Revenue Performance - Revenue for the three months ended September 30, 2023, was $1.8 million, a decrease of 10% from $2.0 million in the same period of 2022[108] - Revenue for the nine months ended September 30, 2023, was $4.9 million, a decrease from $5.2 million in the same period in 2022[128] Product Category Performance - The "Digestive Diseases" product category saw significant growth, generating $0.65 million, up 442% from $0.12 million in the same period last year[109] - The "Digestive Diseases" product category saw a revenue increase of 252%, generating $1.02 million in the nine months ended September 30, 2023, compared to $0.29 million in the same period last year[129] - The "Anti-Viral/Infection & Respiratory" product category revenue decreased by 39%, from $1.03 million to $0.63 million, primarily due to centralized procurement impacts[110] Cost and Expenses - Cost of revenue for the three months ended September 30, 2023, was $2.0 million, representing 113% of total revenue, compared to 104% in the same period of 2022[114] - Gross loss for the three months ended September 30, 2023, was $0.23 million, with a gross loss margin of 13%, up from 7% in the same period last year[114] - Research and development expenses decreased to $0.05 million, accounting for 2.5% of total revenues, down from 4.5% in the same period of 2022[117] - Selling expenses decreased to $0.5 million for the nine months ended September 30, 2023, accounting for 10.7% of total revenue, down from 13.6% in the same period in 2022[137] - General and administrative expenses were $0.78 million for the nine months ended September 30, 2023, compared to $1.06 million in the same period in 2022[138] - The net interest expense for the nine months ended September 30, 2023, was $0.28 million, down from $0.33 million in the same period in 2022[144] Losses - The net loss for the three months ended September 30, 2023, was $0.8 million, consistent with the same period in 2022[125] - The operating loss for the nine months ended September 30, 2023, was $1.6 million, an improvement from $2.4 million in the same period in 2022[142] Accounts Receivable - The allowance for doubtful accounts as a percentage of accounts receivable was 97.8% as of September 30, 2023, an increase from 97.4% in 2022[122] - The allowance for doubtful accounts was $16.2 million as of September 30, 2023, down from $16.7 million as of December 31, 2022[123] Cash Position - Cash and cash equivalents were $1.37 million as of September 30, 2023, representing 8.9% of total assets, down from $2.03 million or 11.4% of total assets as of December 31, 2022[146] Market Opportunities - The total size of China's health service industry is projected to reach RMB 16 trillion (approximately $2.5 trillion) by 2030, indicating significant market expansion opportunities[106] Product Development - The company launched new products such as Noni enzyme and wash-free sanitizers in response to market needs, particularly during the COVID-19 pandemic[106] - The company is focusing on the consistency evaluation of generic drugs, with one flagship product, Candesartan tablets, passing evaluation in August 2023[104] Gross Margin - The gross loss margin improved to 4.2% for the nine months ended September 30, 2023, compared to 10.4% in the same period in 2022[135]

Revenue Performance - Revenue decreased by 31.9% to $1.1 million for the three months ended June 30, 2023, compared to $1.6 million for the same period in 2022[108] - Revenue for the six months ended June 30, 2023 was $3.1 million, slightly down from $3.2 million in the same period in 2022[126] - The "Anti-Viral/Infection & Respiratory" product category saw a revenue decrease of $0.27 million, generating $1.47 million in sales for the six months ended June 30, 2023, compared to $1.74 million in 2022, a decline of 16%[127] Expenses - Selling expenses decreased to $0.17 million for the three months ended June 30, 2023, accounting for 15.5% of total revenue, down from $0.26 million and 16.5% in the same period in 2022[115] - General and administrative expenses were $0.11 million for the three months ended June 30, 2023, accounting for 10.2% of total revenues, compared to $0.27 million and 16.9% in the same period in 2022[116] - Research and development expenses remained constant at $0.02 million for both the three months ended June 30, 2023, and 2022, but accounted for a higher percentage of total revenues at 2.2% compared to 0.9%[117] - General and administrative expenses were $0.5 million for the six months ended June 30, 2023, compared to $0.8 million in 2022, representing 17.3% of total revenues[133] - Research and development expenses decreased to $0.05 million for the six months ended June 30, 2023, from $0.07 million in the same period in 2022[134] Profitability - Gross loss for the three months ended June 30, 2023, was $0.15 million, with a gross loss margin of 13.4%, compared to a gross loss of $0.23 million and a margin of 14.2% in the same period in 2022[114] - Gross profit for the six months ended June 30, 2023 was $0.03 million, compared to a gross loss of $0.4 million in the same period in 2022, resulting in a gross profit margin of 1.0%[131] - Net loss for the three months ended June 30, 2023 was $0.6 million, a decrease from a net loss of $0.9 million for the same period in 2022[125] - Operating loss for the three months ended June 30, 2023, was $0.4 million, an improvement from an operating loss of $0.8 million during the same period in 2022[123] Cash Flow - Net cash used by operating activities was $1.7 million for the six months ended June 30, 2023, compared to $1.2 million in the same period in 2022[143] - Cash flow provided by financing activities was $0.52 million in the six months ended June 30, 2023, compared to cash flow used of $1.13 million in the same period in 2022[146] Inventory - As of June 30, 2023, total inventory was $3.9 million, an increase from $2.9 million as of December 31, 2022[143] Product Development - One of the flagship products, Candesartan tablets, passed the generic-drug-consistency-evaluation in early August 2023, indicating progress in product development[103] Market Outlook - The company continues to explore the field of comprehensive healthcare, with the total size of China's health service industry projected to reach RMB 16 trillion (approximately $2.5 trillion) by 2030[106] Interest Expense - Net interest expense increased to $0.14 million for the three months ended June 30, 2023, compared to $0.11 million for the same period in 2022[124]

Revenue and Sales Performance - Revenue increased by 22.2% to $2.0 million for the three months ended March 31, 2023, compared to $1.6 million for the same period in 2022[91]. - The "Other" product category generated $0.36 million in sales revenue, an increase of 71% from $0.21 million in the same period last year, primarily due to increased mask sales[94]. - The "CNS Cerebral & Cardio Vascular" product category represented 21% of total revenue for the three months ended March 31, 2023, up from 18% in the same period in 2022[96]. Profitability and Expenses - Gross profit for the three months ended March 31, 2023 was $0.2 million, compared to a gross loss of $0.2 million during the same period in 2022, resulting in a gross profit margin of 9.1%[98]. - Selling expenses decreased to $0.14 million for the three months ended March 31, 2023, accounting for 7.4% of total revenue, down from 11.2% in the same period in 2022[99]. - General and administrative expenses were $0.42 million, representing 21.3% of total revenues for the three months ended March 31, 2023, compared to 32.1% in the same period in 2022[101]. - Research and development expenses were $0.02 million, accounting for 1.2% of total revenues for the three months ended March 31, 2023, down from 3.4% in the same period in 2022[102]. - Operating loss for the three months ended March 31, 2023 was $0.4 million, an improvement from an operating loss of $0.9 million during the same period in 2022[108]. - Net interest expense decreased to $0.08 million for the three months ended March 31, 2023, compared to $0.12 million for the same period in 2022[109]. - Net Loss for Q1 2023 was $0.5 million, a decrease from a net loss of $1.0 million in Q1 2022, resulting in a loss per share of $0.06 compared to $0.22 in the prior year[110]. Cash Flow and Financial Position - Cash and cash equivalents as of March 31, 2023, were $1.2 million, representing 6.7% of total assets, down from $2.0 million or 11.4% of total assets as of December 31, 2022[111]. - Net cash used by operating activities was $1.5 million in Q1 2023, compared to $0.9 million in Q1 2022[115]. - Total inventory increased to $3.8 million as of March 31, 2023, from $2.9 million as of December 31, 2022[115]. - Cash flow provided by financing activities was $0.52 million in Q1 2023, compared to cash flow used of $0.28 million in Q1 2022[116]. - Helpson's net assets were $(199,000) as of March 31, 2023, with no allocations to statutory surplus reserve accounts during Q1 2023[117]. - The company has not encountered difficulties refinancing lines of credit and has an aggregated advance from the CEO of $1,142,870 for operations[111]. - The company may seek additional debt or equity financing as necessary, raising concerns about its ability to continue as a going concern[114]. - As of March 31, 2023, net accounts receivable was $0.5 million, up from $0.4 million as of December 31, 2022[115]. - The company did not have any off-balance sheet arrangements as of March 31, 2023[119]. Market Outlook - The total size of China's health service industry is projected to reach RMB 16 trillion (approximately $2.5 trillion) by 2030, indicating significant market expansion opportunities[89].

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, DC 20549 FORM 10-K ☒ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended December 31, 2022 or ☐ TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from _________ to _____________ Commission file number: 001-34471 China Pharma Holdings, Inc. (Exact name of registrant as specified in its charter) Nevada (State or other jurisdiction of ...

Part I [Item 1. Business](index=5&type=section&id=Item%201.%20Business) China Pharma Holdings, Inc. is a PRC-based pharmaceutical company focused on developing, manufacturing, and marketing 19 pharmaceutical products and healthcare items through GMP-compliant facilities, emphasizing generics, Modern TCMs, and strategic market expansion - The company primarily develops, manufactures, and markets pharmaceutical products for human use in the PRC, with all operations and facilities located domestically[11](index=11&type=chunk) - As of December 31, 2021, the company manufactured **19 pharmaceutical products** across basic generic, first-to-market generic, and Modern Traditional Chinese Medicine categories[12](index=12&type=chunk) - The company operates two GMP-compliant production facilities in Haikou, Hainan Province[14](index=14&type=chunk) - The company's strategy includes promoting existing brands, advancing consistency evaluations, exploring consumer healthcare and CDMO services, expanding distribution, and pursuing strategic acquisitions[43](index=43&type=chunk)[44](index=44&type=chunk)[45](index=45&type=chunk) [Industry Background and Market Opportunities](index=7&type=section&id=Industry%20Background%20and%20Market%20Opportunities) The Chinese pharmaceutical manufacturing industry experienced significant growth in 2021, driven by a low COVID-19 base, but faces pressure from medical insurance cost controls and policy trends like volume-based procurement and consistency evaluations favoring innovation - In the first three quarters of 2021, China's pharmaceutical manufacturing industry revenue reached **RMB 2,129 billion (approx. US$330 billion)**, a **24.4% YoY increase**, with net income at **RMB 452 billion (approx. US$70 billion)**, an **80.6% YoY increase**[18](index=18&type=chunk) - The government's volume-based procurement policy resulted in an average drug price reduction of over **50%** across six rounds, saving substantial medical insurance funds[22](index=22&type=chunk)[34](index=34&type=chunk) - The 'Consistency Evaluation' for generic drugs is a critical policy requiring generics to match original drug quality and efficacy, mandatory for national centralized procurement participation[26](index=26&type=chunk)[27](index=27&type=chunk) [Products](index=13&type=section&id=Products) The company's portfolio comprises 19 prescription pharmaceuticals across CNS, Anti-infection/Respiratory, and Digestive diseases, with total product revenue reaching **$9.64 million** in FY2021, a **6% increase** from 2020 Revenue by Product Category (in millions USD) | Product Category | 2021 Revenue | 2020 Revenue | Net Change | % Change | | :--- | :--- | :--- | :--- | :--- | | CNS Cerebral & Cardio Vascular | $2.68 | $2.03 | $0.65 | 32% | | Anti-Viral/ Infection & Respiratory | $5.22 | $5.13 | $0.09 | 2% | | Digestive Diseases | $0.37 | $0.40 | -$0.02 | -6% | | Other | $1.37 | $1.58 | -$0.21 | -13% | | **Total** | **$9.64** | **$9.13** | **$0.51** | **6%** | - The Anti-Viral/Infection & Respiratory product category accounted for the largest portion of sales, representing **54% of total revenue** in 2021[288](index=288&type=chunk) [Competition](index=17&type=section&id=Competition) Operating in China's fragmented pharmaceutical industry, the company faces intense competition from local and overseas manufacturers, with profitability at risk from price wars and substitute products, despite its commercialization efficiency and national sales network - The company's core competitive advantages include an efficient commercialization process, extensive product-development experience, a market-oriented portfolio, and a national sales network[66](index=66&type=chunk) - Profitability may be adversely affected by increased competition, price wars, or the development of superior or less costly substitute products[71](index=71&type=chunk) [Regulations](index=20&type=section&id=Regulations) The company's operations are subject to stringent regulations by China's NMPA, including drug registration, GMP standards, and the 2019 Drug Administration Law's pilot inspection mechanism, alongside foreign currency exchange and dividend distribution rules for foreign-invested enterprises - The pharmaceutical industry in China is highly regulated by the NMPA, overseeing manufacturing, distribution, packaging, pricing, and advertising[76](index=76&type=chunk) - The revised Drug Administration Law, effective December 1, 2019, replaced mandatory GMP certification with a stricter pilot inspection mechanism, to which the company's production lines are subject[85](index=85&type=chunk) - As a foreign-invested enterprise, the company is subject to PRC foreign currency exchange regulations, requiring SAFE approval for capital account currency conversion and remittance[90](index=90&type=chunk) [Item 1A. Risk Factors](index=23&type=section&id=Item%201A.%20Risk%20Factors) The company faces significant business, operational, and stock-related risks, including market acceptance, regulatory compliance, intense competition, distributor reliance, PRC policy changes, currency restrictions, data security laws, potential dilution, concentrated ownership, and a 'going concern' warning [Risks Related to our Business and our Industry](index=25&type=section&id=Risks%20Related%20to%20our%20Business%20and%20our%20Industry) The company's business faces industry-specific risks including market acceptance, compliance with the revised Drug Administration Law, intense competition for off-patent generics, significant gross margin pressure, reliance on a limited number of distributors, and challenges from the COVID-19 pandemic and consistency evaluations - Gross profit margins significantly declined from **18.0% in 2020** to **3.6% in 2021**, reflecting intense market competition and sales price pressure[109](index=109&type=chunk) - The company relies on a limited number of distributors, with the top five accounting for **21% of net revenues** in 2021[136](index=136&type=chunk) - Failure to pass the mandatory 'Consistency Evaluation' for generic drugs could prevent participation in the crucial Centralized Procurement program, negatively impacting business operations[137](index=137&type=chunk) [Risks Related to Doing Business in China](index=38&type=section&id=Risks%20Related%20to%20Doing%20Business%20in%20China) Operating in China exposes the company to significant political, economic, and legal uncertainties, including PRC government policy impacts, legal system unpredictability, Renminbi currency restrictions, and evolving data security and overseas listing regulations that could require CSRC approval - Substantially all revenue is received in Renminbi (RMB), a non-freely convertible currency, subjecting the company to PRC government controls on currency conversion and potential restrictions on fund remittance out of China[183](index=183&type=chunk)[184](index=184&type=chunk) - Compliance with China's new Data Security Law, Cybersecurity Law, and Personal Information Protection Law may require significant expenses and could materially affect business operations[200](index=200&type=chunk) - Uncertainty exists regarding whether future offerings would require approval from the China Securities Regulatory Commission (CSRC) under the M&A Rules, potentially hindering capital raising efforts[207](index=207&type=chunk)[208](index=208&type=chunk) [Risks Related to our Common Stock](index=51&type=section&id=Risks%20Related%20to%20our%20Common%20Stock) Investment in the company's common stock carries risks including price volatility, potential dilution from future issuances and a convertible note, highly concentrated ownership by the CEO and a director, and auditors' 'substantial doubt' about the company's going concern ability due to recurring losses - Auditors have raised substantial doubt about the company's ability to continue as a going concern due to recurring losses, net current liabilities, and an accumulated deficit[249](index=249&type=chunk) - A large portion of common stock is controlled by CEO Zhilin Li (**29.2%**) and director Heung Mei Tsui (**19.7%**), enabling significant influence over stockholder votes[239](index=239&type=chunk) - A convertible note issued in November 2021 could cause substantial dilution upon redemption, materially affecting stock price and earnings per share[236](index=236&type=chunk)[237](index=237&type=chunk) [Item 2. Properties](index=55&type=section&id=Item%202.%20Properties) The company's properties in Haikou, Hainan Province, PRC, include land use rights expiring in 2063 and two owned production facilities, with a new facility collateralizing a **RMB 10 million** line of credit from the Bank of China - The company owns two production facilities in Haikou, Hainan Province, PRC, holding land use rights for approximately **22,936 square meters** expiring in 2063[256](index=256&type=chunk)[257](index=257&type=chunk) Mortgaged Property for Line of Credit | Total Amount of Line of Credit | Lending Institution | Contract Period | Interest Rate | Properties under Mortgage | | :--- | :--- | :--- | :--- | :--- | | RMB 10 million (Approx. $1.54 million) | Bank of China | Sep 18, 2021 to Sep 18, 2022 | 3.85% | Helpson's new factory: 20,282.42 sq. meters | [Item 3. Legal Proceedings](index=56&type=section&id=Item%203.%20Legal%20Proceedings) The company is not currently aware of any legal proceedings or claims expected to have a material adverse effect on its business, financial condition, or operating results - As of the report date, the company is not involved in any material legal proceedings[262](index=262&type=chunk) Part II [Item 5. Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities.](index=57&type=section&id=Item%205.%20Market%20for%20Registrant's%20Common%20Equity,%20Related%20Stockholder%20Matters%20and%20Issuer%20Purchases%20of%20Equity%20Securities.) The company's common stock trades on the NYSE American under the symbol 'CPHI', with approximately **135 stockholders** of record as of March 22, 2022, and no anticipated cash dividends due to its holding company structure and PRC currency controls - The company's common stock trades on the NYSE American under the symbol 'CPHI'[265](index=265&type=chunk) - The company has never paid cash dividends and does not plan to in the foreseeable future[268](index=268&type=chunk) [Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations.](index=58&type=section&id=Item%207.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations.) In 2021, the company faced challenges from China's evolving pharmaceutical policies, resulting in decreased revenue to **$9.6 million**, a significant drop in gross margin to **3.6%**, and an increased net loss to **$3.4 million**, despite securing a **$5 million** convertible note and lines of credit, leading auditors to express substantial doubt about its going concern ability [Results of Operations for the Fiscal Year ended December 31, 2021](index=60&type=section&id=Results%20of%20Operations%20for%20the%20Fiscal%20Year%20ended%20December%2031,%202021) For FY2021, revenue decreased to **$9.6 million** due to a non-recurring 2020 sale, gross profit plummeted to **$0.3 million** with margin contracting to **3.6%** from **18.0%**, and net loss increased to **$3.4 million** or **$0.07 per share** Key Financial Results (FY 2021 vs FY 2020) | Metric | FY 2021 | FY 2020 | | :--- | :--- | :--- | | Revenue | $9.6M | $10.9M | | Gross Profit | $0.3M | $2.0M | | Gross Margin | 3.6% | 18.0% | | Operating Loss | ($2.9M) | ($2.6M) | | Net Loss | ($3.4M) | ($2.9M) | | Loss per Share | ($0.07) | ($0.07) | - The revenue decrease was primarily due to a non-repeated one-time foreign trade order of COVID-19 testers in 2020 for approximately **$1.7 million**[283](index=283&type=chunk) - The significant decrease in gross profit margin was attributed to the high-margin one-time sale in 2020, price decreases of key products, and increased raw material and packaging costs in 2021[290](index=290&type=chunk) [Liquidity and Capital Resources](index=64&type=section&id=Liquidity%20and%20Capital%20Resources) The company's liquidity is under pressure, with auditors expressing 'substantial doubt' about its going concern ability, despite securing a **$5 million** convertible note and several lines of credit in 2021, as future liquidity depends on achieving strategic goals and raising additional capital - In November 2021, the company issued an unsecured convertible promissory note with an original principal of **$5,250,000** for proceeds of **$5,000,000** to be used for general working capital[307](index=307&type=chunk) - The company obtained and renewed several lines of credit from Chinese banks, including a **RMB 10 million** line from Bank of China, collateralized by its new production facility and personally guaranteed by the CEO[303](index=303&type=chunk)[304](index=304&type=chunk)[306](index=306&type=chunk) Cash Flow Summary (in millions USD) | Cash Flow Activity | FY 2021 | FY 2020 | | :--- | :--- | :--- | | Net Cash from Operating Activities | ($0.25) | ($0.04) | | Net Cash from Investing Activities | ($0.44) | ($0.87) | | Net Cash from Financing Activities | $4.60 | $0.62 | [Item 8. Financial Statements and Supplementary Data](index=67&type=section&id=Item%208.%20Financial%20Statements%20and%20Supplementary%20Data) This section presents the company's audited consolidated financial statements for FY2021 and FY2020, including Balance Sheets, Statements of Operations, Stockholders' Equity, and Cash Flows, with the independent auditor's report highlighting a 'going concern uncertainty' due to recurring losses and net current liabilities - The independent auditor's report expresses a fair presentation opinion but highlights 'Going concern uncertainty' due to recurring losses, net current liabilities, and an accumulated deficit[389](index=389&type=chunk) Consolidated Balance Sheet Highlights (as of Dec 31) | Metric | 2021 | 2020 | | :--- | :--- | :--- | | Total Assets | $22.65M | $21.12M | | Total Liabilities | $16.63M | $13.11M | | Total Stockholders' Equity | $6.02M | $8.00M | | Cash and cash equivalents | $4.86M | $0.96M | [Item 9A. Controls and Procedures](index=67&type=section&id=Item%209A.%20Controls%20and%20Procedures) Management concluded that the company's disclosure controls and procedures were ineffective as of December 31, 2021, due to a material weakness in internal control over financial reporting stemming from a lack of U.S. GAAP-knowledgeable personnel, which the company is actively remediating - Management concluded that as of December 31, 2021, the company's disclosure controls and procedures were not effective[325](index=325&type=chunk) - A material weakness was identified in internal control over financial reporting due to a 'lack of accounting financial reporting personnel knowledgeable in US GAAP'[331](index=331&type=chunk) Part III [Item 10. Directors, Executive Officers and Corporate Governance.](index=70&type=section&id=Item%2010.%20Directors,%20Executive%20Officers%20and%20Corporate%20Governance.) The company's leadership includes Zhilin Li as Chairman, President, CEO, and interim CFO, with a five-member Board of Directors including three independent members who form the Audit Committee, and a code of ethics applicable to all personnel - Zhilin Li holds multiple key roles as Chairman, President, Chief Executive Officer, and interim Chief Financial Officer[337](index=337&type=chunk)[338](index=338&type=chunk) - The Board of Directors includes three independent members: Gene Michael Bennett, Yingwen Zhang, and Baowen Dong, who also constitute the Audit Committee[348](index=348&type=chunk) [Item 11. Executive Compensation](index=73&type=section&id=Item%2011.%20Executive%20Compensation) Executive compensation is primarily centered on CEO Zhilin Li, whose total compensation was **$241,600** for both FY2021 and FY2020, and the company's 2010 Long-Term Incentive Plan was expanded to **9 million shares** for equity awards CEO Compensation (Zhilin Li) | Year | Salary | All Other Compensation | Total | | :--- | :--- | :--- | :--- | | 2021 | $225,600 | $16,000 | $241,600 | | 2020 | $225,600 | $16,000 | $241,600 | - The company's 2010 Long-Term Incentive Plan was amended to increase reserved shares from **4,000,000** to **9,000,000**[355](index=355&type=chunk) [Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholders Matters](index=75&type=section&id=Item%2012.%20Security%20Ownership%20of%20Certain%20Beneficial%20Owners%20and%20Management%20and%20Related%20Stockholders%20Matters) As of March 22, 2022, the company's stock ownership is highly concentrated, with the five directors and executive officers beneficially owning **48.8%** of outstanding common stock, including **29.2%** by CEO Zhilin Li and **19.6%** by director Heung Mei Tsui Beneficial Ownership of Key Insiders | Name and Title | Shares Owned | Percentage of Class | | :--- | :--- | :--- | | Zhilin Li (CEO & Chairman) | 13,810,000 | 29.2% | | Heung Mei Tsui (Director) | 9,312,651 | 19.6% | | All directors and executive officers as a group (5 persons) | 23,122,651 | 48.8% | [Item 13. Certain Relationships and Related Transactions, and Director Independence.](index=76&type=section&id=Item%2013.%20Certain%20Relationships%20and%20Related%20Transactions,%20and%20Director%20Independence.) The company engaged in significant related party transactions, including outstanding loans of **$1,354,567** from director Heung Mei Tsui and net advances of **$1,425,123** from CEO Zhilin Li as of December 31, 2021, while three of its five directors are determined to be independent - As of December 31, 2021, the company had outstanding loans from director Heung Mei Tsui totaling **$1,354,567**[367](index=367&type=chunk) - The company received net advances from its Chairperson and CEO, Zhilin Li, totaling **$1,425,123** as of December 31, 2021[368](index=368&type=chunk) [Item 14. Principal Accountant Fees and Services](index=76&type=section&id=Item%2014.%20Principal%20Accountant%20Fees%20and%20Services) For FY2021 and FY2020, the company incurred approximately **$100,000** in audit fees and **$5,400** in tax fees annually from its principal accountant, B F Borgers CPA PC, with all services pre-approved by the Audit Committee Accountant Fees (2021 & 2020) | Fee Category | 2021 | 2020 | | :--- | :--- | :--- | | Audit Fees | ~$100,000 | ~$100,000 | | Audit-Related Fees | $0 | $0 | | Tax Fees | $5,400 | $5,400 | | All Other Fees | $0 | $0 | Part IV [Item 15. Exhibits, Financial Statement Schedules.](index=77&type=section&id=Item%2015.%20Exhibits,%20Financial%20Statement%20Schedules.) This section lists the documents filed as part of the annual report, including China Pharma Holdings, Inc.'s financial statements and an index of exhibits such as articles of incorporation, bylaws, material contracts, and CEO/CFO certifications - This part includes the company's consolidated financial statements and a list of all exhibits filed with the 10-K report[376](index=376&type=chunk)[377](index=377&type=chunk)