TORONTO, – China Health Labs & Diagnostics Ltd. (“China Health” or the “Company”) (CHO: TSXV; CHLBF: OTCQX), is pleased to announce that it has secured a sales order of RMB 74.0 million ($11.6 million) for food safety products and its Type B BK Food Safety Rapid Test System (“BK-iRT”), which is a product developed by the Company and launched in March 2012 (see press release dated March 27, 2012), from the Beijing municipal government, through a bidding agent, Beijing Scientific and Innovation Technology Co., Ltd. The sales order is for delivery in 2012 and includes the BK-iRT product for RMB 44.9 million ($7.0 million) and other food safety test products for RMB 29.1 million ($4.6 million).

“We are pleased to win the bid with the Beijing municipal government to deliver our BK-iRT product and other food safety products, which will be used by Beijing’s food safety detection units in monitoring the thousands of food preparation and distribution nodes in Beijing,” said Wilson Yao, CEO and President of China Health. “Food safety in China continues to be a concern and the Chinese government is committed to significantly improve food safety by increasing its budgets for monitoring and enforcement of regulations. The Company is well positioned with its past success in delivering to the Chinese government effective solutions to address food safety concerns and also in developing new products to meet future demands”.

The BK-iRT is a compact and mobile food safety testing solution and can conduct approximately 100 rapid and accurate types of tests, including physicochemical, veterinary drug residues, biotoxin tests, heavy metal residues, prohibited additives, and food additives. The solution also includes an information management module equipped with a 3G telecommunication function to transmit and communicate data with a network of mobile and stationary labs, which allows data sharing, real-time monitoring and dynamic instructions. Other target markets for the BK-iRT include food distribution centres and facilities such as canteens for large organizations, hospitals and universities.

The expected revenue from this sales order could potentially represent growth of approximately 34% for the Company’s food safety business sector compared to the fiscal year 2011, when the Company had revenues of $9.0 million. Further, the Company’s gross margins in this sector is expected to increase for fiscal year 2012 as the BK-iRT is a proprietary product developed and manufactured in the Company’s Beijing facility, whereas sales in prior years consists of third party products which generate lower gross margins. To date, the Company’s food safety solution to the Beijing municipal government includes 337 enterprise level food safety labs, 17 regional labs and 17 mobile labs delivered and installed in Beijing. The Company is actively marketing to other large cities and municipalities in China in growing its food safety sector outside of Beijing.

About China Health Labs & Diagnostics Ltd.

China Health, operating in China as the Biochem Group, is a leading diagnostic lab solution provider for the public healthcare industry in China. The Company develops and sells Biochem Group branded and third-party medical diagnostic products and services to diagnostic facilities in China. Customers include large urban hospitals, rural hospitals, Chinese defense and rescue operations, the Beijing government and third-party distributors.

The Company intends to continue its growth by focusing its efforts on expanding its sales network in three areas where it provides proprietary solutions, has limited competition and which are supported by Chinese government policies and budgets: BK Clinlab total lab solutions for rural hospitals and clinics, POCT solutions for military and emergency rescue services, and food safety solutions for large cities in China. In 2011, China Health increased its revenues by 35% to $45.6 million, and increased its installed base of BK Clinlab total solution diagnostic labs (“BK Clinlabs”) from 210 at the start of 2011 to 899 rural hospitals to date. In addition, the Company grew revenues from its overall total lab solutions business by 99% from 2010, which increased gross margins to 44% in 2011 as compared to 39% in 2010.

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