UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

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

For the quarterly period ended June 30, 2011

[] 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: 000-53213

SINOCOM PHARMACEUTICAL, INC

 (Exact name of registrant as specified in its charter)

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 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.  [ X ] Yes   [ ] No

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted 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 and post such files).   Yes  [ ]    No [ ]

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and smaller reporting company” in Rule 12b-2 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   [ X ] No

As of June 30, 2011 the Issuer had 71,416,660 shares of common stock issued and outstanding.

PART I-FINANCIAL INFORMATION

ITEM 1.

FINANCIAL STATEMENTS

The consolidated financial statements of Sinocom Pharmaceutical, Inc. (the "Company" or the “Registrant"), a Nevada corporation, included herein were prepared, without audit, pursuant to rules and regulations of the Securities and Exchange Commission.  Because certain information and notes normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America were condensed or omitted pursuant to such rules and regulations, these financial statements should be read in conjunction with the Company’s audited consolidated financial statements for the fiscal years ended December 31, 2010 and 2009, and notes thereto, included in the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 2010, filed with the Securities and Exchange Commission on April 15, 2011.

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SINOCOM PHARMACEUTICAL, INC

CONSOLIDATED FINANCIAL STATEMENTS

PERIOD ENDED JUNE 30, 2011

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SINOCOM PHARMACEUTICAL, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

 (Unaudited)

Note 1 - ORGANIZATION

Sinocom Pharmaceutical, Inc. (“Sinocom” or “Company”) was formed on September 13, 2007 in the State of Nevada. The Company was originally incorporated as Tiger Acquisitions, Inc. and changed its name to Sinocom on February 26, 2009.  Through a share exchange, Rolling Rhine Holdings, Ltd (“Rolling Rhine”) and its wholly-owned subsidiaries, China Zhongxi Yao Group Ltd (“China Zhongxi Yao”) and Anqing Zhongxi Yao Ltd (“Anqing Zhongxi Yao”), became wholly-owned subsidiaries of the Company. Rolling Rhine was incorporated in December 2007, under the laws of the British Virgin Islands as a holding company for the purpose of owning 100% of China Zhongxi Yao.  China Zhongxi Yao was incorporated in July 2008 under the laws of Hong Kong for the purpose of owning 100% of the equity interest of Anqing Zhongxi Yao. Anqing Zhongxi Yao was incorporated in December 1997 under the laws of the People’s Republic of China (“PRC”). Anqing Zhongxi Yao was acquired by Full King International Group Limited (“Full King”) in December 2005.  In October 2008, Full King transferred its entire equity interest in Anqing Zhongxi Yao to China Zhongxi Yao, which was under the same common control.

Note 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of Presentation

The accompanying condensed consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States (“U.S. GAAP”) for interim financial information and with the instructions to Form 10-Q and Article 10 of SEC Regulation S-X. They do not include all of the information and footnotes required by U.S. GAAP for complete financial statements.

Therefore, these financial statements included should be read in conjunction with the Company’s consolidated financial statements and related notes in its 2010 Annual Report on Form 10-K filed on April 15, 2011.

The condensed consolidated financial statements included herein are unaudited; however, in the opinion of management, all adjustments, consisting of only those of a normal recurring nature, considered necessary for a fair presentation of the financial position and interim results of the Company as of and for the periods presented, have been included. Interim results are not necessarily indicative of the results to be expected for a full year.

The condensed consolidated financial statements include the accounts of the parent company and its subsidiaries. All significant intercompany accounts and transactions have been eliminated in consolidation.

The condensed consolidated financial statements prepared in accordance with US GAAP require us to make certain estimates, judgments and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. We believe that the estimates, judgments and assumptions are reasonable, based on information available at the time they are made. Actual results could differ materially from those estimates.

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Significant Accounting Policies

The significant accounting policies used in the preparation of the condensed consolidated financial statements are disclosed in note 2 of the Notes to the Consolidated Financial Statements within the Company's Form 10-K filed with the Securities and Exchange Commission on April 15, 2011. No additional significant accounting policies have been adopted during 2011.

Recent Accounting Pronouncements

In June 2011, the Financial Accounting Standards Board issued ASU No. 2011-05 Comprehensive Income (Topic 220) Presentation of Comprehensive Income. This pronouncement is an authoritative guidance on the presentation of comprehensive income that will require a company to present components of net income and other comprehensive income in one continuous statement or in two separate but consecutive statements. There are no changes to the components other are recognized in net income or other comprehensive income under current GAAP. This guidance is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2011, with early adoption permitted. It is applicable to the Company's year beginning January 1, 2012. The Company is currently evaluating this guidance, but does not expect its adoption will have a material effect on its consolidated financial statements.

Note 3 - SEGMENT REPORTING

The Company operates in one segment, which consists of distribution of pharmaceuticals, processed herbs, medical supplies and raw herbs.  The Company sells their products solely in the PRC, and all of its long-lived assets are physically located in the PRC.  

The following table sets forth a breakdown of our net sales by product categories for the periods.

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Note 4 – EARNINGS PER SHARE

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Note 5 - INVENTORIES

The inventories consisted of the following:

Note 6 - DEPOSIT FOR CONSTRUCTION

The Company entered into an agreement with a developer and paid a deposit for the construction of a distribution center.  The construction is expected to commence in the fourth quarter of 2011. According to the agreement, total construction price was RMB65 million (approximate to $9,845,039) and the construction in progress was expected to be completed within 16 months after beginning of construction. The Company intends to finance the construction using cash generated from its operations, and the net proceeds of the fund-raising.

Note 7 - DUE TO RELATED PARTY

On September 20, 2009, the Company and its CEO entered into a rental agreement for the use of the warehouse and office building owned by the CEO. Under the rental agreement, a subsidiary of the Company pays rental to the CEO at RMB 905,623 per year.

Note 8 – TOTAL COMPREHENSIVE INCOME

The Company’s functional currency is USD and its main operating subsidiary’s functional currency is Chinese Yuan (“RMB”). For financial reporting purposes, the consolidated financial statements of the Company have been translated into USD. All assets and liabilities are translated at the exchange rates at the balance sheet dates, stockholders’ equity were translated at the historical rates and statements of income and cash flow items were translated at the weighted average exchange rate for the year. Any translation adjustments are included in other comprehensive income, as a component of stockholders’ equity.

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ITEM 2.

 MANAGEMENT’S DISCUSSIONS AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS.

Cautionary Note Regarding Forward-Looking Statements

The discussion below contains “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act, and Section 21E of the

Exchange Act. We have used words such as “believes,” “intends,” “anticipates,” “expects” and similar expressions to identify forward-looking statements. These statements are based on information currently available to us and are subject to a number of risks and uncertainties that may cause our actual results of operations, financial condition, cash flows, performance, business prospects and opportunities and the timing of certain events to differ materially from those expressed in, or implied by, these statements. These risks, uncertainties and other factors include, without limitation, those matters discussed in Item 1A of Part I of our Annual Report on Form 107K for the year ended

December 31, 2010. Except as expressly required by the federal securities laws, we undertake no obligation to update such factors or to publicly announce the results of any of the forward-looking statements contained herein to reflect future events, developments, or changed circumstances, or for any other reason. The following discussion should be read in conjunction with our consolidated financial statements and notes thereto appearing in our Annual Report on Form 10-K and Item 1A,

“Risk Factors” for the year ended December 31, 2010.

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Results of Operations

Results of Operation for Sinocom Pharmaceutical, Inc., for the Three and Six Months Ended June 30, 2011 and 2010.

Net Sales

The following table sets forth a breakdown of our net sales by product categories for the periods indicated.

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Net sales increased by 32.1% to $25.6 million for the three months ended June 30, 2011 from $19.4 million for the three months ended June 30, 2010. The increase in net sales was primarily attributable to higher revenue from the distribution sales of pharmaceutical products. Net sales for the six months ended June 30, 2011 were $55.8 million, as compared to net sales of $44.3 million for the six months ended June 30.2010, an increase of about $11.5 million, or 26.1%.

Net sales from the distribution of pharmaceutical products increased by 34.0% to $25.5 million for the three months ended June 30, 2011 from $19.0 million for the three months ended June 30, 2010, primarily due to the increase in number of products distributed. There were 5,250 products distributed for the three months ended June 30, 2011, as compared to 4,819 products for the three months ended June 30, 2010. Net sales from the distribution of pharmaceutical products for the six months ended June 30, 2011 were $48.1 million, as compared to $36.4 million for the six months ended June 30.2010, an increase of about $11.7 million, or 32.0%.  The increase was primarily due to the increase in the number of customers and number of products distributed. For the six months ended June 30, 2011, there were 4,315 customers versus 3,991 customers for the six months ended June 30, 2010. There were 5,878 products distributed for the six months ended June 30, 2011, as compared to 5,333 products for the three months ended June 30, 2010.

Net sales from TCM raw herb plantation management decreased by 73.2% to $0.09 million for the three months ended June 30, 2011 from $0.34 million for the three months ended June 30, 2010. The decrease was because we only harvested figwort roots while the other herbs such as fuling, tianma, gegen and etc. are only due for harvest from September onwards. Net sales for the six months ended June 30, 2011 were $7.7 million, as compared to $7.8 million for the six months ended June 30, 2010, a decrease of $0.1 million, or 1.7%. The sales for the six months ended June 2011 were primarily from 2010 harvest; the harvest for 2011 is not due till September 2011.

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Cost of Sales

Cost of sales increased by 32.6% to $19.1 million for the three months ended June 30, 2011 from $14.4 million for the three months ended June 30, 2010. The increase was primarily due to the increase in net sales driven by increase in volume of products sold. Cost of sales for the six months ended June 30, 2011 was $39.5 million, as compared to $30.6 million for the six months ended June 30, 2010, an increase of $8.9 million, or 29.1%.  

Gross Profit and Gross Profit Margin

The following table sets forth the breakdown of our gross profits and gross profit margins by product categories for the periods indicated.

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Overall gross profit for the three months ended June 30, 2011 was $6.4 million, which represents an increase of 30.6%, from $4.9 million for the three months ended June 30, 2010. The increase in gross profit was primarily attributable to an increase in net sales of Western pharmaceuticals, TCM pharmaceuticals and TCM processed herbs. Overall gross profit margin was 25.1% and 25.4% for the three months ended June 30, 2011 and 2010, respectively.

Gross profit for the distribution of pharmaceutical products increased by 33.6% to $6.4 million for the three months ended June 30, 2011 from $4.8 million for the three months ended June 30, 2010, primarily due to higher sales volume. The gross profit margin of the distribution of pharmaceutical products was 25.2% and 25.1% for the three months ended June 30, 2011 and 2010, respectively.

Gross profit for TCM raw herb plantation management decreased by 68.6% to $0.04 million for the three months ended June 30, 2011 from $0.14 million for the three months ended June 30, 2010, primarily due to lower sales volume because crop rotation effect. The gross profit margin of the TCM raw herbs was 49.8% and 42.6% for the three months ended June 30, 2011 and 2010, respectively.

Overall gross profit for the six months ended June 30, 2011 was $16.3 million, which represents an increase of 19.1%, from $13.7 million for the six months ended June 30, 2010. Overall gross profit margin was 29.2% and 30.8% for the six months ended June 30, 2011 and 2010, respectively.

Gross profit for the distribution of pharmaceutical products increased by 35.5% to $12.2 million for the six months ended June 30, 2011 from $9.0 million for the six months ended June 30, 2010, primarily due

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to higher sales volume. The gross profit margin of the distribution of pharmaceutical products was 25.4% and 24.8% for the six months ended June 30, 2011 and 2010, respectively.

Gross profit for TCM raw herb plantation management decreased by 12.8% to $4.0 million for the six months ended June 30, 2011 from $4.6 million for the six months ended June 30, 2010. The gross profit margin of the TCM raw herbs was 52.4% and 59.0% for the six months ended June 30, 2011 and 2010, respectively

Selling Expenses

Selling expenses were $937,121 for the three months ended June 30, 2011, as compared to $871,373 for the three months ended June 30, 2010. The increase of 7.5% was primarily attributable to the increase in the rates and the amounts of sales commission a result of increase in net sales. Selling expenses were $1.8 million and $1.6 million for the six months ended June 30, 2011 and 2010, respectively. The increase of 10.5% was primarily attributable to the increase in the rates and the amounts of sales commission a result of increase in net sales.

General and Administrative Expenses

General and administrative expenses were $427,822 for the three months ended June 30, 2011, as compared to $310,852 for the three months ended June 30, 2010. The increase of 37.6% was mainly due to an increase in sales incentive and salaries. General and administrative expenses were $838,826 and

$699,103 for the six months ended June 30, 2011 and 2010, respectively. The increase of 20.0% was mainly due to an increase in sales incentive and salaries.

Income from Operations

As a result of the foregoing, income from operations increased by 35.4% to $5.1 million for the three months ended June 30, 2011 from $3.7 million for the three months ended June 30, 2010. Income from operations increased by 20.4% to $13.6 million for the six months ended June 30, 2011 from $11.3 million for the six months ended June 30, 2010.

Total Other Income (expense)

Total other income was $32,695 and $25,625 for the three months ended June 30, 2011 and 2010, respectively. Total other income for the six months ended June 30, 2011 was $142,220, as compared to $100,858 for the six months ended June 30, 2010.  

Provision for Income Taxes

Provision for income taxes increased by 34.1% to $1.3 million for the three months ended June 30, 2011 from $1 million for the three months ended June 30, 2010, mainly due to the increase in net sales. Provision for income taxes was $3.5 million for the six months ended June 30, 2011, as compared to $3.0 million for the six months ended June 30, 2010. The increase of  14.7% was mainly due to the increase in net sales.

Net Income

As a result of the foregoing, net income increased by 35.8% to $3.8 million for the three months ended June 30, 2011 from $2.8 million for the three months ended June 30, 2010. Net income increased by 22.7% for the six months ended June 30, 2011 was $10.3 million, as compared to $8.4 million for the six months ended June 30, 2010.  

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Dividend on Series A Preferred Stock

Pursuant to the Purchase Agreement, holders of Series A preferred stock are entitled to receive cash dividends, which accrued at the rate of 5% per annum for the 12 month period following the issue date, December 3, 2009, and accrue at the rate of 10% per annum for each 12 month period thereafter.  The dividend was $373,973 and $186,986 for the three months ended June 30, 2011 and 2010 respectively and was $743,836 and $371,918 for the six months ended June 30, 2011 and 2010, respectively.  

Net Income Available to Common Stockholders

As a result of the foregoing, net income available to common stockholders increased by 31.2% to $3.4 million for the three months ended June 30, 2011 from $2.6 million for the three months ended June 30, 2010. Net income available to common stockholders increased by 19.1% for the six months ended June 30, 2011 was $9.5 million, as compared to $8.0 million for the six months ended June 30, 2010.

Liquidity and Capital Resources

The following table sets forth a summary of our net cash flow information for the periods indicated:

For the six months ended June 30, 2011, we financed our operations and capital investments mainly through our cash flows from operations. As of June 30, 2011, we had $37.7 million in cash and cash equivalents. Our cash and cash equivalents include cash in hand and cash in time deposits and certificates of deposit with original maturities within three months.

We may need additional cash resources in the future if we find and wish to pursue other opportunities for investment, acquisition, strategic cooperation and similar actions.

Operating Activities

Net cash provided by operating activities was $12.0 million for the six months ended June 30, 2011, which was derived from a net income of $10.3 million adjusted to reflect a net increase relating to non-cash items and a net increase relating to changes in the balances of operating assets and liabilities. The adjustments relating to non-cash items and changes in the balances of operating assets and liabilities, a net of $1.8 million, primarily comprised of a $3.0 million decrease in accounts receivable, a $0.4 million increase in inventories, a $0.4 million increase in trade deposits, a $1.9 million increase in accounts payable, a $0.7 million increase in accrued expenses and payable and a $1.9 million decrease in income taxes payable.

Net cash provided by operating activities was negative $0.8 million for the six months ended June 30, 2010, which was derived from a net income of $8.4 million adjusted to reflect a net increase relating to non-cash items and a net decrease relating to changes in the balances of operating assets and liabilities. The adjustments relating to non-cash items and changes in the balances of operating assets and liabilities,

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a net of $9.0 million, primarily comprised of a $4.9 million decrease in accounts receivable primarily due to good collection from customers, a $4.8 million increase in trade deposits, a $7.8 million decrease in accounts payable mainly due to earlier payment to distribution suppliers made in order to secure better terms, and a $1.2 million decrease in income taxes payable.

Investing Activities

Net cash used by investing activities was $2,422 and $8.7 million for the six months ended June 30, 2011 and 2010, respectively. The $8.7 million for the six months ended June 30, 2010, was primarily attributable to $2.7 million lease prepayments in connection with our TCM raw herb supplies, $3.0 million paid in connection with the acquisition of land use rights for our new warehouse facilities and $2.9 million construction deposits in connection with our new warehouse facilities.

Financing Activities

Net cash used in financing activities was $369,863 for the six months ended June 30, 2011 as compared to net cash used by financing activities of $563,089 for the six months ended June, 2010. The net cash of $563,089 used in financing activities for the six months ended June 30, 2010 was attributable to (i) the issuance costs of Series A preferred stock of $378,157 and (ii) dividends of $184,932 paid to holders of preferred stock.   

Capital Expenditures

For the six months ended June 30, 2011 and 2010, our capital expenditures totaled $2,422 and $6.0 million respectively. Our capital expenditure for the six months ended June 30, 2011 was primarily attributable to the purchase of property and equipment. Our capital expenditures for the six months ended June 30, 2010 were primarily attributable to the purchase of property and equipment.  

Off-balance Sheet Arrangements

We did not have any off-balance sheet arrangements as defined in Item 303(a)(4) of Regulation S-K.

Recent Accounting Pronouncements

In June 2011, the Financial Accounting Standards Board issued ASU No. 2011-05 Comprehensive Income (Topic 220) Presentation of Comprehensive Income. This pronouncement is an authoritative guidance on the presentation of comprehensive income that will require a company to present components of net income and other comprehensive income in one continuous statement or in two separate but consecutive statements. There are no changes to the components other are recognized in net income or other comprehensive income under current GAAP. This guidance is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2011, with early adoption permitted. It is applicable to the Company's year beginning January 1, 2012. The Company is currently evaluating this guidance, but does not expect its adoption will have a material effect on its consolidated financial statements.

ITEM 3.

QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.

There were no material changes in the Company’s market risk components since December 31, 2010. For a discussion of our market risk, see “Item 7A. Quantitative and Qualitative Disclosures About Market Risk” in our 2010 Annual Report on Form 10-K.

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ITEM 4.

CONTROLS AND PROCEDURES.

Disclosure Controls and Procedures

The Securities and Exchange Commission defines the term “disclosure controls and procedures” to mean the   controls and other procedures of an issuer that are designed to ensure that information required to be disclosed in the reports that it files or submits under the Securities Exchange Act of 1934 is recorded, processed, summarized and reported, within the time periods specified in the Securities and Exchange Commission’s rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed by an issuer in the reports that it files or submits under the Securities Exchange Act of 1934 is accumulated and communicated to the issuer’s management, including its principal executive and principal financial officers, or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure.  The Company maintains such a system of controls and procedures in an effort to ensure that all information which it is required to disclose in the reports it files under the Securities Exchange Act of 1934 is recorded, processed, summarized and reported within the time periods specified under the SEC's rules and forms and that information required to be disclosed is accumulated and communicated to principal executive and principal financial officers to allow timely decisions regarding disclosure.

We evaluated the effectiveness of the design and operation of our disclosure controls and procedures, which were designed to provide reasonable assurance of achieving their objectives, as of June 30,

2011, as required by Rule 13a-15 of the Exchange Act. This evaluation was carried out under the supervision and with the participation of our management, including our principal executive officer and principal financial officer. Based on this evaluation, our principal executive officer and principal financial officer have concluded that, as of June 30, 2011, our disclosure controls and procedures were effective at the reasonable assurance level to ensure (1) that information required to be disclosed by us in the reports we file or submit under the Exchange Act is recorded, processed, summarized and reported, within the time periods specified in the SEC’s rules and forms, and (2) information required to be disclosed by us in our reports that we file or submit under the Exchange Act is accumulated and communicated to our management , including our principal executive officer and principal financial officer, or persons performing similar functions , as appropriate to allow timely decisions regarding required disclosure."

Changes in Internal Control over Financial Reporting

There was no change in the Company's internal control over financial reporting during the period ended June 30, 2011, that has materially affected, or is reasonably likely to materially affect, the Company's internal control over financial reporting.

We evaluated the effectiveness of the design and operation of our disclosure controls and procedures, which were designed to provide reasonable assurance of achieving their objectives, as of June 30,

2011, as required by Rule 13a-15 of the Exchange Act. This evaluation was carried out under the supervision and with the participation of our management, including our principal executive officer and principal financial officer. Based on this evaluation, our principal executive officer and principal financial officer have concluded that, as of June 30, 2011, our disclosure controls and procedures were effective at the reasonable assurance level to ensure (1) that information required to be disclosed by us in the reports we file or submit under the Exchange Act is recorded, processed, summarized and reported, within the time periods specified in the SEC’s rules and forms, and (2) information required to be disclosed by us in our reports that we file or submit under the Exchange Act is accumulated and communicated to our management , including our principal executive officer and principal financial officer, or persons performing similar functions , as appropriate to allow timely decisions regarding required disclosure."

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PART II-OTHER INFORMATION

ITEM 1.

LEGAL PROCEEDINGS.

The Company is not a party to any pending legal proceedings, and no such proceedings are known to be contemplated. No director, officer or affiliate of the Company, and no owner of record or beneficial owner of more than 5.0% of the securities of the Company, or any associate of any such director, officer or security holder is a party adverse to the Company or has a material interest adverse to the Company in reference to pending litigation.

ITEM 1A. RISK FACTORS.

The Company is updating the risk factors set forth under Part I, Item 1A, “Risk Factors” of its Annual Report on Form 10-K for the year ended December 31, 2010, by adding the following risk factor related to dividend payments made by its PRC subsidiary in 2007 and 2008.

Dividend payments made by our PRC subsidiary in 2007 and 2008 may not have complied with SAFE regulations and might subject us to liability and penalties that could materially and adversely affect our results of operation and financial condition.

Under SAFE regulations, dividend distributions to an offshore shareholder cannot be made to an onshore entity or any domestic resident, unless the relevant SAFE permit has been obtained. In 2007 and 2008, without a SAFE permit, our PRC subsidiary distributed to its then shareholder Full King, a British Virgin Islands company, dividends in the amount of RMB5 million and RMB336 million ($0.7 million and $47.6 million as recorded in our financial statements using the U.S. dollar as reporting currency), respectively, by paying three domestic individuals and an onshore entity that received such dividends on its behalf. Failure to comply with these SAFE regulations may result in liability and penalties to us, including, among others, for evasion of applicable PRC foreign exchange restrictions. We cannot assure you that the penalties would not be a substantial amount or that they would not have a material and adverse effect on our business, financial condition or results of operations.

ITEM 2.

UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS.

None

ITEM 3.

DEFAULTS UPON SENIOR SECURITIES.

None

ITEM 4.

(REMOVED AND RESERVED)

ITEM 5.    

OTHER INFORMATION.

None

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ITEM 6.

EXHIBITS.

(a)

The following exhibits are filed herewith:

31.1

Certifications pursuant to Rule 13a-14(a) or 15d-14(a) under the Securities Exchange Act of 1934, as amended, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.*

31.2

Certifications pursuant to Rule 13a-14(a) or 15d-14(a) under the Securities Exchange Act of 1934, as amended, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.*

32.1

Certifications pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.*

32.2

Certifications pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.*

* filed herewith

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

SINOCOM PHARMACEUTICAL, INC.

By:  

XueXiang Ai, Chief Executive Officer

Date:  Aug 15, 2011

By:     Tuck Wing Pang, Chief Financial Officer

Date:  Aug 15, 2011

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