Mr. Rodney Gelineau reports

RETRACTION & CORRECTION OF MAY 28, 2020 NEWS RELEASE

On July 8, 2020, the U.S. Securities and Exchange Commission issued an order of suspension of trading in shares of Eastwest Bioscience Inc. traded on the U.S. over-the-counter market. The order referenced the accuracy and adequacy of information that was contained in the press release of Eastwest distributed on May 28, 2020, regarding the U.S. Food and Drug Administration's approval of the company's hand sanitizers (entitled "Eastwest Bioscience 80-Per-Cent Ethyl Alcohol Hand Sanitizer Receives FDA Approval").

This news release is a correction and clarification to the May 28, 2020, release. Under FDA rules, hand sanitizer is considered as an over-the-counter (OTC) drug that requires a national drug code (NDC) number to be marketed to consumers. Additionally, an NDC number is mandatory for the manufacture of hand sanitizers.

Eastwest has secured hand sanitizer supply both in the United States and Canada to ensure that it can meet demand in an efficient manner on both sides of the border. Per FDA regulations, to be able to distribute hand sanitizers to American consumers, the manufacturers of these hand sanitizers must be entities with NDC numbers registered with the FDA and not Orchard Vale Naturals. Contrary to the company's May 28, 2020, news release, the company nor its manufacturing subsidiary has received FDA approval for its hand sanitizer.

By having the manufacturer's NDC number listed with the FDA and not that of Orchard Vale Naturals, Eastwest is in fact abiding by FDA's mandatory requirement. The company did not communicate this clearly in the previous news release and would like to ensure the public that its supply manufacturing NDC number is registered with the FDA. The market on both sides of the border is flooded with questionable hand sanitizer products, and having the manufacturer's NDC number listed with the FDA helps assured quality assurance traceability.

In Canada, the company's raw material supplier has procured an agreement with an existing Health Canada-licensed bulk material supplier of hand sanitizer. This hand sanitizer is then shipped to the company's contract manufacturer in Ontario and the company's Penticton, B.C., facility for further processing, including packaging, bottling and labelling. The product is then shipped to the company's customers from each facility.

Processing at the facility in Penticton is conducted by Orchard Vale Naturals (OVN), which is the supplement and health product manufacturing division of Eastwest. As a health supplement manufacturer that is Health Canada licensed (licence No. 301957), OVN was able to obtain permanent natural product numbers (NPN) for the hand sanitizers. It is important to distinguish the ability for OVN to obtain permanent NPNs for companies that have been granted temporary authorization by Health Canada to manufacture and sell specific hand sanitizers and hard-surface disinfectants. OVN has the ability to manufacture hand sanitizers on site. It also has its Health Canada yearly inspections and a Health Canada-approved standard operating procedure to ensure all products released by OVN are produced under strict good manufacturing practices.

The facility in Ontario is Health Canada licensed and provides additional benefits, including: shipping logistics savings to the company's East Coast customers and, more importantly, on-site bottling production capability. Supply of packaging material has been an issue globally in the industry at the moment due to COVID-19. Access to these packaging materials ensures that the company's hand sanitizers can be packaged and delivered to clients in a timely manner.

These hand sanitizers are marketed through Sangster's Health Centres stores using the Sangsters brand (NPN No. 80101027). Sangster's Health Centres is the retail division of Eastwest with retail locations throughout Canada, predominantly in the Prairies.

These hand sanitizers are also marketed to independent retailers, wholesalers and distributors using the Natural Advancement brand (NPN No. 80101027). Additionally, Eastwest provides private labelling and contract manufacturing for retailers and distributors which would like to use their own brand name(s).

In the May 28, 2020, news release, Eastwest communicated that it has now initiated marketing its hand sanitizer in the United States. To reiterate previous comment, Eastwest would like to assure the public that it is following FDA requirements and will be distributing and/or exporting any hand sanitizer products under the source manufacturer NDC number. Additionally, Eastwest has also secured a hand sanitizer manufacturer in the United States with an FDA-listed NDC number that will allow Eastwest to fulfill any U.S. orders and eliminate cross-border export logistics overhead.

As a wellness company with a Health Canada-licensed facility to manufacture health supplements and a national chain of Health Centres, Eastwest understands first-hand the importance of consumer health and safety. It has conducted its due diligence to ensure that any products it manufactures and/or distributes are safe to be consumed by its customers and have followed regulations on both sides of the border to ensure that this is the case.

The TSX Venture Exchange halted trading in Eastwest stock as a response to the SEC suspension of trading of Eastwest shares in the OTC alternative markets in the U.S. It is important to point out that Eastwest is currently trading on the pink sheets in the U.S. through a symbol that the company did not initiate.

In late June, Eastwest management was contacted by phone by the SEC in relation to the company's May 28, 2020, news release and the U.S. market reaction to the news. It had questions regarding the FDA approval process, and, more importantly, it was concerned about the concurrent trading volume on the OTC alternative markets. During the call, the SEC analyst also provided several names that may have been involved in suspicious trades possibly contributing to the volatility. All of the company's investor relations arrangements have been filed with the TSX Venture Exchange and disclosed in accordance with TSX Venture Exchange policies.

It informed the SEC that Eastwest did not initiate the trading symbol or listing of Eastwest shares in these alternative markets.

The SEC officers enquired about the management trading history and asked if the company had sold stock in the recent run-up. The company pointed out that Eastwest management has, in fact, been purchasing stock in the open market since April until now. In addition, Eastwest management has just completed a debt conversion at five cents with a significant portion of the debt being converted by senior management. The recent market volatility has negatively impacted both efforts from financial perspective.

The company has received no further communication from the SEC and, in light of the foregoing, is completely surprised by the subsequent trading halt.

About Eastwest Bioscience Inc.

Eastwest Bioscience is a vertically integrated wellness company with the infrastructure to become a global giant in the hemp and cannabidiol consumer health market. Since it was founded in 2016, Eastwest continues to expand as a high-quality producer, manufacturer and distributor of multiple lines of premium health and hemp products. Eastwest currently has more than 200-plus NPNs in its stable of products.

We seek Safe Harbor.