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Avalon GloboCare Provides Third Quarter 2018 Business Update; Reports 30% Increase in Revenues

November 13, 2018

FREEHOLD, N.J., Nov. 13, 2018 (GLOBE NEWSWIRE) -- Avalon GloboCare Corp. (NASDAQ: AVCO), a leading global developer of cell-based technologies, today announced financial results and provided a business update for the third quarter ended September 30, 2018.

Third Quarter 2018 Highlights:

-- Revenues increased 30% to $413,503 for the third quarter ended September 30, 2018; -- Cash at September 30, 2018 was $3.8 million; -- Total assets increased to approximately $15.0 million while total liabilities decreased to approximately $2.2 million; -- Formed a new wholly owned U.S. subsidiary, Avactis Biosciences, Inc., focused on accelerating commercial activities related to cellular therapies, including regenerative medicine with stem/progenitor cells as well as cellular immunotherapy including CAR-T, CAR-NK, TCR-T and others; -- Appointed prominent Life Science M&A attorney Steven Sanders to the Board of Directors; -- Formed a strategic partnership with Weill Cornell’s cGMP cellular therapy facility and laboratory for advanced cellular engineering to co-develop technologies and bio-production of CAR-T therapy; -- Appointed former Medical Director at M.D. Anderson Cancer Center, Dr. James L. Gajewski, to head scientific and clinical advisory board; -- Commenced operation of Epicon Biotech Co. Ltd., a joint venture with Jiangsu Unicorn Biological Technology Co. Ltd., to establish a provincial network of translational cellular therapies and bio-banking programs.

David Jin, M.D., Ph.D., CEO and President of Avalon GloboCare Corp., commented, “This has been a very busy quarter, as we continue to advance our cell-based therapies and regenerative medicine platform. In July, we formed a new wholly owned U.S. subsidiary, Avactis Biosciences, Inc., which will be taking on specific roles in CAR-T bio-manufacturing, standardization, and bio-banking for the LuDaopei Hospital network and other affiliated hospitals. Our proprietary, breakthrough technologies have the potential to revolutionize the manufacturing and therapeutic options for cancer patients, particularly in hematologic malignancies (such as B-ALL and non-Hodgkin Lymphoma). Our plan is to establish a unique, full-suite, integrated system for CAR-T bio-manufacturing, standardization, international multi-centered clinical studies, and intelligent bio-banking. In addition, we have formed a strategic partnership with Weill Cornell’s cGMP cellular therapy facility and laboratory for advanced cellular engineering. This strategic partnership will synergize Weill Cornell’s world-class cGMP cellular therapy facility and our immense clinical resources at the LuDaopei hospital network to accelerate innovative CAR-T technology development, standardization in bio-manufacturing process, as well as knowledge exchange in CAR-T and other cellular therapies.”

“During the quarter, we commenced operation of Epicon Biotech Co. Ltd., a joint venture with Jiangsu Unicorn Biological Technology Co. Ltd., to establish the world’s largest aqueous humor derived exosome bio-bank to advance the next-generation of diagnosis and therapeutics for ophthalmologic diseases. Epicon occupies a 16,000 square foot, state-of-the-art Good Manufacturing Practice (GMP) laboratory space for processing, biobanking and preparation of clinical-grade products for cellular therapy. Epicon plays an essential role in facilitating standardized GMP laboratory platform for our subsidiaries- GenExosome Technologies and Avactis Biosciences. This state-of-the-art platform serves well to accelerate our international programs in exosome technology, cellular therapeutics and bio-banking.”

“Finally, we are very pleased to have successfully uplisted to the NASDAQ Capital Markets last week. Listing on NASDAQ provides us greater exposure within the investment community as we execute on key upcoming milestones. Towards this end we appointed two high-profile independent board members, which reinforces our commitment to the highest levels of corporate governance. We also appointed Dr. James Gajewski to head our Scientific and Clinical Advisory Board. Mr. Gajewski will aid our mission of accelerating translational research, clinical development, and commercialization of cellular technologies and therapeutics,” concluded Dr. Jin.

Revenues for the third quarter ended September 30, 2018 were $413,503 versus $317,450 for the third quarter ended September 30, 2017. The increase in revenues was due to development services and sales of developed products, and medical related consulting services. Operating loss for the third quarter ended September 30, 2018 was $2.4 million versus operating loss of $0.7 million for third quarter ended September 30, 2017, which reflects increased SG&A expenses to support the anticipated growth, as well as an increase in public company expenses in advance of the planned listing on a national exchange. Net loss attributable to Avalon GloboCare Corp. common shareholders for the third quarter ended September 30, 2018 was $2.3 million or ($0.03) earnings per share, versus net loss attributable to Avalon GloboCare Corp. common shareholders of $0.7 million or ($0.01) earnings per share for the third quarter ended September 30, 2017.

About Avalon GloboCare Corp.

Avalon GloboCare Corp. (NASDAQ: AVCO) is a global intelligent biotech developer and healthcare service provider dedicated to promoting and empowering high impact, transformative cell-based /technologies and their clinical applications, as well as healthcare facility management through its core platforms, namely “Avalon Cell” and “Avalon Rehab.” In addition, Avalon provides strategic advisory and outsourcing services to facilitate and enhance their clients’ growth, development, as well as competitiveness in both domestic and global healthcare markets. Avalon also engages in the management of stem cell banks and specialty clinical laboratories. Through its U.S. subsidiaries, namely GenExosome Technologies Inc. and Avactis Biosciences Inc., Avalon will further establish our leading roles in the fields of CAR-T therapy, liquid biopsy, precision medicine and regenerative medicine.

Forward-Looking StatementsCertain statements contained in this press release may constitute “forward-looking statements.” Forward-looking statements provide current expectations of future events based on certain assumptions and include any statement that does not directly relate to any historical or current fact. Actual results may differ materially from those indicated by such forward-looking statements as a result of various important factors as disclosed in our filings with the Securities and Exchange Commission located at their website ( http://www.sec.gov ). In addition to these factors, actual future performance, outcomes, and results may differ materially because of more general factors including (without limitation) general industry and market conditions and growth rates, economic conditions, and governmental and public policy changes. The forward-looking statements included in this press release represent the Company’s views as of the date of this press release and these views could change. However, while the Company may elect to update these forward-looking statements at some point in the future, the Company specifically disclaims any obligation to do so. These forward-looking statements should not be relied upon as representing the Company’s views as of any date subsequent to the date of the press release.

Contact Information: Avalon GloboCare Corp. 4400 Route 9, Suite 3100Freehold, NJ 07728 PR@Avalon-GloboCare.com

Investor Relations: Crescendo Communications, LLC Tel: (212) 671-1020 avco@crescendo-ir.com

AVALON GLOBOCARE CORP. AND SUBSIDIARIESCONDENSED CONSOLIDATED BALANCE SHEETS

As of ---------------------------- September December 31, 30, 2018 2017 ------------ ------------ (Unaudited) ASSETS CURRENT ASSETS: Cash $ 3,810,139 $ 3,027,033 Accounts receivable, net of allowance for doubtful accounts 134,319 10,179 Accounts receivable - related party, net of allowance for doubtful accounts 214,665 — Tenants receivable, net of allowance for doubtful accounts 51,244 38,469 Security deposit 418,464 6,916 Security deposit - related party 291,163 — Inventory 27,427 2,667 Prepaid expenses and other current assets 364,655 149,713 - ---------- - ---------- Total Current Assets 5,312,076 3,234,977 - ---------- - ---------- NON-CURRENT ASSETS: Security deposit - noncurrent portion — 25,322 Prepayment for long-term assets — 153,688 Property and equipment, net 271,526 48,029 Investment in real estate, net 7,920,912 7,623,757 Intangible assets, net 1,337,582 1,583,260 - ---------- - ---------- Total Non-current Assets 9,530,020 9,434,056 - ---------- - ---------- Total Assets $ 14,842,096 $ 12,669,033 - ---------- - ---------- LIABILITIES AND EQUITY CURRENT LIABILITIES: Accounts payable $ 106,331 $ 29 Accrued liabilities and other payables 657,815 124,064 Accrued liabilities and other payables - related parties 3,873 39,927 Deferred rental income 3,525 12,769 Loan payable — 1,500,000 Interest payable 50,137 138,110 VAT and other taxes payable 13,218 2,997 Tenants’ security deposit 73,400 92,288 Due to related party 250,000 450,000 Refundable deposit — 3,000,000 - ---------- - ---------- Total Current Liabilities 1,158,299 5,360,184 - ---------- - ---------- NON-CURRENT LIABILITIES: Loan payable - noncurrent portion 1,000,000 — - ---------- - ---------- Total Non-current Liabilities 1,000,000 — - ---------- - ---------- Total Liabilities 2,158,299 5,360,184 - ---------- - ---------- Commitments and Contingencies - (Note 19) EQUITY: Preferred stock, $0.0001 par value; 10,000,000 shares authorized; no shares — — issued and outstanding at September 30, 2018 and December 31, 2017 Common stock, $0.0001 par value; 490,000,000 shares authorized; 73,560,751 shares issued and 73,040,751 shares outstanding at September 30, 2018; 7,356 7,028 70,278,622 shares issued and outstanding at December 31, 2017 Additional paid-in capital 22,822,878 11,490,285 Less: common stock held in treasury, at cost; 520,000 and 0 shares at (522,500 ) — September 30, 2018 and December 31, 2017, respectively Accumulated deficit (8,638,297 ) (3,517,654 ) Statutory reserve 6,578 6,578 Accumulated other comprehensive loss - foreign currency translation adjustment (229,260 ) (91,994 ) - ---------- - ---------- Total Avalon GloboCare Corp. stockholders’ equity 13,446,755 7,894,243 Non-controlling interest (762,958 ) (585,394 ) - ---------- - ---------- Total Equity 12,683,797 7,308,849 - ---------- - ---------- Total Liabilities and Equity $ 14,842,096 $ 12,669,033 - ---------- - ----------

AVALON GLOBOCARE CORP. AND SUBSIDIARIESUNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS

For the For the For the For the Three Three Nine Nine Months Months Months Months Ended Ended Ended Ended September September September September 30, 2018 30, 2017 30, 2018 30, 2017 ------------ ------------ ------------ ------------ REVENUES Real property rental $ 272,444 $ 315,284 $ 847,939 $ 537,538 Medical related consulting services - related 71,398 2,166 213,394 220,949 parties Development services and sales of developed 69,661 — 156,176 — products - ---------- - ---------- - ---------- - ---------- Total Revenues 413,503 317,450 1,217,509 758,487 - ---------- - ---------- - ---------- - ---------- COSTS AND EXPENSES Real property operating expenses 190,899 180,722 597,114 342,576 Medical related consulting services - related 64,196 47,033 188,911 271,845 parties Development services and sales of developed 40,386 — 98,999 — products - ---------- - ---------- - ---------- - ---------- Total Costs and Expenses 295,481 227,755 885,024 614,421 - ---------- - ---------- - ---------- - ---------- REAL PROPERTY OPERATING INCOME 81,545 134,562 250,825 194,962 - ---------- - ---------- - ---------- - ---------- GROSS PROFIT (LOSS) FROM MEDICAL RELATED 7,202 (44,867 ) 24,483 (50,896 ) CONSULTING SERVICES - ---------- - ---------- - ---------- - ---------- GROSS PROFIT FROM DEVELOPMENT SERVICES AND 29,275 — 57,177 — SALES OF DEVELOPED PRODUCTS - ---------- - ---------- - ---------- - ---------- OTHER OPERATING EXPENSES: Selling expenses — 148 — 15,138 Advertising expenses 150,548 — 150,548 — Compensation and related benefits 569,915 468,837 1,596,181 857,237 Professional fees 1,449,768 186,208 2,614,565 566,131 Other general and administrative 327,209 92,421 878,582 245,080 - ---------- - ---------- - ---------- - ---------- Total Other Operating Expenses 2,497,440 747,614 5,239,876 1,683,586 - ---------- - ---------- - ---------- - ---------- LOSS FROM OPERATIONS (2,379,418 ) (657,919 ) (4,907,391 ) (1,539,520 ) - ---------- - ---------- - ---------- - ---------- OTHER INCOME (EXPENSE) Interest income 1,394 122 3,102 1,126 Interest expense (25,205 ) (52,932 ) (287,123 ) (94,932 ) Foreign currency transaction loss — — (106,929 ) (57,244 ) Other (expense) income (22 ) — 306 — - ---------- - ---------- - ---------- - ---------- Total Other Expense, net (23,833 ) (52,810 ) (390,644 ) (151,050 ) - ---------- - ---------- - ---------- - ---------- LOSS BEFORE INCOME TAXES (2,403,251 ) (710,729 ) (5,298,035 ) (1,690,570 ) INCOME TAXES — — — — NET LOSS $ (2,403,251 ) $ (710,729 ) $ (5,298,035 ) $ (1,690,570 ) - ---------- - ---------- - ---------- - ---------- LESS: NET LOSS ATTRIBUTABLE TO NON-CONTROLLING (58,581 ) — (177,392 ) — INTEREST - ---------- - ---------- - ---------- - ---------- NET LOSS ATTRIBUTABLE TO AVALON GLOBOCARE $ (2,344,670 ) $ (710,729 ) $ (5,120,643 ) $ (1,690,570 ) CORP. COMMON SHAREHOLDERS - ---------- - ---------- - ---------- - ---------- COMPREHENSIVE LOSS: NET LOSS (2,403,251 ) (710,729 ) (5,298,035 ) (1,690,570 ) OTHER COMPREHENSIVE (LOSS) INCOME Unrealized foreign currency translation (loss) (94,069 ) 6,151 (137,438 ) (25,973 ) gain - ---------- - ---------- - ---------- - ---------- COMPREHENSIVE LOSS $ (2,497,320 ) $ (704,578 ) $ (5,435,473 ) $ (1,716,543 ) - ---------- - ---------- - ---------- - ---------- LESS: COMPREHENSIVE LOSS ATTRIBUTABLE TO (58,794 ) — (177,564 ) — NON-CONTROLLING INTEREST COMPREHENSIVE LOSS ATTRIBUTABLE TO AVALON $ (2,438,526 ) $ (704,578 ) $ (5,257,909 ) $ (1,716,543 ) GLOBOCARE CORP. COMMON SHAREHOLDERS - ---------- - ---------- - ---------- - ---------- NET LOSS PER COMMON SHARE ATTRIBUTABLE TO AVALON GLOBOCARE CORP. COMMON SHAREHOLDERS: Basic and diluted $ (0.03 ) $ (0.01 ) $ (0.07 ) $ (0.03 ) - ---------- - ---------- - ---------- - ---------- WEIGHTED AVERAGE COMMON SHARES OUTSTANDING: Basic and diluted 72,573,462 64,628,622 71,611,375 63,958,292 - ---------- - ---------- - ---------- - ----------

AVALON GLOBOCARE CORP. AND SUBSIDIARIESUNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

For the Nine For the Nine Months Months Ended Ended September September 30, 2017 30, 2018 ------------ ------------ CASH FLOWS FROM OPERATING ACTIVITIES: Net loss $ (5,298,035 ) $ (1,690,570 ) Adjustments to reconcile net loss from operations to net cash used in operating activities: Depreciation and amortization 383,603 58,478 Stock-based compensation expense 2,224,969 602,224 Changes in operating assets and liabilities: Accounts receivable (131,357 ) — Accounts receivable - related parties (226,166 ) (91,463 ) Tenants receivable (12,775 ) (56,239 ) Inventory (25,876 ) — Prepaid expenses and other current assets (94,094 ) 14,151 Security deposit (710,098 ) (30,081 ) Accounts payable 18,105 21,600 Accrued liabilities and other payables 454,772 320,505 Accrued liabilities and other payables - related parties (35,846 ) 22,990 Deferred rental income (9,244 ) 19,914 Interest payable (87,973 ) — Income taxes payable — (21,400 ) VAT and other taxes payable 28,207 (9,453 ) Tenants’ security deposit (18,888 ) 92,288 - ---------- - ---------- NET CASH USED IN OPERATING ACTIVITIES (3,540,696 ) (747,056 ) - ---------- - ---------- CASH FLOWS FROM INVESTING ACTIVITIES: Purchase of property and equipment (49,949 ) (50,994 ) Purchase of commercial real estate — (7,008,571 ) Improvement of commercial real estate (392,571 ) — Payment for previously acquired business (200,000 ) — - ---------- - ---------- NET CASH USED IN INVESTING ACTIVITIES (642,520 ) (7,059,565 ) - ---------- - ---------- CASH FLOWS FROM FINANCING ACTIVITIES Proceeds received from loan payable — 2,100,000 Repayments for loan (500,000 ) — Proceeds received from related parties’ advance — 210,000 Repayment for related parties’ advance — (500 ) Repurchase of common stock (522,500 ) — Refundable deposit in connection with Share Subscription Agreement — 3,000,000 Refund for refundable deposit in connection with Share Subscription Agreement (1,000,000 ) — Proceeds received from equity offering 7,551,013 — Disbursements for equty offering costs (486,296 ) — - ---------- - ---------- NET CASH PROVIDED BY FINANCING ACTIVITIES 5,042,217 5,309,500 - ---------- - ---------- EFFECT OF EXCHANGE RATE ON CASH (75,895 ) (32,246 ) - ---------- - ---------- NET INCREASE (DECREASE) IN CASH 783,106 (2,529,367 ) CASH - beginning of period 3,027,033 2,886,189 - ---------- - ---------- CASH - end of period $ 3,810,139 $ 356,822 - ---------- - ---------- SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION: Cash paid for: Interest $ 375,096 $ — - ---------- - ---------- Income taxes $ — $ 21,400 - ---------- - ---------- NON-CASH INVESTING AND FINANCING ACTIVITIES: Common stock issued in connection with Share Subscription Agreement $ — $ 300 - ---------- - ---------- Acquisition of equipment by decreasing prepayment for long-term assets $ 153,381 $ — - ---------- - ---------- Equipment acquired on credit as payable $ 93,894 $ — - ---------- - ---------- Acquisition of real estate by decreasing prepayment for property $ — $ 700,000 - ---------- - ---------- Common stock issued for future services $ 33,235 $ — - ---------- - ---------- Refundable deposit exchange for common shares $ 2,000,000 $ — - ---------- - ----------

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