically evaluates individual customer’s financial condition, credit history, and the current economic conditions to monitor the progress of the collection of accounts receivables. For the receivables that are past due or not being paid according to payment terms, the appropriate actions are taken to exhaust all means of collection, including seeking legal resolution in a court of law. Account balances are charged off against the allowance after all means of collection have been exhausted and the potential for recovery is considered remote. We do not have any off-balance-sheet credit exposure related to its customers.

● Advances to suppliers

Advances to suppliers consist of prepayments to the Company’s vendors, such as pharmaceutical manufacturers and medicine suppliers. The Company typically prepays for the purchase of our merchandise, especially for those salable, scarce, personalized medicine or medical devices. The Company typically receive products from vendors within three to nine months after making prepayments. The Company continuously monitor delivery from, and payments to, the vendors while maintaining a provision for estimated credit losses based upon historical experience and any specific supplier issues, such as discontinuing of inventory supply, that have been identified. If the Company has difficulty receiving products from a vendor, the Company will cease purchasing products from such vendor, request return of our prepayment promptly, and if necessary, take legal action. The Company has not taken such type of legal action during the reporting periods. If none of these steps are successful, management will then determine whether the prepayments should be reserved or written off. As of June 30, 2023 and December 31, 2022, the allowance for doubtful accounts was Nil.

● Businesses held for sale

In late 2022, we committed to a plan to dispose of the Zhongshan, Minkang, Qiangsheng and Eurasia hospitals and ceased the operation of the Guoyitang hospital. A An impairment is recorded, if necessary, on an annual basis or at the point of sale, based on an impairment assessment report by a third party.

When we acquire a business, a substantial portion of the purchase price of the acquisition may be allocated to goodwill and other identifiable intangible assets. The amount of the purchase price which is allocated to goodwill and other intangible assets is determined by the excess of the purchase price over the net identifiable assets acquired. The current accounting standards require that goodwill and intangible assets should be deemed to have indefinite lives, which should be tested for impairment at least annually (or more frequently if impairment indicators arise). Other intangible assets are amortized over their useful lives. In 2022, we recorded impairment losses totaling approximately $5.4 million with respect to the goodwill relating to our acquisitions of the Guanzan Group, Zhongshan, Guoyitang, Minkang, Qiangsheng and Eurasia.

On December 28, 2022, the Company entered into an agreement to transfer 87% of the equity interests in Zhongshan to the prior owner and retain 13% of the equity interests in Zhongshan. As consideration for the transfer and pursuant to an amendment to the original stock purchase agreement, the original seller agreed to return the 40,037 shares of Common Stock previously issued (reflecting the Reverse Splits) and RMB 40,000,000 in cash (approximately ($6,116,207) previously paid upon the acquisition of Zhongshan. The former owner also agreed to release the Company from any and all claims relating to two earn out payments that were payable under the original purchase agreement. The Company received a put option to sell part or all of its 13% interest in Zhongshan before December 31, 2032, based on a valuation determined by a reputable third-party appraisal firm jointly chosen by the two parties. On September 1, 2023, 39,037 shares of Common Stock were returned to the Company. The remaining 1,000 shares were returned in the form of $3,055 in cash because the shares were sold by the original seller. The transaction is expected to close by December 31, 2023, at which time the cash paid at the time of the transaction will also be returned.

On December 28, 2022, the Company entered into an agreement to transfer 90% of the equity interests in the Qiangsheng, Eurasia and Minkang hospitals to their former owners. Pursuant to the agreement, the Company will transfer 90% of the equity interests in each of the three hospitals and continue to own 10% of the equity interests in each hospital. As consideration for the transfer and pursuant to an amendment to the original stock purchase agreement, the original sellers agreed to return the 80,000 shares of Common Stock previously issued (reflecting the Reverse Splits) and RMB 20,000,000 (approximately $2,767,860) in cash previously paid upon the acquisition of the three hospitals. The former owner also agreed to release the Company from any and all claims relating to two earn out payments that were payable under the original purchase agreement. The Company received a put option to sell part or all of its 10% interest in each of the three hospitals to the former owner before December 31, 2032, based on a valuation determined by a reputable third-party appraisal firm jointly chosen by the parties. On December 9, 2022, 43,600 shares of Common Stock were returned to the Company and on September 1, 2023, 36,400 shares of Common Stock were returned to the Company. The transaction is expected to close by December 31, 2023, at which time the cash paid at the time of the transaction will also be returned.

The Company determined that the plan and the subsequent actions taken to dispose of the four hospitals qualified as held for sale operations under the criteria set forth in the ASC 205-20 Presentation of Financial Statements – Discontinued Operation.

The carrying amount of the major classes of assets and liabilities of the businesses held for sale as of June 30, 2023 and December 31, 2022 consist of the following:

	June 30,			December 31,
	2023			2022
Assets from held for sale
Current assets
Cash and cash equivalents	$	154,503		$	53,928
Accounts receivable, net		516,287			501,054
Advances to suppliers		197,737			211,335
Amount due from related parties		337,904			350,577
Inventories, net		153,977			155,736
Prepayments and other receivables		772,974			827,043
Total current assets		2,133,382			2,099,673
Non-current assets
Deferred tax assets		(128	)		(133	)
Property, plant and equipment, net		1,191,554			1,254,328
Operating lease-right of use assets		2,247,673			2,506,954
Goodwill		-			-
Total non-current assets		3,439,099			3,761,149
Total assets held for sale	$	5,572,481		$	5,860,822
Liabilities of held for sale businesses
Current liabilities
Short-term loans	$	207,589		$	215,375
Long-term loans due within one year		-			-
Accounts payable, trade		1,375,938			1,480,098
Advances from customers		2,668			1,537
Taxes payable		324,582			336,755
Other payables and accrued liabilities		766,601			739,873
Lease liability-current		456,369			466,312
Total current liabilities		3,133,747			3,239,950
Non-current liabilities
Lease liability-non current		2,214,033			2,245,373
Total non-current liabilities		2,214,033			2,245,373
Total liabilities		5,347,780			5,485,323

The summarized operating results of the businesses held for sale included in the Company’s consolidated statements of operations consist of the following:

	For the six months ended June 30,
	2023			2022
Revenues	$	330,281			2,850,027
Cost of revenues		149,253			1,233,688
Gross profit		181,028			1,616,339
Operating expense		253,107			1,598,666
Other expense		(70,288	)		(194,199	)
Loss before income taxes		(142,367	)		(176,526	)
Income tax expense		735			22,212
Loss from businesses held for sale	$	(143,102	)	$	(198,738	)

● Inventories

Inventories are stated at the lower of cost or market value. Cost is determined using the weighted average method, and market value is the middle (the second highest) value among an inventory item’s replacement cost, market celling and market floor. The Company carries out physical inventory counts on a monthly basis at each store and warehouse location. The Company reviews historical sales activity quarterly to determine excess, slow-moving items and potentially obsolete items. The Company provides inventory reserve based on the excess quantities on hand equal to the difference, if any, between the cost of the inventory and its estimated market value, or obsolescence of inventories determined principally by customer demand. As of June 30, 2023 and December 31, 2022, the Company recorded an allowance for obsolete inventories, which mainly consists of expired medicine, of $26,604 and $59,567, respectively.

● Property, plant and equipment

Property, plant, and equipment are stated at cost less accumulated depreciation and impairment, if any. Depreciation is calculated on the straight-line basis over the following expected useful lives from the date on which they become fully operational and after taking into account their estimated residual values:

Items	Expected useful lives	Residual value
Building	20 years		5	%
Office equipment	3 years		5	%
Electronic equipment	3 years		5	%
Furniture	5 years		5	%
Medical equipment	10 years		5	%
Vehicles	4 years		5	%
Leasehold Improvement	Shorter of lease term or useful life		5	%

Expenditures for repairs and maintenance are expensed as incurred. When assets have been retired or sold, the cost and related accumulated depreciation are removed from the accounts and any resulting gain or loss is recognized in the results of operations.

● Leases

On January 1, 2020, the Company adopted Accounting Standards Update (“ASU”) 2016-02. For all leases that were entered into prior to the effective date of ASC 842, we elected to apply the package of practical expedients. Based on this guidance, the Company did not reassess the following: (1) whether any expired or existing contracts are or contain leases; (2) the lease classification for any expired or existing leases; and (3) initial direct costs for any existing leases.

The Company determines if an arrangement is a lease at inception. Operating leases are included in operating lease right-of-use (“ROU”) assets, current portion of obligations under operating leases, and obligations under operating leases, non-current on the Company’s consolidated balance sheets. Finance leases are included in property and equipment, net, current portion of obligations under capital leases, and obligations under capital leases, non-current on our consolidated balance sheets.

Operating lease ROU assets and operating lease liabilities are recognized based on the present value of the future minimum lease payments over the lease term at commencement date, adjusted by the deferred rent liabilities at the adoption date. As most of the Company’s leases do not provide an implicit rate, the Company uses its incremental borrowing rate based on the information available at commencement date in determining the present value of future payments. The operating lease ROU asset also includes any lease payments made and excludes lease incentives and initial direct costs incurred. The Company’s terms may include options to extend or terminate the lease when it is reasonably certain that the Company will exercise that option. Operating lease expense is recognized on a straight-line basis over the lease term.

● Goodwill

Goodwill represents the excess of the consideration paid of an acquisition over the fair value of the net identifiable assets of the acquired subsidiary at the date of acquisition. Goodwill is not amortized, and is tested for impairment at least annually, more often when circumstances indicate impairment may have occurred. Goodwill is carried at cost less accumulated impairment losses. If impairment exists, goodwill is immediately written off to its fair value and the loss is recognized in the consolidated statements of operations and comprehensive loss. Impairment losses on goodwill are not reversed.

The Company reviews the carrying value of intangible assets not subject to amortization, including goodwill, to determine whether impairment may exist annually or more frequently if events and circumstances indicate that it is more likely than not that an impairment has occurred. The Company has the opinion to assess qualitative factors to determine whether it is necessary to perform the two-step in accordance with ASC 350-20. If the Company believes, as a result of the qualitative carrying amount, the two-step quantities impairment test described below is required.

The first step compares the fair values of each reporting unit to its carrying amount, including goodwill. If the fair value of each reporting unit exceeds its carrying amount, goodwill is not considered to be impaired and the second step will not be required.

If the carrying amount of a reporting unit exceeds its fair value, the second step compares the implied fair value of goodwill to the carrying value of a reporting unit’s goodwill. The implied fair value of goodwill is determined in a manner similar to accounting for a business acquisition with the allocation of the assessed fair value determined in the first step to the assets and liabilities of the reporting unit. The excess of the fair value of the reporting unit. over the amounts assigned to the assets and liabilities is the implied fair value of goodwill. Estimating fair value is performed by utilizing various valuation techniques, with the primary technique being a discounted cash flow. The fair value of discounted cash flow was determined using management’s estimates and assumptions.

Management evaluates the recoverability of goodwill, with the assistance of a third party evaluation firm, by performing a qualitative assessment before using a two-step impairment test approach at the reporting unit level. If the Company reorganizes its reporting structure in a manner that changes the composition of one or more of its reporting units, goodwill will be reassigned based on the relative fair value of each of the affected reporting units. An impairment is recorded, if necessary, at the end of each year, based on an annual impairment assessment report by a third party.

As of June 30, 2023 and December 31, 2022, the Company recorded impairments for goodwill of Nil and $5,385,811, respectively.

As a result of the impairments recognized on December 31, 2022, the remaining goodwill of the Company was related to the acquisitions of Guanzan and Zhongshan. The remaining goodwill of Guanzan was $1,392,449, and the remaining goodwill of Zhongshan was $673, 217 as of December 31, 2022 and June 30, 2023. As of June 30, 2023, the fair value of these businesses was at risk for future goodwill impairments, based on the continuation of negative macroeconomic conditions, which could represent potential indicators of impairment requiring further impairment analysis in 2023. The Company continues to monitor for potential impairment should impairment indicators arise.

● Impairment of long-lived assets and intangibles

In accordance with the provisions of ASC Topic 360, “Impairment or Disposal of Long-Lived Assets”, all long-lived assets such as property, plant and equipment held and used by the Company are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability of assets to be held and used is evaluated by a comparison of the carrying amount of an asset to its estimated future undiscounted cash flows expected to be generated by the asset. If such assets are considered to be impaired, the impairment to be recognized is measured by the amount by which the carrying amounts of the assets exceed the fair value of the assets.

Intangible assets that are considered to have a definite useful life are amortized over their useful lives using a method of amortization that reflects the pattern in which the economic benefits of the intangible assets are consumed or otherwise used up in accordance with ASC No. 350, “Intangibles - Goodwill and other” (“ASC 350”). The Company’s identifiable intangibles are reviewed for impairment in accordance with ASC 360 whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability of assets to be held and used is measured by a comparison of the carrying amount of an asset to the future undiscounted cash flows expected to be generated by the assets. If such assets are considered to be impaired, the impairment is measured by the amount by which the carrying amount of the assets exceeds the fair value of the assets.

Goodwill and other certain purchased intangible assets have been recorded in the Company’s financial statements as a result of acquisitions. Goodwill represents the excess of the purchase price in a business combination over the fair value of the net tangible and intangible assets acquired. Under ASC 350 goodwill is not amortized, but rather is subject to an annual impairment test.

ASC 350 requires goodwill to be tested for impairment at the reporting unit level at least annually or between annual tests in certain circumstances and written down when impaired. Goodwill is tested for impairment by comparing the fair value of the reporting unit with its carrying value.

ASC 350 allows an entity to first assess qualitative factors to determine whether it is necessary to perform the two-step quantitative goodwill impairment test. If the qualitative assessment does not result in a more likely than not indication of impairment, no further impairment testing is required. If it does result in a more likely than not indication of impairment, the two-step impairment test is performed. Alternatively, ASC 350 permits an entity to bypass the qualitative assessment for any reporting unit and proceed directly to performing the first step of the goodwill impairment test.

● Revenue recognition

We adopted Accounting Standard Codification (“ASC”) Topic 606, Revenues from Contract with Customers (“ASC 606”) for all periods presented with respect to each of our segments. Under ASC 606, revenue is recognized when control of the promised goods and services is transferred to the Company’s customers, in an amount that reflects the consideration that the Company expects to be entitled to in exchange for those goods and services, net of value-added tax. The Company determines revenue recognition through the following steps:

● Identify the contract with a customer;

● Identify the performance obligations in the contract;

● Determine the transaction price;

● Allocate the transaction price to the performance obligations in the contract; and

● Recognize revenue when (or as) the entity satisfies a performance obligation.

The transaction price is allocated to each performance obligation on a relative standalone selling price basis. The transaction price allocated to each performance obligation is recognized when that performance obligation is satisfied by the control of the promised goods and services is transferred to the customers, which at a point in time or over time as appropriate.

The Company’s revenue is net of value added tax (“VAT”) collected on behalf of PRC tax authorities in respect to the sales of products. VAT collected from customers, net of VAT paid for purchases, is recorded as a liability in the accompanying consolidated balance sheets until it is paid to the relevant PRC tax authorities.

● Cost of revenue

Cost of revenue consists primarily of cost of goods purchased from suppliers plus direct material costs for packaging and storage, direct labor, which are directly attributable to the acquisition and maintaining of products for sales. Cost of revenues also include impairment loss of our products which are obsolete or expired for sale, if any. Shipping and handling costs, associated with the distribution of finished products to customers, are borne by the customers.

● Comprehensive income

ASC Topic 220, “Comprehensive Income”, establishes standards for reporting and display of comprehensive income, its components and accumulated balances. Comprehensive income as defined includes all changes in equity during a period from non-owner sources. Accumulated other comprehensive income, as presented in the accompanying condensed consolidated statement of stockholders’ equity, consists of changes in unrealized gains and losses on foreign currency translation. This comprehensive income is not included in the computation of income tax expense or benefit.

● Income taxes

Income taxes are determined in accordance with the provisions of ASC Topic 740, “Income Taxes” (“ASC 740”). Under this method, deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax basis. Deferred tax assets and liabilities are measured using enacted income tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. Any effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date.

ASC 740 prescribes a comprehensive model for how companies should recognize, measure, present, and disclose in their financial statements uncertain tax positions taken or expected to be taken on a tax return. Under ASC 740, tax positions must initially be recognized in the financial statements when it is more likely than not the position will be sustained upon examination by the tax authorities. Such tax positions must initially and subsequently be measured as the largest amount of tax benefit that has a greater than 50% likelihood of being realized upon ultimate settlement with the tax authority assuming full knowledge of the position and relevant facts.

For the six months ended June 30, 2023 and 2022, the Company did not incur any interest or penalties associated with the tax positions it has taken. As of June 30, 2023, the Company did not have any significant unrecognized uncertain tax positions.

● Value added tax

Sales revenue represents the invoiced value of goods sold, net of VAT. All of the Company’s products that are sold in the PRC are subject to a VAT on the gross sales price. The VAT rates range up to 13%, depending on the type of products sold. The VAT may be offset by VAT paid by the Company on its purchase activities of merchandises, raw materials, utilities, and other materials which cost was included in the cost of producing or acquiring its products for sales. The Company records a VAT payable net of payments if the VAT payable on the gross sales is larger than VAT paid by the Company on purchase of finished goods; on the other hand, the Company records a VAT deductible in the accompanying financial statements net of any VAT payable at the end of reporting period.

● Convertible promissory notes

The Company records debt net of debt discount for beneficial conversion features and warrants, on a relative fair value basis. Beneficial conversion features are recorded pursuant to the Beneficial Conversion and Debt Topics of the FASB Accounting Standards Codification. The amounts allocated to warrants and beneficial conversion rights are recorded as debt discount and as additional paid-in-capital. Debt discount is amortized to interest expense over the life of the debt.

● Debt issuance costs and debt discounts

The Company may record debt issuance costs and/or debt discounts in connection with raising funds through the issuance of debt. These costs may be paid in the form of cash, or equity (such as warrants). These costs are amortized to interest expense through the maturity of the debt. If a conversion of the underlying debt occurs prior to maturity a proportionate share of the unamortized amounts is immediately expensed.

● Beneficial conversion feature

The Company evaluates the conversion feature of its convertible promissory notes to determine whether it was beneficial as described in ASC 470-20. The intrinsic value of a beneficial conversion feature inherent to a convertible note payable, which is not bifurcated and accounted for separately from the convertible notes payable and may not be settled in cash upon conversion, is treated as a discount to the convertible notes payable. This discount is amortized over the period from the date of issuance to the date the notes is due using the effective interest method. If the notes payable are retired prior to the end of their contractual term, the unamortized discount is expensed in the period of retirement to interest expense. In general, the beneficial conversion feature is measured by comparing the effective conversion price, after considering the relative fair value of detachable instruments included in the financing transaction, if any, to the fair value of the shares of Common Stock at the commitment date to be received upon conversion.

● Discontinued operations

In accordance with ASC 205-20, Reporting Discontinued Operations and Disclosures of Disposals of Components of an Entity, a disposal of a component of an entity or a group of components of an entity is required to be reported as a discontinued operation if the disposal represents a strategic shift that has (or will have) a major effect on an entity’s operations and financial results when the components of an entity meets the criteria in paragraph 205-20-45-1E to be classified as held for sale. When all of the criteria to be classified as held for sale are met, including management, having the authority to approve the action, commits to a plan to sell the entity, the major current assets, other assets, current liabilities, and non-current liabilities shall be reported as components of total assets and liabilities separate from those balances of the continuing operations. At the same time, the results of all discontinued operations, less applicable income taxes (benefit), shall be reported as components of net income (loss) separate from the net income (loss) of continuing operations in accordance with ASC 205-20-45.

On October 19, 2022, the Company’s wholly owned Guanzan subsidiary agreed to sell its 100% equity interest in Zhuoda and Zhuoda’s wholly owned subsidiary, Qianmei, to the former owner. Guanzan had previously purchased Zhuoda for 44,000 of shares of Common Stock (post the Reverse Splits). As consideration for the sale, the buyer agreed to return the 44,000 shares of Common Stock to the Company. The transaction closed effective November 23, 2022, when 100% of the equity interests in Zhuoda were transferred to the former owners and the 44,000 shares of Common Stock were returned to the Company.

On December 28, 2022, the Company entered into an agreement to transfer 87% of the equity interests in Zhongshan to the prior owner. Pursuant to the agreement, the Company agreed to transfer 87% of the equity interests in Zhongshan to the former owner and will retain 13% of the equity interests in Zhongshan. As consideration for the transfer and pursuant to an amendment to the original stock purchase agreement, the original seller agreed to return the 40,037 shares of Common Stock previously issued (reflecting Two Reverse Splits) and RMB 40,000,000 in cash (approximately ($6,116,207) previously paid upon the acquisition of Zhongshan. The former owner also agreed to release the Company from any and all claims relating to two earn out payments that were payable under the original purchase agreement. The Company received a put option to sell part or all of its 13% interest in Zhongshan before December 31, 2032, based on a valuation determined by a reputable third-party appraisal firm jointly chosen by the two parties. On September 1, 2023, 39,037 shares of Common Stock were returned to the Company. The remaining 1,000 shares were returned in the form of a cash payment of $3,055 because the shares were sold by the original seller. The transaction is expected to close by December 31, 2023, at which time the cash paid at the time of the transaction will also be returned.

On December 28, 2022, the Company entered into an agreement to transfer 90% of the equity interests in the Qiangsheng, Eurasia and Minkang hospitals to their former owners. Pursuant to the agreement, the Company will transfer 90% of the equity interests in each of the three hospitals and continue to own 10% of the equity interests in each hospital. As consideration for the transfer and pursuant to an amendment to the original stock purchase agreement, the original sellers agreed to return the 80,000 shares of Common Stock previously issued (reflecting the Reverse Splits) and RMB 20,000,000 (approximately $2,767,860 in cash previously paid upon the acquisition of the three hospitals. The former owner also agreed to release the Company from any and all claims relating to two earn out payments that were payable under the original purchase agreement. The Company received a put option to sell part or all of its 10% interest in each of the three hospitals to the former owner before December 31, 2032, based on a valuation determined by a reputable third-party appraisal firm jointly chosen by the parties. On December 9, 2022, 43,600 shares of Common Stock were returned to the Company and on September 1, 2023, 36,400 shares of Common Stock were returned to the Company. The transaction is expected to close by December 31, 2023, at which time the cash paid at the time of the transaction will also be returned.

● Derivative instruments

The Company has entered into financing arrangements that consist of freestanding derivative instruments or are hybrid instruments that contain embedded derivative features. The Company accounts for these arrangements in accordance with Accounting Standards Codification Topic 815, Accounting for Derivative Instruments and Hedging Activities (“ASC 815”) as well as related interpretation of this standard. In accordance with this standard, derivative instruments are recognized as either assets or liabilities in the balance sheet and are measured at fair values with gains or losses recognized in earnings. Embedded derivatives that are not clearly and closely related to the host contract are bifurcated and are recognized at fair value with changes in fair value recognized as either a gain or loss in earnings. The Company determines the fair value of derivative instruments and hybrid instruments based on available market data using appropriate valuation models, giving consideration to all of the rights and obligations of each instrument.

The Company estimates fair values of derivative financial instruments using various techniques (and combinations thereof) that are considered to be consistent with the objective measuring fair values. In selecting the appropriate technique, we consider, among other factors, the nature of the instrument, the market risks that it embodies and the expected means of settlement. For less complex derivative instruments, such as free-standing warrants, we generally use the Black-Scholes model, adjusted for the effect of dilution, because it embodies all of the requisite assumptions (including trading volatility, estimated terms, dilution and risk-free rates) necessary to fair value these instruments. Estimating fair values of derivative financial instruments requires the development of significant and subjective estimates that may, and are likely to, change over the duration of the instrument with related changes in internal and external market factors. In addition, option-based techniques (such as Black-Scholes model) are highly volatile and sensitive to changes in the trading market price of our Common Stock. Since derivative financial instruments are initially and subsequently carried at fair values, our income (expense) going forward will reflect the volatility in these estimate and assumption changes. Under the terms of the new accounting standard, increases in the trading price of the Common Stock and increases in fair value during a given financial quarter result in the application of non-cash derivative expense. Conversely, decreases in the trading price of the Common Stock and decreases in trading fair value during a given financial quarter result in the application of non-cash derivative income. 

● Net loss per share

The Company calculates net loss per share in accordance with ASC Topic 260, “Earnings per Share.” Basic income per share is computed by dividing the net income by the weighted-average number of shares of Common Stock outstanding during the period. Diluted income per share is computed similar to basic income per share except that the denominator is increased to include the number of additional shares of Common Stock that would have been outstanding if the potential Common Stock equivalents had been issued and if the additional shares of Common Stock were dilutive.

● Foreign currencies translation

Transactions denominated in currencies other than the functional currency are translated into the functional currency at the exchange rates prevailing at the dates of the transaction. Monetary assets and liabilities denominated in currencies other than the functional currency are translated into the functional currency using the applicable exchange rates at the balance sheet dates. The resulting exchange differences are recorded in the statement of operations.

The reporting currency of the Company is the United States Dollar (“US$”). The Company’s subsidiaries in the PRC maintain their books and records in their local currency, the Renminbi Yuan (“RMB”), which is the functional currency as being the primary currency of the economic environment in which these entities operate.

In general, for consolidation purposes, assets and liabilities of its subsidiaries whose functional currency is not the US$ are translated into US$, in accordance with ASC Topic 830-30, “Translation of Financial Statement”, using the exchange rate on the balance sheet date. Revenues and expenses are translated at average rates prevailing during the period. The gains and losses resulting from translation of financial statements of foreign subsidiaries are recorded as a separate component of accumulated other comprehensive income within the statement of stockholders’ equity.

Translation of amounts from RMB into US$ has been made at the following exchange rates for the respective period:

	June 30, 2023		June 30, 2022
Period-end RMB:US$1 exchange rate		7.2258		6.7114
Six months end average RMB:US$1 exchange rate		6.9291		6.4835

● Related parties

Parties, which can be a corporation or an individual, are considered to be related if the Company has the ability, directly or indirectly, to control the other party or exercise significant influence over the other party in making financial and operational decisions. Companies are also considered to be related if they are subject to common control or common significant influence.

● Segment reporting

ASC Topic 280, “Segment Reporting” establishes standards for reporting information about operating segments on a basis consistent with the Company’s internal organization structure as well as information about the type of products and services, geographical areas, business strategies and major customers in business components. For the six months ended June 30, 2023, and 2022, the Company operated in four reportable segments in the PRC.

As of June 30, 2023, the Company had four reportable segments, which consisted of retail pharmacy, wholesale pharmaceuticals, wholesale medical devices and healthcare products.

As of June 30, 2022, the Company had four reportable segments, which consisted of wholesale medical devices, wholesale pharmaceuticals, medical services and retail pharmacies.

● Fair value of financial instruments

The carrying value of the Company’s financial instruments (excluding short-term bank borrowing and convertible promissory notes): cash and cash equivalents, accounts and retention receivable and other receivables, accounts payable, amounts due to related parties, other payables and accrued liabilities approximate their fair values because of the short-term nature of these financial instruments.

Management believes, based on the current market prices or interest rates for similar debt instruments, the fair value of its obligations under its finance lease and short-term bank borrowing approximates the carrying amount.

The Company also follows the guidance of the ASC Topic 820-10, “Fair Value Measurements and Disclosures” (“ASC 820-10”), with respect to financial assets and liabilities that are measured at fair value. ASC 820-10 establishes a three-tier fair value hierarchy that prioritizes the inputs used in measuring fair value as follows:

● Level 1: Inputs are based upon unadjusted quoted prices for identical instruments traded in active markets;

● Level 2: Inputs are based upon quoted prices for similar instruments in active markets, quoted prices for identical or similar instruments in markets that are not active, and model-based valuation techniques (e.g., Black-Scholes Option-Pricing model) for which all significant inputs are observable in the market or can be corroborated by observable market data for substantially the full term of the assets or liabilities. Where applicable, these models project future cash flows and discount the future amounts to a present value using market-based observable inputs; and

● Level 3: Inputs are generally unobservable and typically reflect management’s estimates of assumptions that market participants would use in pricing the asset or liability. The fair values are therefore determined using model-based techniques, including option pricing models and discounted cash flow models.

Fair value estimates are made at a specific point in time based on relevant market information about the financial instrument. These estimates are subjective in nature and involve uncertainties and matters of significant judgment and, therefore, cannot be determined with precision. Changes in assumptions could significantly affect the estimates.

The Company measures the fair value of the following assets and liabilities:

Financial assets and liabilities for which carrying value approximates fair value - Cash and cash equivalents, deposits, receivables, repurchase agreements, payables, and other assets and liabilities are reflected in the consolidated balance sheets at their cost, which, due to the short-term nature of these instruments and their limited inherent credit risk, approximates fair value.

Convertible promissory note - As of June 30, 2023, and 2022, the carrying value of the Company’s convertible promissory notes was $0 and $6,320,075, respectively. The Company’s estimate of the fair value of convertible promissory note is $0 and $6,320,075 as of June 30, 2023, and 2022, respectively. The Company’s convertible promissory note, which are publicly traded on the Nasdaq Stock Exchange, are classified within Level 1 of the fair value hierarchy.

Recent accounting pronouncements

In August 2020, the FASB issued ASU No. 2020-06 (“ASU 2020-06”) “Debt—Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging—Contracts in Entity’s Own Equity (Subtopic 815-40): Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity.” ASU 2020-06 will simplify the accounting for convertible instruments by reducing the number of accounting models for convertible debt instruments and convertible preferred stock. For public business entities, the amendments in ASU 2020-06 are effective for public entities which meet the definition of a smaller reporting company are effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2023. The Company will adopt ASU 2020-06 effective January 1, 2024. Management is currently evaluating the effect of the adoption of ASU 2020-06 on the consolidated financial statements. The effect will largely depend on the composition and terms of the financial instruments at the time of adoption.

In October 2021, the FASB issued ASU No. 2021-08, “‘Business Combinations (Topic 805): Accounting for Contract Assets and Contract Liabilities from Contracts with Customers” (“ASU 2021-08”). This ASU requires entities to apply Topic 606 to recognize and measure contract assets and contract liabilities in a business combination. The amendments improve comparability after the business combination by providing consistent recognition and measurement guidance for revenue contracts with customers acquired in a business combination and revenue contracts with customers not acquired in a business combination. The amendments are effective for the Company beginning after December 15, 2023, and are applied prospectively to business combinations that occur after the effective date. The Company does not expect the adoption of ASU 2021-04 will have a material effect on the consolidated financial statements.

Other accounting standards that have been issued or proposed by the FASB or other standards-setting bodies that do not require adoption until a future date are not expected to have a material impact on the Company’s consolidated financial statements upon adoption. The Company does not discuss recent pronouncements that are not anticipated to have an impact on or are unrelated to its consolidated financial condition, results of operations, cash flows or disclosures.

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The Acquisition of the Guanzan Group

6 Months Ended

Jun. 30, 2023

The Acquisition of the Guanzan Group [Line Items]

THE ACQUISITION OF THE GUANZAN GROUP

4. THE ACQUISITION OF THE GUANZAN GROUP

On February 1, 2020, the Company entered into a stock purchase agreement to purchase Guanzan, (the “Guanzan SPA”). Guanzan is a distributor of medical devices whose customers are primarily drug stores, private clinics, pharmaceutical dealers and hospitals in the Southwest of China. Guanzan holds business licenses in the PRC such as a Business Permit for Medical Devices and a Recordation Certificate for Business Activities Involving Class II Medical Devices, etc., which qualify Guanzan to engage in the distribution of medical devices in the PRC. Pursuant to the Guanzan SPA, we agreed to purchase all the issued and outstanding shares of Guanzan for RMB 100,000,000 (approximately $14,285,714) to be paid by the issuance of 19,000 shares of Common Stock (post the Reverse Splits) and the payment of RMB 80,000,000 (approximately $11,428,571) in cash. The stock consideration was payable at closing and the cash consideration, which was subject to post-closing adjustments based on the performance of Guanzan in the years ending December 31, 2020, and 2021, respectively, was to be paid pursuant to a post-closing payment schedule. The transaction closed on March 18, 2020. Upon the closing, 100% of the shares of Guanzan were transferred to the Company and the stock consideration was issued to the seller.

The following summarizes the identified assets acquired and liabilities assumed pursuant to the Guanzan acquisition as of March 18, 2020:

Items	Amount
Assets
Cash and cash equivalents	$	95,220
Accounts receivable		1,835,981
Advances to suppliers		1,222,986
Amount due from related parties		410,943
Inventories		950,225
Prepayments and other receivables		90,256
Property, plant and equipment		707,289
Intangible assets		254,737
Goodwill		6,686,053
Liabilities
Short-term bank borrowings		(838,926	)
Long-term loans due within one year		(250,663	)
Accounts payable, trade		(1,303,399	)
Advances from customers		(1,350,126	)
Amount due to related parties		(106,720	)
Taxes payable		(406,169	)
Other payables and accrued liabilities		(390,593	)
Long-term loans – noncurrent portion		(186,796	)
Non-controlling interests		(46,295	)
Total-net assets	$	7,374,000

On November 20, 2020, the parties to the Guanzan SPA entered into a prepayment and amendment agreement (the “Prepayment Agreement”) for the prepayment of a portion of the cash consideration in the amount of RMB 20,000,000, in the form of shares of Common Stock valued at $3.00 per share, in light of Guanzan’s performance during the period from March 18, 2020, to September 30, 2020. On November 30, 2020, 20,000 shares (after the Reverse Splits) of our Common Stock were issued to the designated assignees of the seller as the prepayment. Upon the approval of the Company’s shareholders, on August 27, 2021, the Company issued 92,000 shares (after the Reverse Splits) of Common Stock as payment in full for the balance of the post-closing consideration for the acquisition of Guanzan.

The following reconciles the identified assets acquired and liabilities assumed pursuant to the Guanzan SPA, and the Prepayment and Amendment Agreement made on November 20, 2020:

The determination of the value of the shares issued was determined according to the closing price on the day the shares issued. On March 12, 2020, the price was $2.86 per share.

The fair value of the shares issued on March 12, 2020	$	2,717,000
The fair value of the shares issued on November 19, 2020		1,820,000
Cash		3,065,181
Total consideration	$	7,602,181
Net assets		(687,949	)
Goodwill	$	6,914,232

The fair value of all assets acquired, and liabilities assumed is the estimated book value of Guanzan. Goodwill represents the excess of the fair value of purchase price over the amounts assigned to the fair value of the assets acquired and the liabilities assumed of Guanzan at the acquisition date. Upon the acquisition of Guanzan, the Company recognized its non-controlling interest in Shude in the amount of $46,295, representing the 20% non-controlling equity interest in Shude. Shude is a pharmaceuticals distributor. Shude’s customers include a wide range of clinics, private and public hospitals, and pharmacies in the PRC.  On April 9, 2021, the Company increased its equity interest in Shude from 80% to 95.2% by making a direct capital investment of $4,892,293 in Shude.

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The Acquisition of the Guoyitang Hospital

6 Months Ended

Jun. 30, 2023

Schedule of Acquisition of the Guoyitang Hospital [Line Items]

THE ACQUISITION OF THE GUOYITANG HOSPITAL

5. THE ACQUISITION OF THE GUOYITANG HOSPITAL

On December 9, 2020, the Company entered into an agreement to acquire all of the outstanding equity of Guoyitang, the owner and operator of a private general hospital in Chongqing City, a southwest city of China, with 100 hospital beds. The aggregate purchase price for Guoyitang was RMB 100,000,000 (approximately $15,251,807). Upon signing the agreement, 40,000 shares of Common Stock (post the Reverse Splits) and RMB 20,000,000 (approximately $3,096,119) were paid as partial consideration for the purchase of Guoyitang. The transaction closed on February 2, 2021. The balance of the purchase price of RMB 40,000,000 (approximately $6,100,723) was subject to post-closing adjustments based on the performance of Guoyitang in 2021 and 2022. As the future performance of Guoyitang in 2021 and 2022 was uncertain, the total acquired consideration at the acquisition date was calculated based on the value of the closing payment without taking into consideration of potential payments based on future performance. As a result of the performance failure of Guoyitang in 2021, the sellers were not eligible to receive any contingent payments.

The following summarizes the identified assets acquired and liabilities assumed pursuant to the Guoyitang Acquisition as of February 2, 2021:

Items	Amount
Assets
Cash and cash equivalents	$	28,457
Accounts receivable		11,797
Advances to suppliers		12,670
Amount due from related parties		41,598
Inventories		167,440
Prepayments and other receivables		61,102
Property, plant and equipment		528,814
Right-of-use asset		441,150
Goodwill		7,154,393
Liabilities
Accounts payable, trade		(599,391	)
Amount due to related parties		(183,796	)
Taxes payable		(121	)
Other payables and accrued liabilities		(231,375	)
Lease liability-current		(161,707	)
Lease liability-non current		(354,912	)
Total-net assets	$	6,916,119

The fair value of all assets acquired and liabilities assumed was the estimated book value of Guoyitang. Goodwill represents the excess of the fair value of purchase price over the amounts assigned to the fair value of the assets acquired and the liabilities assumed of Guoyitang at the acquisition date.

The determination of the share value was determined according to the closing price of the Company’s Common Stock on the day the shares were issued.

The value of the shares issued on February 2, 2021		3,820,000
Cash		3,096,119
Total consideration	$	6,916,119
Net assets		(238,274	)
Goodwill		7,154,393

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The Acquisition of the Zhongshan Hospital

6 Months Ended

Jun. 30, 2023

The Acquisition of the Zhongshan Hospital [Line Items]

THE ACQUISITION OF THE ZHONGSHAN HOSPITAL

6. THE ACQUISITION OF THE ZHONGSHAN HOSPITAL

On December 15, 2020, the Company entered into an agreement to acquire Zhongshan, a private hospital in the east region of China with 65 hospital beds. Zhongshan is a general hospital known for its complex minimally invasive surgeries. Pursuant to the agreement, the Company agreed to purchase all the issued and outstanding equity interests in Zhongshan in consideration of RMB 120,000,000. The cash consideration of RMB 40,000,000 (approximately $6,116,207) was paid to the seller in December 2020. On February 12, 2021, we issued 40,037 shares of Common Stock (post the Reverse Splits) then valued at RMB 40,000,000 (approximately $6,116,207) to the seller as part of the consideration. The balance of the purchase price in the amount of RMB 40,000,000 (approximately $6,116,207) was subject to post-closing adjustments based on the performance of Zhongshan in 2021 and 2022. The transaction closed on February 5, 2021. As the future performance of Zhongshan in 2021 and 2022 was uncertain, the total acquired consideration at the acquisition date was calculated based on the value of the closing payment without taking into consideration of potential payments based on future performance.

As a result of the performance failure of Zhongshan in the year ended December 31, 2021, the seller was not eligible to receive any contingent payments.

The following summarizes the identified assets acquired and liabilities assumed pursuant to the Zhongshan acquisition as of February 5, 2021:

Items	Amount
Assets
Cash and cash equivalents	$	46,748
Accounts receivable		92,900
Inventories		108,413
Prepayments and other receivables		432,231
Property, plant and equipment		344,208
Right-of-use asset		1,188,693
Goodwill		10,443,494
Liabilities
Short-term bank borrowings		(154,701	)
Accounts payable, trade		(928,640	)
Advances from customers		(5,603	)
Amount due to related parties		(217,203	)
Other payables and accrued liabilities		(435,290	)
Lease liability-current		(160,774	)
Lease liability-non current		(1,102,589	)
Total-net assets	$	9,651,887

The fair value of all assets acquired, and liabilities assumed is the estimated book value of the Zhongshan. Goodwill represents the excess of the fair value of purchase price over the amounts assigned to the fair value of the assets acquired and the liabilities assumed of Zhongshan Hospital at the acquisition date.

The determination of the share value was determined according to the closing price of the Company’s Common Stock on the day the shares were issued,

The value of the shares issued on February 12, 2021		3,480,000
Cash payment in December 2020		6,171,887
Total consideration	$	9,651,887
Net assets		(791,607	)
Goodwill		10,443,494

On December 28, 2022, we entered into an agreement to transfer 87% of the equity interests in Zhongshan to the prior owner. As consideration for the transfer and pursuant to an amendment to the original stock purchase agreement, the original seller agreed to return the 40,037 shares of Common Stock previously issued and RMB 40,000,000 in cash (approximately $6,116,207) previously paid upon the acquisition of Zhongshan. On September 1, 2023, 39,037 shares of Common Stock were returned to the Company. The remaining 1,000 shares were returned in the form of cash because the shares were sold by the original seller. The transaction is expected to close by December 31, 2023, at which time the cash paid at the time of the transaction will also be returned.

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The Acquisition of the Qiangsheng, Eurasia and Minkang Hospitals

6 Months Ended

Jun. 30, 2023

The Acquisition of the Qiangsheng, Eurasia and Minkang Hospitals [Abstract]

THE ACQUISITION OF THE QIANGSHENG, EURASIA AND MINKANG HOSPITALS

7. THE ACQUISITION OF THE QIANGSHENG, EURASIA AND MINKANG HOSPITALS

On April 9, 2021, the Company and Chongqing Bimai entered into a stock purchase agreement to acquire three private hospitals in the PRC, Qiangsheng, Eurasia and Minkang. Pursuant to the agreement, the Company agreed to purchase all the issued and outstanding equity interests in Qiangsheng, Eurasia and Minkang in consideration of approximately RMB162,000,000 (approximately $25,023,555) to paid by the issuance of 80,000 shares of Common Stock (post the Reverse Splits), the value of which was agreed to be RMB 78 million (approximately $12 million) and the payment of RMB 84,000,000 (approximately $13,008,734) in cash (the “Cash Consideration”). The first payment of the Cash Consideration was RMB 20,000,000 (approximately $3,097,317). The second and third payments of the Cash Consideration of RMB 64,000,000 (approximately $9,911,416) were subject to post-closing adjustments based on the performance of Qiangsheng, Eurasia and Minkang in 2021 and 2022. The sellers had the choice to receive the second and third payments in the form of the shares of Common Stock valued at $15 per share (post the Reverse Splits) or in cash. The transaction closed on May 6, 2021; at which time the 16,000 shares of Common Stock were issued. As the future performance of the three hospitals was uncertain, the total acquired consideration at the acquisition date was calculated based on the value of the closing payment without taking into consideration of potential payments based on future performance. As a result of the performance failure by the three hospitals for the year ended December 31, 2021, the sellers were not eligible to receive any contingent payments.

The following summarizes the identified assets acquired and liabilities assumed pursuant to the Qiangsheng, Eurasia and Minkang acquisitions as of May 6, 2021:

Items	Amount
Assets
Cash and cash equivalents	$	12,341
Accounts receivable		41,836
Inventories		156,576
Advances and other receivables		40,620
Property, plant and equipment		653,104
Right of use assets		2,168,709
Goodwill		9,067,529
Liabilities
Accounts payable		(355,980	)
Advances from customers		(36,798	)
Tax payable		(345,870	)
Other payables and accrued liabilities		(311,174	)
Lease liability-current		(365,788	)
Lease liability-non-current		(1,988,195	)
Total net assets	$	8,736,910

The fair value of all assets acquired, and liabilities assumed is the estimated book value of the Qiangsheng, Eurasia and Minkang hospitals. Goodwill represents the excess of the fair value of purchase price over the amounts assigned to the fair value of the assets acquired and the liabilities assumed of Qiangsheng, Eurasia and Minkang Hospitals at the acquisition date.

The determination of the share value was determined according to the closing price of the Company’s Common Stock on the day the shares were issued.

The value of the shares issued on April 20, 2021		5,600,000
Cash payment on December 2021		3,136,910
Total consideration	$	8,736,910
Net assets		(330,619	)
Goodwill		9,067,529

On December 28, 2022, we entered into an agreement to transfer 90% of the equity interests in Qiangsheng, Minkang and Eurasia to the previous owners. As consideration for the transfer and pursuant to an amendment to the original stock purchase agreement, the original sellers agreed to return the 80,000 shares of Common Stock previously issued and RMB 20,000,000 (approximately $2,767,860) in cash previously paid upon the acquisition of the three hospitals. On December 9, 2022, 43,600 shares of Common Stock were returned to the Company and on September 1, 2023, 36,400 shares of Common Stock were returned to the Company. The sales of Qiangsheng, Minkang and Eurasia are expected to close by December 31, 2023 at which time the RMB 20,000,000 will also be returned.

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The Acquisition of Zhuoda

6 Months Ended

Jun. 30, 2023

The Acquisition of Zhuoda [Abstract]

THE ACQUISITION OF ZHUODA

8. THE ACQUISITION OF ZHUODA

On September 10, 2021, Guanzan entered into an agreement to acquire Zhuoda. Pursuant to the agreement, Guanzan agreed to purchase all the issued and outstanding equity interests in Zhuoda in consideration of RMB 75,240,000 (approximately $11,400,000). The entire purchase consideration was payable in shares of Common Stock. At the closing on September 22, 2021, 44,000 shares of Common Stock (post the Reverse Splits) valued at RMB 43,560,000 (approximately $6,600,000) were issued as partial consideration for the purchase. The remainder of the purchase price of RMB 31,680,000 (approximately $4,800,000), was subject to post-closing adjustments based on the performance of Zhuoda in 2022 and 2023. The transaction closed on October 8, 2021. As the future performance of Zhuoda in 2022 and 2023 was uncertain, the total acquired consideration at the acquisition date and at December 31, 2021 was calculated based on the value of the closing payment without taking into consideration of potential payments based on future performance.  

The following summarizes the identified assets acquired and liabilities assumed pursuant to the Zhuoda acquisition as of October 8, 2021:

Items	Amount
Assets
Cash and cash equivalents	$	102,350
Accounts receivable		804,083
Inventories		131,456
Advances and other receivables		886,370
Property, plant and equipment		6,579
Right of use assets		17,160
Goodwill		924,740
Liabilities
Short term loan		(773,737	)
Accounts payable		(56,887	)
Advances from customers		(3,778	)
Tax payable		(24,787	)
Other payables and accrued liabilities		(493,868	)
Lease liability-current		(7,217	)
Lease liability-non-current		(14,265	)
Total net assets	$	1,498,199

The fair value of all assets acquired, and liabilities assumed is the estimated book value of the Zhuoda. Goodwill represents the excess of the fair value of purchase price over the amounts assigned to the fair value of the assets acquired and the liabilities assumed of Zhuoda at the acquisition date.

The determination of the share value was determined according to the closing price of the Company’s Common Stock on the day the shares were issued.

The value of the shares issued on September 6, 2021	$	1,498,200
Total consideration	$	1,498,200
Net assets		573,458
Goodwill	$	924,742

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The Sale of Zhuoda

6 Months Ended

Jun. 30, 2023

The Sale of Zhuoda [Abstract]

THE SALE OF ZHUODA

9. THE SALE OF ZHUODA

On October 19, 2022, the Company’s wholly owned Guanzan subsidiary agreed to sell its 100% equity interest in Zhuoda and Zhuoda’s wholly owned subsidiary, Qianmei, to the former owner. Guanzan had previously purchased Zhuoda for 44,000 shares of Common Stock (reflecting the December 1 to 10 reverse split). As consideration for the sale, the buyer agreed to return the 44,000 shares of Common Stock to the Company. The transaction closed effective November 23, 2022, when 100% of the equity interests in Zhuoda were transferred to the former owners and the 44,000 shares of Common Stock were returned to us.

The summarized operating results of the Zhuoda and its subsidiary in the Company’s condensed consolidated statements of operations for the period of January 1 to November 23, 2022, consisted of the following:

	For the period ended November 23, 2022
Revenues	$	2,713,818
Cost of revenues		2,314,877
Gross profit		398,941
Operating expense		392,875
Other income (expense)		(45,146	)
Loss before income taxes		(39,080	)
Income tax expense		1,425
Net income/(loss) from discontinued operations	$	(40,505	)

The assets and liabilities of the discontinued operations of Zhuoda consisted of the following items as of November 23, 2022, and December 31, 2021:

	November 23,		December 31,
	2022		2021
Assets from discontinued operations
Current assets
Cash and cash equivalents	$	13,922	$	100,678
Accounts receivable, net		1,951,997		984,030
Advances to suppliers		67,561		118,365
Amount due from related parties		-		-
Inventories, net		101,059		162,882
Prepayments and other receivables		720,365		725,881
Operating lease-right of use assets		-		-
Total current assets		2,854,904		2,091,836
Non-current assets
Deferred tax assets		-		-
Property, plant and equipment, net		1,442		2,507
Intangible assets, net		-		-
Operating lease-right of use assets		10,044		15,959
Goodwill		-		-
Long-term investment		-		-
Total non-current assets		11,486		18,466
Total assets from discontinued operations	$	2,866,390	$	2,110,302
Liabilities from discontinued operations
Current liabilities
Short-term loans	$	154,288	$	795,583
Long-term loans due within one year		-		-
Convertible promissory notes, net		-		-
Accounts payable, trade		1,301,712		265,731
Advances from customers		-		723
Amount due to related parties		-		-
Taxes payable		441		218
Other payables and accrued liabilities		162,362		468,970
Lease liability-current		7,693		8,102
Total current liabilities		1,626,496		1,539,327
Non-current liabilities
Lease liability-non current		6,976		12,727
Long-term loans – non-current		330,242		-
Total non-current liabilities		337,218		12,727
Total liabilities		1,963,714		1,552,054

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The Acquisition of Phenix

6 Months Ended

Jun. 30, 2023

The Acquisition of Phenix [Abstract]

THE ACQUISITION OF PHENIX

10. THE ACQUISITION OF PHENIX

On July 5, 2022, we entered into a stock purchase agreement (as amended on February 27, 2023) with Mr. Fnu Oudom, the Chairman of our board of directors, whereby we agreed to acquire 100% of the equity interests in Phenix Bio Inc. (Phenix”), a developer and distributor of dietary supplements, in consideration of $1,800,000, consisting of $180,000 in cash (paid on July 7, 2022) and the issuance of 270,000 shares of Common Stock (reflecting the December 2022 reverse split). In a further amendment to the agreement dated February 27, 2023, we agreed to issue an additional 5,000,000 shares of Common Stock to Mr. Oudom if the aggregate net profit generated by Phenix is at least $2,500,000 in calendar year 2023 or in any fiscal quarter of 2023. Upon obtaining shareholder approval for the transaction, we issued 270,000 shares of Common Stock to Mr. Oudom on June 19, 2023 .

The Company’s healthcare products are developed and distributed by Phenix. Phenix owns its formulas and uses out-sourced facilities in the U.S. and Australia to manufacture its products. In the first six months of 2023, Phenix sold all its products through one online sales platform. Most of the customers were from Asian countries. Phenix currently offers six categories of dietary supplements, a cardiovascular product, an anti-insomnia and depression product, a male aphrodisiac product, a woman’s menopausal syndrome product, a gout product, and an immunity enhancer.

The following summarizes the identified assets acquired and liabilities assumed pursuant to Phenix acquisition as of March 15, 2023:

Items	Amount
Assets
Cash and cash equivalents	$	1,511,220
Accounts receivable		346
Inventories		892,214
Advances and other receivables		386,965
Fixed assets		99,599
Intangible assets		500,000
Liabilities
Accounts payable		(6,650	)
Other payables and accrued liabilities		(13,883	)
Advance from customer		(1,028,004	)
Total net assets	$	2,341,807

The fair value of all assets acquired, and liabilities assumed is the estimated book value of the Phenix.

The determination of the share value was determined according to the closing price of the Company’s Common Stock on the day the shares were issued.

Cash payment on July 7,2022	$	180,000
The value of the 270,000 shares issued on June 19, 2023	$	291,600
Total consideration	$	471,600
Net assets	$	2,341,807
Additional paid in capital	$	1,870,207

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Accounts Receivable

6 Months Ended

Jun. 30, 2023

Accounts Receivable [Abstract]

ACCOUNTS RECEIVABLE

11. ACCOUNTS RECEIVABLE

The revenues of the Company’s pharmacy segment are derived from cash sales, except for sales to the government social security bureaus or commercial health insurance programs, which typically settle once a month.

The revenues of the Company’s wholesale pharmaceuticals segment are recognized when the goods are transferred to the customer, Generally, the receivables are collected within 30 to 60 days.

The revenues of the Company’s wholesale medical devices segment are recognized when the goods are transferred to the customers, Generally, the receivables are collected within 30 to 60 days.

The revenues of the Company’s healthcare products segment are recognized when the goods are transferred to the customers. Payment terms generally provide for payment within 30 to 60 days.

The Company routinely evaluates the need for allowance for doubtful accounts based on specifically identified amounts that the management believes to be uncollectible. If the actual collection experience changes, revisions to the allowance may be required. As of June 30, 2023, and December 31, 2022, accounts receivable consisted of the following:

	June 30, 2023			December 31, 2022
Accounts receivable, cost	$	7,927,248		$	4,813,160
Less: allowance for doubtful accounts		(1,546,861	)		(1,604,874	)
Accounts receivable, net	$	6,380,387		$	3,208,286

Movements of allowance for accounts receivable are as follows:

	June 30, 2023			December 31, 2022
Beginning balance	$	1,604,874		$	322,145
Addition		-			1,282,729
Reversal		(58,013	)		-
Ending Balance	$	1,546,861		$	1,604,874

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Advances to Suppliers

6 Months Ended

Jun. 30, 2023

Advances to Suppliers [Abstract]

ADVANCES TO SUPPLIERS

12. ADVANCES TO SUPPLIERS

Advances to suppliers represent the amount the Company prepaid to its suppliers for merchandises for sale in the ordinary course of business. As of June 30, 2023, and December 31, 2022, the Company reported advances to suppliers as follow:

	June 30, 2023		December 31, 2022
Advances to suppliers	$	7,017,279	$	6,589,759

No bad debt expenses were accrued for doubtful accounts relating to advances to suppliers for the six months ended June 30, 2023, and 2022, respectively.

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Inventories

6 Months Ended

Jun. 30, 2023

Inventories [Abstract]

INVENTORIES

13. INVENTORIES

The Company’s inventories consist of medicine, medical devices and healthcare products that are sold either on a retail or wholesale basis. Inventories consisted of the following:

	June 30, 2023			December 31, 2022
Pharmaceuticals	$	6,672,082		$	7,067,613
Healthcare products		323,095			-
Medical devices		213,952			614,231
Less: allowance for obsolete and expired inventory		(26,605	)		(27,602	)
	$	7,182,524		$	7,654,242

Movements of inventory reserves are as follows:

	June 30, 2023			December 31, 2022
Beginning balance	$	27,602		$	103,178
Reversal		(997	)		(75,576	)
Ending Balance	$	26,605		$	27,602

For the six months ended June 30, 2023, and 2022, the Company had accrued allowances of $26,604 and $28,644, respectively, for obsolete and expired items.

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Prepayments and Other Receivables

6 Months Ended

Jun. 30, 2023

Prepayments and Other Receivables [Abstract]

PREPAYMENTS AND OTHER RECEIVABLES

14. PREPAYMENTS AND OTHER RECEIVABLES

Prepayments and other receivables represent the amount that the Company prepaid as rent deposits for its retail stores, hospitals and office space, special medical device purchase deposits, prepaid rental fee and professional services, advances to employees in the ordinary course of business, VAT deductibles and other miscellaneous receivables. The table below sets forth the balances as of June 30, 2023, and December 31, 2022.

	June 30, 2023			December 31, 2022
Deposit for rentals	$	142,088		$	132,960
Prepaid expenses and improvements of offices		54,092			56,121
Prepaid for acquisition of phenix		-			180,000
Deposit for purchase of medical devices		160,737			166,765
Deposit for sales platform		20,399			24,337
Receivables form third party		118,625			66,986
VAT deductibles		825,095			881,014
Others		52,100			42,771
Less: allowance for doubtful accounts		(23,012	)		(23,875	)
Prepayments and other receivables, net	$	1,350,124			1,527,079

Movements of allowance for doubtful accounts are as follows:

	June 30, 2023			December 31, 2022
Beginning balance	$	23,875		$	26,080
Reversal		(863	)		(2,205	)
Ending Balance	$	23,012		$	23,875

Management evaluates the recoverable value of these balances periodically according to the Company’s policy of credit and allowance for doubtful accounts. For the six months ended June 30, 2023, and 2022, the Company recorded bad debt allowances of $23,012 and $24,776, respectively.

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Property, Plant and Equipment

6 Months Ended

Jun. 30, 2023

Property, Plant and Equipment [Abstract]

PROPERTY, PLANT AND EQUIPMENT

15. PROPERTY, PLANT AND EQUIPMENT

Property, plant, and equipment consisted of the following:

	June 30, 2023			December 31, 2022
Buildings	$	722,432		$	749,526
Office equipment		227,867			132,329
Electronic equipment		35,910			37,257
Furniture		29,651			30,764
Vehicles		145,747			168,512
Medical equipment		891,834			925,281
Leasehold improvements		596,048			598,677
		2,649,489			2,642,346
Less: accumulated depreciation		(959,382	)		(938,926	)
Property, plant and equipment, net	$	1,690,107		$	1,703,420

Depreciation expense for the six months ended June 30, 2023, and 2022 were $58,107 and $89,159, respectively.

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Intangible Assets

6 Months Ended

Jun. 30, 2023

Intangible Assets [Abstract]

INTANGIBLE ASSETS

16. INTANGIBLE ASSETS

	June 30, 2023			December 31, 2022
Software	$	18,967		$	19,679
Trademark use rights		500,000			-
Less: accumulated amortization		(70,036	)		(3,496	)
Intangible assets, net	$	448,931		$	16,183

The trademark use rights acquired in the six months ended June 30, 2023, relate to the trademarks for products being sold by Phenix. The trademarks relate to nine healthcare products, such as general recovery, cardiovascular and cerebrovascular disease prevention, male health care, female health care, and memory enhancement for the elderly. Amortization expense for the six months ended June 30, 2023, and 2022 were $70,036 and $3,627, respectively.

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Leases

6 Months Ended

Jun. 30, 2023

Leases [Abstract]

LEASES

17. LEASES

Balance sheet information related to the Company’s operating leases was as follows*:

	June 30, 2023		December 31, 2022
Operating Lease Assets
Operating lease	$	2,835,992	$	2,942,265
Total operating lease assets	$	2,835,992	$	2,942,265
Operating Lease Obligations
Current operating lease liabilities	$	650,661		532,630
Non-current operating lease liabilities	$	2,414,883		2,574,751
Total Lease Liabilities	$	3,065,544		3,107,381

* The Company’s operating leases include the leases of operating companies only and do not include discontinued operations-held for sale.

Lease liability maturities as of June 30, 2023, are as follows:

	June 30, 2023
2023		805,746
2024		816,021
2025		797,854
2026		776,996
2027 and thereafter		438,800
Total minimum lease payments		3,635,417
Less: Amount representing interest		(569,873	)
Total		3,065,544

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Goodwill

6 Months Ended

Jun. 30, 2023

Goodwill [Abstract]

GOODWILL

18. GOODWILL

Changes in the carrying amount of goodwill consisted of the following:

	June 30, 2023		December 31, 2022
Beginning balance	$	2,065,666	$	8,376,217
Disposal of Zhuoda		-		(924,740	)
Impairment during the year		-		(5,385,811	)
Goodwill	$	2,065,666	$	2,065,666

As a result of the impairments recognized on December 31, 2022, the remaining goodwill of the Company was related to the acquisitions of Guanzan and Zhongshan. The remaining goodwill of Guanzan was $1,392,449, and the remaining goodwill of Zhongshan was $673,217 as of December 31, 2022 and June 30, 2023, respectively. As of June 30, 2023, the fair value of these businesses was at risk for future goodwill impairments. The Company continues to monitor for potential impairment should impairment indicators arise.

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Loans

6 Months Ended

Jun. 30, 2023

Loans [Abstract]

LOANS

19. LOANS

Short-term loans

	June 30, 2023		December 31, 2022
China Minsheng Bank	$	110,714	$	114,867
Postal Savings Bank of China		678,126		703,558
Pingan Bank of China		345,982		-
Total	$	1,134,822	$	818,425

For the six months ended June 30, 2023 and 2022, interest expense on short-term loans amounted to $14,408 and $63,847, respectively.

Pusheng borrowed $345,982 from Pingan Bank of China on May 29, 2023. The loan is due on May 20, 2024, with an interest rate of 8.91%. Pusheng borrowed $110,714 from China Minsheng Banking Corp. Ltd. on March 24, 2023, which is due on March 21, 2024, with an interest rate of 5.50%. Guanzan borrowed $678,126 from Postal Savings Bank of China on December 22, 2022, which is due on December 20, 2023, with an interest rate of 4.50% and the real estate right of Guanzan as the right holder provided a mortgage loan.

Guanzan borrowed $678,126 from Postal Savings Bank of China on December 22, 2022, which is due on December 20, 2023, with an interest rate of 4.50%.

Long-term loans

	June 30, 2023			December 31, 2022
China Construction Bank Chongqing Zhongxian, Sub-branch		-			59,926
We Bank		227.528			360,825
Subtotal of long-term loans		227,528			420,751
Less: current portion		(101,244	)		(105,965	)
Total Long-term loans – noncurrent portion	$	126,284		$	314,786

For the six months ended June 30, 2023 and 2022, interest expense on long-term loans amounted to $23,141 and $41,387, respectively.

Guanzan borrowed $912,500 from We Bank on September 6, 2022, for a term of two years, with an interest rate of 14.40%. Guanzan borrowed $148,571 from Huaneng Guicheng Trust Co., LTD on October 7, 2021, which is due on September 26, 2023, with an interest rate of 12.96% and the general manager of Guanzan provided a personal guarantee for the loan. Guanzan borrowed $300,000 from We Bank on April 26, 2022, which is due on March 26, 2024, with an interest rate of 9.45%. Guanzan borrowed $39,839 from We Bank on July 24, 2021, for a term of two years, with an interest rate of 13.68%. Guanzan borrowed $243,154 from Fudan Bank on February 25, 2021, for a term of three years, with an interest rate of 8.00%.

The combined aggregate amount of interest expenses for all long-term borrowings for each of the five years as of June 30, 2023, are as follows:

	June 30, 2023
July 1, 2023 to June 30, 2024		18,963
July 1, 2024 to June 30, 2025		3,616
Total		22,579

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Convertible Promissory Notes and Embedded Derivative Instructions

6 Months Ended

Jun. 30, 2023

Convertible Promissory Notes and Embedded Derivative Instructions [Abstract]

CONVERTIBLE PROMISSORY NOTES AND EMBEDDED DERIVATIVE INSTRUCTIONS

20. CONVERTIBLE PROMISSORY NOTES AND EMBEDDED DERIVATIVE INSTRUCTIONS

On May 18, 2020, we entered into a securities purchase agreement (the “May SPA”) with two institutional investors (the “Institutional Investors”) to sell convertible notes having a face amount of up to $6,550,000 at an aggregate original issue discount of 19.85% (the “2020 Notes”) and ranking senior to all outstanding and future indebtedness of the Company. The 2020 Notes did not bear interest except upon the occurrence of an event of default. Each Institutional Investor also received a warrant (the “Institutional Investor 2020 Warrant”) to purchase 13,000 shares of Common Stock (post the Reverse Splits) at an initial exercise price of $142.25 per share (post the Reverse Splits price and subject to the Event Market Price Adjustment). The placement agent for the private placement received a warrant (the “Placement Agent 2020 Warrant”, together with the Institutional Investor 2020 Warrant, the “2020 Warrants”) to purchase up to 10% of the aggregate number of shares of Common Stock at an initial exercise price of $142.25 per share (post the Reverse Splits price and subject to the Event Market Price Adjustment), subject to increase based on the number of shares Common Stock issued pursuant to the 2020 Notes.

Pursuant to the May SPA, two 2020 Notes each in the face amount of $2,225,000 were issued to the Institutional Investors in consideration of the payment of $1,750,000 in cash for each 2020 Note. Pursuant to the May SPA, additional convertible notes in an aggregate original face amount not to exceed $2,100,000 (the “Additional Notes”) could also be issued to the Institutional Investors under certain circumstances.

The May SPA, the 2020 Notes and the warrants provided that each and every reference to share prices, shares of Common Stock and any other numbers therein that relate to the Common Stock will be automatically adjusted for any stock splits, stock dividends, stock combinations, recapitalizations or other similar transactions that occur with respect to the Common Stock (each, a “Stock Combination Event”, and such date thereof, the “Stock Combination Event Date”) thereafter. The May SPA, the 2020 Notes and the 2020 Warrants further provided if after a Stock Combination Event, the Event Market Price is less than the conversion price (in the case of the Convertible Notes) or the exercise price (in the case of the warrants) then in effect (after giving effect to the above adjustments), then on the sixteenth (16th) trading day immediately following such Stock Combination Event Date, the conversion price or exercise then in effect on such sixteenth (16th) trading day (after giving effect to the above adjustments) will be reduced (but in no event increased) to the Event Market Price. “Event Market Price” means, with respect to any Stock Combination Event Date, the quotient determined by dividing (x) the sum of the dollar volume-weighted average price of the Common Stock for each of the five (5) trading days with the lowest dollar volume-weighted average price of the Common Stock during the fifteen (15) consecutive trading day period ending and including the trading day immediately preceding the sixteenth (16th) trading day after such Stock Combination Event Date, divided by (y) five (5). The price adjustment described in this paragraph is hereinafter referred to as the “Event Market Price Adjustment.”

On February 24, 2021, we entered into an amendment to the May SPA with the Institutional Investors to increase the amount of the Additional Notes by $3,300,000 to $5,400,000. On February 26, 2021, Additional Notes in an aggregate original principal amount of $5,400,000 were issued to the Institutional Investors, together with the issuance of warrants to acquire an aggregate of 14,400 shares of Common Stock (post the Reverse Splits) at an initial exercise price of $129.50 per share (post the Reverse Splits price and subject to the Event Market Price Adjustment). The placement agent for the private placement received a warrant to purchase up to 3,475 shares of our Common Stock (post the Reverse Splits) at an initial exercise price of $142.25 per share ((post the Reverse Splits Price and subject to the Event Market Price Adjustment), subject to increase based on the number of shares of Common Stock issued pursuant to the Additional Notes.

On November 18, 2021, we entered into a securities purchase agreement (the “November SPA”) with the same two Institutional Investors to sell them in a private placement a series of senior convertible notes (the “2021 Notes”) with an original issue discount of 20% and ranking senior to all outstanding and future indebtedness of the Company. Each Institutional Investor paid $3,250,000 in cash for a 2021 Note in the face amount of $3,900,000. The November SPA also provided for the issuance of additional 2021 Notes in an aggregate original principal amount not to exceed $3,900,000 under certain circumstances. The November SPA also contains provisions about the Market Event Price. The 2021 Notes, which were issued on November 22, 2021, matured on the eighteen-month anniversary of the issuance date, were payable by the Company in installments and convertible at the election of the Institutional Investors at the conversion price of $32.5 (post the Reverse Splits and subject to the Event Market Price Adjustment), which was subject to adjustment in the event of default. Each Institutional Investor also received a warrant (the “Institutional Investor 2021 Warrant”) to purchase 180,000 shares of Common Stock at an initial exercise price of $35.5 per share (post the Reverse Splits and subject to the Event Market Price Adjustment). The placement agent for the private placement received a warrant (the “Placement Agent 2021 Warrant”, together with the Institutional Investor 2021 Warrant, the “2021 Warrants”) to purchase up to 8% of the aggregate number of shares of Common Stock at an initial exercise price of $35.5 per share (post the Reverse Splits and subject to the Event Market Price Adjustment), subject to increase based on the number of shares Common Stock issued pursuant to the 2021 Notes.

The Company implemented a reverse stock split on February 2, 2022, at the ratio of 5 to 1. The 2020 Notes and Additional Notes were fully converted before the February reverse split, and therefore no price adjustment was implemented at the conversion, although the price information provided above about the 2020 Notes and Additional Notes was post-split price. The conversion price of the 2021 Notes and the exercise price of the 2020 Warrants and the 2021 Warrants will be adjusted pursuant to the Event Market Price formula upon conversion or exercise.

Upon evaluation, the Company determined that the two agreements contained embedded beneficial conversion features which met the definition of Debt with Conversion and Other Options covered under the Accounting Standards Codification topic 470 (“ASC 470”). According to ASC 470, an embedded beneficial conversion feature present in a convertible instrument shall be recognized separately at issuance by allocating a portion of the proceeds equal to the intrinsic value of that feature to additional paid-in capital.

	June 30, 2023		December 31, 2022
Convertible note – principal	$	-	$	1,108,785
	$	-	$	1,108,785

Additionally, the Company accounted for the embedded conversion option liability in accordance with the Accounting Standards Codification topic 815, Accounting for Derivative Instruments and Hedging Activities (“ASC 815”) as well as related interpretation of this standard. In accordance with these standards, derivative instruments are recognized as either assets or liabilities in the balance sheet and are measured at fair values with gains or losses recognized in earnings. Embedded derivatives that are not clearly and closely related to the host contract are bifurcated and are recognized at fair value with changes in fair value recognized as either a gain or loss in earnings. The Company determines the fair value of derivative instruments and hybrid instruments based on available market data using appropriate valuation models, giving consideration to all of the rights and obligations of each instrument. The initial fair value of the embedded conversion option liability associated with each Note was valued using the Black-Scholes model. The assumptions used in the Black-Scholes option pricing model are as follows:

	June 30, 2023			December 31, 2022
Dividend yield	$	0	%	$	0	%
Expected volatility		171	%		171	%
Risk free interest rate		0.87	%		0.87	%
Expected life (years)		1.42			1.42

The value of the conversion option liability underlying the 2020 Notes, Additional Notes, and 2021 Notes as of June 30, 2023, and December 31, 2022 were nil. The Company recognized a loss from the increase in the fair value of the conversion option liability in the amount of Nil for the six months ended June 30, 2023, and 2022.

Pursuant to the convertible note agreement between the Company and the Institutional Investors, the “Installment Conversion Price” is used for each note conversion except for conversions made when there is an Event of Default as defined in the convertible note agreement, in which event an Alternate Conversion Price is used.

“Installment Conversion Price” means, with respect to a particular date of determination, the lowest of (i) the conversion price fixed in the convertible note agreement, then in effect (the “Conversion Price”), (ii) the greater of (x) the floor price fixed in the note agreement (the “Floor Price”) and (y) 78% of the lowest VWAP of the Common Stock during the ten (10) consecutive trading day period ending and including the trading day immediately preceding the applicable conversion date (the “VWAP Price”).

For any particular conversion, if (y) becomes applicable (i.e. the VWAP Price is lower than the Conversion Price and the Floor Price), because of the mandatory application of the Floor Price, the Floor Price has to be used for the conversion. As a result, the note holder is entitled to a cash amount equal to the value of the difference between the number of shares of Common Stock the note holder would have received if the VWAP Price was used for the conversion, and the number of shares of Common Stock the note holder actually received due to the application of the application of the Floor Price (the “Conversion Installment Floor Amount”).

In 2022 and 2023, instead of paying the Conversion Installment Floor Amount in cash as provided for in the convertible note agreements, the Company paid such amount by issuing shares of Common Stock using the Conversion Price. (the “Floor Amount Issuance”).

As of December 31, 2022, one of the Institutional Investors had converted all of its 2021 Notes into shares of Common Stock while the other Institutional Investor held $3,000 of the 2021 Notes.

In 2022, one of the Institutional Investors received 275,000 shares of Common Stock having a then market value of $200,000 as a result of the application of the of the Floor Amount Issuance and the other Institutional Investor received 1,234,715 shares of Common Stock having a then market value of $493,886 as a result of the application of the Floor Amount Issuance.

In 2022, one of the institutional investors exercised 100,000 warrants on a cashless exercise basis into 44,445 shares of Common Stock having a then market value of $100,000.

During the three months ended March 31, 2023, no shares of Common Stock were issued to the Institutional Investors upon conversion of convertible notes. However, 270,000 shares of Common Stock having a value of $334,800 were issued to one of the Institutional Investors due to the application of the Floor Amount Issuance.

During the three months ended March 31,2023, none of the warrants held by the Institutional Investors were exercised.

During the three months ended June 30, 2023, 2,420 shares were issued to one institutional Investor upon conversion of $3,000 of the 2021 Notes. In addition, 621,762 shares of Common Stock having a value of $770,985 were issued to one Institutional Investor due to the application of the Floor Amount Issuance.

During the three and six month periods ended June 30, 2023, no shares of Common Stock were issued to the two Institutional Investors upon exercise of warrants.

During the six months ended June 30, 2023, 2,420 shares of Common Stock were issued to one Institutional Investor upon conversion of $3,000 of the 2021 Notes. In addition, 891,762 shares of Common Stock having a value of $1,105,785 were issued to the other Institutional Investor due to the application of the Floor Amount Issuance.

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Other Payables and Accrued Liabilities

6 Months Ended

Jun. 30, 2023

Other Payables and Accrued Liabilities [Abstract]

OTHER PAYABLES AND ACCRUED LIABILITIES

21. OTHER PAYABLES AND ACCRUED LIABILITIES

Other payables and accrued liabilities consisted of the following:

	June 30, 2023			December 31, 2022
Salary payable	$	331,136		$	411,043
Salary payable – related parties (1)		2,285,333			2,135,333
Accrued operating expenses		(900	)		(900	)
Other payables		589,401			630,097
	$	3,204,970		$	3,175,574

The Company entered into an employment agreement with Mr. Tiewei Song dated October 1, 2019, to serve as its Chief Executive Officer for a term of two years commencing on October 1, 2019, with base annual cash compensation of $500,000. The agreement was renewed on October 28, 2021, for one year with an annual base salary of $1,000,000 in cash and annual stock compensation of 100,000 shares of the Company’s Common Stock (reflecting a 1-to-10 reverse stock split on December 9, 2022). The 100,000 shares of the Company’s Common Stock were issued on January 24, 2022. Mr. Song’s annual compensation was reduced to $300,000 in cash beginning in October 2022 pursuant to an amendment agreement dated June 9, 2022. As of June 30, 2023, the total accrued compensation payable to Mr. Song was $1.5 million.

The Company entered into the employment Agreement with Ms. Baiqun Zhong dated January 27, 2022, as the Interim CFO from May 21, 2021, until July 14, 2021. Ms. Zhong assumed such role once again on September 27, 2021, and her base annual compensation was set at $250,000. Since January 1, 2023, Ms. Baiqun Zhong has been paid a monthly salary of RMB 7,000. As of June 30, 2023, the accrued compensation payable to Ms. Zhong was $265,833. On January 27, 2022, the Company entered into an employment agreement with Mr. Xiaoping Wang for a term of one-year, effective January 1, 2022. Mr. Wang’s compensation consisted of an annual salary of $500,000 in cash and stock compensation of 10,000 shares of the Company’s Common Stock (post the Reverse Splits). We issued 10,000 shares of our Common Stock to Mr. Wang on February 1, 2022. We have not paid any cash compensation to Mr. Wang as of the date of this quarterly report. The Company did not renew the employment agreement with Mr. Wang for 2023. As of June 30, 2023, the accrued compensation payable to Mr. Wang was $500,000.  

On December 23, 2022, Mr. Song and Mr. Wang provided written performance pledges to the Company, whereby they pledged to use their best efforts to ensure that the aggregate amount of the available cash (excluding cash received as loans or capital infusions or cash held in restricted accounts or otherwise unavailable for unrestricted use for any reason) of Chongqing Bimai Pharmaceutical Technology Group Co., Ltd., a subsidiary of Bimai Pharmaceutical (Chongqing) Co., Ltd., and its subsidiaries, as of December 31, 2023, held in bank accounts of financial banking institutions, as audited by the Company’s independent auditors will be not less than $2 million (the “Performance Target”). If the Performance Target is not met by December 31, 2023, Mr. Song will forfeit his unpaid cash salary accrued from October 1, 2021 to September 30, 2022 in the amount of $1 million, and Mr. Wang will forfeit all his unpaid cash salary accrued through the end of 2023 and will return to the Company the 50,000 shares of the Company’s Common Stock he previously received as salary. 

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Related Parties and Related Party Transactions

6 Months Ended

Jun. 30, 2023

Related Parties and Related Party Transactions [Abstract]

RELATED PARTIES AND RELATED PARTY TRANSACTIONS

22. RELATED PARTIES AND RELATED PARTY TRANSACTIONS

Amounts due to related parties and management team.

As of June 30, 2023, and December 31,2022, the total amounts payable to related parties and mid-level management team was $1,018,832 and $2,980,441, respectively, which included:

1. As of June 30, 2023, and December 31, 2022, the amount payable to Mr. Yongquan Bi, the former Chief Executive Officer and Chairman of the Board of directors of the Company was Nil and $27,699, respectively, free of interest and due on demand. The $27,699 represents the remaining balance that Mr. Bi advanced for third party services on behalf of Xinrongxin during the ordinary course of business of Xinrongxin since the beginning of 2018. As the amount was owed by Xinrongxin, which was dissolved as of January 3, 2023, the Company believes that it no longer has any liability for this debt.

2. As of June 30, 2023, and December 31, 2022, the amounts payable to Mr. Li Zhou, the legal representative (general manager) of Guanzan, were Nil and $248,690, respectively. The $248,690 was used for daily operations and payment of third-party professional fees and were interest-free.

3. As of June 30, 2023, and December 31, 2022, the amounts payable to Mr. Fuqing Zhang, the Chief Executive Officer of Xinrongxin, were $Nil and $172,730, respectively. The $172,730 was free of interest and due on demand. The amount due to Mr. Fuqing Zhang represents reimbursable operating expenses that Xinrongxin owed to Mr. Zhang prior to the acquisition of of Xinrongxin. As the amount was owed by Xinrongxin, which was dissolved as of January 3, 2023, the Company believes that it no longer has any liability for this debt.

4. As of June 30, 2023, and December 31, 2022, the amounts payable to Mr. Youwei Xu, the former financial manager of Xinrongxin, were $11,943 and $11,784, respectively. These sums are free of interest and due on demand. The outstanding amounts owed to Mr. Xu is in connection with reimbursable operating expenses that were incurred prior to the acquisition of of Xinrongxin, As the amounts were owed by Xinrongxin, which was dissolved as of January 3, 2023, the Company believes that it no longer has any liability for this debt.

5. As of June 30, 2023, and December 31, 2022, the amounts payable to Shaohui Zhuo, the general manager of Guoyitang, were $4,502 and $4,671, respectively, which amounts were used for daily operations and do not bear any interest.

6. As of June 30, 2023, and December 31, 2022, the amounts payable to Nanfang Xiao, a director of Guoyitang, were $10,102 and $10,482, respectively. These funds were used for daily operations and were not subject to any interest.

7. As of June 30, 2023, and December 31, 2022, the amounts payable to Jia Song, the manager of Guoyitang, were $4,228 and $4,385, respectively, which amounts were used for daily operations and do not bear any interest.

8. As of December 31, 2022, we owed $2 million to Mr. Fnu Oudom pursuant to a $ 2 million convertible note that was issued on December 6, 2022. The convertible note provided for annual interest of 6%, which was payable together with the principal amount one year after the date of issuance. Mr. Oudom had a conversion right with respect to the principal and interest due on the note at a conversion price of $4.00 per share (reflecting a 1-to-10 reverse stock split on December 9, 2022). The (post reverse split) conversion price of $4.00 reflected a 60% premium on the closing price of the Common Stock on Nasdaq on the date of issuance of the note, which was $0.25. On February 27, 2023, the Company and Mr. Oudom entered into an agreement whereby the Company agreed to exercise its prepayment right under the convertible note by issuing shares of its Common Stock. In consideration of Mr. Oudom’s agreement to convert the convertible note into shares of Common Stock and to waive his right to any and all interest accrued and to be accrued, the Company agreed to issue 1,330,000 shares of Common Stock at a conversion price of $1.50 per share, subject to shareholder approval, as full payment of the $2,000,000 principal and accrued interest. Such issuance was approved by the Company’s shareholders on April 13, 2023, and the shares were issued to Mr. Oudom on June 19, 2023.

9. On July 18, 2022, 1,250,000 shares of Common Stock (reflecting the Reverse Splits) were issued to Mr. Oudom in consideration of the payment $5 million after obtaining the approval of shareholders at the Company’s 2022 annual meeting of shareholders.

10. On February 27, 2023, the Company entered into a stock purchase Agreement with Mr. Oudom, whereby the Company agreed to sell 2,000,000 shares of Common Stock to Mr. Oudom for $3,000,000 in cash, based on a purchase price of $1.50 per share, subject to shareholder approval of the issuance of such shares. The transaction was approved by the Company’s shareholders on April 13, 2023. The Company expects to receive the $3,000,000 in cash from Mr. Oudom and to issue the shares to him by December 2023.

11. On July 5, 2022, we entered into a stock purchase agreement (as amended on February 27, 2023) with Mr. Fnu Oudom, whereby we agreed to acquire 100% of the equity interests in Phenix in consideration of $1,800,000. The transaction closed effective March 15, 2023. The aggregate purchase price for the equity interests in Phenix was $180,000 in cash, which was paid on July 7,2022 and 270,000 shares of Common Stock (reflecting the Reverse Splits), which were issued to Mr. Oudom on June 19,2023 after we obtained shareholder consent. We also agreed to issue an additional 5,000,000 shares of Common Stock if the aggregate net profit generated by Phenix is at least $2,500,000 in calendar year 2023 or in any fiscal quarter of 2023.

12. On October 28, 2022, Mr. Song, the CEO of the Company, loaned the Company $ 500,000. The loan originally had a term of three months from November 3, 2022, to February 3, 2023. No interest was payable if the loan was repaid on time. This loan has not been repaid and pursuant to the agreement, the loan is automatically extended until the principal amount and all accrued interest is paid in full. 1% interest has accrued since March 3, 2023.

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Stockholders’ Equity

6 Months Ended

Jun. 30, 2023

Stockholder's Equity [Abstract]

STOCKHOLDERS’ EQUITY

23. STOCKHOLDERS’ EQUITY

The Company is authorized to issue 200,000,000 shares of Common Stock, $0.001 par value. As of June 30, 2023, and December 31,2022, there were 6,258,926 shares and 3,764,780 shares outstanding, respectively.

From January 4, 2021, to February 9, 2021, Hudson Bay converted 2020 Notes in the aggregate principal amount of $ 2,150,000 into 276,943 shares of Common Stock.

From January 4, 2021, to March 1, 2021, CVI converted 2020 Notes in the aggregate principal amount of $ 2,150,000 into 227,731 shares of the Common Stock.

On February 2, 2021, the Company issued 40,000 shares of Common Stock (reflecting the Reverse Splits) in connection with the purchase of Guoyitang Hospital. 

On February 3, 2021, a holder of a convertible note issued on December 16, 2019, converted a part of the note in the aggregate principal amount of $ 74,473 plus interest into 20,706 shares of Common Stock.

On February 11, 2021, the Company issued 100 shares of Common Stock (reflecting the Reverse Splits) to Real Miracle Investments Limited in consideration for consulting services.

On March 26, 2021, the Company issued 40,037 shares of Common Stock (reflecting the Reverse Splits) as part of the Zhongshan acquisition. On September 1, 2023, 39,037 shares of Common Stock were returned to the Company.

On April 20, 2021, the Company issued 80,000 shares of Common Stock (reflecting the Reverse Splits) as partial consideration for the acquisition of the Minkang, Qiangsheng and Eurasia hospitals. On December 9, 2022, 43,600 shares of Common Stock were returned to the Company and on September 1, 2023, 36,400 shares of Common Stock were returned to the Company.

On April 29, 2021, the Company issued 2,00 shares of Common Stock (reflecting the Reverse Splits) as payment for improvements to offices located in Chongqing.

On June 18, 2021, 32,500 shares of Common Stock were issued to an Institutional Investor with respect to its cashless exercise of 650,000 warrants that were issued in 2020.

On July 23, 2021, the Company issued 600 shares of Common Stock (reflecting the Reverse Splits) as payment for salary to three employees.

From August 26, 2021, to November 30, 2021, an Institutional Investor converted $2,400,000 principal amount of the 2020 Notes and Additional Notes into 970,173 shares of Common Stock.

From August 26, 2021, to November 30, 2021, an Institutional Investor converted $3,000,000 principal amount of the 2020 Notes and Additional Notes into 1,183,251 shares of Common Stock.

On August 27, 2021, the Company issued 92,000 shares of Common Stock (reflecting the Reverse Splits) in full payment of the balance of the post-closing consideration for the acquisition of Guanzan.

On September 22, 2021, the Company issued 44,000 shares of Common Stock (reflecting the Reverse Split on February 3, 2022) as the initial consideration for the acquisition of Zhuoda.

On January 7, 2022, the Company issued 60,000 shares of Common Stock (reflecting the Reverse Splits) as the initial consideration for the acquisition of Mali Hospital. On December 9, 2022, 52,000 shares of Common Stock were returned to the Company. And on September 1, 2023, the remaining 8,000 shares of Common Stock were returned to the Company.

On January 24, 2022, the Company issued 100,000 shares of Common Stock (reflecting a 1-to-10 reverse stock split on December 9, 2022) to Mr. Song as part of his compensation.

On January 27, 2022, the Company the Company issued 10,000 shares of Common Stock (post the Reverse Splits) to Mr. Wang as part of his compensation.

On February 1, 2022, the Company issued 1,000 shares of Common Stock (post the Reverse Splits) to Chongqing Jinmujinyang (Jiulongpo) Law Firm (a/k/a in English: Chongqing Kingmoon & Kingyang (Jiulongpo) Law Firm) as payment for services under a legal consulting agreement dated January 1, 2022.

A 1-for-5 reverse stock split of the Company’s Common Stock became effective on February 3, 2022.

On July 18, 2022, the Company issued 1,250,000 shares of Common Stock (reflecting a 1-to-10 reverse stock split on December 9, 2022) to Mr. Oudom in consideration of an investment of $5 million after obtaining the approval of stockholders at the Company’s 2022 annual meeting of shareholders.

A 1-for-10 reverse stock split of the Company’s Common Stock became effective on December 9, 2022.

On November 23, 2022, the Zhuoda sale transaction closed, when 100% of the equity interests in Zhuoda were transferred to the buyers and 44,000 shares of the Company’s Common Stock (reflecting the Reverse Splits) were returned to the Company as the full consideration.

From January 1, 2022, to December 31, 2022, a converted 2021 Notes in the aggregate principal amount of $2,097,000 into 442,357 shares of Common Stock.

From January 1, 2022, to December 31, 2022, the Institutional Investors. converted $5,700,000 of the 2021 Notes into 1,138,248 shares of Common Stock.

In 2022, one Institutional Investor received 275,000 shares of Common Stock as a result of the Floor Amount Issuance and the other Institutional Investor received 1,234,715 shares; of Common Stock as a result of the Floor Amount Issuance.

In 2022, an Institutional Investor exercised warrants into 44,445 shares of Common Stock.

During the three months ended March 31, 2023, an Institutional Investor was issued  270,000 shares of Common Stock as a result of the Floor Amount Issuance.

During the three months ended June 30, 2023, an Institutional Investor converted $3,000 of 2021 Notes into 2,420 shares of Common Stock.

During the three months ended June 30, 2023, an Institutional Investor was issued 621,762 shares of Common Stock as a result of the Floor Amount Issuance.

On June 19, 2023, Mr. Oudom was issued 270,000 shares of Common Stock (reflecting the Reverse Splits) as partial consideration for the Company’s acquisition of Phenix.

On June 19, 2023, 1,330,000 shares of Common Stock were issued to Mr. Fnu Oudom pursuant to an agreement dated as of February 27, 2023, in consideration for the prepayment of a $2,000,000 convertible promissory note sold by the Company to Mr. Oudom on December 6, 2022.

During the three months ended June 30, 2023, 2,420 shares were issued to an Institutional Investor upon conversion of $3,000 of 2021 Notes. In addition, 621,762 shares were issued to the Institutional Investor due to the Floor Amount Issuance.

During the three months ended June 30, 2023, there is no shares were issued to two institutional investors upon exercise of warrants.

During the six months ended June 30, 2023, 270,000 shares of Common Stock were issued to an Institutional Investor due to the Floor Amount Issuance.

From the legal perspective, the reverse splits applied to the issued shares of Common Stock of the Company did not have any retroactive effect on the Company’s shares prior to those dates. However, for accounting purposes only, references to our Common Stock are stated as having been retroactively adjusted and restated to give effect to the reverse splits, as if the reverse splits had occurred by the relevant earlier date.

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Net Income (Loss) Per Share

6 Months Ended

Jun. 30, 2023

Net Income (Loss) Per Share [Abstract]

NET INCOME (LOSS) PER SHARE

24. NET INCOME (LOSS) PER SHARE

Basic net loss per share is computed using the weighted average number of shares of Common Stock outstanding during the year. The dilutive effect of potential shares of Common Stock outstanding is included in diluted net loss per share. Due to the Company’s net loss from its continuing operations, all potential common share issuances had anti-dilutive effect on net loss per share. The following table sets forth the computation of basic and diluted net loss per share for the six months ended June 30, 2023, and 2022:

	For the six months ended June 30,
	2023			2022
Net income (loss)  from continuing operation attributable to common shareholders	$	1,987,491		$	(9,114,986	)
Net loss from discontinued operation attributable to common shareholders		(143,102	)		(171,810	)
Total net income (loss) attributable to common shareholders		1,844,389			(9,286,796	)
Weighted average number of common shares outstanding – Basic and diluted		4,219,675			15,429,754
loss per share – basic and diluted:
Income (loss) from continuing operations	$	0.47	)	$	(0.59	)
Income (loss) from discontinued operations		(0.03	)		(0.01	)
Total	$	0.44		$	(0.60	)

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Segments

6 Months Ended

Jun. 30, 2023

Segment Reporting [Abstract]

SEGMENTS

25. SEGMENTS

General Information of Reportable Segments:

As of June 30, 2023, the Company had four operating segments: retail pharmacy, wholesale pharmaceuticals, wholesale medical devices and healthcare products. The retail pharmacy segment sells prescription and OTC medicines, TCM, healthcare supplies and sundry items to retail customers through its directly owned pharmacies and authorized retail stores. The wholesale pharmaceuticals segment includes supplying prescription and OTC medicines, TCM, healthcare supplies and sundry items to clinics, third party pharmacies, hospitals, and other drug wholesalers. There were no inter-segment revenues between our retail pharmacy and wholesale pharmaceuticals segments. The wholesale medical device segment distributes medical devices, including medical consumables to private clinics, hospitals, third party pharmacies and other medical device dealers. Healthcare products include dietary supplements such as a cardiovascular product, an anti-insomnia and depression product, a male aphrodisiac product, a women’s menopausal syndrome product, a gout product, and an immunity product.

As of June 30, 2022, the Company had four reportable segments: wholesale medical devices, wholesale pharmaceuticals, medical services, and retail pharmacies. The wholesale medical devices segment distributes medical devices, including medical consumables to drug stores, private clinics, pharmaceutical dealers, and hospitals. The wholesale pharmaceuticals segment includes supplying prescription and OTC medicines, TCM, healthcare supplies and sundry items to clinics, third party pharmacies, hospitals, and other drug vendors. The medical services segment included the hospitals acquired in 2021.The retail pharmacy segment sells prescription and OTC medicines, traditional Chinese medicines (“TCM”), healthcare supplies, and sundry items to retail customers through its directly owned pharmacies and authorized retail stores.

To date, there have limited inter-segment revenues between our segments, consisting of wholesale pharmaceuticals and retail pharmacies.

The segments’ accounting policies are the same as those described in the summary of significant accounting policies. The Company’s chief operating decision maker (“CODM”), who is the CEO of the Company, evaluates performance of each of the segments based on profit or loss from continuing operations net of income tax.

The Company’s reportable business segments are strategic business units that offer different products. Each segment is managed independently because they require different operations and markets to distinct classes of customers. 

Information about Operating Segment Profit or Loss and Segment Assets

BIMI, as the holding company, incurred a significant amount of general operating expenses, such as financing costs, that the Company’s chief operating decision maker did not allocate to segments to evaluate the segments performance and allocate recourses of the Company. In addition, except for depreciation and amortization of long-lived assets, the Company does not allocate the change in fair value of derivative liabilities and the amortization of discount of convertible notes to reporting segments in its reported profit or loss. The following amounts were used by the chief operating decision maker.

For six months ended June 30, 2023	Retail pharmacy			Wholesale medical devices			Wholesale pharmaceuticals			Healthcare products		Medical services			Others			Total
Revenues from external customers	$	480,205		$	1,051,385		$	1,928,388		$	5,295,325	$	-		$	-		$	8,755,303
Cost of revenues	$	357,836		$	805,574		$	1,813,422		$	1,202,013	$	-		$	2,137		$	4,180,982
Depreciation, depletion, and amortization expense	$	9,049		$	11,300		$	-		$	79,449	$	-		$	2,517		$	102,315
Profit (loss)	$	(194,401	)	$	(106,312	)	$	(169,748	)	$	3,842,311	$	(22,309	)	$	(1,362,049	)	$	1,987,492
Total assets	$	294,548		$	3,128,979		$	12,531,453		$	6,372,681	$	998,867		$	7,759,486		$	31,086,014

For six months ended June 30, 2022	Retail pharmacy			Wholesale medical devices		Wholesale pharmecuticals			Medical services			Others			Total
Revenues from external customers	$	505,003		$	2,828,557	$	2,055,417		$	-		$	154,768		$	5,543,745
Cost of revenues	$	223,032		$	2,415,231	$	1,962,623		$	123		$	97,813		$	4,698,822
Depreciation, depletion, and amortization expense	$	10,229		$	24,152	$	154		$	-		$	54,624		$	89,159
Profit (loss)	$	(291,344	)	$	1,224	$	(257,769	)	$	(65,421	)	$	(5,136,229	)	$	(5,749,539	)
Total assets	$	337,795		$	3,750,466	$	7,979,593		$	1,102,730		$	18,937,103		$	32,107,687

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Entity-Wide Information and Concentrations of Risk

6 Months Ended

Jun. 30, 2023

Entity-Wide Information and Concentrations of Risk [Abstract]

ENTITY-WIDE INFORMATION AND CONCENTRATIONS OF RISK

26. ENTITY-WIDE INFORMATION AND CONCENTRATIONS OF RISK

Entity-Wide Information

(a) Revenues from each type of products

For the six months ended June 30, 2023, and 2022, respectively, the Company reported revenues for each segment as follows:

	For the six months ended June 30,
	2023		2022
Medical devices	$	1,051,385	$	2,828,557
Healthcare products		5,295,325		-
Wholesale pharmaceuticals		1,928,388		2,055,417
Pharmacy retail		480,205		505,003
Other		-		154,768
Total	$	8,755,303	$	5,543,745

(b) Geographic areas information

For the six months ended June 30, 2023, all of the Company’s revenues were generated in the PRC and the United States, of which, Phenix accounted for $5.29 million of the revenues.

For the six months ended June 30, 2022, all the Company’s revenues were generated in the PRC. There were no long-lived assets located outside of the PRC as of June 30, 2022.

(c) Major customers

For the six months ended June 30, 2023, one customer accounted for more than 10% of the Company’s revenues:

		For the six months ended
		June 30, 2023
Customers	Segment	Revenue		Percentage of total Revenue
Customer A	Healthcare products	$	5,295,325		60.48	%

(d) Major vendors

For the six months ended June 30, 2023, one vendor accounted for more than 10% of the Company’s purchases as of June 30, 2023:

		For the six months ended					As of June 30,
		June 30, 2023					2023
Vendors	Segment	Purchases		Percentage of total purchases			Accounts payable
Vendor A	Wholesale pharmaceuticals	$	442,323		11.22	%		-

Concentrations of Risk

The Company is exposed to the following concentrations of risk:

(a) Credit risk

Financial instruments that are potentially subject to credit risk consist principally of trade receivables. The Company believes the concentration of credit risk in its trade receivables is substantially mitigated by its ongoing credit evaluation process and relatively short collection terms. The Company does not generally require prepayments or deposits from customers. The Company evaluates the need for an allowance for doubtful accounts based upon factors surrounding the credit risk of specific customers, historical trends, and other information.

(b) Interest rate risk

The Company’s interest-rate risk arises from convertible promissory notes, short-term and long-term loans. The Company manages interest rate risk by varying the issuance and maturity dates, fixing interest rate of debt, limiting the amount of debt, and continually monitoring the effects of market changes in interest rates. As of June 30, 2023, and December 31, 2022, respectively, the Notes, short-term and long-term loans were at fixed rates.

(c) Exchange rate risk

Substantially all of the Company’s revenues and a majority of its costs are denominated in RMB and a significant portion of its assets and liabilities are denominated in RMB. As a result, the Company’s results of operations may be affected by fluctuations in the exchange rate between US$ and RMB. If the RMB depreciates against the US$, the value of RMB revenues and assets as expressed in US$ financial statements will decline. The Company does not hold any derivative or other financial instruments that expose to substantial market risk.

(d) Economic and political risks

The Company’s operations are conducted in the PRC. Accordingly, the Company’s business, financial condition and results of operation may be influenced by the political, economic, and legal environment in the PRC, and by the general state of the PRC economy. The outbreak of COVID-19 pandemic has expanded all over the world since the beginning of 2020, which has greatly slowed the growth of the global economy, including the PRC, and this effect may continue until the pandemic is controlled, or a vaccine or cure is developed. The slowdown of the growth of the PRC’s economy has adversely effected our current business and future success will be adversely affected if we are unable to capitalize on the opportunities arising from the increasing demand for medicine and medical devices in the markets in which we operate.

The Company’s operations in the PRC are subject to special considerations. These include risks associated with, among others, the political, economic, and legal environment and foreign currency exchange. The Company’s results may be adversely affected by changes in the political and social conditions in the PRC, and by changes in governmental policies with respect to laws and regulations, anti-inflationary measures, currency conversion, remittances abroad, and rates and methods of taxation.

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Subsequent Events

6 Months Ended

Jun. 30, 2023

Subsequent Events [Abstract]

SUBSEQUENT EVENTS

27. SUBSEQUENT EVENTS

On September 1, 2023, 39,037 shares of Common Stock were returned to the Company by the prior owner of Zhongshan pursuant to an agreement dated December 28, 2022 whereby the Company agreed to transfer 87% of the equity interests in Zhongshan to the prior owner. Such shares were partial consideration for the transfer. 1,000 shares of Common Stock were returned in the form of cash on September 30, 2023 because the 1,000 shares were sold by the prior owner.

On September 1, 2023, 36,400 shares of Common Stock were returned to the Company by the prior owner of the Qiangsheng, Eurasia and Minkang hospitals pursuant to an agreement dated December 28, 2022 whereby the agreed to transfer 90% of the equity interests in the Qiangsheng, Eurasia and Minkang hospitals to their prior owners. Such shares were partial consideration for the transfer.

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Accounting Policies, by Policy (Policies)

6 Months Ended

Jun. 30, 2023

Summary of Significant Accounting Policies [Abstract]

Basis of presentation and consolidation

● Basis of presentation and consolidation

These accompanying unaudited condensed consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States of America (“US GAAP”). These unaudited condensed consolidated financial statements include the financial statements of the Company and its subsidiaries. All significant inter-company balances and transactions within the Company have been eliminated upon consolidation.

The unaudited condensed consolidated financial information as of June 30, 2023, and for the three and six months ended June 30, 2023, and 2022 have been prepared, pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”). Certain information and footnote disclosures, which are normally included in annual consolidated financial statements prepared in accordance with US GAAP, have been omitted pursuant to those rules and regulations. The unaudited interim condensed consolidated financial information should be read in conjunction with the consolidated financial statements and the notes thereto, included in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2022, filed with the SEC on May 4, 2023.

In the opinion of management, all adjustments (which include normal recurring adjustments) necessary to present a fair statement of the Company’s unaudited condensed consolidated financial position as of June 30, 2023 and its unaudited condensed consolidated results of operations for the three and six months ended June 30, 2023 and 2022, and its unaudited condensed consolidated cash flows for the three and six months ended June 30, 2023 and 2022, as applicable, have been made. The results of operations are not necessarily indicative of the operating results for the fiscal year or any future periods.

Use of estimates

● Use of estimates

The preparation of these condensed consolidated financial statements in conformity with the US GAAP requires management to make estimates and judgments that affect the reported amounts of assets and liabilities, disclosures of contingent assets and liabilities on the date of these condensed consolidated financial statements and the reported amounts of revenues and expenses during the reporting periods. The Company bases its estimates and judgments on historical experience and on various other assumptions and information that are believed to be reasonable under the circumstances. Estimates and assumptions of future events and their effects cannot be perceived with certainty and, accordingly, these estimates may change as new events occur, as more experience is acquired, as additional information is obtained and as our operating environment changes. Significant estimates and assumptions made by management include, among others, useful lives and impairment of long-lived assets, collectability of accounts receivable, advances to suppliers, allowance for doubtful accounts, reserve for inventory obsolescence, fair value of goodwill and valuation of derivative liabilities. While the Company believes that the estimates and assumptions used in the preparation of these condensed consolidated financial statements are appropriate, actual results could differ from those estimates. Estimates and assumptions are periodically reviewed, and the effects of revisions are reflected in the consolidated financial statements in the period they are determined to be necessary.

Business combinations

● Business combinations

The Company accounts for its business combinations using the acquisition method of accounting in accordance with ASC 805 “Business Combinations”. The cost of an acquisition is measured as the aggregate of the acquisition date fair values of the assets transferred and liabilities incurred by the Company to the sellers and equity instruments issued. Transaction costs directly attributable to the acquisition are expensed as incurred. Identifiable assets and liabilities acquired or assumed are measured separately at their fair values as of the acquisition date, irrespective of the extent of any non-controlling interests. The excess of (i) the total costs of acquisition, fair value of the non-controlling interests and acquisition date fair value of any previously held equity interest in the acquiree over (ii) the fair value of the identifiable net assets of the acquiree is recorded as goodwill. If the cost of acquisition is less than the acquisition date amounts of the net assets of the subsidiary acquired, the difference is recognized directly in the consolidated income statements. During the measurement period, which can be up to one year from the acquisition date, the Company may record adjustments to the assets acquired and liabilities assumed with the corresponding offset to goodwill. Subsequent to the conclusion of the measurement period or final determination of the values of assets acquired or liabilities assumed, whichever comes first, any further adjustments are recorded in the consolidated income statements.

In a business combination achieved in stages, the Company re-measures the previously held equity interest in the acquiree immediately before obtaining control at its acquisition date fair value and the re-measurement gain or loss, if any, is recognized in the consolidated income statements.

When there is a change in ownership interests or a change in contractual arrangements that results in a loss of control of a subsidiary, the Company deconsolidates the subsidiary from the date control is lost. Any retained non-controlling investment in the former subsidiary is measured at fair value and is included in the calculation of the gain or loss upon deconsolidation of the subsidiary.

Cash and cash equivalents

● Cash and cash equivalents

Cash and cash equivalents consist primarily of cash on hand and cash in banks which is readily available in checking and saving accounts. The Company maintains cash with various financial institutions in the PRC where its accounts are uninsured. The Company has not experienced any losses from funds held in bank accounts and believes it is not exposed to any risk on its bank accounts.

Accounts receivable and allowance for doubtful accounts

● Accounts receivable and allowance for doubtful accounts

Accounts receivable are recorded at the invoiced amount and do not bear interest, which are due within contractual payment terms, generally 30 to 90 days from delivery. Credit is extended based on evaluation of a customer’s financial condition, the customer creditworthiness and their payment history. Accounts receivable outstanding longer than the contractual payment terms are considered past due. Past due balances over 90 days and over a specified amount are reviewed individually for collectability. At the end of each period, the Company specifically evaluates individual customer’s financial condition, credit history, and the current economic conditions to monitor the progress of the collection of accounts receivables. For the receivables that are past due or not being paid according to payment terms, the appropriate actions are taken to exhaust all means of collection, including seeking legal resolution in a court of law. Account balances are charged off against the allowance after all means of collection have been exhausted and the potential for recovery is considered remote. We do not have any off-balance-sheet credit exposure related to its customers.

Advances to suppliers

● Advances to suppliers

Advances to suppliers consist of prepayments to the Company’s vendors, such as pharmaceutical manufacturers and medicine suppliers. The Company typically prepays for the purchase of our merchandise, especially for those salable, scarce, personalized medicine or medical devices. The Company typically receive products from vendors within three to nine months after making prepayments. The Company continuously monitor delivery from, and payments to, the vendors while maintaining a provision for estimated credit losses based upon historical experience and any specific supplier issues, such as discontinuing of inventory supply, that have been identified. If the Company has difficulty receiving products from a vendor, the Company will cease purchasing products from such vendor, request return of our prepayment promptly, and if necessary, take legal action. The Company has not taken such type of legal action during the reporting periods. If none of these steps are successful, management will then determine whether the prepayments should be reserved or written off. As of June 30, 2023 and December 31, 2022, the allowance for doubtful accounts was Nil.

Businesses held for sale

● Businesses held for sale

In late 2022, we committed to a plan to dispose of the Zhongshan, Minkang, Qiangsheng and Eurasia hospitals and ceased the operation of the Guoyitang hospital. A An impairment is recorded, if necessary, on an annual basis or at the point of sale, based on an impairment assessment report by a third party.

When we acquire a business, a substantial portion of the purchase price of the acquisition may be allocated to goodwill and other identifiable intangible assets. The amount of the purchase price which is allocated to goodwill and other intangible assets is determined by the excess of the purchase price over the net identifiable assets acquired. The current accounting standards require that goodwill and intangible assets should be deemed to have indefinite lives, which should be tested for impairment at least annually (or more frequently if impairment indicators arise). Other intangible assets are amortized over their useful lives. In 2022, we recorded impairment losses totaling approximately $5.4 million with respect to the goodwill relating to our acquisitions of the Guanzan Group, Zhongshan, Guoyitang, Minkang, Qiangsheng and Eurasia.

On December 28, 2022, the Company entered into an agreement to transfer 87% of the equity interests in Zhongshan to the prior owner and retain 13% of the equity interests in Zhongshan. As consideration for the transfer and pursuant to an amendment to the original stock purchase agreement, the original seller agreed to return the 40,037 shares of Common Stock previously issued (reflecting the Reverse Splits) and RMB 40,000,000 in cash (approximately ($6,116,207) previously paid upon the acquisition of Zhongshan. The former owner also agreed to release the Company from any and all claims relating to two earn out payments that were payable under the original purchase agreement. The Company received a put option to sell part or all of its 13% interest in Zhongshan before December 31, 2032, based on a valuation determined by a reputable third-party appraisal firm jointly chosen by the two parties. On September 1, 2023, 39,037 shares of Common Stock were returned to the Company. The remaining 1,000 shares were returned in the form of $3,055 in cash because the shares were sold by the original seller. The transaction is expected to close by December 31, 2023, at which time the cash paid at the time of the transaction will also be returned.

On December 28, 2022, the Company entered into an agreement to transfer 90% of the equity interests in the Qiangsheng, Eurasia and Minkang hospitals to their former owners. Pursuant to the agreement, the Company will transfer 90% of the equity interests in each of the three hospitals and continue to own 10% of the equity interests in each hospital. As consideration for the transfer and pursuant to an amendment to the original stock purchase agreement, the original sellers agreed to return the 80,000 shares of Common Stock previously issued (reflecting the Reverse Splits) and RMB 20,000,000 (approximately $2,767,860) in cash previously paid upon the acquisition of the three hospitals. The former owner also agreed to release the Company from any and all claims relating to two earn out payments that were payable under the original purchase agreement. The Company received a put option to sell part or all of its 10% interest in each of the three hospitals to the former owner before December 31, 2032, based on a valuation determined by a reputable third-party appraisal firm jointly chosen by the parties. On December 9, 2022, 43,600 shares of Common Stock were returned to the Company and on September 1, 2023, 36,400 shares of Common Stock were returned to the Company. The transaction is expected to close by December 31, 2023, at which time the cash paid at the time of the transaction will also be returned.

The Company determined that the plan and the subsequent actions taken to dispose of the four hospitals qualified as held for sale operations under the criteria set forth in the ASC 205-20 Presentation of Financial Statements – Discontinued Operation.

The carrying amount of the major classes of assets and liabilities of the businesses held for sale as of June 30, 2023 and December 31, 2022 consist of the following:

	June 30,			December 31,
	2023			2022
Assets from held for sale
Current assets
Cash and cash equivalents	$	154,503		$	53,928
Accounts receivable, net		516,287			501,054
Advances to suppliers		197,737			211,335
Amount due from related parties		337,904			350,577
Inventories, net		153,977			155,736
Prepayments and other receivables		772,974			827,043
Total current assets		2,133,382			2,099,673
Non-current assets
Deferred tax assets		(128	)		(133	)
Property, plant and equipment, net		1,191,554			1,254,328
Operating lease-right of use assets		2,247,673			2,506,954
Goodwill		-			-
Total non-current assets		3,439,099			3,761,149
Total assets held for sale	$	5,572,481		$	5,860,822
Liabilities of held for sale businesses
Current liabilities
Short-term loans	$	207,589		$	215,375
Long-term loans due within one year		-			-
Accounts payable, trade		1,375,938			1,480,098
Advances from customers		2,668			1,537
Taxes payable		324,582			336,755
Other payables and accrued liabilities		766,601			739,873
Lease liability-current		456,369			466,312
Total current liabilities		3,133,747			3,239,950
Non-current liabilities
Lease liability-non current		2,214,033			2,245,373
Total non-current liabilities		2,214,033			2,245,373
Total liabilities		5,347,780			5,485,323

The summarized operating results of the businesses held for sale included in the Company’s consolidated statements of operations consist of the following:

	For the six months ended June 30,
	2023			2022
Revenues	$	330,281			2,850,027
Cost of revenues		149,253			1,233,688
Gross profit		181,028			1,616,339
Operating expense		253,107			1,598,666
Other expense		(70,288	)		(194,199	)
Loss before income taxes		(142,367	)		(176,526	)
Income tax expense		735			22,212
Loss from businesses held for sale	$	(143,102	)	$	(198,738	)

Inventories

● Inventories

Inventories are stated at the lower of cost or market value. Cost is determined using the weighted average method, and market value is the middle (the second highest) value among an inventory item’s replacement cost, market celling and market floor. The Company carries out physical inventory counts on a monthly basis at each store and warehouse location. The Company reviews historical sales activity quarterly to determine excess, slow-moving items and potentially obsolete items. The Company provides inventory reserve based on the excess quantities on hand equal to the difference, if any, between the cost of the inventory and its estimated market value, or obsolescence of inventories determined principally by customer demand. As of June 30, 2023 and December 31, 2022, the Company recorded an allowance for obsolete inventories, which mainly consists of expired medicine, of $26,604 and $59,567, respectively.

Property, plant and equipment

● Property, plant and equipment

Property, plant, and equipment are stated at cost less accumulated depreciation and impairment, if any. Depreciation is calculated on the straight-line basis over the following expected useful lives from the date on which they become fully operational and after taking into account their estimated residual values:

Items	Expected useful lives	Residual value
Building	20 years		5	%
Office equipment	3 years		5	%
Electronic equipment	3 years		5	%
Furniture	5 years		5	%
Medical equipment	10 years		5	%
Vehicles	4 years		5	%
Leasehold Improvement	Shorter of lease term or useful life		5	%

Expenditures for repairs and maintenance are expensed as incurred. When assets have been retired or sold, the cost and related accumulated depreciation are removed from the accounts and any resulting gain or loss is recognized in the results of operations.

Leases

● Leases

On January 1, 2020, the Company adopted Accounting Standards Update (“ASU”) 2016-02. For all leases that were entered into prior to the effective date of ASC 842, we elected to apply the package of practical expedients. Based on this guidance, the Company did not reassess the following: (1) whether any expired or existing contracts are or contain leases; (2) the lease classification for any expired or existing leases; and (3) initial direct costs for any existing leases.

The Company determines if an arrangement is a lease at inception. Operating leases are included in operating lease right-of-use (“ROU”) assets, current portion of obligations under operating leases, and obligations under operating leases, non-current on the Company’s consolidated balance sheets. Finance leases are included in property and equipment, net, current portion of obligations under capital leases, and obligations under capital leases, non-current on our consolidated balance sheets.

Operating lease ROU assets and operating lease liabilities are recognized based on the present value of the future minimum lease payments over the lease term at commencement date, adjusted by the deferred rent liabilities at the adoption date. As most of the Company’s leases do not provide an implicit rate, the Company uses its incremental borrowing rate based on the information available at commencement date in determining the present value of future payments. The operating lease ROU asset also includes any lease payments made and excludes lease incentives and initial direct costs incurred. The Company’s terms may include options to extend or terminate the lease when it is reasonably certain that the Company will exercise that option. Operating lease expense is recognized on a straight-line basis over the lease term.

Goodwill

● Goodwill

Goodwill represents the excess of the consideration paid of an acquisition over the fair value of the net identifiable assets of the acquired subsidiary at the date of acquisition. Goodwill is not amortized, and is tested for impairment at least annually, more often when circumstances indicate impairment may have occurred. Goodwill is carried at cost less accumulated impairment losses. If impairment exists, goodwill is immediately written off to its fair value and the loss is recognized in the consolidated statements of operations and comprehensive loss. Impairment losses on goodwill are not reversed.

The Company reviews the carrying value of intangible assets not subject to amortization, including goodwill, to determine whether impairment may exist annually or more frequently if events and circumstances indicate that it is more likely than not that an impairment has occurred. The Company has the opinion to assess qualitative factors to determine whether it is necessary to perform the two-step in accordance with ASC 350-20. If the Company believes, as a result of the qualitative carrying amount, the two-step quantities impairment test described below is required.

The first step compares the fair values of each reporting unit to its carrying amount, including goodwill. If the fair value of each reporting unit exceeds its carrying amount, goodwill is not considered to be impaired and the second step will not be required.

If the carrying amount of a reporting unit exceeds its fair value, the second step compares the implied fair value of goodwill to the carrying value of a reporting unit’s goodwill. The implied fair value of goodwill is determined in a manner similar to accounting for a business acquisition with the allocation of the assessed fair value determined in the first step to the assets and liabilities of the reporting unit. The excess of the fair value of the reporting unit. over the amounts assigned to the assets and liabilities is the implied fair value of goodwill. Estimating fair value is performed by utilizing various valuation techniques, with the primary technique being a discounted cash flow. The fair value of discounted cash flow was determined using management’s estimates and assumptions.

Management evaluates the recoverability of goodwill, with the assistance of a third party evaluation firm, by performing a qualitative assessment before using a two-step impairment test approach at the reporting unit level. If the Company reorganizes its reporting structure in a manner that changes the composition of one or more of its reporting units, goodwill will be reassigned based on the relative fair value of each of the affected reporting units. An impairment is recorded, if necessary, at the end of each year, based on an annual impairment assessment report by a third party.

As of June 30, 2023 and December 31, 2022, the Company recorded impairments for goodwill of Nil and $5,385,811, respectively.

As a result of the impairments recognized on December 31, 2022, the remaining goodwill of the Company was related to the acquisitions of Guanzan and Zhongshan. The remaining goodwill of Guanzan was $1,392,449, and the remaining goodwill of Zhongshan was $673, 217 as of December 31, 2022 and June 30, 2023. As of June 30, 2023, the fair value of these businesses was at risk for future goodwill impairments, based on the continuation of negative macroeconomic conditions, which could represent potential indicators of impairment requiring further impairment analysis in 2023. The Company continues to monitor for potential impairment should impairment indicators arise.

Impairment of long-lived assets and intangibles

● Impairment of long-lived assets and intangibles

In accordance with the provisions of ASC Topic 360, “Impairment or Disposal of Long-Lived Assets”, all long-lived assets such as property, plant and equipment held and used by the Company are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability of assets to be held and used is evaluated by a comparison of the carrying amount of an asset to its estimated future undiscounted cash flows expected to be generated by the asset. If such assets are considered to be impaired, the impairment to be recognized is measured by the amount by which the carrying amounts of the assets exceed the fair value of the assets.

Intangible assets that are considered to have a definite useful life are amortized over their useful lives using a method of amortization that reflects the pattern in which the economic benefits of the intangible assets are consumed or otherwise used up in accordance with ASC No. 350, “Intangibles - Goodwill and other” (“ASC 350”). The Company’s identifiable intangibles are reviewed for impairment in accordance with ASC 360 whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability of assets to be held and used is measured by a comparison of the carrying amount of an asset to the future undiscounted cash flows expected to be generated by the assets. If such assets are considered to be impaired, the impairment is measured by the amount by which the carrying amount of the assets exceeds the fair value of the assets.

Goodwill and other certain purchased intangible assets have been recorded in the Company’s financial statements as a result of acquisitions. Goodwill represents the excess of the purchase price in a business combination over the fair value of the net tangible and intangible assets acquired. Under ASC 350 goodwill is not amortized, but rather is subject to an annual impairment test.

ASC 350 requires goodwill to be tested for impairment at the reporting unit level at least annually or between annual tests in certain circumstances and written down when impaired. Goodwill is tested for impairment by comparing the fair value of the reporting unit with its carrying value.

ASC 350 allows an entity to first assess qualitative factors to determine whether it is necessary to perform the two-step quantitative goodwill impairment test. If the qualitative assessment does not result in a more likely than not indication of impairment, no further impairment testing is required. If it does result in a more likely than not indication of impairment, the two-step impairment test is performed. Alternatively, ASC 350 permits an entity to bypass the qualitative assessment for any reporting unit and proceed directly to performing the first step of the goodwill impairment test.

Revenue recognition

● Revenue recognition

We adopted Accounting Standard Codification (“ASC”) Topic 606, Revenues from Contract with Customers (“ASC 606”) for all periods presented with respect to each of our segments. Under ASC 606, revenue is recognized when control of the promised goods and services is transferred to the Company’s customers, in an amount that reflects the consideration that the Company expects to be entitled to in exchange for those goods and services, net of value-added tax. The Company determines revenue recognition through the following steps:

● Identify the contract with a customer;

● Identify the performance obligations in the contract;

● Determine the transaction price;

● Allocate the transaction price to the performance obligations in the contract; and

● Recognize revenue when (or as) the entity satisfies a performance obligation.

The transaction price is allocated to each performance obligation on a relative standalone selling price basis. The transaction price allocated to each performance obligation is recognized when that performance obligation is satisfied by the control of the promised goods and services is transferred to the customers, which at a point in time or over time as appropriate.

The Company’s revenue is net of value added tax (“VAT”) collected on behalf of PRC tax authorities in respect to the sales of products. VAT collected from customers, net of VAT paid for purchases, is recorded as a liability in the accompanying consolidated balance sheets until it is paid to the relevant PRC tax authorities.

Cost of revenue

● Cost of revenue

Cost of revenue consists primarily of cost of goods purchased from suppliers plus direct material costs for packaging and storage, direct labor, which are directly attributable to the acquisition and maintaining of products for sales. Cost of revenues also include impairment loss of our products which are obsolete or expired for sale, if any. Shipping and handling costs, associated with the distribution of finished products to customers, are borne by the customers.

Comprehensive income

● Comprehensive income

ASC Topic 220, “Comprehensive Income”, establishes standards for reporting and display of comprehensive income, its components and accumulated balances. Comprehensive income as defined includes all changes in equity during a period from non-owner sources. Accumulated other comprehensive income, as presented in the accompanying condensed consolidated statement of stockholders’ equity, consists of changes in unrealized gains and losses on foreign currency translation. This comprehensive income is not included in the computation of income tax expense or benefit.

Income taxes

● Income taxes

Income taxes are determined in accordance with the provisions of ASC Topic 740, “Income Taxes” (“ASC 740”). Under this method, deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax basis. Deferred tax assets and liabilities are measured using enacted income tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. Any effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date.

ASC 740 prescribes a comprehensive model for how companies should recognize, measure, present, and disclose in their financial statements uncertain tax positions taken or expected to be taken on a tax return. Under ASC 740, tax positions must initially be recognized in the financial statements when it is more likely than not the position will be sustained upon examination by the tax authorities. Such tax positions must initially and subsequently be measured as the largest amount of tax benefit that has a greater than 50% likelihood of being realized upon ultimate settlement with the tax authority assuming full knowledge of the position and relevant facts.

For the six months ended June 30, 2023 and 2022, the Company did not incur any interest or penalties associated with the tax positions it has taken. As of June 30, 2023, the Company did not have any significant unrecognized uncertain tax positions.

Value added tax

● Value added tax

Sales revenue represents the invoiced value of goods sold, net of VAT. All of the Company’s products that are sold in the PRC are subject to a VAT on the gross sales price. The VAT rates range up to 13%, depending on the type of products sold. The VAT may be offset by VAT paid by the Company on its purchase activities of merchandises, raw materials, utilities, and other materials which cost was included in the cost of producing or acquiring its products for sales. The Company records a VAT payable net of payments if the VAT payable on the gross sales is larger than VAT paid by the Company on purchase of finished goods; on the other hand, the Company records a VAT deductible in the accompanying financial statements net of any VAT payable at the end of reporting period.

Convertible promissory notes

● Convertible promissory notes

The Company records debt net of debt discount for beneficial conversion features and warrants, on a relative fair value basis. Beneficial conversion features are recorded pursuant to the Beneficial Conversion and Debt Topics of the FASB Accounting Standards Codification. The amounts allocated to warrants and beneficial conversion rights are recorded as debt discount and as additional paid-in-capital. Debt discount is amortized to interest expense over the life of the debt.

Debt issuance costs and debt discounts

● Debt issuance costs and debt discounts

The Company may record debt issuance costs and/or debt discounts in connection with raising funds through the issuance of debt. These costs may be paid in the form of cash, or equity (such as warrants). These costs are amortized to interest expense through the maturity of the debt. If a conversion of the underlying debt occurs prior to maturity a proportionate share of the unamortized amounts is immediately expensed.

Beneficial conversion feature

● Beneficial conversion feature

The Company evaluates the conversion feature of its convertible promissory notes to determine whether it was beneficial as described in ASC 470-20. The intrinsic value of a beneficial conversion feature inherent to a convertible note payable, which is not bifurcated and accounted for separately from the convertible notes payable and may not be settled in cash upon conversion, is treated as a discount to the convertible notes payable. This discount is amortized over the period from the date of issuance to the date the notes is due using the effective interest method. If the notes payable are retired prior to the end of their contractual term, the unamortized discount is expensed in the period of retirement to interest expense. In general, the beneficial conversion feature is measured by comparing the effective conversion price, after considering the relative fair value of detachable instruments included in the financing transaction, if any, to the fair value of the shares of Common Stock at the commitment date to be received upon conversion.

Discontinued operations

● Discontinued operations

In accordance with ASC 205-20, Reporting Discontinued Operations and Disclosures of Disposals of Components of an Entity, a disposal of a component of an entity or a group of components of an entity is required to be reported as a discontinued operation if the disposal represents a strategic shift that has (or will have) a major effect on an entity’s operations and financial results when the components of an entity meets the criteria in paragraph 205-20-45-1E to be classified as held for sale. When all of the criteria to be classified as held for sale are met, including management, having the authority to approve the action, commits to a plan to sell the entity, the major current assets, other assets, current liabilities, and non-current liabilities shall be reported as components of total assets and liabilities separate from those balances of the continuing operations. At the same time, the results of all discontinued operations, less applicable income taxes (benefit), shall be reported as components of net income (loss) separate from the net income (loss) of continuing operations in accordance with ASC 205-20-45.

On October 19, 2022, the Company’s wholly owned Guanzan subsidiary agreed to sell its 100% equity interest in Zhuoda and Zhuoda’s wholly owned subsidiary, Qianmei, to the former owner. Guanzan had previously purchased Zhuoda for 44,000 of shares of Common Stock (post the Reverse Splits). As consideration for the sale, the buyer agreed to return the 44,000 shares of Common Stock to the Company. The transaction closed effective November 23, 2022, when 100% of the equity interests in Zhuoda were transferred to the former owners and the 44,000 shares of Common Stock were returned to the Company.

On December 28, 2022, the Company entered into an agreement to transfer 87% of the equity interests in Zhongshan to the prior owner. Pursuant to the agreement, the Company agreed to transfer 87% of the equity interests in Zhongshan to the former owner and will retain 13% of the equity interests in Zhongshan. As consideration for the transfer and pursuant to an amendment to the original stock purchase agreement, the original seller agreed to return the 40,037 shares of Common Stock previously issued (reflecting Two Reverse Splits) and RMB 40,000,000 in cash (approximately ($6,116,207) previously paid upon the acquisition of Zhongshan. The former owner also agreed to release the Company from any and all claims relating to two earn out payments that were payable under the original purchase agreement. The Company received a put option to sell part or all of its 13% interest in Zhongshan before December 31, 2032, based on a valuation determined by a reputable third-party appraisal firm jointly chosen by the two parties. On September 1, 2023, 39,037 shares of Common Stock were returned to the Company. The remaining 1,000 shares were returned in the form of a cash payment of $3,055 because the shares were sold by the original seller. The transaction is expected to close by December 31, 2023, at which time the cash paid at the time of the transaction will also be returned.

On December 28, 2022, the Company entered into an agreement to transfer 90% of the equity interests in the Qiangsheng, Eurasia and Minkang hospitals to their former owners. Pursuant to the agreement, the Company will transfer 90% of the equity interests in each of the three hospitals and continue to own 10% of the equity interests in each hospital. As consideration for the transfer and pursuant to an amendment to the original stock purchase agreement, the original sellers agreed to return the 80,000 shares of Common Stock previously issued (reflecting the Reverse Splits) and RMB 20,000,000 (approximately $2,767,860 in cash previously paid upon the acquisition of the three hospitals. The former owner also agreed to release the Company from any and all claims relating to two earn out payments that were payable under the original purchase agreement. The Company received a put option to sell part or all of its 10% interest in each of the three hospitals to the former owner before December 31, 2032, based on a valuation determined by a reputable third-party appraisal firm jointly chosen by the parties. On December 9, 2022, 43,600 shares of Common Stock were returned to the Company and on September 1, 2023, 36,400 shares of Common Stock were returned to the Company. The transaction is expected to close by December 31, 2023, at which time the cash paid at the time of the transaction will also be returned.

Derivative instruments

● Derivative instruments

The Company has entered into financing arrangements that consist of freestanding derivative instruments or are hybrid instruments that contain embedded derivative features. The Company accounts for these arrangements in accordance with Accounting Standards Codification Topic 815, Accounting for Derivative Instruments and Hedging Activities (“ASC 815”) as well as related interpretation of this standard. In accordance with this standard, derivative instruments are recognized as either assets or liabilities in the balance sheet and are measured at fair values with gains or losses recognized in earnings. Embedded derivatives that are not clearly and closely related to the host contract are bifurcated and are recognized at fair value with changes in fair value recognized as either a gain or loss in earnings. The Company determines the fair value of derivative instruments and hybrid instruments based on available market data using appropriate valuation models, giving consideration to all of the rights and obligations of each instrument.

The Company estimates fair values of derivative financial instruments using various techniques (and combinations thereof) that are considered to be consistent with the objective measuring fair values. In selecting the appropriate technique, we consider, among other factors, the nature of the instrument, the market risks that it embodies and the expected means of settlement. For less complex derivative instruments, such as free-standing warrants, we generally use the Black-Scholes model, adjusted for the effect of dilution, because it embodies all of the requisite assumptions (including trading volatility, estimated terms, dilution and risk-free rates) necessary to fair value these instruments. Estimating fair values of derivative financial instruments requires the development of significant and subjective estimates that may, and are likely to, change over the duration of the instrument with related changes in internal and external market factors. In addition, option-based techniques (such as Black-Scholes model) are highly volatile and sensitive to changes in the trading market price of our Common Stock. Since derivative financial instruments are initially and subsequently carried at fair values, our income (expense) going forward will reflect the volatility in these estimate and assumption changes. Under the terms of the new accounting standard, increases in the trading price of the Common Stock and increases in fair value during a given financial quarter result in the application of non-cash derivative expense. Conversely, decreases in the trading price of the Common Stock and decreases in trading fair value during a given financial quarter result in the application of non-cash derivative income. 

Net loss per share

● Net loss per share

The Company calculates net loss per share in accordance with ASC Topic 260, “Earnings per Share.” Basic income per share is computed by dividing the net income by the weighted-average number of shares of Common Stock outstanding during the period. Diluted income per share is computed similar to basic income per share except that the denominator is increased to include the number of additional shares of Common Stock that would have been outstanding if the potential Common Stock equivalents had been issued and if the additional shares of Common Stock were dilutive.

Foreign currencies translation

● Foreign currencies translation

Transactions denominated in currencies other than the functional currency are translated into the functional currency at the exchange rates prevailing at the dates of the transaction. Monetary assets and liabilities denominated in currencies other than the functional currency are translated into the functional currency using the applicable exchange rates at the balance sheet dates. The resulting exchange differences are recorded in the statement of operations.

The reporting currency of the Company is the United States Dollar (“US$”). The Company’s subsidiaries in the PRC maintain their books and records in their local currency, the Renminbi Yuan (“RMB”), which is the functional currency as being the primary currency of the economic environment in which these entities operate.

In general, for consolidation purposes, assets and liabilities of its subsidiaries whose functional currency is not the US$ are translated into US$, in accordance with ASC Topic 830-30, “Translation of Financial Statement”, using the exchange rate on the balance sheet date. Revenues and expenses are translated at average rates prevailing during the period. The gains and losses resulting from translation of financial statements of foreign subsidiaries are recorded as a separate component of accumulated other comprehensive income within the statement of stockholders’ equity.

Translation of amounts from RMB into US$ has been made at the following exchange rates for the respective period:

	June 30, 2023		June 30, 2022
Period-end RMB:US$1 exchange rate		7.2258		6.7114
Six months end average RMB:US$1 exchange rate		6.9291		6.4835

Related parties

● Related parties

Parties, which can be a corporation or an individual, are considered to be related if the Company has the ability, directly or indirectly, to control the other party or exercise significant influence over the other party in making financial and operational decisions. Companies are also considered to be related if they are subject to common control or common significant influence.

Segment reporting

● Segment reporting

ASC Topic 280, “Segment Reporting” establishes standards for reporting information about operating segments on a basis consistent with the Company’s internal organization structure as well as information about the type of products and services, geographical areas, business strategies and major customers in business components. For the six months ended June 30, 2023, and 2022, the Company operated in four reportable segments in the PRC.

As of June 30, 2023, the Company had four reportable segments, which consisted of retail pharmacy, wholesale pharmaceuticals, wholesale medical devices and healthcare products.

As of June 30, 2022, the Company had four reportable segments, which consisted of wholesale medical devices, wholesale pharmaceuticals, medical services and retail pharmacies.

Fair value of financial instruments

● Fair value of financial instruments

The carrying value of the Company’s financial instruments (excluding short-term bank borrowing and convertible promissory notes): cash and cash equivalents, accounts and retention receivable and other receivables, accounts payable, amounts due to related parties, other payables and accrued liabilities approximate their fair values because of the short-term nature of these financial instruments.

Management believes, based on the current market prices or interest rates for similar debt instruments, the fair value of its obligations under its finance lease and short-term bank borrowing approximates the carrying amount.

The Company also follows the guidance of the ASC Topic 820-10, “Fair Value Measurements and Disclosures” (“ASC 820-10”), with respect to financial assets and liabilities that are measured at fair value. ASC 820-10 establishes a three-tier fair value hierarchy that prioritizes the inputs used in measuring fair value as follows:

● Level 1: Inputs are based upon unadjusted quoted prices for identical instruments traded in active markets;

● Level 2: Inputs are based upon quoted prices for similar instruments in active markets, quoted prices for identical or similar instruments in markets that are not active, and model-based valuation techniques (e.g., Black-Scholes Option-Pricing model) for which all significant inputs are observable in the market or can be corroborated by observable market data for substantially the full term of the assets or liabilities. Where applicable, these models project future cash flows and discount the future amounts to a present value using market-based observable inputs; and

● Level 3: Inputs are generally unobservable and typically reflect management’s estimates of assumptions that market participants would use in pricing the asset or liability. The fair values are therefore determined using model-based techniques, including option pricing models and discounted cash flow models.

Fair value estimates are made at a specific point in time based on relevant market information about the financial instrument. These estimates are subjective in nature and involve uncertainties and matters of significant judgment and, therefore, cannot be determined with precision. Changes in assumptions could significantly affect the estimates.

The Company measures the fair value of the following assets and liabilities:

Financial assets and liabilities for which carrying value approximates fair value - Cash and cash equivalents, deposits, receivables, repurchase agreements, payables, and other assets and liabilities are reflected in the consolidated balance sheets at their cost, which, due to the short-term nature of these instruments and their limited inherent credit risk, approximates fair value.

Convertible promissory note - As of June 30, 2023, and 2022, the carrying value of the Company’s convertible promissory notes was $0 and $6,320,075, respectively. The Company’s estimate of the fair value of convertible promissory note is $0 and $6,320,075 as of June 30, 2023, and 2022, respectively. The Company’s convertible promissory note, which are publicly traded on the Nasdaq Stock Exchange, are classified within Level 1 of the fair value hierarchy.

Recent accounting pronouncements

Recent accounting pronouncements

In August 2020, the FASB issued ASU No. 2020-06 (“ASU 2020-06”) “Debt—Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging—Contracts in Entity’s Own Equity (Subtopic 815-40): Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity.” ASU 2020-06 will simplify the accounting for convertible instruments by reducing the number of accounting models for convertible debt instruments and convertible preferred stock. For public business entities, the amendments in ASU 2020-06 are effective for public entities which meet the definition of a smaller reporting company are effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2023. The Company will adopt ASU 2020-06 effective January 1, 2024. Management is currently evaluating the effect of the adoption of ASU 2020-06 on the consolidated financial statements. The effect will largely depend on the composition and terms of the financial instruments at the time of adoption.

In October 2021, the FASB issued ASU No. 2021-08, “‘Business Combinations (Topic 805): Accounting for Contract Assets and Contract Liabilities from Contracts with Customers” (“ASU 2021-08”). This ASU requires entities to apply Topic 606 to recognize and measure contract assets and contract liabilities in a business combination. The amendments improve comparability after the business combination by providing consistent recognition and measurement guidance for revenue contracts with customers acquired in a business combination and revenue contracts with customers not acquired in a business combination. The amendments are effective for the Company beginning after December 15, 2023, and are applied prospectively to business combinations that occur after the effective date. The Company does not expect the adoption of ASU 2021-04 will have a material effect on the consolidated financial statements.

Other accounting standards that have been issued or proposed by the FASB or other standards-setting bodies that do not require adoption until a future date are not expected to have a material impact on the Company’s consolidated financial statements upon adoption. The Company does not discuss recent pronouncements that are not anticipated to have an impact on or are unrelated to its consolidated financial condition, results of operations, cash flows or disclosures.

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Organization and Business Background (Tables)

6 Months Ended

Jun. 30, 2023

Organization and Business Background [Abstract]

Schedule of Subsidiaries

As of June 30, 2023, the details of the Company’s subsidiaries are as follows:

Name	Place of incorporation and kind of legal entity	Principal activities and Type of operation	Effective ownership interest held
Lasting Wisdom Holdings Limited (“Lasting”)	British Virgin Island, a limited liability company	Investment holding		100	%
Phenix Bio Inc. (“Phenix”)	California, a corporation	Distribution of healthcare products		100	%
Pukung Limited (“Pukung”)	Hong Kong, a limited liability company	Investment holding		100	%
Beijing Xinrongxin Industrial Development Co., Ltd. (“Xinrongxin”)	The PRC, a limited liability company	Investment holding		100	%
Boyi (Liaoning) Technology Co., Ltd (“Liaoning Boyi”)	The PRC, a limited liability company	IT Technology service research and development		100	%
Dalian Boyi Technology Co., Ltd (“Dalian Boyi”)	The PRC, a limited liability company	IT Technology service research and development		100	%
Chongqing Guanzan Technology Co., Ltd. (“Guanzan”)	The PRC, a limited liability company	Wholesale distribution of medical devices in the PRC		100	%
Chongqing Shude Pharmaceutical Co., Ltd.(“Shude”)	The PRC, a limited liability company	Wholesale distribution of generic drugs in the PRC		95	%
Chongqing Lijiantang Pharmaceutical Co., Ltd.(“Lijiantang”)	The PRC, a limited liability company	Wholesale distribution of generic drugs in the PRC		100	%
Bimai Pharmaceutical (Chongqing) Co., Ltd.	The PRC, a limited liability company	Investment holding		100	%
Chongqing Guoyitang Hospital Co., Ltd.	The PRC, a limited liability company	Hospital in the PRC		100	%
Chongqing Huzhongtang Healthy Technology Co., Ltd.	The PRC, a limited liability company	Wholesale distribution of generic drugs in the PRC		100	%
Chaohu Zhongshan Minimally Invasive Hospital Co.,Ltd.	The PRC, a limited liability company	Hospital in the PRC		100	%
Yunnan Yuxi Minkang Hospital Co., Ltd.	The PRC, a limited liability company	Hospital in the PRC		100	%
Wuzhou Qiangsheng Hospital Co., Ltd.	The PRC, a limited liability company	Hospital in the PRC		100	%
Suzhou Eurasia Hospital Co., Ltd.	The PRC, a limited liability company	Hospital in the PRC		100	%
Bimai Hospital Management (Chongqing) Co. Ltd	The PRC, a limited liability company	Hospital management in the PRC		100	%
Pusheng Pharmaceutical Co., Ltd	The PRC, a limited liability company	Wholesale distribution of generic drugs in the PRC		100	%

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Summary of Significant Accounting Policies (Tables)

6 Months Ended

Jun. 30, 2023

Summary of Significant Accounting Policies [Abstract]

Schedule of Carrying Amount of the Major Classes of Assets and Liabilities

The carrying amount of the major classes of assets and liabilities of the businesses held for sale as of June 30, 2023 and December 31, 2022 consist of the following:

	June 30,			December 31,
	2023			2022
Assets from held for sale
Current assets
Cash and cash equivalents	$	154,503		$	53,928
Accounts receivable, net		516,287			501,054
Advances to suppliers		197,737			211,335
Amount due from related parties		337,904			350,577
Inventories, net		153,977			155,736
Prepayments and other receivables		772,974			827,043
Total current assets		2,133,382			2,099,673
Non-current assets
Deferred tax assets		(128	)		(133	)
Property, plant and equipment, net		1,191,554			1,254,328
Operating lease-right of use assets		2,247,673			2,506,954
Goodwill		-			-
Total non-current assets		3,439,099			3,761,149
Total assets held for sale	$	5,572,481		$	5,860,822
Liabilities of held for sale businesses
Current liabilities
Short-term loans	$	207,589		$	215,375
Long-term loans due within one year		-			-
Accounts payable, trade		1,375,938			1,480,098
Advances from customers		2,668			1,537
Taxes payable		324,582			336,755
Other payables and accrued liabilities		766,601			739,873
Lease liability-current		456,369			466,312
Total current liabilities		3,133,747			3,239,950
Non-current liabilities
Lease liability-non current		2,214,033			2,245,373
Total non-current liabilities		2,214,033			2,245,373
Total liabilities		5,347,780			5,485,323

Schedule of Summarized Operating Results of the Business

The summarized operating results of the businesses held for sale included in the Company’s consolidated statements of operations consist of the following:

	For the six months ended June 30,
	2023			2022
Revenues	$	330,281			2,850,027
Cost of revenues		149,253			1,233,688
Gross profit		181,028			1,616,339
Operating expense		253,107			1,598,666
Other expense		(70,288	)		(194,199	)
Loss before income taxes		(142,367	)		(176,526	)
Income tax expense		735			22,212
Loss from businesses held for sale	$	(143,102	)	$	(198,738	)

Schedule of Expected Useful Lives

Property, plant, and equipment are stated at cost less accumulated depreciation and impairment, if any. Depreciation is calculated on the straight-line basis over the following expected useful lives from the date on which they become fully operational and after taking into account their estimated residual values:

Items	Expected useful lives	Residual value
Building	20 years		5	%
Office equipment	3 years		5	%
Electronic equipment	3 years		5	%
Furniture	5 years		5	%
Medical equipment	10 years		5	%
Vehicles	4 years		5	%
Leasehold Improvement	Shorter of lease term or useful life		5	%

Schedule of Exchange Rates

Translation of amounts from RMB into US$ has been made at the following exchange rates for the respective period:

	June 30, 2023		June 30, 2022
Period-end RMB:US$1 exchange rate		7.2258		6.7114
Six months end average RMB:US$1 exchange rate		6.9291		6.4835

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The Acquisition of the Guanzan Group (Tables) - Guanzan Acquisition [Member]

6 Months Ended

Jun. 30, 2023

The Acquisition of the Guanzan Group (Tables) [Line Items]

Schedule of Identified Assets Acquired and Liabilities

The following summarizes the identified assets acquired and liabilities assumed pursuant to the Guanzan acquisition as of March 18, 2020:

Items	Amount
Assets
Cash and cash equivalents	$	95,220
Accounts receivable		1,835,981
Advances to suppliers		1,222,986
Amount due from related parties		410,943
Inventories		950,225
Prepayments and other receivables		90,256
Property, plant and equipment		707,289
Intangible assets		254,737
Goodwill		6,686,053
Liabilities
Short-term bank borrowings		(838,926	)
Long-term loans due within one year		(250,663	)
Accounts payable, trade		(1,303,399	)
Advances from customers		(1,350,126	)
Amount due to related parties		(106,720	)
Taxes payable		(406,169	)
Other payables and accrued liabilities		(390,593	)
Long-term loans – noncurrent portion		(186,796	)
Non-controlling interests		(46,295	)
Total-net assets	$	7,374,000

Schedule of Reconciles the Identified Assets Acquired and Liabilities Assumed

The following reconciles the identified assets acquired and liabilities assumed pursuant to the Guanzan SPA, and the Prepayment and Amendment Agreement made on November 20, 2020:

The fair value of the shares issued on March 12, 2020	$	2,717,000
The fair value of the shares issued on November 19, 2020		1,820,000
Cash		3,065,181
Total consideration	$	7,602,181
Net assets		(687,949	)
Goodwill	$	6,914,232

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The Acquisition of the Guoyitang Hospital (Tables) - Guoyitang Acquisition [Member]

6 Months Ended

Jun. 30, 2023

Schedule of Acquisition of the Guoyitang Hospital [Line Items]

Schedule of Identified Assets Acquired and Liabilities

The following summarizes the identified assets acquired and liabilities assumed pursuant to the Guoyitang Acquisition

Items	Amount
Assets
Cash and cash equivalents	$	28,457
Accounts receivable		11,797
Advances to suppliers		12,670
Amount due from related parties		41,598
Inventories		167,440
Prepayments and other receivables		61,102
Property, plant and equipment		528,814
Right-of-use asset		441,150
Goodwill		7,154,393
Liabilities
Accounts payable, trade		(599,391	)
Amount due to related parties		(183,796	)
Taxes payable		(121	)
Other payables and accrued liabilities		(231,375	)
Lease liability-current		(161,707	)
Lease liability-non current		(354,912	)
Total-net assets	$	6,916,119

Schedule of Reconciles the Identified Assets Acquired and Liabilities Assumed

The fair value of all assets acquired and liabilities assumed was the estimated book value of Guoyitang. Goodwill represents the excess of the fair value of purchase price over the amounts assigned to the fair value of the assets acquired and the liabilities assumed of Guoyitang at the acquisition date.

The value of the shares issued on February 2, 2021		3,820,000
Cash		3,096,119
Total consideration	$	6,916,119
Net assets		(238,274	)
Goodwill		7,154,393

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The Acquisition of the Zhongshan Hospital (Tables) - Zhongshan Acquisition [Member]

6 Months Ended

Jun. 30, 2023

The Acquisition of the Zhongshan Hospital [Line Items]

Schedule of Identified Assets Acquired and Liabilities Assumed Pursuant to the Zhongshan Acquisition

The following summarizes the identified assets acquired and liabilities assumed pursuant to the Zhongshan acquisition as of February 5, 2021:

Items	Amount
Assets
Cash and cash equivalents	$	46,748
Accounts receivable		92,900
Inventories		108,413
Prepayments and other receivables		432,231
Property, plant and equipment		344,208
Right-of-use asset		1,188,693
Goodwill		10,443,494
Liabilities
Short-term bank borrowings		(154,701	)
Accounts payable, trade		(928,640	)
Advances from customers		(5,603	)
Amount due to related parties		(217,203	)
Other payables and accrued liabilities		(435,290	)
Lease liability-current		(160,774	)
Lease liability-non current		(1,102,589	)
Total-net assets	$	9,651,887

Schedule of Fair Value of all Assets Acquired and Liabilities Assumed is the Estimated Book Value

The determination of the share value was determined according to the closing price of the Company’s Common Stock on the day the shares were issued,

The value of the shares issued on February 12, 2021		3,480,000
Cash payment in December 2020		6,171,887
Total consideration	$	9,651,887
Net assets		(791,607	)
Goodwill		10,443,494

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The Acquisition of the Qiangsheng, Eurasia and Minkang Hospitals (Tables) - Qiangsheng, Eurasia and Minkang Acquisition [Member]

6 Months Ended

Jun. 30, 2023

The Acquisition of the Qiangsheng, Eurasia and Minkang Hospitals (Tables) [Line Items]

Schedule of Identified Assets Acquired and Liabilities

The following summarizes the identified assets acquired and liabilities assumed pursuant to the Qiangsheng, Eurasia and Minkang acquisitions as of May 6, 2021:

Items	Amount
Assets
Cash and cash equivalents	$	12,341
Accounts receivable		41,836
Inventories		156,576
Advances and other receivables		40,620
Property, plant and equipment		653,104
Right of use assets		2,168,709
Goodwill		9,067,529
Liabilities
Accounts payable		(355,980	)
Advances from customers		(36,798	)
Tax payable		(345,870	)
Other payables and accrued liabilities		(311,174	)
Lease liability-current		(365,788	)
Lease liability-non-current		(1,988,195	)
Total net assets	$	8,736,910

Schedule of Fair Value of the Assets Acquired and the Liabilities Assumed of Qiangsheng

The determination of the share value was determined according to the closing price of the Company’s Common Stock on the day the shares were issued.

The value of the shares issued on April 20, 2021		5,600,000
Cash payment on December 2021		3,136,910
Total consideration	$	8,736,910
Net assets		(330,619	)
Goodwill		9,067,529

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The Acquisition of Zhuoda (Tables)

6 Months Ended

Jun. 30, 2023

The Acquisition of Zhuoda (Tables) [Line Items]

Schedule of Fair Value of all Assets Acquired, and Liabilities

The determination of the share value was determined according to the closing price of the Company’s Common Stock on the day the shares were issued

The value of the shares issued on September 6, 2021	$	1,498,200
Total consideration	$	1,498,200
Net assets		573,458
Goodwill	$	924,742

Zhuoda Acquisition [Member]

The Acquisition of Zhuoda (Tables) [Line Items]

Schedule of Identified Assets Acquired and Liabilities

The following summarizes the identified assets acquired and liabilities assumed pursuant to the Zhuoda acquisition as of October 8, 2021:

Items	Amount
Assets
Cash and cash equivalents	$	102,350
Accounts receivable		804,083
Inventories		131,456
Advances and other receivables		886,370
Property, plant and equipment		6,579
Right of use assets		17,160
Goodwill		924,740
Liabilities
Short term loan		(773,737	)
Accounts payable		(56,887	)
Advances from customers		(3,778	)
Tax payable		(24,787	)
Other payables and accrued liabilities		(493,868	)
Lease liability-current		(7,217	)
Lease liability-non-current		(14,265	)
Total net assets	$	1,498,199

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The Sale of Zhuoda (Tables) - The Sale of Zhuoda [Member]

6 Months Ended

Jun. 30, 2023

The Sale of Zhuoda (Tables) [Line Items]

Schedule of Condensed Consolidated Statements of Operations

The summarized operating results of the Zhuoda and its subsidiary in the Company’s condensed consolidated statements of operations

	For the period ended November 23, 2022
Revenues	$	2,713,818
Cost of revenues		2,314,877
Gross profit		398,941
Operating expense		392,875
Other income (expense)		(45,146	)
Loss before income taxes		(39,080	)
Income tax expense		1,425
Net income/(loss) from discontinued operations	$	(40,505	)

Schedule of Assets and Liabilities of the Discontinued Operations

The assets and liabilities of the discontinued operations of Zhuoda consisted of the following items

	November 23,		December 31,
	2022		2021
Assets from discontinued operations
Current assets
Cash and cash equivalents	$	13,922	$	100,678
Accounts receivable, net		1,951,997		984,030
Advances to suppliers		67,561		118,365
Amount due from related parties		-		-
Inventories, net		101,059		162,882
Prepayments and other receivables		720,365		725,881
Operating lease-right of use assets		-		-
Total current assets		2,854,904		2,091,836
Non-current assets
Deferred tax assets		-		-
Property, plant and equipment, net		1,442		2,507
Intangible assets, net		-		-
Operating lease-right of use assets		10,044		15,959
Goodwill		-		-
Long-term investment		-		-
Total non-current assets		11,486		18,466
Total assets from discontinued operations	$	2,866,390	$	2,110,302
Liabilities from discontinued operations
Current liabilities
Short-term loans	$	154,288	$	795,583
Long-term loans due within one year		-		-
Convertible promissory notes, net		-		-
Accounts payable, trade		1,301,712		265,731
Advances from customers		-		723
Amount due to related parties		-		-
Taxes payable		441		218
Other payables and accrued liabilities		162,362		468,970
Lease liability-current		7,693		8,102
Total current liabilities		1,626,496		1,539,327
Non-current liabilities
Lease liability-non current		6,976		12,727
Long-term loans – non-current		330,242		-
Total non-current liabilities		337,218		12,727
Total liabilities		1,963,714		1,552,054

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The Acquisition of Phenix (Tables) - Phenix Acquisition [Member]

6 Months Ended

Jun. 30, 2023

The Acquisition of Phenix (Tables) [Line Items]

Schedule of Identified Assets Acquired and Liabilities

The following summarizes the identified assets acquired and liabilities assumed pursuant to Phenix acquisition as of March 15, 2023:

Items	Amount
Assets
Cash and cash equivalents	$	1,511,220
Accounts receivable		346
Inventories		892,214
Advances and other receivables		386,965
Fixed assets		99,599
Intangible assets		500,000
Liabilities
Accounts payable		(6,650	)
Other payables and accrued liabilities		(13,883	)
Advance from customer		(1,028,004	)
Total net assets	$	2,341,807

Schedule of Assets Acquired and the Liabilities Assumed of Phenix at the Acquisition Date

The fair value of all assets acquired, and liabilities assumed is the estimated book value of the Phenix.

Cash payment on July 7,2022	$	180,000
The value of the 270,000 shares issued on June 19, 2023	$	291,600
Total consideration	$	471,600
Net assets	$	2,341,807
Additional paid in capital	$	1,870,207

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Accounts Receivable (Tables)

6 Months Ended

Jun. 30, 2023

Accounts Receivable [Abstract]

Schedule of Accounts Receivable

The Company routinely evaluates the need for allowance for doubtful accounts based on specifically identified amounts that the management believes to be uncollectible. If the actual collection experience changes, revisions to the allowance may be required. As of June 30, 2023, and December 31, 2022, accounts receivable consisted of the following:

	June 30, 2023			December 31, 2022
Accounts receivable, cost	$	7,927,248		$	4,813,160
Less: allowance for doubtful accounts		(1,546,861	)		(1,604,874	)
Accounts receivable, net	$	6,380,387		$	3,208,286

Schedule of Movements of Allowance for Accounts Receivable

Movements of allowance for accounts receivable are as follows:

	June 30, 2023			December 31, 2022
Beginning balance	$	1,604,874		$	322,145
Addition		-			1,282,729
Reversal		(58,013	)		-
Ending Balance	$	1,546,861		$	1,604,874

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Advances to Suppliers (Tables)

6 Months Ended

Jun. 30, 2023

Advances to Suppliers [Abstract]

Schedule of Advances to Suppliers

Advances to suppliers represent the amount the Company prepaid to its suppliers for merchandises for sale in the ordinary course of business. As of June 30, 2023, and December 31, 2022, the Company reported advances to suppliers as follow:

	June 30, 2023		December 31, 2022
Advances to suppliers	$	7,017,279	$	6,589,759

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Inventories (Tables)

6 Months Ended

Jun. 30, 2023

Inventories [Abstract]

Schedule of Movements of inventory reserves

Inventories consisted of the following:

	June 30, 2023			December 31, 2022
Pharmaceuticals	$	6,672,082		$	7,067,613
Healthcare products		323,095			-
Medical devices		213,952			614,231
Less: allowance for obsolete and expired inventory		(26,605	)		(27,602	)
	$	7,182,524		$	7,654,242

Schedule of Movements of inventory reserves

Movements of inventory reserves are as follows:

	June 30, 2023			December 31, 2022
Beginning balance	$	27,602		$	103,178
Reversal		(997	)		(75,576	)
Ending Balance	$	26,605		$	27,602

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Prepayments and Other Receivables (Tables)

6 Months Ended

Jun. 30, 2023

Prepayments and Other Receivables [Abstract]

Schedule of Prepayments and Other Receivables

The table below sets forth the balances as of June 30, 2023, and December 31, 2022.

	June 30, 2023			December 31, 2022
Deposit for rentals	$	142,088		$	132,960
Prepaid expenses and improvements of offices		54,092			56,121
Prepaid for acquisition of phenix		-			180,000
Deposit for purchase of medical devices		160,737			166,765
Deposit for sales platform		20,399			24,337
Receivables form third party		118,625			66,986
VAT deductibles		825,095			881,014
Others		52,100			42,771
Less: allowance for doubtful accounts		(23,012	)		(23,875	)
Prepayments and other receivables, net	$	1,350,124			1,527,079

Schedule of Allowance for Doubtful Accounts

Movements of allowance for doubtful accounts are as follows:

	June 30, 2023			December 31, 2022
Beginning balance	$	23,875		$	26,080
Reversal		(863	)		(2,205	)
Ending Balance	$	23,012		$	23,875

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Property, Plant and Equipment (Tables)

6 Months Ended

Jun. 30, 2023

Property, Plant and Equipment [Abstract]

Schedule of Property, Plant and Equipment

Property, plant, and equipment consisted of the following:

	June 30, 2023			December 31, 2022
Buildings	$	722,432		$	749,526
Office equipment		227,867			132,329
Electronic equipment		35,910			37,257
Furniture		29,651			30,764
Vehicles		145,747			168,512
Medical equipment		891,834			925,281
Leasehold improvements		596,048			598,677
		2,649,489			2,642,346
Less: accumulated depreciation		(959,382	)		(938,926	)
Property, plant and equipment, net	$	1,690,107		$	1,703,420

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Intangible Assets (Tables)

6 Months Ended

Jun. 30, 2023

Intangible Assets [Abstract]

Schedule of Intangible Asset

	June 30, 2023			December 31, 2022
Software	$	18,967		$	19,679
Trademark use rights		500,000			-
Less: accumulated amortization		(70,036	)		(3,496	)
Intangible assets, net	$	448,931		$	16,183

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Leases (Tables)

6 Months Ended

Jun. 30, 2023

Leases [Abstract]

Schedule of Operating Leases

Balance sheet information related to the Company’s operating leases was as follows

	June 30, 2023		December 31, 2022
Operating Lease Assets
Operating lease	$	2,835,992	$	2,942,265
Total operating lease assets	$	2,835,992	$	2,942,265
Operating Lease Obligations
Current operating lease liabilities	$	650,661		532,630
Non-current operating lease liabilities	$	2,414,883		2,574,751
Total Lease Liabilities	$	3,065,544		3,107,381

* The Company’s operating leases include the leases of operating companies only and do not include discontinued operations-held for sale.

Schedule of Lease Liability Maturities

Lease liability maturities as of June 30, 2023, are as follows:

	June 30, 2023
2023		805,746
2024		816,021
2025		797,854
2026		776,996
2027 and thereafter		438,800
Total minimum lease payments		3,635,417
Less: Amount representing interest		(569,873	)
Total		3,065,544

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Goodwill (Tables)

6 Months Ended

Jun. 30, 2023

Goodwill [Abstract]

Schedule of Carrying Amount of Goodwill

Changes in the carrying amount of goodwill consisted of the following:

	June 30, 2023		December 31, 2022
Beginning balance	$	2,065,666	$	8,376,217
Disposal of Zhuoda		-		(924,740	)
Impairment during the year		-		(5,385,811	)
Goodwill	$	2,065,666	$	2,065,666

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Loans (Tables)

6 Months Ended

Jun. 30, 2023

Loans [Abstract]

Schedule of Short-Term Loans

	June 30, 2023		December 31, 2022
China Minsheng Bank	$	110,714	$	114,867
Postal Savings Bank of China		678,126		703,558
Pingan Bank of China		345,982		-
Total	$	1,134,822	$	818,425

Schedule of Long-Term Loans

	June 30, 2023			December 31, 2022
China Construction Bank Chongqing Zhongxian, Sub-branch		-			59,926
We Bank		227.528			360,825
Subtotal of long-term loans		227,528			420,751
Less: current portion		(101,244	)		(105,965	)
Total Long-term loans – noncurrent portion	$	126,284		$	314,786

Schedule of Aggregate Amount of Interest Expenses for All Long-Term Borrowings

The combined aggregate amount of interest expenses for all long-term borrowings for each of the five years as of June 30, 2023, are as follows:

	June 30, 2023
July 1, 2023 to June 30, 2024		18,963
July 1, 2024 to June 30, 2025		3,616
Total		22,579

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Convertible Promissory Notes and Embedded Derivative Instructions (Tables)

6 Months Ended

Jun. 30, 2023

Convertible Promissory Notes and Embedded Derivative Instructions [Abstract]

Schedule of Additional Paid-In Capital

	June 30, 2023		December 31, 2022
Convertible note – principal	$	-	$	1,108,785
	$	-	$	1,108,785

Schedule of Assumptions Used In the Black-Scholes Option Pricing Model

The assumptions used in the Black-Scholes option pricing model are as follows:

	June 30, 2023			December 31, 2022
Dividend yield	$	0	%	$	0	%
Expected volatility		171	%		171	%
Risk free interest rate		0.87	%		0.87	%
Expected life (years)		1.42			1.42

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Other Payables and Accrued Liabilities (Tables)

6 Months Ended

Jun. 30, 2023

Other Payables and Accrued Liabilities [Abstract]

Schedule of Other Payables and Accrued Liabilities

Other payables and accrued liabilities consisted of the following:

	June 30, 2023			December 31, 2022
Salary payable	$	331,136		$	411,043
Salary payable – related parties (1)		2,285,333			2,135,333
Accrued operating expenses		(900	)		(900	)
Other payables		589,401			630,097
	$	3,204,970		$	3,175,574

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Net Income (Loss) Per Share (Tables)

6 Months Ended

Jun. 30, 2023

Net Income (Loss) Per Share [Abstract]

Schedule of Basic and Diluted Net Loss Per Share

The following table sets forth the computation of basic and diluted net loss per share for the six months ended June 30, 2023, and 2022:

	For the six months ended June 30,
	2023			2022
Net income (loss)  from continuing operation attributable to common shareholders	$	1,987,491		$	(9,114,986	)
Net loss from discontinued operation attributable to common shareholders		(143,102	)		(171,810	)
Total net income (loss) attributable to common shareholders		1,844,389			(9,286,796	)
Weighted average number of common shares outstanding – Basic and diluted		4,219,675			15,429,754
loss per share – basic and diluted:
Income (loss) from continuing operations	$	0.47	)	$	(0.59	)
Income (loss) from discontinued operations		(0.03	)		(0.01	)
Total	$	0.44		$	(0.60	)

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Segments (Tables)

6 Months Ended

Jun. 30, 2023

Segment Reporting [Abstract]

Schedule of Reported Segment Profit or Loss

The following amounts were used by the chief operating decision maker.

For six months ended June 30, 2023	Retail pharmacy			Wholesale medical devices			Wholesale pharmaceuticals			Healthcare products		Medical services			Others			Total
Revenues from external customers	$	480,205		$	1,051,385		$	1,928,388		$	5,295,325	$	-		$	-		$	8,755,303
Cost of revenues	$	357,836		$	805,574		$	1,813,422		$	1,202,013	$	-		$	2,137		$	4,180,982
Depreciation, depletion, and amortization expense	$	9,049		$	11,300		$	-		$	79,449	$	-		$	2,517		$	102,315
Profit (loss)	$	(194,401	)	$	(106,312	)	$	(169,748	)	$	3,842,311	$	(22,309	)	$	(1,362,049	)	$	1,987,492
Total assets	$	294,548		$	3,128,979		$	12,531,453		$	6,372,681	$	998,867		$	7,759,486		$	31,086,014

For six months ended June 30, 2022	Retail pharmacy			Wholesale medical devices		Wholesale pharmecuticals			Medical services			Others			Total
Revenues from external customers	$	505,003		$	2,828,557	$	2,055,417		$	-		$	154,768		$	5,543,745
Cost of revenues	$	223,032		$	2,415,231	$	1,962,623		$	123		$	97,813		$	4,698,822
Depreciation, depletion, and amortization expense	$	10,229		$	24,152	$	154		$	-		$	54,624		$	89,159
Profit (loss)	$	(291,344	)	$	1,224	$	(257,769	)	$	(65,421	)	$	(5,136,229	)	$	(5,749,539	)
Total assets	$	337,795		$	3,750,466	$	7,979,593		$	1,102,730		$	18,937,103		$	32,107,687

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Entity-Wide Information and Concentrations of Risk (Tables)

6 Months Ended

Jun. 30, 2023

Entity-Wide Information and Concentrations of Risk [Abstract]

Schedule of Reported Revenues for Each Type of Product

For the six months ended June 30, 2023, and 2022, respectively, the Company reported revenues for each segment as follows:

	For the six months ended June 30,
	2023		2022
Medical devices	$	1,051,385	$	2,828,557
Healthcare products		5,295,325		-
Wholesale pharmaceuticals		1,928,388		2,055,417
Pharmacy retail		480,205		505,003
Other		-		154,768
Total	$	8,755,303	$	5,543,745

Schedule of One Customer Accounted for Revenue

For the six months ended June 30, 2023, one customer accounted for more than 10% of the Company’s revenues:

		For the six months ended
		June 30, 2023
Customers	Segment	Revenue		Percentage of total Revenue
Customer A	Healthcare products	$	5,295,325		60.48	%

Schedule of Purchases and Its Outstanding Accounts Payable

For the six months ended June 30, 2023, one vendor accounted for more than 10% of the Company’s purchases as of June 30, 2023:

		For the six months ended					As of June 30,
		June 30, 2023					2023
Vendors	Segment	Purchases		Percentage of total purchases			Accounts payable
Vendor A	Wholesale pharmaceuticals	$	442,323		11.22	%		-

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Organization and Business Background (Details)				1 Months Ended	3 Months Ended		6 Months Ended
	Jul. 05, 2023 USD ($) shares	Jul. 05, 2022 shares	Jan. 04, 2022 CNY (¥) shares	Dec. 20, 2021 USD ($)	Jun. 30, 2023 USD ($) shares	Mar. 31, 2023 shares	Jun. 30, 2023 USD ($) shares	Jun. 30, 2022	Sep. 10, 2021	Dec. 09, 2020	Mar. 18, 2020	Oct. 14, 2019
Organization and Business Background (Details) [Line Items]
Consideration amount			¥ 7,227,000	$ 16,750,000
Purchase shares (in Shares)			60,000
Shares not received (in Shares)							52,000
Cash consideration (in Dollars) | $					$ 8,000		$ 8,000
Net profit (in Dollars) | $							$ 770,985
Number of operating segments							4	4
Common Stock [Member]
Organization and Business Background (Details) [Line Items]
Shares issued (in Shares)							60,000
Shares issued (in Shares)					2,224,182	270,000
Additional shares (in Shares)		5,000,000
Mr. Fnu Oudom [Member]
Organization and Business Background (Details) [Line Items]
Equity interest percentage		100.00%
Subsequent Event [Member]
Organization and Business Background (Details) [Line Items]
Consideration amount (in Dollars) | $	$ 1,800,000
Equity interests amount (in Dollars) | $	$ 180,000
Company's shares (in Shares)	5,270,000
Shares issued (in Shares)	270,000
Net profit (in Dollars) | $	$ 2,500,000
Subsequent Event [Member] | Common Stock [Member]
Organization and Business Background (Details) [Line Items]
Additional shares (in Shares)	5,000,000
Subsequent Event [Member] | Mr. Fnu Oudom [Member]
Organization and Business Background (Details) [Line Items]
Equity interest percentage	100.00%
Lasting Wisdom Holdings Limited [Member]
Organization and Business Background (Details) [Line Items]
Equity interest rate												100.00%
Beijing Xinrongxin Industrial Development Co., Ltd. [Member]
Organization and Business Background (Details) [Line Items]
Equity interest rate												100.00%
Dalian Boyi Technology Co., Ltd. [Member]
Organization and Business Background (Details) [Line Items]
Equity interest rate												100.00%
Chongqing Guanzan Technology Co., Ltd. [Member]
Organization and Business Background (Details) [Line Items]
Equity interest rate											100.00%
Chongqing Shude Pharmaceutical Co., Ltd. [Member]
Organization and Business Background (Details) [Line Items]
Equity interest rate											80.00%
hongqing Lijiantang Pharmaceutical Co. Ltd. [Member]
Organization and Business Background (Details) [Line Items]
Equity interest rate											100.00%
Chongqing Guoyitang Hospital [Member]
Organization and Business Background (Details) [Line Items]
Equity interest rate										100.00%
Business Combination [Member]
Organization and Business Background (Details) [Line Items]
Equity interest rate									100.00%

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Organization and Business Background (Details) - Schedule of Subsidiaries	6 Months Ended
	Jun. 30, 2023
Lasting Wisdom Holdings Limited (“Lasting”) [Member]
Subsidiary of Limited Liability Company or Limited Partnership [Line Items]
Place of incorporation and kind of legal entity	British Virgin Island, a limited liability company
Principal activities and type of operation	Investment holding
Effective interest held	100.00%
Phenix Bio Inc(“Phenix”) [Member]
Subsidiary of Limited Liability Company or Limited Partnership [Line Items]
Place of incorporation and kind of legal entity	California, a corporation
Principal activities and type of operation	Distribution of healthcare products
Effective interest held	100.00%
Pukung Limited (“Pukung”) [Member]
Subsidiary of Limited Liability Company or Limited Partnership [Line Items]
Place of incorporation and kind of legal entity	Hong Kong, a limited liability company
Principal activities and type of operation	Investment holding
Effective interest held	100.00%
Beijing Xinrongxin Industrial Development Co., Ltd. (“Xinrongxin”) [Member]
Subsidiary of Limited Liability Company or Limited Partnership [Line Items]
Place of incorporation and kind of legal entity	The PRC, a limited liability company
Principal activities and type of operation	Investment holding
Effective interest held	100.00%
Boyi (Liaoning) Technology Co., Ltd (“Liaoning Boyi”) [Member]
Subsidiary of Limited Liability Company or Limited Partnership [Line Items]
Place of incorporation and kind of legal entity	The PRC, a limited liability company
Principal activities and type of operation	IT Technology service research and development
Effective interest held	100.00%
Dalian Boyi Technology Co., Ltd (“Dalian Boyi”) [Member]
Subsidiary of Limited Liability Company or Limited Partnership [Line Items]
Place of incorporation and kind of legal entity	The PRC, a limited liability company
Principal activities and type of operation	IT Technology service research and development
Effective interest held	100.00%
Chongqing Guanzan Technology Co., Ltd. (“Guanzan”) [Member]
Subsidiary of Limited Liability Company or Limited Partnership [Line Items]
Place of incorporation and kind of legal entity	The PRC, a limited liability company
Principal activities and type of operation	Wholesale distribution of medical devices in the PRC
Effective interest held	100.00%
Chongqing Shude Pharmaceutical Co., Ltd.(“Shude”) [Member]
Subsidiary of Limited Liability Company or Limited Partnership [Line Items]
Place of incorporation and kind of legal entity	The PRC, a limited liability company
Principal activities and type of operation	Wholesale distribution of generic drugs in the PRC
Effective interest held	95.00%
Chongqing Lijiantang Pharmaceutical Co., Ltd.(“Lijiantang”) [Member]
Subsidiary of Limited Liability Company or Limited Partnership [Line Items]
Place of incorporation and kind of legal entity	The PRC, a limited liability company
Principal activities and type of operation	Wholesale distribution of generic drugs in the PRC
Effective interest held	100.00%
Bimai Pharmaceutical (Chongqing) Co., Ltd. [Member]
Subsidiary of Limited Liability Company or Limited Partnership [Line Items]
Place of incorporation and kind of legal entity	The PRC, a limited liability company
Principal activities and type of operation	Investment holding
Effective interest held	100.00%
Chongqing Guoyitang Hospital Co., Ltd. [Member]
Subsidiary of Limited Liability Company or Limited Partnership [Line Items]
Place of incorporation and kind of legal entity	The PRC, a limited liability company
Principal activities and type of operation	Hospital in the PRC
Effective interest held	100.00%
Chongqing Huzhongtang Healthy Technology Co., Ltd. [Member]
Subsidiary of Limited Liability Company or Limited Partnership [Line Items]
Place of incorporation and kind of legal entity	The PRC, a limited liability company
Principal activities and type of operation	Wholesale distribution of generic drugs in the PRC
Effective interest held	100.00%
Chaohu Zhongshan Minimally Invasive Hospital Co.,Ltd. [Member]
Subsidiary of Limited Liability Company or Limited Partnership [Line Items]
Place of incorporation and kind of legal entity	The PRC, a limited liability company
Principal activities and type of operation	Hospital in the PRC
Effective interest held	100.00%
Yunnan Yuxi Minkang Hospital Co., Ltd. [Member]
Subsidiary of Limited Liability Company or Limited Partnership [Line Items]
Place of incorporation and kind of legal entity	The PRC, a limited liability company
Principal activities and type of operation	Hospital in the PRC
Effective interest held	100.00%
Wuzhou Qiangsheng Hospital Co., Ltd. [Member]
Subsidiary of Limited Liability Company or Limited Partnership [Line Items]
Place of incorporation and kind of legal entity	The PRC, a limited liability company
Principal activities and type of operation	Hospital in the PRC
Effective interest held	100.00%
Suzhou Eurasia Hospital Co., Ltd. [Member]
Subsidiary of Limited Liability Company or Limited Partnership [Line Items]
Place of incorporation and kind of legal entity	The PRC, a limited liability company
Principal activities and type of operation	Hospital in the PRC
Effective interest held	100.00%
Bimai Hospital Management (Chongqing) Co. Ltd [Member]
Subsidiary of Limited Liability Company or Limited Partnership [Line Items]
Place of incorporation and kind of legal entity	The PRC, a limited liability company
Principal activities and type of operation	Hospital management in the PRC
Effective interest held	100.00%
Pusheng Pharmaceutical Co., Ltd [Member]
Subsidiary of Limited Liability Company or Limited Partnership [Line Items]
Place of incorporation and kind of legal entity	The PRC, a limited liability company
Principal activities and type of operation	Wholesale distribution of generic drugs in the PRC
Effective interest held	100.00%

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Going Concern Uncertainties (Details) - USD ($)	1 Months Ended	6 Months Ended
	Jul. 18, 2022	Jun. 30, 2023	Jun. 30, 2022	Jul. 07, 2022	Jun. 09, 2022
Going Concern Uncertainties [Abstract]
Incurred operating losses		$ 1,844,389	$ 9,286,796
Accumulated deficit		$ 68,300,000
Subordinated promissory note					$ 5,000,000
Converted shares (in Shares)	1,250,000
Deposit amount				$ 180,000

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Summary of Significant Accounting Policies (Details)					1 Months Ended			6 Months Ended	12 Months Ended
	Sep. 01, 2023 shares	Jun. 30, 2023 USD ($) shares	Dec. 31, 2022 USD ($)	Dec. 09, 2022 shares	Dec. 28, 2022 USD ($) shares	Nov. 23, 2022 shares	Oct. 19, 2022 shares	Jun. 30, 2023 USD ($) shares	Dec. 31, 2022 USD ($)	Feb. 27, 2023 USD ($)	Dec. 28, 2022 CNY (¥)	Jun. 30, 2022 USD ($)
Summary of Significant Accounting Policies (Details) [Line Items]
Allowance for doubtful accounts | $
Impairment losses totaling | $								$ 5,400,000
Equity interests rate percentage					87.00%						87.00%
Return common shares (in Shares)				43,600	80,000
Cash amount					$ 6,116,207					$ 3,000,000	¥ 40,000,000
Remaining shares was returned (in Shares)		1,000						1,000
Cash sales | $								$ 3,055
Allowance for obsolete inventories | $		$ 26,604	59,567					26,604	$ 59,567
Impairments for goodwill | $									5,385,811
Impairment, description								As a result of the impairments recognized on December 31, 2022, the remaining goodwill of the Company was related to the acquisitions of Guanzan and Zhongshan.
Income tax benefit percentage								50.00%
VAT rates percentage		13.00%						13.00%
Owner interest rate					87.00%
Convertible promissory note | $		$ 0						$ 0				$ 6,320,075
Fair value of convertible promissory note | $		$ 0						$ 0				$ 6,320,075
Maximum [Member]
Summary of Significant Accounting Policies (Details) [Line Items]
Equity interests rate percentage					90.00%						90.00%
Minimum [Member]
Summary of Significant Accounting Policies (Details) [Line Items]
Equity interests rate percentage					10.00%						10.00%
Zhongshan [Member]
Summary of Significant Accounting Policies (Details) [Line Items]
Equity interests rate percentage					13.00%						13.00%
Return common shares (in Shares)					40,037
Qiangsheng, Eurasia and Minkang [Member]
Summary of Significant Accounting Policies (Details) [Line Items]
Cash amount					$ 2,767,860						¥ 20,000,000
Equity interests, description					the Company entered into an agreement to transfer 90% of the equity interests in the Qiangsheng, Eurasia and Minkang hospitals to their former owners. Pursuant to the agreement, the Company will transfer 90% of the equity interests in each of the three hospitals and continue to own 10% of the equity interests in each hospital.
Qiangsheng, Eurasia and Minkang hospitals [Member]
Summary of Significant Accounting Policies (Details) [Line Items]
Equity interests rate percentage					90.00%						90.00%
Return common shares (in Shares)				43,600	80,000
Cash amount					$ 2,767,860						¥ 20,000,000
Guanzan [Member]
Summary of Significant Accounting Policies (Details) [Line Items]
Equity interests rate percentage							100.00%
Return common shares (in Shares)							44,000
Remaining goodwill | $			1,392,449						1,392,449
Purchased shares of common stock (in Shares)							44,000
Zhongshan [Member]
Summary of Significant Accounting Policies (Details) [Line Items]
Equity interests rate percentage					87.00%						87.00%
Return common shares (in Shares)					40,037
Cash amount					$ 6,116,207						¥ 40,000,000
Remaining shares was returned (in Shares)		1,000						1,000
Cash sales | $								$ 3,055
Remaining goodwill | $			$ 673,217						$ 673,217
Owner interest rate					13.00%
Zhuoda [Member]
Summary of Significant Accounting Policies (Details) [Line Items]
Equity interests rate percentage						100.00%
Return common shares (in Shares)						44,000
Zhongshan [Member]
Summary of Significant Accounting Policies (Details) [Line Items]
Interest rate percentage		13.00%			13.00%			13.00%			13.00%
Qiangsheng, Eurasia and Minkang hospitals [Member]
Summary of Significant Accounting Policies (Details) [Line Items]
Interest rate percentage		10.00%						10.00%
Qiangsheng, Eurasia and Minkang [Member]
Summary of Significant Accounting Policies (Details) [Line Items]
Interest rate percentage		10.00%						10.00%
Forecast [Member]
Summary of Significant Accounting Policies (Details) [Line Items]
Return common shares (in Shares)	36,400
Forecast [Member] | Zhongshan [Member]
Summary of Significant Accounting Policies (Details) [Line Items]
Return common shares (in Shares)	39,037
Forecast [Member] | Qiangsheng, Eurasia and Minkang [Member]
Summary of Significant Accounting Policies (Details) [Line Items]
Return common shares (in Shares)	36,400
Forecast [Member] | Zhongshan [Member]
Summary of Significant Accounting Policies (Details) [Line Items]
Return common shares (in Shares)	39,037

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Summary of Significant Accounting Policies (Details) - Schedule of Carrying Amount of the Major Classes of Assets and Liabilities - USD ($)	6 Months Ended	12 Months Ended
	Jun. 30, 2023	Dec. 31, 2022
Assets from held for sale [Member]
Current assets
Cash and cash equivalents	$ 154,503	$ 53,928
Accounts receivable, net	516,287	501,054
Advances to suppliers	197,737	211,335
Amount due from related parties	337,904	350,577
Inventories, net	153,977	155,736
Prepayments and other receivables	772,974	827,043
Total current assets	2,133,382	2,099,673
Non-current assets
Deferred tax assets	(128)	(133)
Property, plant and equipment, net	1,191,554	1,254,328
Operating lease-right of use assets	2,247,673	2,506,954
Goodwill
Total non-current assets	3,439,099	3,761,149
Total assets held for sale	5,572,481	5,860,822
Liabilities of held for sale businesses [Member]
Current liabilities
Short-term loans	207,589	215,375
Long-term loans due within one year
Accounts payable, trade	1,375,938	1,480,098
Advances from customers	2,668	1,537
Taxes payable	324,582	336,755
Other payables and accrued liabilities	766,601	739,873
Lease liability-current	456,369	466,312
Total current liabilities	3,133,747	3,239,950
Non-current liabilities
Lease liability-non current	2,214,033	2,245,373
Total non-current liabilities	2,214,033	2,245,373
Total liabilities	$ 5,347,780	$ 5,485,323

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Summary of Significant Accounting Policies (Details) - Schedule of Summarized Operating Results of the Business - businesses held for sale [Member] - USD ($)	6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022
Summary of Significant Accounting Policies (Details) - Schedule of Summarized Operating Results of the Business [Line Items]
Revenues	$ 330,281	$ 2,850,027
Cost of revenues	149,253	1,233,688
Gross profit	181,028	1,616,339
Operating expense	253,107	1,598,666
Other expense	(70,288)	(194,199)
Loss before income taxes	(142,367)	(176,526)
Income tax expense	735	22,212
Loss from businesses held for sale	$ (143,102)	$ (198,738)

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Summary of Significant Accounting Policies (Details) - Schedule of Expected Useful Lives	6 Months Ended
	Jun. 30, 2023
Building [Member]
Summary of Significant Accounting Policies (Details) - Schedule of Expected Useful Lives [Line Items]
Expected useful lives	20 years
Residual value	5.00%
Office equipment [Member]
Summary of Significant Accounting Policies (Details) - Schedule of Expected Useful Lives [Line Items]
Expected useful lives	3 years
Residual value	5.00%
Electronic equipment [Member]
Summary of Significant Accounting Policies (Details) - Schedule of Expected Useful Lives [Line Items]
Expected useful lives	3 years
Residual value	5.00%
Furniture [Member]
Summary of Significant Accounting Policies (Details) - Schedule of Expected Useful Lives [Line Items]
Expected useful lives	5 years
Residual value	5.00%
Medical equipment [Member]
Summary of Significant Accounting Policies (Details) - Schedule of Expected Useful Lives [Line Items]
Expected useful lives	10 years
Residual value	5.00%
Vehicles [Member]
Summary of Significant Accounting Policies (Details) - Schedule of Expected Useful Lives [Line Items]
Expected useful lives	4 years
Residual value	5.00%
Leasehold Improvement [Member]
Summary of Significant Accounting Policies (Details) - Schedule of Expected Useful Lives [Line Items]
Residual value	5.00%
Expected useful lives	Shorter of lease term or useful life

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Summary of Significant Accounting Policies (Details) - Schedule of Exchange Rates	Jun. 30, 2023	Jun. 30, 2022
Schedule of Exchange Rates [Abstract]
Period-end RMB:US$1 exchange rate	7.2258	6.7114
Six months end average RMB:US$1 exchange rate	6.9291	6.4835

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The Acquisition of the Guanzan Group (Details)					1 Months Ended		6 Months Ended
	Jul. 07, 2022 shares	Apr. 09, 2021 USD ($)	Feb. 01, 2020 USD ($) shares	Feb. 01, 2020 CNY (¥) shares	Aug. 27, 2021 shares	Mar. 18, 2020	Jun. 30, 2023 USD ($) shares	Feb. 27, 2023 shares	Feb. 02, 2021 shares	Nov. 30, 2020 shares	Nov. 20, 2020 $ / shares	Nov. 20, 2020 CNY (¥)	Mar. 12, 2020 $ / shares
The Acquisition of the Guanzan Group (Details) [Line Items]
Shares issued							621,762	2,000,000
Shares of common stock							2,420
Cash consideration amount (in Yuan Renminbi) | $							$ 8,000
Shares issued payment	270,000
Price per share (in Dollars per share) | $ / shares													$ 2.86
Non-controlling interests (in Dollars) | $							$ 46,295
Non controlling equity interest Percentage							20.00%
Capital investment (in Dollars) | $		$ 4,892,293
Minimum [Member]
The Acquisition of the Guanzan Group (Details) [Line Items]
Percentage of equity interest		80.00%
Maximum [Member]
The Acquisition of the Guanzan Group (Details) [Line Items]
Percentage of equity interest		95.20%
Prepayment Agreement [Member]
The Acquisition of the Guanzan Group (Details) [Line Items]
Shares of common stock										20,000
Cash consideration amount (in Yuan Renminbi) | ¥												¥ 20,000,000
Common Stock valued price (in Dollars per share) | $ / shares											$ 3
Shares issued payment					92,000
Gunazan [Member]
The Acquisition of the Guanzan Group (Details) [Line Items]
Shares issued			100,000,000	100,000,000
Shares outstanding			14,285,714	14,285,714
Shares of common stock			19,000	19,000					40,000
Payment in cash			$ 11,428,571	¥ 80,000,000
Stock consideration, percentage						100.00%

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The Acquisition of the Guanzan Group (Details) - Schedule of Identified Assets Acquired and Liabilities - Guanzan Acquisition [Member]	6 Months Ended
	Jun. 30, 2023 USD ($)
Assets
Cash and cash equivalents	$ 95,220
Accounts receivable	1,835,981
Advances to suppliers	1,222,986
Amount due from related parties	410,943
Inventories	950,225
Prepayments and other receivables	90,256
Property, plant and equipment	707,289
Intangible assets	254,737
Goodwill	6,686,053
Liabilities
Short-term bank borrowings	(838,926)
Long-term loans due within one year	(250,663)
Accounts payable, trade	(1,303,399)
Advances from customers	(1,350,126)
Amount due to related parties	(106,720)
Taxes payable	(406,169)
Other payables and accrued liabilities	(390,593)
Long-term loans – noncurrent portion	(186,796)
Non-controlling interests	(46,295)
Total-net assets	$ 7,374,000

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The Acquisition of the Guanzan Group (Details) - Schedule of Reconciles the Identified Assets Acquired and Liabilities Assumed - USD ($)	Jun. 30, 2023	Nov. 20, 2020
Business Acquisition [Line Items]
Total consideration		$ 7,602,181
Net assets	$ 330,619	(687,949)
Goodwill		6,914,232
Cash		3,065,181
March 12, 2020 [Member]
Business Acquisition [Line Items]
Total consideration		2,717,000
November 30, 2020 [Member]
Business Acquisition [Line Items]
Total consideration		$ 1,820,000

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The Acquisition of the Guoyitang Hospital (Details)			6 Months Ended
	Dec. 09, 2020 USD ($) shares	Dec. 09, 2020 CNY (¥) shares	Jun. 30, 2023 USD ($)	Jun. 30, 2023 CNY (¥)
The Acquisition of the Guoyitang Hospital (Details) [Line Items]
partial consideration paid amount	$ 3,096,119	¥ 20,000,000
Guoyitang [Member]
The Acquisition of the Guoyitang Hospital (Details) [Line Items]
Aggregate purchase price	$ 15,251,807	¥ 100,000,000
Shares of common stock	40,000	40,000
Balance of purchase price			$ 6,100,723	¥ 40,000,000

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The Acquisition of the Guoyitang Hospital (Details) - Schedule of Identified Assets Acquired and Liabilities - Guoyitang Acquisition [Member]	Feb. 02, 2021 USD ($)
Assets
Cash and cash equivalents	$ 28,457
Accounts receivable	11,797
Advances to suppliers	12,670
Amount due from related parties	41,598
Inventories	167,440
Prepayments and other receivables	61,102
Property, plant and equipment	528,814
Right-of-use asset	441,150
Goodwill	7,154,393
Liabilities
Accounts payable, trade	(599,391)
Amount due to related parties	(183,796)
Taxes payable	(121)
Other payables and accrued liabilities	(231,375)
Lease liability-current	(161,707)
Lease liability-non current	(354,912)
Total-net assets	$ 6,916,119

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The Acquisition of the Guoyitang Hospital (Details) - Schedule of Reconciles the Identified Assets Acquired and Liabilities Assumed - Business Acquisition [Member]	6 Months Ended
	Jun. 30, 2023 USD ($)
Business Acquisition [Line Items]
Total consideration	$ 6,916,119
Net assets	(238,274)
Goodwill	7,154,393
February 2, 2021 [Member]
Business Acquisition [Line Items]
Total consideration	3,820,000
Cash [Member]
Business Acquisition [Line Items]
Total consideration	$ 3,096,119

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The Acquisition of the Zhongshan Hospital (Details)						1 Months Ended			6 Months Ended		12 Months Ended
	Dec. 28, 2022 shares	Dec. 09, 2022 shares	Feb. 12, 2021 USD ($)	Feb. 12, 2021 CNY (¥)	Dec. 15, 2020 CNY (¥)	Dec. 28, 2022 USD ($) shares	Dec. 28, 2022 CNY (¥) shares	Feb. 28, 2021 USD ($)	Jun. 30, 2023 USD ($) shares	Jun. 30, 2023 CNY (¥) shares	Dec. 31, 2020 USD ($)	Dec. 31, 2020 CNY (¥)	Dec. 31, 2022 shares
The Acquisition of the Zhongshan Hospital (Details) [Line Items]
Partial consideration | $								$ 40,037
Common stock shares													1,234,715
Common stock returned shares		43,600				39,037	39,037
Remaining shares returned									1,000	1,000
Zhongshan Hospital [Member]
The Acquisition of the Zhongshan Hospital (Details) [Line Items]
Consideration			$ 6,116,207	¥ 40,000,000	¥ 120,000,000						$ 6,116,207	¥ 40,000,000
Purchase price									$ 6,116,207	¥ 40,000,000
Equity interests rate	87.00%
Common stock shares	40,037					40,037	40,037
Cash consideration						$ 6,116,207	¥ 40,000,000

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The Acquisition of the Zhongshan Hospital (Details) - Schedule of Identified Assets Acquired and Liabilities Assumed Pursuant to the Zhongshan Acquisition - Zhongshan Acquisition [Member]	Feb. 05, 2021 USD ($)
Assets
Cash and cash equivalents	$ 46,748
Accounts receivable	92,900
Inventories	108,413
Prepayments and other receivables	432,231
Property, plant and equipment	344,208
Right-of-use asset	1,188,693
Goodwill	10,443,494
Liabilities
Short-term bank borrowings	(154,701)
Accounts payable, trade	(928,640)
Advances from customers	(5,603)
Amount due to related parties	(217,203)
Other payables and accrued liabilities	(435,290)
Lease liability-current	(160,774)
Lease liability-non current	(1,102,589)
Total-net assets	$ 9,651,887

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The Acquisition of the Zhongshan Hospital (Details) - Schedule of Fair Value of all Assets Acquired and Liabilities Assumed is the Estimated Book Value - Zhongshan [Member]	6 Months Ended
	Jun. 30, 2023 USD ($)
Business Acquisition [Line Items]
The value of the shares issued on February 12, 2021	$ 3,480,000
Cash payment in December 2020	6,171,887
Total consideration	9,651,887
Net assets	(791,607)
Goodwill	$ 10,443,494

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The Acquisition of the Qiangsheng, Eurasia and Minkang Hospitals (Details)							1 Months Ended
	Sep. 01, 2023 shares	Dec. 28, 2022 USD ($) shares	Dec. 28, 2022 CNY (¥) shares	Dec. 09, 2022 shares	Apr. 09, 2021 USD ($) shares	Apr. 09, 2021 CNY (¥) shares	Dec. 28, 2022 shares	Dec. 31, 2023 CNY (¥)	Jun. 30, 2023 USD ($) shares	May 06, 2021 shares
The Acquisition Of The Qiangsheng Eurasia And Minkang Hospitals [Line Items]
Shares issued		80,000	80,000		80,000	80,000
Shares issuance value					$ 12,000,000	¥ 78,000,000
Cash payment		$ 2,767,860	¥ 20,000,000		13,008,734	84,000,000
Shares of common stock									2,420
Equity Interest percenatge		90.00%	90.00%
Common stock shares returned				43,600			39,037
Sale consideration returned | $									$ 8,000
Common Stock [Member]
The Acquisition Of The Qiangsheng Eurasia And Minkang Hospitals [Line Items]
Shares of common stock										16,000
Forecast [Member]
The Acquisition Of The Qiangsheng Eurasia And Minkang Hospitals [Line Items]
Common stock shares returned	36,400
Sale consideration returned | ¥								¥ 20,000,000
Qiangsheng, Eurasia and Minkang Hospitals [Member]
The Acquisition Of The Qiangsheng Eurasia And Minkang Hospitals [Line Items]
Consideration amount					$ 25,023,555	¥ 162,000,000
Cash consideration description					The first payment of the Cash Consideration was RMB 20,000,000 (approximately $3,097,317). The second and third payments of the Cash Consideration of RMB 64,000,000 (approximately $9,911,416) were subject to post-closing adjustments based on the performance of Qiangsheng, Eurasia and Minkang in 2021 and 2022. The sellers had the choice to receive the second and third payments in the form of the shares of Common Stock valued at $15 per share (post the Reverse Splits) or in cash.	The first payment of the Cash Consideration was RMB 20,000,000 (approximately $3,097,317). The second and third payments of the Cash Consideration of RMB 64,000,000 (approximately $9,911,416) were subject to post-closing adjustments based on the performance of Qiangsheng, Eurasia and Minkang in 2021 and 2022. The sellers had the choice to receive the second and third payments in the form of the shares of Common Stock valued at $15 per share (post the Reverse Splits) or in cash.

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The Acquisition of the Qiangsheng, Eurasia and Minkang Hospitals (Details) - Schedule of Identified Assets Acquired and Liabilities - Qiangsheng, Eurasia and Minkang acquisitions [Member]	May 06, 2021 USD ($)
Assets
Cash and cash equivalents	$ 12,341
Accounts receivable	41,836
Inventories	156,576
Advances and other receivables	40,620
Property, plant and equipment	653,104
Right of use assets	2,168,709
Goodwill	9,067,529
Liabilities
Accounts payable	(355,980)
Advances from customers	(36,798)
Tax payable	(345,870)
Other payables and accrued liabilities	(311,174)
Lease liability-current	(365,788)
Lease liability-non-current	(1,988,195)
Total net assets	$ 8,736,910

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The Acquisition of the Qiangsheng, Eurasia and Minkang Hospitals (Details) - Schedule of Fair Value of the Assets Acquired and the Liabilities Assumed of Qiangsheng - USD ($)	6 Months Ended
	Jun. 30, 2023	Nov. 20, 2020
Business Acquisition [Line Items]
Total consideration	$ 8,736,910
Net assets	(330,619)	$ 687,949
Goodwill	9,067,529
April 20, 2021 [Member]
Business Acquisition [Line Items]
Total consideration	5,600,000
December 2021 [Member]
Business Acquisition [Line Items]
Total consideration	$ 3,136,910

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The Acquisition of Zhuoda (Details)				1 Months Ended		6 Months Ended
	Sep. 22, 2021 shares	Sep. 10, 2021 USD ($)	Sep. 10, 2021 CNY (¥)	Sep. 22, 2021 USD ($)	Sep. 22, 2021 CNY (¥)	Jun. 30, 2023 USD ($)	Jun. 30, 2023 CNY (¥)
Zhuoda [Member]
The Acquisition of Zhuoda (Details) [Line Items]
Issued and outstanding equity interests		$ 11,400,000	¥ 75,240,000
Consideration of purchase				$ 6,600,000	¥ 43,560,000
Purchase price						$ 4,800,000	¥ 31,680,000
Business Combination [Member]
The Acquisition of Zhuoda (Details) [Line Items]
Shares of common stock	44,000

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The Acquisition of Zhuoda (Details) - Schedule of Identified Assets Acquired and Liabilities - Zhuoda Acquisition [Member]	Oct. 08, 2021 USD ($)
Assets
Cash and cash equivalents	$ 102,350
Accounts receivable	804,083
Inventories	131,456
Advances and other receivables	886,370
Property, plant and equipment	6,579
Right of use assets	17,160
Goodwill	924,740
Liabilities
Short term loan	(773,737)
Accounts payable	(56,887)
Advances from customers	(3,778)
Tax payable	(24,787)
Other payables and accrued liabilities	(493,868)
Lease liability-current	(7,217)
Lease liability-non-current	(14,265)
Total net assets	$ 1,498,199

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The Acquisition of Zhuoda (Details) - Schedule of Fair Value of all Assets Acquired, and Liabilities	6 Months Ended
	Jun. 30, 2023 USD ($)
The Acquisition of Zhuoda (Details) - Schedule of Fair Value of all Assets Acquired, and Liabilities [Line Items]
Total consideration	$ 1,498,200
Net assets	573,458
Goodwill	924,742
September 6, 2021 [Member]
The Acquisition of Zhuoda (Details) - Schedule of Fair Value of all Assets Acquired, and Liabilities [Line Items]
Total consideration	$ 1,498,200

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The Sale of Zhuoda (Details) - shares						6 Months Ended
	Nov. 23, 2022	Jan. 27, 2022	Jan. 24, 2022	Sep. 22, 2021	Apr. 29, 2021	Jun. 30, 2023
The Sale of Zhuoda (Details) [Line Items]
Purchased shares						2,420
Shares return		10,000	100,000		200	44,000
Common stock shares amount	44,000
Zhuoda [Member]
The Sale of Zhuoda (Details) [Line Items]
Equity interests	100.00%
Zhuoda [Member]
The Sale of Zhuoda (Details) [Line Items]
Purchased shares	44,000					44,000
Shares return				44,000
Series of Individually Immaterial Business Acquisitions [Member] | Zhuoda [Member]
The Sale of Zhuoda (Details) [Line Items]
Equity interests						100.00%

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The Sale of Zhuoda (Details) - Schedule of Condensed Consolidated Statements of Operations - The Sale of Zhuoda [Member]	11 Months Ended
	Nov. 23, 2022 USD ($)
Schedule of condensed consolidated statements of operations [Abstract]
Revenues	$ 2,713,818
Cost of revenues	2,314,877
Gross profit	398,941
Operating expense	392,875
Other income (expense)	(45,146)
Loss before income taxes	(39,080)
Income tax expense	1,425
Net income/(loss) from discontinued operations	$ (40,505)

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The Sale of Zhuoda (Details) - Schedule of Assets and Liabilities of the Discontinued Operations - The Sale of Zhuoda [Member] - USD ($)	Nov. 23, 2022	Dec. 31, 2021
Current assets
Cash and cash equivalents	$ 13,922	$ 100,678
Accounts receivable, net	1,951,997	984,030
Advances to suppliers	67,561	118,365
Amount due from related parties
Inventories, net	101,059	162,882
Prepayments and other receivables	720,365	725,881
Operating lease-right of use assets
Total current assets	2,854,904	2,091,836
Non-current assets
Deferred tax assets
Property, plant and equipment, net	1,442	2,507
Intangible assets, net
Operating lease-right of use assets	10,044	15,959
Goodwill
Long-term investment
Total non-current assets	11,486	18,466
Total assets from discontinued operations	2,866,390	2,110,302
Current liabilities
Short-term loans	154,288	795,583
Long-term loans due within one year
Convertible promissory notes, net
Accounts payable, trade	1,301,712	265,731
Advances from customers		723
Amount due to related parties
Taxes payable	441	218
Other payables and accrued liabilities	162,362	468,970
Lease liability-current	7,693	8,102
Total current liabilities	1,626,496	1,539,327
Non-current liabilities
Lease liability-non current	6,976	12,727
Long-term loans – non-current	330,242
Total non-current liabilities	337,218	12,727
Total liabilities	$ 1,963,714	$ 1,552,054

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The Acquisition of Phenix (Details) - USD ($)					6 Months Ended	12 Months Ended
	Jun. 19, 2023	Feb. 27, 2023	Jul. 07, 2022	Jul. 05, 2022	Jun. 30, 2023	Dec. 31, 2022
The Acquisition of Phenix (Details) [Line Items]
Percentage of equity interests				100.00%
Products consideration						$ 3,000
Equity interests amount			$ 180,000
Common stock, shares (in Shares)			270,000
Shares issued		$ 5,000,000
Aggregate net profit					$ 2,500,000
Mr. Fnu Oudom [Member]
The Acquisition of Phenix (Details) [Line Items]
Common stock, shares (in Shares)	270,000
Business Combination [Member]
The Acquisition of Phenix (Details) [Line Items]
Products consideration				$ 1,800,000

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The Acquisition of Phenix (Details) - Schedule of Identified Assets Acquired and Liabilities - USD ($)	Jun. 30, 2023	Mar. 15, 2023	Dec. 31, 2022
Assets
Cash and cash equivalents	$ 1,931,744	$ 1,511,220	$ 2,336,636
Accounts receivable	7,927,248	346	4,813,160
Inventories	7,182,524	892,214	7,654,242
Advances and other receivables		386,965
Fixed assets		99,599
Intangible assets		500,000
Liabilities
Accounts payable	(1,018,832)	(6,650)	(2,980,441)
Other payables and accrued liabilities	$ (3,204,970)	(13,883)	$ (3,175,574)
Advance from customer		(1,028,004)
Total net assets		$ 2,341,807

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The Acquisition of Phenix (Details) - Schedule of Assets Acquired and the Liabilities Assumed of Phenix at the Acquisition Date - Phenix Acquisition [Member]	6 Months Ended
	Jun. 30, 2023 USD ($)
Business Acquisition [Line Items]
Total consideration	$ 471,600
Net assets	2,341,807
Additional paid in capital	1,870,207
July 7,2022 [Member]
Business Acquisition [Line Items]
Total consideration	180,000
June 19, 2023 [Member]
Business Acquisition [Line Items]
Total consideration	$ 291,600

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The Acquisition of Phenix (Details) - Schedule of Assets Acquired and the Liabilities Assumed of Phenix at the Acquisition Date (Parentheticals)	6 Months Ended
	Jun. 30, 2023 shares
Schedule Of Assets Acquired And The Liabilities Assumed Of Phenix At The Acquisition Date Abstract
Total consideration value of shares	270,000

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Accounts Receivable (Details) - Schedule of Accounts Receivable - USD ($)	6 Months Ended	12 Months Ended
	Jun. 30, 2023	Dec. 31, 2022	Mar. 15, 2023
Schedule of Accounts Receivable [Abstract]
Accounts receivable, cost	$ 7,927,248	$ 4,813,160	$ 346
Less: allowance for doubtful accounts	(1,546,861)	(1,604,874)
Accounts receivable, net	$ 6,380,387	$ 3,208,286

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Accounts Receivable (Details) - Schedule of Movements of Allowance for Accounts Receivable - USD ($)	6 Months Ended	12 Months Ended
	Jun. 30, 2023	Dec. 31, 2022
Schedule Of Movements Of Allowance For Accounts Receivable Abstract
Beginning balance	$ 1,604,874	$ 322,145
Addition		1,282,729
Reversal	(58,013)
Ending Balance	$ 1,546,861	$ 1,604,874

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Advances to Suppliers (Details) - Schedule of Advances to Suppliers - USD ($)	6 Months Ended	12 Months Ended
	Jun. 30, 2023	Dec. 31, 2022
Schedule of advances to suppliers [Abstract]
Advances to suppliers, cost	$ 7,017,279	$ 6,589,759

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Inventories (Details) - USD ($)	6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022
Inventories [Abstract]
Accrued allowances	$ 26,604	$ 28,644

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Inventories (Details) - Schedule of Inventories - USD ($)	Jun. 30, 2023	Dec. 31, 2022
Schedule Of Inventories Abstract
Pharmaceuticals	$ 6,672,082	$ 7,067,613
Healthcare products	323,095
Medical devices	213,952	614,231
Less: allowance for obsolete and expired inventory	(26,605)	(27,602)
Total inventory	$ 7,182,524	$ 7,654,242

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Inventories (Details) - Schedule of Movements of inventory reserves - USD ($)	6 Months Ended	12 Months Ended
	Jun. 30, 2023	Dec. 31, 2022
Schedule Of Movements Of Inventory Reserves Abstract
Beginning balance	$ 27,602	$ 103,178
Reversal	(997)	(75,576)
Ending Balance	$ 26,605	$ 27,602

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Prepayments and Other Receivables (Details) - USD ($)	6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022
Prepayments and Other Receivables [Abstract]
Bad debt expenses	$ 23,012	$ 24,776

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Prepayments and Other Receivables (Details) - Schedule of Prepayments and Other Receivables - USD ($)	6 Months Ended	12 Months Ended
	Jun. 30, 2022	Dec. 31, 2022	Jun. 30, 2023	Dec. 31, 2021
Schedule of prepayments and other receivables [Abstract]
Deposit for rentals	$ 142,088	$ 132,960
Prepaid expenses and improvements of offices	54,092	56,121
Prepaid for acquisition of phenix		180,000
Deposit for purchase of medical devices	160,737	166,765
Deposit for sales platform	20,399	24,337
Receivables form third party	118,625	66,986
VAT deductibles	825,095	881,014
Others	52,100	42,771
Less: allowance for doubtful accounts	(23,012)	(23,875)	$ (23,012)	$ (26,080)
Prepayments and other receivables, net	$ 1,350,124	$ 1,527,079

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Prepayments and Other Receivables (Details) - Schedule of Allowance for Doubtful Accounts - USD ($)	6 Months Ended	12 Months Ended
	Jun. 30, 2023	Dec. 31, 2022
Schedule Of Allowance For Doubtful Accounts Abstract
Beginning balance	$ 23,875	$ 26,080
Reversal	(863)	(2,205)
Ending Balance	$ 23,012	$ 23,875

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Property, Plant and Equipment (Details) - USD ($)	6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022
Property, Plant and Equipment [Abstract]
Depreciation expense	$ 58,107	$ 89,159

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Property, Plant and Equipment (Details) - Schedule of Property, Plant and Equipment - USD ($)	Jun. 30, 2023	Dec. 31, 2022
Property, Plant and Equipment [Line Items]
Property, plant and equipment, gross	$ 2,649,489	$ 2,642,346
Less: accumulated depreciation	(959,382)	(938,926)
Property, plant and equipment, net	1,690,107	1,703,420
Building [Member]
Property, Plant and Equipment [Line Items]
Property, plant and equipment, gross	722,432	749,526
Office equipment [Member]
Property, Plant and Equipment [Line Items]
Property, plant and equipment, gross	227,867	132,329
Electronic equipment [Member]
Property, Plant and Equipment [Line Items]
Property, plant and equipment, gross	35,910	37,257
Furniture [Member]
Property, Plant and Equipment [Line Items]
Property, plant and equipment, gross	29,651	30,764
Vehicles [Member]
Property, Plant and Equipment [Line Items]
Property, plant and equipment, gross	145,747	168,512
Medical equipment [Member]
Property, Plant and Equipment [Line Items]
Property, plant and equipment, gross	891,834	925,281
Leasehold Improvement [Member]
Property, Plant and Equipment [Line Items]
Property, plant and equipment, gross	$ 596,048	$ 598,677

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Intangible Assets (Details) - USD ($)	6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022
Intangible Assets [Abstract]
Amortization expense	$ 70,036	$ 3,627

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Intangible Assets (Details) - Schedule of Intangible Asset - USD ($)	Jun. 30, 2023	Dec. 31, 2022
Schedule of intangible assets [Abstract]
Software	$ 18,967	$ 19,679
Trademark use rights	500,000
Less: accumulated amortization	(70,036)	(3,496)
Intangible assets, net	$ 448,931	$ 16,183

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Leases (Details) - Schedule of Operating Leases - USD ($)		6 Months Ended
		Jun. 30, 2023	Dec. 31, 2022
Operating Lease Assets
Operating lease	[1]	$ 2,835,992	$ 2,942,265
Total operating lease assets	[1]	2,835,992	2,942,265
Current operating lease liabilities	[1]	650,661	532,630
Non-current operating lease liabilities	[1]	2,414,883	2,574,751
Total Lease Liabilities	[1]	$ 3,065,544	$ 3,107,381

[1] The Company’s operating leases include the leases of operating companies only and do not include discontinued operations-held for sale.

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Leases (Details) - Schedule of Lease Liability Maturities	6 Months Ended
	Jun. 30, 2023 USD ($)
Schedule of lease liability maturities [Abstract]
2023	$ 805,746
2024	816,021
2025	797,854
2026	776,996
2027 and thereafter	438,800
Total minimum lease payments	3,635,417
Less: Amount representing interest	(569,873)
Total	$ 3,065,544

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Goodwill (Details) - USD ($)	6 Months Ended	12 Months Ended
	Jun. 30, 2023	Dec. 31, 2022
Goodwill [Abstract]
Goodwill	$ 673,217	$ 1,392,449

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Goodwill (Details) - Schedule of Carrying Amount of Goodwill - USD ($)	6 Months Ended	12 Months Ended
	Jun. 30, 2023	Dec. 31, 2022
Schedule of carrying amount of goodwill [Abstract]
Beginning balance	$ 2,065,666	$ 8,376,217
Disposal of Zhuoda		(924,740)
Impairment during the year		(5,385,811)
Goodwill	$ 2,065,666	$ 2,065,666

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Loans (Details) - USD ($)		6 Months Ended
	Mar. 24, 2023	Jun. 30, 2023	Jun. 30, 2022	Dec. 20, 2023	Sep. 26, 2023	May 29, 2023	Dec. 22, 2022	Sep. 06, 2022	Apr. 26, 2022	Oct. 07, 2021	Jul. 24, 2021	Feb. 25, 2021
Loans (Details) [Line Items]
Interest expense on short-term loans		$ 14,408	$ 63,847
Loan borrowed		$ 110,714				$ 345,982
Interest rate description		The loan is due on May 20, 2024, with an interest rate of 8.91%.
Due date	Mar. 21, 2024
Long term borrowing amount							$ 678,126	$ 912,500	$ 300,000	$ 148,571	$ 39,839	$ 243,154
Borrowed amount							$ 678,126
Interest expense on long-term loans		$ 23,141	$ 41,387
Term of borrowed								2 years
Interest rate percentage					12.96%			14.40%			13.68%	8.00%
Guanzan [Member]
Loans (Details) [Line Items]
Interest rate description		which is due on March 26, 2024, with an interest rate of 9.45%
Postal Savings Bank of China [Member]
Loans (Details) [Line Items]
Interest rate percentage	5.50%						4.50%
Forecast [Member] | Postal Savings Bank of China [Member]
Loans (Details) [Line Items]
Interest rate percentage				4.50%

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Loans (Details) - Schedule of Short-Term Loans - USD ($)	Jun. 30, 2023	Dec. 31, 2022
Short-Term Debt [Line Items]
Short-term Loans	$ 1,134,822	$ 818,425
China Minsheng Bank [Member]
Short-Term Debt [Line Items]
Short-term Loans	110,714	114,867
Postal Savings Bank of China [Member]
Short-Term Debt [Line Items]
Short-term Loans	678,126	703,558
Pingan Bank of China [Member]
Short-Term Debt [Line Items]
Short-term Loans	$ 345,982

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Loans (Details) - Schedule of Long-Term Loans - USD ($)	Jun. 30, 2023	Dec. 31, 2022
Loans (Details) - Schedule of Long-Term Loans [Line Items]
Subtotal of long-term loans	$ 227,528	$ 420,751
Less: current portion	(101,244)	(105,965)
Total Long-term loans – noncurrent portion	126,284	314,786
China Construction Bank Chongqing Zhongxian Sub-branch [Member]
Loans (Details) - Schedule of Long-Term Loans [Line Items]
Long-term loans		59,926
We Bank [Member]
Loans (Details) - Schedule of Long-Term Loans [Line Items]
Long-term loans	$ 227.528	$ 360,825

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Loans (Details) - Schedule of Aggregate Amount of Interest Expenses for all Long-Term Borrowings	Jun. 30, 2023 USD ($)
Schedule of Aggregate Amount of Interest Expenses for all Long-Term Borrowings [Abstract]
July 1, 2023 to June 30, 2024	$ 18,963
July 1, 2024 to June 30, 2025	3,616
Total	$ 22,579

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Convertible Promissory Notes and Embedded Derivative Instructions (Details) - USD ($)						6 Months Ended	12 Months Ended
		Nov. 18, 2021	Feb. 26, 2021	Feb. 24, 2021	May 18, 2020	Jun. 30, 2023	Dec. 31, 2022	Mar. 31, 2023
Convertible Promissory Notes and Embedded Derivative Instructions [Line Items]
Convertible notes face amount					$ 6,550,000
Discount rate					19.85%
Shares of common stock (in Shares)						621,762		270,000
Exercise price (in Dollars per share)			$ 129.5			$ 142.25
Investors in consideration of payment							$ 3,000
Reverse split						The Company implemented a reverse stock split on February 2, 2022, at the ratio of 5 to 1.
Convertible notes
Fair value of conversion option liability
Common stock percentage						78.00%
Trading days						10 days
Common stock value issued	[1]					$ 6,259	$ 3,765
Shares warrants (in Shares)							44,445
Shares issued value						770,985
Minimum [Member]
Convertible Promissory Notes and Embedded Derivative Instructions [Line Items]
Additional notes				$ 3,300,000
Maximum [Member]
Convertible Promissory Notes and Embedded Derivative Instructions [Line Items]
Additional notes				$ 5,400,000
Convertible Promissory Notes [Member]
Convertible Promissory Notes and Embedded Derivative Instructions [Line Items]
Face amount						$ 2,100,000
Institutional Investors [Member]
Convertible Promissory Notes and Embedded Derivative Instructions [Line Items]
Principal amount			$ 5,400,000
Converted shares (in Dollars per share)			$ 14,400
Securities purchase, agreement		the “November SPA”) with the same two Institutional Investors to sell them in a private placement a series of senior convertible notes (the “2021 Notes”) with an original issue discount of 20% and ranking senior to all outstanding and future indebtedness of the Company. Each Institutional Investor paid $3,250,000 in cash for a 2021 Note in the face amount of $3,900,000. The November SPA also provided for the issuance of additional 2021 Notes in an aggregate original principal amount not to exceed $3,900,000 under certain circumstances. The November SPA also contains provisions about the Market Event Price. The 2021 Notes, which were issued on November 22, 2021, matured on the eighteen-month anniversary of the issuance date, were payable by the Company in installments and convertible at the election of the Institutional Investors at the conversion price of $32.5 (post the Reverse Splits and subject to the Event Market Price Adjustment), which was subject to adjustment in the event of default. Each Institutional Investor also received a warrant (the “Institutional Investor 2021 Warrant”) to purchase 180,000 shares of Common Stock at an initial exercise price of $35.5 per share (post the Reverse Splits and subject to the Event Market Price Adjustment). The placement agent for the private placement received a warrant (the “Placement Agent 2021 Warrant”, together with the Institutional Investor 2021 Warrant, the “2021 Warrants”) to purchase up to 8% of the aggregate number of shares of Common Stock at an initial exercise price of $35.5 per share (post the Reverse Splits and subject to the Event Market Price Adjustment), subject to increase based on the number of shares Common Stock issued pursuant to the 2021 Notes.
Other Institutional Investor [Member]
Convertible Promissory Notes and Embedded Derivative Instructions [Line Items]
Shares of common stock (in Shares)							1,234,715
Placement Agent 2020 Warrant [Member]
Convertible Promissory Notes and Embedded Derivative Instructions [Line Items]
Exercise price (in Dollars per share)					$ 142.25
Number of shares percentage					10.00%
Private Placement [Member]
Convertible Promissory Notes and Embedded Derivative Instructions [Line Items]
Shares of common stock (in Shares)						3,475
Exercise price (in Dollars per share)						$ 142.25
One Institutional Investors [Member]
Convertible Promissory Notes and Embedded Derivative Instructions [Line Items]
Shares of common stock (in Shares)						2,420	275,000
Common stock value issued						$ 3,000	$ 200,000
Other Institutional Investor [Member]
Convertible Promissory Notes and Embedded Derivative Instructions [Line Items]
Shares of common stock (in Shares)						891,762
Common stock value issued						$ 1,105,785	$ 493,886
Institutional Investor Warrant [Member]
Convertible Promissory Notes and Embedded Derivative Instructions [Line Items]
Shares of common stock (in Shares)							44,445
Common stock value issued							$ 100,000
Shares warrants (in Shares)							100,000
Common Stock [Member]
Convertible Promissory Notes and Embedded Derivative Instructions [Line Items]
Shares of common stock (in Shares)						13,000
Converted shares (in Dollars per share)							$ 1.5
Common stock value issued								$ 334,800
2020 Note [Member]
Convertible Promissory Notes and Embedded Derivative Instructions [Line Items]
Face amount						$ 2,225,000
Investors in consideration of payment						$ 1,750,000
Convertible Notes Payable [Member]
Convertible Promissory Notes and Embedded Derivative Instructions [Line Items]
Shares of common stock (in Shares)						2,420
Institutional Investors [Member]
Convertible Promissory Notes and Embedded Derivative Instructions [Line Items]
Common stock value issued						$ 3,000

[1] On February 2, 2022, we effected a reverse stock split of Common Stock at a ratio of 1-to-5 and on December 9, 2022, we effected a reverse stock split of Common Stock at a ratio of 1-to-10 (collectively, the “Reverse Splits”).

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Convertible Promissory Notes and Embedded Derivative Instructions (Details) - Schedule of Additional Paid-In Capital - USD ($)	Jun. 30, 2023	Dec. 31, 2022
Schedule of Additional Paid in Capital [Abstract]
Convertible note – principal		$ 1,108,785
Convertible promissory note, net		$ 1,108,785

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Convertible Promissory Notes and Embedded Derivative Instructions (Details) - Schedule of Assumptions Used In the Black-Scholes Option Pricing Model	6 Months Ended
	Jun. 30, 2023	Dec. 31, 2022
Schedule of Assumptions Used in the Black Scholes Option Pricing Model [Abstract]
Dividend yield	0.00%	0.00%
Expected volatility	171.00%	171.00%
Risk free interest rate	0.87%	0.87%
Expected life (years)	1 year 5 months 1 day	1 year 5 months 1 day

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Other Payables and Accrued Liabilities (Details)		1 Months Ended		6 Months Ended
	Oct. 01, 2019 USD ($)	Oct. 28, 2021 USD ($) shares	Sep. 27, 2021 USD ($)	Jun. 30, 2023 USD ($) shares	Dec. 31, 2023 USD ($)	Sep. 30, 2023 shares	Sep. 01, 2023 shares	Feb. 27, 2023 shares	Jan. 01, 2023 CNY (¥)	Feb. 01, 2022 shares
Other Payables and Accrued Liabilities (Details) [Line Items]
Agreement term		1 year
Annual cash compensation	$ 500,000
Salaries and wages		$ 1,000,000
Stock compensation (in Shares) | shares		100,000
Annual compensation			$ 250,000	$ 300,000
Accrued compensation payable				$ 265,833
Shares of common stock issued (in Shares) | shares				621,762				2,000,000
Common stock shares (in Shares) | shares				2,420
Unpaid cash of salary				$ 1,000,000
Common Stock [Member]
Other Payables and Accrued Liabilities (Details) [Line Items]
Shares of common stock issued (in Shares) | shares				10,000
Common stock shares (in Shares) | shares										10,000
Chief Executive Officer [Member]
Other Payables and Accrued Liabilities (Details) [Line Items]
Agreement term	2 years
Forecast [Member]
Other Payables and Accrued Liabilities (Details) [Line Items]
Shares of common stock issued (in Shares) | shares							36,400
Held in bank accounts					$ 2,000,000
Forecast [Member] | Common Stock [Member]
Other Payables and Accrued Liabilities (Details) [Line Items]
Shares of common stock issued (in Shares) | shares						1,000	39,037
CEO Mr. Tiewei Song [Member]
Other Payables and Accrued Liabilities (Details) [Line Items]
Payroll payable				$ 1,500,000
Ms. Baiqun Zhong [Member]
Other Payables and Accrued Liabilities (Details) [Line Items]
Annual base salary | ¥									¥ 7,000
Mr. Wang’s [Member]
Other Payables and Accrued Liabilities (Details) [Line Items]
Annual base salary				500,000
Accrued compensation payable				$ 500,000
Shares of common stock issued (in Shares) | shares				50,000

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Other Payables and Accrued Liabilities (Details) - Schedule of Other Payables and Accrued Liabilities - USD ($)	6 Months Ended	12 Months Ended
	Jun. 30, 2023	Dec. 31, 2022
Schedule of Other Payables and Accrued Liabilities [Abstract]
Salary payable	$ 331,136	$ 411,043
Salary payable – related party	2,285,333	2,135,333
Accrued operating expenses	(900)	(900)
Other payables	589,401	630,097
Other payables and accrued liabilities, net	$ 3,204,970	$ 3,175,574

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Related Parties and Related Party Transactions (Details)			1 Months Ended	6 Months Ended	12 Months Ended
	Dec. 06, 2022 USD ($)	Jul. 05, 2022 USD ($) shares	Feb. 27, 2023 USD ($) $ / shares shares	Jun. 30, 2023 USD ($) shares	Dec. 31, 2022 USD ($) $ / shares shares	Mar. 15, 2023 USD ($)	Mar. 03, 2023	Dec. 28, 2022 USD ($)	Dec. 28, 2022 CNY (¥)	Oct. 28, 2022 USD ($)	Jul. 18, 2022 USD ($) shares
Related Parties and Related Party Transactions (Details) [Line Items]
Accounts payable				$ 1,018,832	$ 2,980,441	$ 6,650
Remaining balance amount				27,699
Third party professional fees				248,690
Free of interest				$ 172,730
Convertible note issued	$ 2,000,000
Interest rate	6.00%
Closing price percentage of common stock					60.00%
Conversion of closing price per share (in Dollars per share) | $ / shares					$ 0.25
Shares of common stock at conversion price (in Shares) | shares					1,330,000
Repaid principal					$ 2,000,000
Common stock issued (in Shares) | shares			2,000,000	621,762
Consideration of payment											$ 5,000,000
Common stock value in cash			$ 3,000,000
Price per share (in Dollars per share) | $ / shares			$ 1.5
Received cash			$ 3,000,000					$ 6,116,207	¥ 40,000,000
Net profit generated amount		$ 2,500,000
loaned value										$ 500,000
Loans Payable [Member]
Related Parties and Related Party Transactions (Details) [Line Items]
Interest accrued							1.00%
Common Stock [Member]
Related Parties and Related Party Transactions (Details) [Line Items]
Additional shares issue (in Shares) | shares		5,000,000
Mr.Oudom [Member]
Related Parties and Related Party Transactions (Details) [Line Items]
Conversion price per share (in Dollars per share) | $ / shares					$ 4
Common Stock [Member]
Related Parties and Related Party Transactions (Details) [Line Items]
Conversion price per share (in Dollars per share) | $ / shares					1.5
Common stock issued (in Shares) | shares				10,000
Mr. Fnu Oudom [Member]
Related Parties and Related Party Transactions (Details) [Line Items]
Ownership percentage		100.00%
Measurement Input, Conversion Price [Member]
Related Parties and Related Party Transactions (Details) [Line Items]
Conversion price per share (in Dollars per share) | $ / shares					$ 4
Mr. Fnu Oudom [Member]
Related Parties and Related Party Transactions (Details) [Line Items]
Amount owed					$ 2,000,000
Mr.Oudom [Member]
Related Parties and Related Party Transactions (Details) [Line Items]
Common stock issued (in Shares) | shares											1,250,000
Mr. Yongquan Bi [Member]
Related Parties and Related Party Transactions (Details) [Line Items]
Accounts payable					27,699
Mr. Li Zhou [Member]
Related Parties and Related Party Transactions (Details) [Line Items]
Accounts payable					248,690
Mr. Fuqing Zhang [Member]
Related Parties and Related Party Transactions (Details) [Line Items]
Accounts payable					172,730
Mr. Youwei Xu [Member]
Related Parties and Related Party Transactions (Details) [Line Items]
Accounts payable				11,943	11,784
Shaohui Zhuo [Member]
Related Parties and Related Party Transactions (Details) [Line Items]
Amount payable to daily operations				4,502	4,671
Nanfang Xiao [Member]
Related Parties and Related Party Transactions (Details) [Line Items]
Amount payable to daily operations				10,102	10,482
Jia Song [Member]
Related Parties and Related Party Transactions (Details) [Line Items]
Amount payable to daily operations				$ 4,228	$ 4,385
Mr.Oudom [Member]
Related Parties and Related Party Transactions (Details) [Line Items]
Equity interest in consideration		$ 1,800,000
Mr. Fnu Oudom [Member]
Related Parties and Related Party Transactions (Details) [Line Items]
Other payable		180,000
Common Stock, issued share		$ 270,000

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Stockholders’ Equity (Details) - USD ($)																	1 Months Ended	2 Months Ended	3 Months Ended		6 Months Ended	12 Months Ended
	Jun. 19, 2023	Dec. 06, 2022	Nov. 23, 2022	Jul. 18, 2022	Jan. 27, 2022	Jan. 24, 2022	Jan. 07, 2022	Sep. 22, 2021	Aug. 27, 2021	Jul. 23, 2021	Jun. 18, 2021	Apr. 29, 2021	Mar. 26, 2021	Feb. 11, 2021	Feb. 03, 2021	Apr. 20, 2020	Feb. 09, 2021	Mar. 01, 2021	Jun. 30, 2023	Nov. 30, 2021	Jun. 30, 2023	Dec. 31, 2022	Dec. 31, 2020	Sep. 01, 2023	Mar. 31, 2023	Feb. 27, 2023	Dec. 09, 2022	Feb. 01, 2022	May 06, 2021	Feb. 02, 2021	Feb. 01, 2020
Stockholder's Equity [Line Items]
Common stock, shares authorized																			200,000,000		200,000,000	200,000,000
Common stock, par value (in Dollars per share)																			$ 0.001		$ 0.001	$ 0.001
Common stock, shares outstanding																			6,258,962		6,258,962	3,764,780
Aggregate principal amount (in Dollars)															$ 74,473
Aggregate of common stock shares																						1,138,248
Shares issued																			2,420		2,420
Common Stock of shares																			621,762		621,762					2,000,000
Number of share issued					10,000	100,000						200									44,000
Shares returned																								39,037
Aggregate principal amount (in Dollars)																						$ 2,097,000
Common stock ,remaining shares returned																			1,000		1,000
Common stock shares received																						1,234,715
Exercised warrants																						44,445
Common stock, shares issued																			6,258,962		6,258,962	3,764,780
Converted shares																			3,000
Convertible notes issued (in Dollars)		$ 2,000,000
Institutional investors upon conversion																			3,000		3,000
Addition shares issued																			621,762
Common Stock [Member]
Stockholder's Equity [Line Items]
Common stock, shares authorized																			200,000,000		200,000,000
Common stock, par value (in Dollars per share)																			$ 0.001		$ 0.001
Shares issued																													16,000
Number of share issued										600
Common stock, shares issued																			270,000		270,000
Converted shares																			2,420
One Institutional Investor [Member]
Stockholder's Equity [Line Items]
Common stock shares received																						275,000
Two Institutional Investor [Member]
Stockholder's Equity [Line Items]
Shares issued
Common Stock [Member]
Stockholder's Equity [Line Items]
Common stock, shares outstanding																			6,258,926		6,258,926	3,764,780
Shares issued																												10,000
Common Stock of shares																			10,000		10,000
Common stock, shares issued																									270,000
Convertible Notes Payable [Member]
Stockholder's Equity [Line Items]
Common Stock of shares															20,706
Mr Oudom [Member]
Stockholder's Equity [Line Items]
Common Stock of shares				1,250,000
Number of share issued	270,000
Mr. Fnu Oudom [Member]
Stockholder's Equity [Line Items]
Number of share issued	1,330,000
Hudson Bay [Member]
Stockholder's Equity [Line Items]
Aggregate principal amount (in Dollars)																	$ 2,150,000			$ 2,400,000
Aggregate of common stock shares																	276,943			970,173		442,357
CVI [Member]
Stockholder's Equity [Line Items]
Aggregate principal amount (in Dollars)																		$ 2,150,000
Aggregate of common stock shares																		227,731		1,183,251
Number of share issued											32,500
Cashless exercise warrants																							650,000
Aggregate principal amount (in Dollars)																				$ 3,000,000
Guanzan [Member]
Stockholder's Equity [Line Items]
Shares issued																														40,000	19,000
Common Stock of shares																															100,000,000
Number of share issued									92,000
Real Miracle Investments Limited [Member]
Stockholder's Equity [Line Items]
Number of share issued														100
Zhongshan [Member]
Stockholder's Equity [Line Items]
Number of share issued													40,037
Minkang, Qiangsheng and Eurasia hospitals [Member]
Stockholder's Equity [Line Items]
Number of share issued																80,000
Shares returned																								36,400			43,600
Zhuoda [Member]
Stockholder's Equity [Line Items]
Shares issued			44,000																44,000		44,000
Number of share issued								44,000
Equity interests percentage			100.00%
Mali Hospital [Member]
Stockholder's Equity [Line Items]
Number of share issued							60,000
Shares returned																											52,000
Common stock ,remaining shares returned																								8,000
Kingmoon & Kingyang (Jiulongpo) [Member]
Stockholder's Equity [Line Items]
Shares issued																												1,000
Mr. Fnu Oudom [Member]
Stockholder's Equity [Line Items]
Shares issued				1,250,000
Mr Oudom [Member]
Stockholder's Equity [Line Items]
Consideration amount (in Dollars)				$ 5,000,000
Platinum Point Capital LLC [Member]
Stockholder's Equity [Line Items]
Aggregate of common stock shares																						5,700,000

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Net Income (Loss) Per Share (Details) - Schedule of Basic and Diluted Net Loss Per Share - USD ($)	3 Months Ended		6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022	Jun. 30, 2023	Jun. 30, 2022
Schedule of Basic and Diluted Net Loss Per Share [Abstract]
Net income (loss) from continuing operation attributable to common shareholders			$ 1,987,491	$ (9,114,986)
Net loss from discontinued operation attributable to common shareholders			(143,102)	(171,810)
Total net income (loss) attributable to common shareholders			$ 1,844,389	$ (9,286,796)
Weighted average number of common shares outstanding – Basic			4,219,675	15,429,754
Income (loss) from continuing operations	$ 0.26	$ (0.65)	$ 0.47	$ (0.59)
Income (loss) from discontinued operations			(0.03)	(0.01)
Total			$ 0.44	$ (0.6)

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Net Income (Loss) Per Share (Details) - Schedule of Basic and Diluted Net Loss Per Share (Parentheticals) - shares	3 Months Ended		6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022	Jun. 30, 2023	Jun. 30, 2022
Schedule of Basic and Diluted Net Loss Per Share [Abstract]
Weighted average number of common shares outstanding – Diluted	4,596,440	9,493,512	4,219,675	15,429,754

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Segments (Details) - Schedule of Reported Segment Profit or Loss - USD ($)	6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022
Segment Reporting Information [Line Items]
Revenues from external customers	$ 8,755,303	$ 5,543,745
Cost of revenues	4,180,982	4,698,822
Depreciation, depletion, and amortization expense	102,315	89,159
Profit (loss)	1,987,492	(5,749,539)
Total assets	31,086,014	32,107,687
Retail pharmacy [Member]
Segment Reporting Information [Line Items]
Revenues from external customers	480,205	505,003
Cost of revenues	357,836	223,032
Depreciation, depletion, and amortization expense	9,049	10,229
Profit (loss)	(194,401)	(291,344)
Total assets	294,548	337,795
Wholesale medical devices [Member]
Segment Reporting Information [Line Items]
Revenues from external customers	1,051,385	2,828,557
Cost of revenues	805,574	2,415,231
Depreciation, depletion, and amortization expense	11,300	24,152
Profit (loss)	(106,312)	1,224
Total assets	3,128,979	3,750,466
Wholesale pharmecuticals[Member]
Segment Reporting Information [Line Items]
Revenues from external customers	1,928,388	2,055,417
Cost of revenues	1,813,422	1,962,623
Depreciation, depletion, and amortization expense		154
Profit (loss)	(169,748)	(257,769)
Total assets	12,531,453	7,979,593
Healthcare products [Member]
Segment Reporting Information [Line Items]
Revenues from external customers	5,295,325
Cost of revenues	1,202,013
Depreciation, depletion, and amortization expense	79,449
Profit (loss)	3,842,311
Total assets	6,372,681
Medical services [Member]
Segment Reporting Information [Line Items]
Revenues from external customers
Cost of revenues		123
Depreciation, depletion, and amortization expense
Profit (loss)	(22,309)	(65,421)
Total assets	998,867	1,102,730
Others [Member]
Segment Reporting Information [Line Items]
Revenues from external customers		154,768
Cost of revenues	2,137	97,813
Depreciation, depletion, and amortization expense	2,517	54,624
Profit (loss)	(1,362,049)	(5,136,229)
Total assets	$ 7,759,486	$ 18,937,103

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Entity-Wide Information and Concentrations of Risk (Details) - USD ($)	3 Months Ended		6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022	Jun. 30, 2023	Jun. 30, 2022
Entity-Wide Information and Concentrations of Risk (Details) [Line Items]
Revenues (in Dollars)	$ 5,557,666	$ 2,829,034	$ 8,755,303	$ 5,543,745
Revenues percentage	10.00%		10.00%
Accounts payable percentage			10.00%
United States [Member]
Entity-Wide Information and Concentrations of Risk (Details) [Line Items]
Revenues (in Dollars)			$ 5,290,000

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Entity-Wide Information and Concentrations of Risk (Details) - Schedule of Reported Revenues for Each Type of Product - USD ($)	6 Months Ended
	Jun. 30, 2023	Jun. 30, 2022
Entity-Wide Information and Concentrations of Risk (Details) - Schedule of Reported Revenues for Each Type of Product [Line Items]
Total	$ 8,755,303	$ 5,543,745
Medical devices [Member]
Entity-Wide Information and Concentrations of Risk (Details) - Schedule of Reported Revenues for Each Type of Product [Line Items]
Total	1,051,385	2,828,557
Healthcare products [Member]
Entity-Wide Information and Concentrations of Risk (Details) - Schedule of Reported Revenues for Each Type of Product [Line Items]
Total	5,295,325
Wholesale pharmaceuticals [Member]
Entity-Wide Information and Concentrations of Risk (Details) - Schedule of Reported Revenues for Each Type of Product [Line Items]
Total	1,928,388	2,055,417
Pharmacy retail [Member]
Entity-Wide Information and Concentrations of Risk (Details) - Schedule of Reported Revenues for Each Type of Product [Line Items]
Total	480,205	505,003
Others [Member]
Entity-Wide Information and Concentrations of Risk (Details) - Schedule of Reported Revenues for Each Type of Product [Line Items]
Total		$ 154,768

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Entity-Wide Information and Concentrations of Risk (Details) - Schedule of One Customer Accounted for Revenue	6 Months Ended
	Jun. 30, 2023 USD ($)
Revenue, Major Customer [Line Items]
Revenue	$ 5,295,325
Percentage of total Revenue	60.48%
Customer A [Member]
Revenue, Major Customer [Line Items]
Segment	Healthcare products

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Entity-Wide Information and Concentrations of Risk (Details) - Schedule of Purchases and Its Outstanding Accounts Payable - Vendor A [Member]	6 Months Ended
	Jun. 30, 2023 USD ($)
Entity-Wide Information and Concentrations of Risk (Details) - Schedule of Purchases and Its Outstanding Accounts Payable [Line Items]
Segment	Wholesale pharmaceuticals
Purchases	$ 442,323
Percentage of total purchases	11.22%
Accounts payable

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Subsequent Events (Details) - Forecast [Member] - shares	9 Months Ended
	Sep. 30, 2023	Sep. 01, 2023
Subsequent Events [Line Items]
Common stock returned		36,400
Shares sold	1,000
Common Stock [Member]
Subsequent Events [Line Items]
Common stock returned	1,000	39,037
Zhongshan [Member]
Subsequent Events [Line Items]
Percentage of equity interests		87.00%
Qiangsheng, Eurasia and Minkang hospitals [Member]
Subsequent Events [Line Items]
Percentage of equity interests		90.00%