Does anyone know how the auditors KPMG and PwC came out unscathed in this? They both resigned, but the court ordered KPMG to release documents. That was the last I heard.

China Medical revoked:

http://www.sec.gov/litigation/admin/2012/34-68198.pdf

China Medical: SEC Litigation:

http://www.sec.gov/litigation/admin/2012/34-68040.pdf

TOTAL LIQUIDATION - WORTHLESS

NOTICE OF ISSUE OF SHARES AND DETERMINATION OF INSOLVENCY
The Joint Official Liquidators (the JOLs) of China Medical Technologies, Inc (in official liquidation) (the Company) refer to their previous announcements dated 3 and 15 August 2012.
On 29 August 2012, on an application by certain holders of 6.25% convertible senior notes issued by the Company (the Applicant Noteholders) the Grand Court of the Cayman Islands (the Court) ordered that the JOLs be authorised and directed to exercise their powers to cause the Company to comply with its obligations pursuant to the 6.25% Indenture, to do all things in their power to cause the Company to convert to American Depository Shares Receipts (ADS) such parts of the Applicant Noteholders' 6.25% notes as they have requested or request be so converted (including by causing the issuance of new ordinary shares by the Company). It is therefore anticipated that the JOLs will shortly be causing the Company to convert such notes to ADSs and to issue new shares in the Company which are referable to such ADSs (the New Share Issuance).
The Court also directed that the JOLs, through this announcement, give notice that they have summarily determined that the Company isinsolvent. The JOLs may change their determination in this respect in light of relevant circumstances and / or their assessment of the Companys financial position. However, their current view is that the Company is insolvent and that there will not therefore be any surplus assets in the liquidation estate available for distribution to shareholders in the Company, including for the avoidance of doubt any holders of shares issued in connection with the New Share Issuance.


Kenneth Krys
Joint Official Liquidator
China Medical Technologies Inc. (in official liquidation)
29 August 2012

Don't think it matters, company is another Chinese fraud like sino forest etc.

China Medical files Bankruptcy. (*** I don't know which Chapter)

http://www.otcbb.com/asp/dailylist_detail.asp?d=08/30/2012&mkt_ctg=OTCBB

Amazes me the ihub still lets the you talk here,didnt you know that it's during the summer holiday,the most stocks are having vocations,relax,bro.........

Looks like Bronte Capital was right about comedy just didn't factor in a short squeeze. Amazes me the sec still lets the stock trade.

dump CMEDY buy $ZSTN


same peeps.. big run coming

Given the allegations in the CMEDY suspension order, I think you're right. It sounds like there will be additional investigation and possible litigation.

Nice call on CMEDY....

Forget the last 2 days what about the last month?

Having a suspicious mind it looks to me to that a few China Medical insiders knew, or strongly suspected the stock could be suspended and colluded to run the stock from $8.49 to $12.00 two days ago to cash out before the SEC guillotine occured today.

Hmmmmmmmmmmmmmmmmm.

Betcha the SEC will want to know who ran the stock and who cashed out.

CMEDY SEC Suspension:

http://www.sec.gov/litigation/suspensions/2012/34-67311.pdf

SECURITIES EXCHANGE ACT OF 1934 Release No. 67311/June 29, 2012

The Securities and Exchange Commission (“Commission”) announced the temporary suspension, pursuant to Section 12(k) of the Securities Exchange Act of 1934 (the “Exchange Act”), of trading in the securities of China Medical Technologies, Inc. (“China Medical”), of the People’s Republic of China, at 9:30 a.m. on June 29, 2012, and terminating at 11:59 p.m. on July 13, 2012.

The Commission temporarily suspended trading in the securities of China Medical because of questions that have been raised about the accuracy and adequacy of publicly disseminated information concerning, among other things, the status of the company’s officers and directors, the accuracy of the company’s financial statements and filings with the Commission, and the current financial condition of the company.

The Commission cautions brokers, dealers, shareholders, and prospective purchasers that they should carefully consider the foregoing information along with all other currently available information and any information subsequently issued by the company.

Further, brokers and dealers should be alert to the fact that, pursuant to Rule 15c2-11 under the Exchange Act, at the termination of the trading suspension, no quotation may be entered unless and until they have strictly complied with all of the provisions of the rule. If any broker or dealer has any questions as to whether or not he has complied with the rule, he should not enter any quotation but immediately contact the staff in the Division of Trading and Markets, Office of Interpretation and Guidance, at (202) 551-5777. If any broker or dealer is uncertain as to what is required by Rule 15c2-11, he should refrain from entering quotations relating to China Medical securities until such time as he has familiarized himself with the rule and is certain that all of its provisions have been met. If any broker or dealer enters any quotation which is in violation of the rule, the Commission will consider the need for prompt enforcement action.

If any broker, dealer or other person has any information which may relate to this matter, he should contact Michael S. Dicke or Tracy L. Davis of the San Francisco Regional Office of the Securities and Exchange Commission at (415) 705-2500.

Since I posted the link the stock has gone from about 2 to 8. I assume the author covered their short.

http://brontecapital.blogspot.com/

This is well worth a read if you are long cmedy.

CMEDY = POS

In December, I wrote two articles on China Medical (CMEDY.PK). I pointed out some factual errors in a report that Glaucus Research issued. Additionally, I commented on the debt restructuring that management accounced. Since then, shareholders have experienced a roller coaster ride.

In mid-January, Standard & Poors credit research downgraded the company's credit rating as it was their understanding that the company missed a coupon payment on its 2016 convertible debt. Speculation of this, and the subsequent news, sent shares reeling from nearly $3.71 on January 18 to $1.82 on February 6. Shares of the company's stock were halted the next day on lack of communication from management to the NASDAQ. Before shares opened for trading again, S&P dropped its rating on the company due to lack of available information. After opening at $0.62 on the Pink Sheets on February 28, the stock, having traded nearly 14.5 million shares since, is up to over $3 per share, 70% higher than where it was halted.

Now that shares are back to where they opened the year, it is time for investors to reevaluate their stake in shares of China Medical. The most clear signal that investors need to be skeptical is that the company has not put out an official (or unofficial) communication since December of last year, despite efforts by the NASDAQ and ratings agencies to do so, not to mention what i'm sure amounted to countless communications from shareholders. This act alone constitutes a breach of management's fiduciary duty. Even if one day management comes out of the woodwork to explain themselves, the company, the board and management will face significant back lash and lawsuits over what has occured over the past three months.

Maybe the most miraculous part of this story is that despite the company's radio silence, shares, as of today, are over $3. It's difficult to understand who is buying shares in China Medical right now and what their rationale is. Some investors have speculated that the convertible bond holders converting into shares is a good thing, as it takes the liability off the company's balance sheet. If investors believe the company's most recent balance sheet, which states it has $200 million in cash, that would make for an interesting floor for the stock.

A best case scenario is that management goes public in the not so distant future and says that the radio silence was an effort for management and its affiliates to buy the majority of the shares at a discounted price, however, as I mentioned before, this would breed all types of lawsuits. With that being the case, we have sold out of the majority of our position. It's impossible to justify holding a company that does not communicate with its shareholders in any significance in a portfolio.

Alternatively, if the company's financial records were accurate, there could be significant upside in shares. By holding on to a limited number of shares, shareholders still benefit on the upside and considerably hedge their risk on the downside.

Disclosure: I am long CMEDY.PK.

http://seekingalpha.com/article/464601-china-medical-is-a-mystery-that-most-investors-can-t-explain?source=yahoo

jus checkin the 10 bagger -WOW ! Glad I got out !!!!!!!!!!!!!!!

-bunny-

What's the big news for the rise today?

This one was also on Buy-ins.. Though they will alert anyone to anything, as long as it's naked I think.

~ $CMEDY ~ Possibly going long scan results (Daily and Weekly) for for the week of March 1st 2012 - Daily and Weekly views.

Chart results for you to ponder with me.. These are technical scans only, Click next or previous at the top of the page to see my others. Twitter: @MACDgyver ---> CMEDY <---
Keyword: MACDscan ----> http://tinyurl.com/MACDscan

$CMED ~ Buy-ins ~ Naked Short List! In Charts and links! for Feb. 14th 2012 - Daily and Weekly views.







Chart results for you to ponder with me.. Certain charts may be reposted while on the Buy-ins website, Click next or previous at the top of the page to see my others.







~ Barchart: http://barchart.com/quotes/stocks/CMED?
~ OTC Markets: http://www.otcmarkets.com/stock/CMED/company-info
~ Google Finance: http://www.google.com/finance?q=CMED
~ Google Fin Options: hhttp://www.google.com/finance/option_chain?q=CMED#
~ Yahoo! Finance ~ Stats: http://finance.yahoo.com/q/ks?s=CMED+Key+Statistics
~ Yahoo! Finance ~ Profile: http://finance.yahoo.com/q/pr?s=CMED
Finviz: http://finviz.com/quote.ashx?t=CMED
~ BusyStock: http://busystock.com/i.php?s=CMED&v=2
~ CandlestickChart: http://www.candlestickchart.com/cgi/chart.cgi?symbol=CMED&exchange=US
~ Investorshub Trades: http://ih.advfn.com/p.php?pid=trades&symbol=CMED
~ Investorshub Board Search: http://investorshub.advfn.com/boards/getboards.aspx?searchstr=CMED
~ Investorshub PostStream Search: http://investorshub.advfn.com/boards/poststream.aspx?ticker=CMED
~ Investorshub Goodies Search: http://investorshub.advfn.com/boards/msgsearchbyboard.aspx?boardID=18582&srchyr=2011&SearchStr=CMED
~ Investorshub Message Search: http://investorshub.advfn.com/boards/msgsearch.aspx?SearchStr=CMED
~ MarketWatch: http://www.marketwatch.com/investing/stock/CMED/profile
~ E-Zone Chart: http://www.windchart.com/ezone/signals/?symbol=CMED
~ 5-Min Wind: http://www.windchart.com/stockta/analysis?symbol=CMED
~ 10-Min Wind: http://www.windchart.com/stockta/analysis?symbol=CMED&size=l&frequency=10&color=g
~ 30-Min Wind: http://www.windchart.com/stockta/analysis?symbol=CMED&size=l&frequency=30&color=g
~ 60-Min Wind: http://www.windchart.com/stockta/analysis?symbol=CMED&size=l&frequency=60&color=g


Volume, MACD, ADX 3 EMA Par sar - http://bigcharts.marketwatch.com/advchart/frames/frames.asp?show=True&insttype=Stock&symb=CMED&time=8&startdate=1%2F4%2F1999&enddate=11%2F21%2F2011&freq=2&compidx=aaaaa%3A0&comptemptext=&comp=none&ma=6&maval=9&uf=16&lf=1&lf2=4&lf3=1024&type=4&style=380&size=2&timeFrameToggle=false&compareToToggle=false&indicatorsToggle=false&chartStyleToggle=false&state=11&x=25&y=5
RSI, Money Flow, Volume Accumulation, 3sma, Bollinger bands - http://bigcharts.marketwatch.com/advchart/frames/frames.asp?show=True&insttype=Stock&symb=CMED&time=8&startdate=1%2F4%2F1999&enddate=11%2F21%2F2011&freq=2&compidx=aaaaa%3A0&comptemptext=&comp=none&ma=4&maval=9&uf=8&lf=2&lf2=512&lf3=4096&type=4&style=380&size=2&timeFrameToggle=false&compareToToggle=false&indicatorsToggle=false&chartStyleToggle=false&state=11&x=36&y=14
Price Channel, Momentum, Volatility Slow, P/E Ratio - http://bigcharts.marketwatch.com/advchart/frames/frames.asp?show=True&insttype=Stock&symb=CMED&time=8&startdate=1%2F4%2F1999&enddate=11%2F21%2F2011&freq=2&compidx=aaaaa%3A0&comptemptext=&comp=none&ma=6&maval=9&uf=128&lf=65536&lf2=16384&lf3=16777216&type=4&style=380&size=2&timeFrameToggle=false&compareToToggle=false&indicatorsToggle=false&chartStyleToggle=false&state=11&x=28&y=15



Volume, MACD, ADX 3 EMA Par sar - http://bigcharts.marketwatch.com/advchart/frames/frames.asp?show=True&insttype=Stock&symb=CMED&time=6&startdate=1%2F4%2F1999&enddate=11%2F21%2F2011&freq=1&compidx=aaaaa%3A0&comptemptext=&comp=none&ma=6&maval=9&uf=16&lf=1&lf2=4&lf3=1024&type=4&style=380&size=2&timeFrameToggle=false&compareToToggle=false&indicatorsToggle=false&chartStyleToggle=false&state=11&x=39&y=17
RSI, Money Flow, Volume Accumulation, 3sma, Bollinger bands - http://bigcharts.marketwatch.com/advchart/frames/frames.asp?show=True&insttype=Stock&symb=CMED&time=6&startdate=1%2F4%2F1999&enddate=11%2F21%2F2011&freq=1&compidx=aaaaa%3A0&comptemptext=&comp=none&ma=4&maval=9&uf=8&lf=2&lf2=512&lf3=4096&type=4&style=380&size=2&timeFrameToggle=false&compareToToggle=false&indicatorsToggle=false&chartStyleToggle=false&state=11&x=35&y=12
Price Channel, Momentum, Volatility Slow, P/E Ratio - http://bigcharts.marketwatch.com/advchart/frames/frames.asp?show=True&insttype=Stock&symb=CMED&time=6&startdate=1%2F4%2F1999&enddate=11%2F21%2F2011&freq=1&compidx=aaaaa%3A0&comptemptext=&comp=none&ma=6&maval=9&uf=128&lf=65536&lf2=16384&lf3=16777216&type=4&style=380&size=2&timeFrameToggle=false&compareToToggle=false&indicatorsToggle=false&chartStyleToggle=false&state=11&x=23&y=19




Twitter: @MACDgyver ---> CMED <---

T12 Halt - Additional Information Requested by NASDAQ
Trading is halted pending receipt of additional information requested by NASDAQ.

02/07/2012 09:18:57 CMED China Medical Technologies Inc NASDAQ T12

http://www.nasdaqtrader.com/Trader.aspx?id=Tradehalts

~ Monday! $CMED ~ Earnings posted, pending or coming soon! In Charts and Links Below!

~ $CMED ~ Earnings expected on Monday *
Want more like this? Search Keyword: MACMONEY >>> http://tinyurl.com/MACMONEY <<<
One or more of many earnings sites has alerted this security has or will be posting earnings on or around the day of this message.








http://stockcharts.com/h-sc/ui?s=CMED&p=D&b=3&g=0&id=p88783918276&a=237480049




http://stockcharts.com/h-sc/ui?s=CMED&p=W&b=3&g=0&id=p54550695994



~ Google Finance: http://www.google.com/finance?q=CMED
~ Google Fin Options: hhttp://www.google.com/finance/option_chain?q=CMED#
~ Yahoo! Finance ~ Stats: http://finance.yahoo.com/q/ks?s=CMED+Key+Statistics
~ Yahoo! Finance ~ Profile: http://finance.yahoo.com/q/pr?s=CMED
Finviz: http://finviz.com/quote.ashx?t=CMED
~ BusyStock: http://busystock.com/i.php?s=CMED&v=2


<<<<<< http://www.earningswhispers.com/stocks.asp?symbol=CMED >>>>>>



http://investorshub.advfn.com/boards/post_prvt.aspx?user=251916

*If the earnings date is in error please ignore error. I do my best.

Faruqi & Faruqi, LLP Files Securities Class Action Suit Against China Medical Technologies, Inc. and Certain of Its Executives
BY PR Newswire
— 8:00 PM ET 02/03/2012

NEW YORK, Feb. 3, 2012 /PRNewswire/ -- Faruqi & Faruqi, LLP today announced that it has filed a securities class action lawsuit against China Medical Technologies, Inc. (CMED
Loading... Loading...
) and certain of its senior executives. The action (No. 12-CIV-0882), filed in the United States District Court for the Southern District of New York, asserts claims under the Securities Exchange Act of 1934 ("Exchange Act") on behalf of all persons who purchased or otherwise acquired CMED's American Depositary Shares ("ADS") during the expanded period between February 7, 2007 and December 12, 2011, inclusive (the "Class Period").

(Logo: http://photos.prnewswire.com/prnh/20120119/MM38856LOGO )

A copy of the complaint can be viewed on the firm's website at www.faruqilaw.com/CMED.

China Medical and certain of its senior executives are charged with issuing a series of materially false and misleading statements in violation of Section 10(b) and 20(a) of the Exchange Act and Rule 10b-5 promulgated thereunder. Specifically, defendants misstated and failed to disclose that the Company engaged in suspicious and improper related-party transactions and misstated its receivables in order to artificially inflate sales and net income. As a result of defendants' false and misleading statements and material omissions, China Medical ADS traded at artificially inflated prices during the Class Period, reaching a high of $57.50 per share on February 28, 2008.

On December 6, 2011, the Glaucus Research Group published a report that revealed that China Medical's Chief Executive Officer engaged in a related party transaction with the Company pursuant to which the Company improperly funneled approximately $20 million to the Company's Chief Executive Officer. The report also concluded that the Company's profits, revenue and net income were severely inflated. On this news, China Medical's shares declined nearly 24% on unusually high trading volume. Moreover, on December 13, 2011, China Medical further disclosed that the Company intended to restructure its debt to improve its balance sheets. This news caused China Medical's shares to decline an additional 13% to close at $2.87 per share, on unusually high trading volume.

The true facts, which were known by the defendants but concealed from the investing public during the Class Period, were as follows: (1) several China Medical acquisitions during the Class Period were the result of suspicious and/or improper related party transactions with third-party sellers connected to the Company; (2) the Company significantly overpaid for at least one acquisition to the detriment of Company shareholders and to the benefit of China Medical's Chairman of the Board and Chief Executive Officer, defendant Xiaodong Wu; (3) the Company overstated accounts receivable in order to inflate reported sales, profit margins and net income; and (4) as a result of the foregoing, the Company's financial performance, expected earnings and business prospects were false and misleading and lacked a reasonable basis when made. As a result, the Complaint alleges that China Medical violated provisions of the Exchange Act during the Class Period by issuing false and misleading press releases, financial statements, filings with the Securities and Exchange Commission and statements during investor conference calls.

Plaintiff now seeks to recover damages on behalf of himself and all other investors who purchased or acquired China Medical ADS during the Class Period, excluding defendants and their affiliates. Plaintiff is represented by Faruqi & Faruqi, LLP, a national securities law firm with extensive experience in prosecuting class actions involving corporate fraud.

If you wish to serve as lead plaintiff for the proposed class in this action, you must file a motion with the Court no later than February 17, 2012.

If you purchased China Medical ADS during the Class Period and wish to obtain information concerning joining this action, you can do so under the "Join Lawsuit" section of our website or by clicking: http://www.faruqilaw.com/CMED. If you wish to discuss this action or have any questions concerning this notice or your rights or interests, you can also contact us by calling Richard Gonnello or Francis McConville toll free at 877-247-4292 or at 212-983-9330 or by sending an e-mail to rgonnello@faruqilaw.com or fmcconville@faruqilaw.com.

Contact:
FARUQI & FARUQI, LLP
369 Lexington Avenue, 10th Floor
New York, NY 10017
Attn: Richard Gonnello, Esq.
rgonnello@faruqilaw.com
Francis McConville, Esq.
fmcconville@faruqilaw.com
Telephone: (877) 247-4292 or (212) 983-9330

SOURCE Faruqi & Faruqi

What is happening???

Oh no!!!

Nice post!Excellent article.I just bought in again because there have been a number of articles about CMED being undervalued and after a closer look I totally agree.This stock should be trading at at least twice what it is now but people are fearful.As Buffett says when people are fearful be greedy, so I'm being very greedy.Here's another good article.CMED is mentioned in the section called "Business section:Investing ideas". http://community.nasdaq.com/news/2012-01/volatility-clouds-2012-predictions.aspx?storyid=114432&source=TheMotleyFool[url][/url][tag]insert-text-here[/tag]

Paul Nouri Positions For 2012: Gauging Healthcare's Upside Potential

http://seekingalpha.com/article/316297-paul-nouri-positions-for-2012-gauging-healthcare-s-upside-potential?source=yahoo

CMED $2.70 INTRA-DAY'S LOW on news: China Medical Tech intends to implement debt restructuring (CMED) 3.30 : Co announced it intends to implement a debt restructuring plan to improve its balance sheet. The plan may include, without limitation, a debt-for-debt exchange with existing holders of the Company's convertible notes maturing in August 2013 and December 2016, which may potentially involve holders receiving new debts with different interest rates, maturities and principal amounts compared to the existing debts or other alternatives to be agreed.

Hey y'all! Just bought some shares. Excited to see where the Chinese healthcare sector goes. Happy investing!

picked some up this morning, hope this will work out....GL

CMED answer:

http://phx.corporate-ir.net/phoenix.zhtml?c=192852&p=irol-newsArticle&ID=1636981&highlight=

BEIJING, Dec. 6, 2011 /PRNewswire-Asia-FirstCall/ -- China Medical Technologies, Inc. (the "Company") (Nasdaq: CMED), a leading China-based advanced in-vitro diagnostic ("IVD") company, responded today to the allegations raised in a research report by Glaucus Research Group ("Glaucus") dated December 6, 2011. The Company maintains that the allegations set forth in the Glaucus Research report (the "Report") concern matters which have long been disclosed in the Company's annual reports and press releases, misrepresent the information they present and attribute motives to management that are based on innuendo and fail to take into account business and commercial considerations relevant to the matters discussed in the Report. The Company denies the allegations entirely.

Allegation 1

CMED paid $28 million for an acquisition from a seller who we believe was secretly related to CMED's chairman. Evidence also shows that CMED radically overpaid for the acquisition: a few months before selling the company to CMED, a company controlled by parties related to CMED insiders bought out minority shareholders at prices suggesting that the business was worth $5-$8 million, not the $28 million paid by CMED for the acquisition. In our opinion, CMED's chairman orchestrated an acquisition to embezzle roughly $20-$23 million from the public company. (Source: Glaucus Research Group)

The Company confirmed with Mr. Xiaodong Wu, the Chairman and Chief Executive Officer of the Company, that he never employed a general manager assistant or executive assistant for his private company, Beijing Chengxuan and Mr. Shujun Chen is not a related party to him. The employment history of Mr. Chen with Beijing Chengxuan in the registration form is wrong. Glaucus alleged a secret related party transaction based on wrong information. The conclusion of overpayment for the acquisition based on partial public information without commercial consideration indicates lack of business knowledge of Glaucus’s team. During 2007, many PRC medical diagnostic companies were valued with more than 5 times revenue multiples and over 20 times earnings multiples. There were a number of cases of venture capital investments in PRC diagnostic companies where US$5 million can take only a minority equity interest. The disclosed payments of Beijing Yimin were only part of the price. Glaucus provided financial information of BBE on page 8 of the Report. For the financial year ended December 31, 2006 before the acquisition by the Company, the equity was about US$7 million. BBE is a long established company and was reputable in the PRC IVD industry before the Company’s acquisition. It does not make sense for the previous shareholders of BBE to sell the whole company only at the book value to Beijing Yimin. The Company acquired BBE from Finnea which is a real company and was incorporated in the British Virgin Islands. The owner of Finnea was not Mr. Wu or his related party or Mr. Chen based on the company records of Finnea which were verified by the Company’s lawyers conducting the legal due diligence for the Company’s acquisition. Besides, the decline of the financial performance of BBE after the acquisition during 2007 was because the Company’s subsidiary, Beijing Yuande, took over the profitable ECLIA business of BBE which conducted competing business with Beijing Yuande before the acquisition. The acquisition eliminated a growing competitor of the Company. The Company’s ECLIA business grew strongly in 2007 and 2008. The Company arranged BBE to focus on the research and development of a fully-automated ECLIA analyzer after the acquisition.

Allegation 2

CMED sold its primary business segment, responsible for the majority of the firm’s sales since inception, to the chairman at less than 2x trailing EBITDA.We believe that this suspicious looking transaction was designed to cover up that the Chinese FDA was about to (or already had) suspended CMED’s permit to sell HIFU products, thus rendering CMED’s core business segment worthless almost overnight. (Source: Glaucus Research Group)

Again, the allegation by Glaucus indicates its team’s lack of commercial knowledge. Mr. Wu would not pay US$53.5 million to buy the business from the Company if he knew that the HIFU business would be suspended by SFDA around mid-2009 before the purchase in December 2008. It was fine to let the suspension happen as the decision of SFDA, a government agency, was not within the control of the Company or its management. Glaucus’s reasoning is also conflicting. If the business is known to be worthless, nobody should buy the business even at 2X EBITDA of historical financial results. The Company provided a detailed discussion for the sale of the HIFU business to Mr. Wu in the Company’s press release in December 2008 while Glaucus only extracted partial information favorable to Glaucus’s analysis and allegation. Besides, the sale of the HIFU business to Mr. Wu was part of the internal investigation conducted in 2009. The investigation did not find anything wrong for the sale of the business. The investigators reviewed the independent business evaluation of the HIFU prepared by a Big Four firm.

Allegation 3

Despite a purportedly profitable business, CMED is a serial capital raiser and has not generated free cash flow for most of its history. The company has spent twice as much on “investing activities” as it has purportedly generated from operations, so much like a typical Chinese fraud, it relies on debt or equity financing as its primary source of cash generation. (Source: Glaucus Research Group)

The Company spent substantial cash to transform from a higher risk therapeutic medical equipment business (HIFU) to an IVD business offering traditional immunoassay diagnostic products (ECLIA) and advanced molecular diagnostic business (FISH and SPR) to a much broader customer base and generating recurring revenues. The molecular diagnostic business continued to generate high double-digit growth since the acquisition of FISH in 2007.

Allegation 4

CMED’s balance sheet presents numerous highly suspicious red flags. CMED’s receivables account for a much higher percentage of net revenues than its Chinese competitors and its Day Sales Outstanding are on average 141.9 days longer than a leading Chinese competitor, despite the fact that both companies sell similar products to similarly situated customers. (Source: Glaucus Research Group)

Glaucus claimed to read our press releases and quoted information in the Report. However, Glaucus intentional or unintentional overlooked our explanations of our long DSO contained in our several earnings press releases and our annual reports. The Company conducted its molecular diagnostic business through its direct sales team rather than distributors. The payment time for hospitals is much longer than distributors. One of the reasons to use distributors is to get working capital provided by the distributors while distributors take the place to collect long time payment from hospitals for diagnostic consumable products. One of the disadvantages to use distributors is to share profit margin with distributors. This explained partially the “Uncreditable Margins” alleged by Glaucus.

Allegation 5

In 2009, an anonymous letter to the audit committee accused senior management of committing fraud with respect to the company’s financials and its acquisitions. After an investigation by the audit committee, CMED’s auditor, KPMG, resigned. (Source: Glaucus Research Group)

Again, Glaucus demonstrated again the lack of business knowledge of its team. If KPMG resigned because of the findings of the internal investigation, PwC, a similar reputable firm would not be willing to take up the audit. PwC would not benefit to take up a case if the findings indicated problems of the Company or its management. The Company explained the reasons for the change in auditors in its press release in August 2009. In addition, KPMG continued to provide its consent to include its audit report in the annual reports for the subsequent two fiscal years.

The Company is aware of usual doubts of investors for a related party transaction of a company even though it is a good transaction. For example, Glaucus questioned the related party transaction of the Company to purchase ECLIA technology in 2004. In fact, it is a very successful acquisition of the Company which contributed substantial revenues and earnings to the Company in the past five years. The Company will not engage any related party transaction in the future.

Glaucus did not contact the Company to verify the facts, analyses and allegations in the Report.

China Medical shares plunge on fraud allegations


Mon, Nov 21 2011


Tue Dec 6, 2011 11:10am EST

(Reuters) - Shares of China Medical Technologies (CMED.O) lost over a quarter of their value on Tuesday to hit a life low, after an online research firm alleged that the Chinese company had defrauded investors.

In a report on its website, research firm Glaucus Research Group alleged that China Medical's CEO "orchestrated an acquisition to embezzle roughly $20-$23 million from the public company."

The firm disclosed that it held a short position in China Medical shares and stood to gain from a decline in the stock's price.

The company was not immediately available for comment.

Glaucus' report is the latest in a string of fraud allegations against Chinese companies listed in the North America, and are often made by investors who are simultaneously shorting the stocks they comment on.

In 2007, China Medical acquired Beijing Bio-Ekon Biotechnology Co Ltd for $28.8 million.

Glaucus said it believes that the medical device maker overpaid for the acquisition from an entity it thinks is secretly related to China Medical's Chief Executive Xiaodong Wu.

The firm also alleged that China Medical sold its biggest revenue generating segment -- high intensity focused ultrasound business that develops products used to treat solid cancers and benign tumors -- to Wu, to conceal that the unit was worthless.

China Medical shares were down 17 percent at $2.81 in morning trade on Nasdaq. They touched a low of $2.46 earlier in the session.

(Reporting by Anand Basu in Bangalore; Editing by Esha Dey)

Holy Sh*t batman... what a deal! Got me 4k

6:53AM China Medical Tech receives SFDA approval for its PCR-based KRAS Assay for colorectal cancer targeted drug (CMED) 4.93 : Co announced that China's State Food and Drug Administration has approved the Company's real-time PCR-based V-Ki-ras2 Kirsten rat sarcoma viral oncogene homolog assay as a companion diagnostic test for the use of a targeted drug for the treatment of colorectal cancer patients.

http://www.insidercow.com/history/company.jsp?company=cmed&B1=Search%21

Nice volume yesterday --premarket headed higher. Short-squeeze starting! Bought in yesterday.

China Medical Technologies Management Discusses F1Q 2011 Results - Earnings Call Transcript

http://seekingalpha.com/article/287754-china-medical-technologies-management-discusses-f1q-2011-results-earnings-call-transcript?source=yahoo

8 Oversold Healthcare Stocks Being Bought Up By Insiders

8. China Medical Technologies Inc. (CMED): Develops, manufactures, and markets immunodiagnostic and molecular diagnostic products. Market cap of $165.22M. RSI(14) at 38.73. Net insider shares purchased over the last six months at 16.70K, which is 0.10% of the company's 16.44M share float. The stock is a short squeeze candidate, with a short float at 16.69% (equivalent to 17.96 days of average volume). The stock has performed poorly over the last month, losing 13.07%.

http://seekingalpha.com/article/294611-8-oversold-healthcare-stocks-being-bought-up-by-insiders?source=yahoo

I don't think this is a reverse merger company...

http://www.fundmymutualfund.com/2011/06/list-of-chinese-reverse-mergers.html

What happened to this Mark Skousen '10 Bagger' ? -HA!

He said it was a stone deal at $20.00 a share !

-bunny-

Thanks! GLTU as well! :)

Yes, let's hope so. I'm interested in seeing what kind of trading that tomorrow brings for us. There are some big name holders of this stock in the likes of Putnam, Wellington, Blackrock and BOA. Sure seems to me to be way underpriced. The short intrest almost borders stupid it's so high. Some big news could send this through the roof. I'm hoping so anyway. GLTU

I didn't think of it, but it is a buyout target at these prices. I think this could really pop when the short covering starts.

Should be worth at least $35. That's just using a 7.5X1 pe ratio. We are only sitting at a 1.48 pe ratio at the present and the company is growing. Huge short intrest here also. Could be a buyout target. That would put one hell of a squeeze on the shorts. The possibility is also there for a share buyback. The ceo just bought some yesterday. Lots of institutional big name ownership also. Gonna sit on this one.

I agree. I bought some this morning and am going to sit for a while. There is a very large short intrest and any news at all could send it flying. Large institutional holdings also. Could be a buyout candidate.

7.67? What is up? This is a profitable co. with a good revenue stream.I see this going up very soon.

down over 2 bucks! $12.00s on earnings report:

China Medical Technologies Reports Second Fiscal Quarter Financial Results

BEIJING, Nov. 19 /PRNewswire-Asia-FirstCall/ -- China Medical Technologies, Inc. (the "Company") (NASDAQ:CMED), a leading China-based medical device company that develops, manufactures and markets advanced in-vitro diagnostic products, today announced its unaudited financial results for the second fiscal quarter ended September 30, 2009 ("2Q FY2009"). The Company's 2009 fiscal year ends on March 31, 2010 ("FY2009").

2Q FY2009 Highlights

-- Revenues decreased by 14.4% year-over-year to RMB166.1 million (US$24.3 million).

-- Loss from continuing operations was RMB47.1 million (US$6.9 million).

-- Net loss was RMB47.1 million (US$6.9 million).

-- Non-GAAP income from continuing operations, as defined below, decreased by 82.7% year-over-year to RMB17.7 million (US$2.6 million).

-- Diluted loss from continuing operations per ADS* was RMB1.78 (US$0.26).

-- Non-GAAP diluted earnings from continuing operations per ADS*, as defined below, decreased by 82.6% year-over-year to RMB0.67 (US$0.10).

-- Net cash generated from operating activities was RMB45.5 million (US$6.7 million).

3Q FY2009 Targets

-- Target revenues are in the range of RMB170.0 million (US$24.9 million) and RMB180.0 million (US$26.4 million).

-- Target non-GAAP income from continuing operations is not less than RMB38.0 million (US$5.6 million).

*One American Depositary Share ("ADS") = 10 ordinary shares

See "Non-GAAP Measure Disclosures" below, where the impact of certain items on reported results is discussed.

"Despite recent challenges, we have seen several positive signs," commented Mr. Xiaodong Wu, Chairman and Chief Executive Officer of the Company. "In the past quarter, we received SFDA approvals for both our FISH probes in hematology and our SPR-based analysis system, representing a major milestone. Although our ECLIA business was impacted by increased competition and our implementation of price reduction in September, we have seen signs of stabilization. Our FISH business remained healthy despite the diversion of management's attention and we have seen growth resumed in this business recently. In addition, we have completed a trial launch on our SPR-based analysis system in a small number of top tier hospitals. With the constructive feedback from key opinion leaders after initial usage, we are well positioned for a full-scale launch on the system in the first quarter of 2010. We expect to generate revenue from the sale of HPV-DNA chips used with the system in that quarter."

2Q FY2009 Unaudited Financial Results

The Company reported revenues of RMB166.1 million (US$24.3 million) for 2Q FY2009, representing a 14.4% decrease from the corresponding period of FY2008.

The Company's revenues are currently generated from two segments, immunodiagnostic systems and molecular diagnostic systems. Immunodiagnostic systems are consisted of ECLIA products while molecular diagnostic systems include FISH products and are expected to include SPR products starting from 4Q FY2009.

Immunodiagnostic system sales for 2Q FY2009 were RMB76.8 million (US$11.3 million), representing a 37.1% decrease from the corresponding period of FY2008. The year-over-year decrease in the immunodiagnostic system sales was primarily due to the decrease in customers' inventory levels in anticipation of a selling price reduction on ECLIA reagent kits as well as the price reduction for ECLIA reagent kits in September 2009.

Molecular diagnostic system sales for 2Q FY2009 were RMB89.2 million (US$13.1 million), representing a 24.3% increase from the corresponding period of FY2008. The year-over-year growth in the molecular diagnostic system sales was primarily due to increase in sales of FISH probes to hospitals as a result of increase in new hospital customers and the increased usage of the Company's FISH probes by existing hospital customers.

Gross margin decreased to 65.4% for 2Q FY2009 as compared to 70.5% for the corresponding period of FY2008. The decrease in gross margin was primarily due to the price reduction on ECLIA reagent kits starting from September 2009.

Research and development expenses were RMB9.5 million (US$1.4 million) for 2Q FY2009, representing a 49.9% year-over-year increase. The increase was primarily due to the development of new ECLIA reagent kits, FISH probes and SPR-based chips.

Sales and marketing expenses were RMB17.4 million (US$2.6 million) for 2Q FY2009, representing a 55.0% year-over-year increase. The increase was primarily due to the continued expansion of the direct sales force for molecular diagnostic system sales.

General and administrative expenses were RMB45.1 million (US$6.6 million) for 2Q FY2009, representing a 77.2% year-over-year increase. The increase was primarily due to the costs of the independent internal investigation and provision for bad debts related to certain ECLIA customers.

Amortization of SPR intangible assets was RMB27.4 million (US$4.0 million) for 2Q FY2009. As the SPR acquisition was complete in December 2008, there was no amortization of SPR intangible assets in the corresponding period of FY2008.

Interest expense on convertible notes was RMB35.4 million (US$5.2 million) for 2Q FY2009, representing a 38.6% year-over-year increase. The increase was primarily due to the issuance of US$276.0 million convertible notes in August 2008. The Company's outstanding convertible notes of US$150.0 million and US$276.0 million bear interest at 3.5% and 4.0% per annum, respectively and will mature in November 2011 and August 2013, respectively. Due to the adoption of new authoritative guidance governing the accounting for convertible instruments that can be settled in cash or partially in cash upon conversion effective on April 1, 2009, the Company recorded additional non-cash interest expense of RMB7.6 million (US$1.1 million) for the US$150.0 million convertible notes in 2Q FY2009. The Company also made an adjustment related to these convertible notes for the corresponding period of FY2008 by increasing non-cash interest expense by RMB7.2 million to adopt this guidance retrospectively. This new guidance is not applicable to the US$276.0 million convertible notes.

Interest expense on amortization of convertible notes issuance costs was RMB4.4 million (US$0.6 million) for 2Q FY2009, representing a 47.6% year-over-year increase. The increase was primarily due to the issuance of US$276.0 million convertible notes in August 2008.

Income tax expense was RMB18.3 million (US$2.7 million) for 2Q FY2009. The occurrence of income tax expense was primarily because certain expenses of the Company such as stock compensation expense, amortization of acquired intangible assets and interest expense of convertible notes were not deductible for income tax purpose as well as the accrual for withholding income tax on distributable earnings generated during the quarter in the PRC.

Loss from continuing operations was RMB47.1 million (US$6.9 million) for 2Q FY2009 and net loss was RMB47.1 million (US$6.9 million) for 2Q FY2009.

Non-GAAP income from continuing operations excluding stock compensation expense, amortization of acquired intangible assets and non-cash interest expense of convertible notes arising from the adoption of the new guidance related to convertible instruments that can be settled in cash or partially in cash upon conversion was RMB17.7 million (US$2.6 million) for 2Q FY2009, representing a 82.7% decrease from the corresponding period of FY2008.

Stock compensation expense for 2Q FY2009 was RMB7.4 million (US$1.1 million), of which RMB1.3 million was allocated to research and development expenses and RMB6.1 million to general and administrative expenses.

The Company approved the grant of 2,450,000 restricted ordinary shares, equivalent to 245,000 ADS to certain directors, officers and employees on November 16, 2009, which was approximately 0.8% of the Company's issued ordinary shares. These restricted ordinary shares vest over a period of three years.

Amortization of acquired intangible assets for 2Q FY2009 was RMB49.8 million (US$7.3 million), of which RMB22.4 million was allocated to cost of revenues and RMB27.4 million to operating expenses.

As of September 30, 2009, the Company's cash and cash equivalents was RMB1,236.7 million (US$181.2 million). Net cash generated from operating activities for 2Q FY2009 was RMB45.5 million (US$6.7 million).

As of September 30, 2009, the Company's net accounts receivable was RMB317.9 million (US$46.6 million), representing a decrease of 7.3% from the balance at March 31, 2009.

For the convenience of readers, certain RMB amounts have been translated into U.S. dollars at the rate of RMB6.8262 to US$1.00, the noon buying rate in New York City for cable transfers of RMB per U.S. dollar as set forth in the H.10 weekly statistical release of the Federal Reserve Board, as of Wednesday, September 30, 2009. No representation is made that the RMB amounts could have been or could be converted into U.S. dollars at that rate or at any other certain rate on September 30, 2009 or at any other dates.

Outlook for 3Q FY2009

Given the full impact of the price reduction on ECLIA reagent kits but certain positive trends in December quarter, the Company estimates the target revenues for 3Q FY2009 range from RMB170.0 million (US$24.9 million) to RMB180.0 million (US$26.4 million).

The Company estimates the target non-GAAP income from continuing operations for 3Q FY2009 to be not less than RMB38.0 million (US$5.6 million).

The above targets are based on the Company's current views on the operating and marketing conditions, which are subject to change.

Non-GAAP Measure Disclosures

To supplement its consolidated financial statements presented in accordance with United States Generally Accepted Accounting Principles ("GAAP"), the Company uses non-GAAP measures of gross profit, operating income, income from continuing operations and earnings from continuing operations per ADS, which are adjusted from the results based on GAAP to exclude the impact of stock compensation expense, amortization of acquired intangible assets and non-cash interest expense of convertible notes arising from the adoption of the new guidance related to convertible instruments that can be settled in cash or partially in cash upon conversion. Non-GAAP financial measures are used by the Company in their financial and operating decision-making because management believes they reflect the Company's ongoing business in a manner that allows meaningful period-to-period comparison. The Company's management believes that these non-GAAP financial measures provide useful information to investors and others in understanding and evaluating the Company's current operating performance and future prospects in the same manner as management does, if they so choose. The Company's management also believes the non-GAAP financial measures are useful for itself and investors because it makes more meaningful comparisons of the Company's current results of operations to those of prior periods.

The presentation of this additional financial information is not intended to be considered in isolation or as a substitute for the financial information prepared and presented in accordance with GAAP. For a reconciliation of the non-GAAP financial measures to the most directly comparable GAAP financial measures, please see the financial information included with this earnings announcement.

Conference Call

The Company's management team will host a conference call at 8:00a.m. U.S. Eastern Time on November 19, 2009 (or 9:00p.m. Beijing/Hong Kong time on the same date) to discuss the results following this earnings announcement.