SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                  SCHEDULE 13D

                    Under the Securities Exchange Act of 1934
                               (Amendment No. __)


                           Dragon Pharmaceutical, Inc.
                           --------------------------
                                (Name of Issuer)

                         Common Stock, $0.001 Par Value
                         ------------------------------
                         (Title of Class of Securities)


                                   26143 X 100
                                   -----------
                                 (CUSIP Number)

                                 Mr. Yanlin Han
                                 --------------
                      1055 West Hastings Street, Suite 1900
                           Vancouver, British Columbia
                                 Canada V6E 2E9
                                 (604) 669-8817
            (Name, Address and Telephone Number of Person Authorized
                     to Receive Notices and Communications)


                                January 12, 2005
                                ----------------
             (Date of Event Which Requires Filing of this Statement)


If the filing person has previously  filed a statement on Schedule 13G to report
the  acquisition  that is the subject of this  Schedule  13D, and is filing this
schedule  because of Rule 13d-1(e),  Rule 13d-1(f) or Rule 13d-(g) or (4), check
the following box. [ ]

*The  remainder of this cover page shall be filled out for a reporting  person's
initial filing on this form with respect to the subject class of securities, and
for any  subsequent  amendment  containing  information  which  would  alter the
disclosures provided in a prior cover page.

The information required in the remainder of this cover page shall not be deemed
to be "filed" for the purpose of Section 18 of the  Securities  Exchange  Act of
1934 ("Act") or otherwise  subject to the liabilities of that section of the Act
but  shall be  subject  to all other  provisions  of the Act  (however,  see the
Notes).




CUSIP No.  26143 X 100

--------------------------------------------------------------------------------
1.   NAME OF REPORTING PERSON                                         Yanlin Han
     S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON                       N/A
--------------------------------------------------------------------------------
2.   CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP                     a. [ ]
                                                                          b. [ ]
--------------------------------------------------------------------------------
3.   SEC USE ONLY

--------------------------------------------------------------------------------
4.   SOURCE OF FUNDS                                                          OO

--------------------------------------------------------------------------------
5.   CHECK IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d)
     OR 2(e)                                                                 [ ]
--------------------------------------------------------------------------------
6.   CITIZENSHIP OR PLACE OF ORGANIZATION

     China
--------------------------------------------------------------------------------
                                        7. SOLE VOTING POWER

NUMBER OF                                  31,151,403
SHARES                                  ----------------------------------------
BENEFICIALLY                            8. SHARED VOTING POWER
OWNED
BY EACH                                    0
REPORTING                               ----------------------------------------
PERSON WITH                             9. SOLE DISPOSITIVE POWER

                                           12,578,019

                                        ----------------------------------------
                                        10. SHARED DISPOSITIVE POWER

                                            0
--------------------------------------------------------------------------------
11. AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
    31,151,403

--------------------------------------------------------------------------------
12. CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES [X]

    Does not include 2,997,682  Additional Dragon Closing Shares (as defined in
    Item 3) below which are held in escrow.
--------------------------------------------------------------------------------
13. PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 

    47.8%

--------------------------------------------------------------------------------
14. TYPE OF REPORTING PERSON*

    IN
--------------------------------------------------------------------------------
                      *SEE INSTRUCTION BEFORE FILLING OUT!
                     INCLUDE BOTH SIDES OF THE COVER PAGES,
                 RESPONSES TO ITEMS 1-7 (INCLUDING EXHIBITS) OF
                  THE SCHEDULE, AND THE SIGNATURE ATTESTATION.

                                                                     Page 2 of 6

Item 1.  Security and Issuer.
         -------------------

     This  statement  relates to shares of Common  Stock,  $0.001 par value (the
"Shares") of Dragon Pharmaceutical,  Inc., a Florida corporation ("Issuer"). The
address of the Issuer's  principal  executive  office is Dragon  Pharmaceutical,
Inc.,  1055 West  Hastings  Street,  Suite 1900,  Vancouver,  British  Columbia,
Canada, V6E 2E9.

Item 2.  Identity and Background.
         -----------------------

     a. The person filing this statement is Yanlin Han.

     b. The  business  address of Mr. Han is 1055 West  Hastings  Street,  Suite
1900, Vancouver, British Columbia, Canada, V6E 2E9.

     c. Mr. Han's  principal  occupation  is the Chief  Executive  Officer and a
Director of the Issuer.

     d. Mr.  Han has not been  convicted  in a  criminal  proceeding  (excluding
traffic violations or similar misdemeanors).

     e. Mr.  Han has not been a party to a civil  proceeding  of a  judicial  or
administrative  body  of  competent  jurisdiction,  and  as  a  result  of  such
proceeding,  was or is subject to a judgment,  decree or final  order  enjoining
future violations of, or prohibiting or mandating  activities  subject to United
States federal or state securities laws or finding any violation with respect to
such laws.

     f. Mr. Han is a citizen of China.

Item 3.  Source and Amount of Funds or Other Consideration.
         -------------------------------------------------

     On June 11,  2004,  the Issuer and Oriental  Wave  Holding Ltd.  ("Oriental
Wave") and Mr. Han, and two other  shareholders  of Oriental Wave entered into a
Share Purchase Agreement.  Under the terms of the Share Purchase Agreement,  Mr.
Han and the two  other  shareholders  of  Oriental  Wave  would  receive  in the
aggregate  shares of common  stock equal to 68.35% of the  Issuer's  outstanding
common stock after  consummation of the acquisition of Oriental Wave in exchange
for all their shares of Oriental  Wave.  In addition,  Mr. Han and the two other
shareholders  of Oriental  Wave also would receive  additional  shares of common
stock  ("Additional  Dragon  Closing  Shares")  such that all the Oriental  Wave
shareholders  will continue to own 68.35% of the Issuer's common stock if all of
the Issuer's outstanding options and warrants to purchase common stock as of the
date of the closing are exercised.

     On January 11, 2005,  the  Issuer's  shareholders  approved  two  proposals
related to the  acquisition of Oriental Wave, and the closing of the acquisition
of Oriental Wave pursuant to the Share  Purchase  Agreement  occurred on January
12,  2005.  Under  terms of the  Share  Purchase  Agreement,  Mr.  Han  received
31,151,403 shares of common stock, or 47.8% of the outstanding  common stock and
2,997,682 shares of Additional  Dragon Closing Shares.  Of the 31,151,403 shares
of common  stock,  18,573,384  shares are held in  escrow.  The shares of common
stock held in escrow will be released on the first and second  anniversary dates
of the close provided that the Company has made no claims against  Oriental Wave
and  its  shareholders  for  misrepresentations   made  in  the  Share  Purchase
Agreement.  Mr. Han will retain voting rights  (excluding the Additional  Dragon
Closing  Shares) of those  shares held in escrow.  In addition,  the  Additional
Dragon  Closing  Shares  are being  held in escrow  and such  Additional  Dragon
Closing Shares may be released or cancelled  depending on whether certain of the
Issuer's options and warrants have been subsequently  exercised or expired.  Mr.
Han will have no voting rights or dispositive  powers over the Additional Dragon
Closing Shares while they are held in escrow,  and they will not be deemed to be
outstanding unless they are released from escrow.

                                                                     Page 3 of 6

Item 4.  Purpose of the Transaction.
         --------------------------

     Mr. Han purchased Shares (described in Item 3) for investment purposes.

     Mr. Han,  subject to and  depending  upon  availability  of prices he deems
favorable,  may purchase  additional  shares of the Issuer's Shares from time to
time in the open  market or in  privately  negotiated  transactions  with  third
parties.  Further, while it is not the present intention of Mr. Han to do so, he
reserves the right to dispose of the Shares held by him in the open  market,  in
privately  negotiated  transactions  with third parties or otherwise,  depending
upon market conditions and other factors.

     Subject to on going  evaluation,  Mr. Han has no current plans or proposals
which relate to or would result in any of the following:

     (i)  An   extraordinary   corporate   transaction,   such   as  a   merger,
reorganization or liquidation, involving the Issuer or any of its subsidiaries;

     (ii) A sale or transfer of a material amount of assets of the Issuer or any
of its subsidiaries;

     (iii) Any change in the present  Board of  Directors or  management  of the
Issuer,  including  any  plans or  proposals  to  change  the  number or term of
directors or to fill any existing vacancies on the Board;

     (iv) Any material change in the present  capitalization  or dividend policy
of the Issuer;

     (v) Any  other  material  change  in the  Issuer's  business  or  corporate
structure;

     (vi) Changes in the Issuer's charter,  bylaws or instruments  corresponding
thereto or other  actions  which may impede  the  acquisition  of control of the
Issuer by any person;

     (vii)  Causing a class of  securities  of the Issuer to be delisted  from a
national  securities  exchange or to cease to be  authorized  to be quoted in an
inter-dealer quotation system of a registered national securities association;

     (viii) A class of equity  securities  of the Issuer  becoming  eligible for
termination  of  registration  pursuant to Section  12(g)(4)  of the  Securities
Exchange Act of 1934, as amended, or

     (ix) Any action similar to any of those enumerated above.

Item 5.  Interest in Securities of the Issuer.
         ------------------------------------

     (a) Mr. Han beneficially owns 31,151,403 or 47.8% of the Shares.

     (b) Mr. Han has the sole power to vote  31,151,403  and power to dispose of
12,578,019 Shares.

     (c) On January 12, 2005, Mr. Han acquired  31,151,403  Shares in connection
with the Share Purchase Agreement.

                                                                     Page 4 of 6

     (d) Not applicable.

     (e) Not applicable.

Item 6.   Contracts, Arrangements,  Understandings or Relationships with Respect
          ----------------------------------------------------------------------
          to Securities of the Issuer.
          ---------------------------

     Not applicable.

Item 7.  Materials to be Filed as Exhibits.
         ---------------------------------

     A. Escrow Agreement Dated January 12, 2005.

                                                                     Page 5 of 6



                                    SIGNATURE

     After  reasonable  inquiry and to the best of my  knowledge  and belief,  I
certify that the information  set forth in this statement is true,  complete and
correct.




Dated: January 13, 2005                     /s/ Yanlin Han
                                            -----------------------------------
                                            Yanlin Han, an individual



                                                                     Page 6 of 6


                                    EXHIBIT A

                                Escrow Agreement




                                ESCROW AGREEMENT

THIS AGREEMENT is made effective this 12th day of January, 2005 

AMONG:

          DRAGON  PHARMACEUTICAL  INC.,  of 1990 - 1055  West  Hastings  Street,
          Vancouver, British Columbia, V6E 2E9

          ("Dragon")

AND:

          LML&S  SERVICES  INC. of 1500 - 1055 West Georgia  Street,  Vancouver,
          British Columbia, V6E 4N7

          ("Escrow Agent")

AND:

          YAN-LIN  HAN,  c/o Shanxi  Weigida  Pharmaceutical  Co.  Ltd.,  Datong
          Economic and Technology Development Zone, Shanxi, China 037300

          ZHAN-GUO  WENG,  c/o Shanxi Weigida  Pharmaceutical  Co. Ltd.,  Datong
          Economic and Technology Development Zone, Shanxi, China 037300

          XUE-MEI LIU, c/o Yongfeng  Enterprise,  9/F, Tower B, Yingjia  Center,
          No. 2, Dongsanhuan Nanlu, Chaoyang District, Beijing, China 100022

          (collectively, the "Vendors" and each, a "Vendor")

WHEREAS:

(A)  Pursuant  to a share  purchase  agreement  made June 11,  2004 (the  "Share
Purchase  Agreement")  among Dragon,  the Vendors and Oriental Wave Holding Inc.
("Oriental"),  the  Vendors  have sold their  shares of  Oriental  to Dragon for
common shares of Dragon; and

(B)  The Share Purchase  Agreement  provides for the deposit by the Vendors with
the Escrow  Agent of  certificates  representing  a total of  26,533,405  common
shares of Dragon,  to be held and released in accordance  with the terms of this
Agreement;   

WITNESSES that in consideration of the mutual covenants and agreements contained
in this  Agreement and in the Share  Purchase  Agreements,  the Parties agree as
follows:

                                       1

                                     PART 1

                    DEFINITIONS, INTERPRETATION AND SCHEDULES

Definitions

1.1  In this Agreement, except as otherwise expressly provided or as the context
otherwise requires,

     (a)  "ADCS  Escrow  Shares"  means a total of  4,282,402  common  shares of
     Dragon deposited  hereunder and designated in the Share Purchase  Agreement
     as the "Additional Dragon Closing Shares";

     (b)  "Agreement"  means this Escrow  Agreement and the  schedules  attached
     hereto, as may be supplemented or amended from time to time and in effect;

     (c)  "Business Day" means a day that is not a Saturday, Sunday or statutory
     holiday in Vancouver, British Columbia;

     (d)   "Claim" has the meaning ascribed to it in ss.4.4;

     (e)  "DCS  Escrow  Shares"  means a total of  22,251,003  common  shares of
     Dragon deposited  hereunder and designated in the Share Purchase  Agreement
     as the "Dragon Closing Shares";

     (f)  "Dispute" has the meaning ascribed to it in ss.5.1;

     (g)  "Effective Date" means the effective date of this Agreement, being the
     date first above written;

     (h)   "Escrow Agreement Claim" has the meaning ascribed to it in ss.3.5;

     (i)  "Escrow  Shares"  means  the ADCS  Escrow  Shares  and the DCS  Escrow
     Shares;

     (j)  "Force  Majeure"  means any event or occurrence  beyond the reasonable
     control  of  a  Party  which  prevents  such  Party  from   performing  its
     obligations under this Agreement including an act of God, government order,
     strike,  lockout  or other  industrial  disturbance,  war,  terrorist  act,
     blockade,  insurrection,  riot, earthquake,  typhoon,  hurricane,  flood or
     other natural disaster;

     (k)  "Notice" has the meaning ascribed to it in ss.6.2;

     (l)  "Party" means a Person that is a party to this Agreement;

     (m)  "Person" means any individual,  company, body corporate, firm, limited
     or unlimited  liability  company,  partnership,  syndicate,  joint venture,
     society,  association,  trust,  unincorporated  organisation  or government
     authority,  or  any  trustee,   executor,   administrator  or  other  legal
     representative thereof;

                                       2


     (n)  "Vendors' Declaration" has the meaning ascribed to in ss.4.8; and

     (o)  "Vendors'  Representative"  means  Yan-Lin  Han or another  individual
     appointed by the Vendors to act as their  representative,  provided written
     notice of such appointment is provided to Dragon and the Escrow Agent;

Interpretation

1.2  In this Agreement, except as otherwise expressly provided,

     (a)  the headings are for  convenience  only and do not form a part of this
     Agreement  and are not  intended to  interpret,  define or limit the scope,
     extent or intent of this Agreement or any provision hereof;

     (b)  whenever  required by context,  a word importing the masculine  gender
     includes the feminine or neuter gender and a word in the singular  includes
     the plural and vice versa;

     (c)  a reference  to a Part means a Part of this  Agreement  and the symbol
     "ss."  followed  by a number or letter or some  combination  of numbers and
     letters  refers to the provision of this  Agreement so  designated  and the
     words "hereof", "hereto", "herein" and "hereunder" refer to the entirety of
     this Agreement rather than any particular Part or section;

     (d)  a  reference  to a statute  includes  all  regulations  made  pursuant
     thereto, all amendments to the statute or regulations in force from time to
     time and any statute or  regulations  that  supplement  or  supersede  such
     statute or regulations;

     (e)  a reference  to a corporate  entity  includes  any  successor  to that
     entity;

     (f)  a reference to currency means Canadian currency;

     (g)  a reference  to  "approval",  "authorization",  "notice" or  "consent"
     means  written  approval,  authorization,  notice  or  consent  not  to  be
     unreasonably withheld or delayed;

     (h)  the  words  "including"  and  "include",   when  following  a  general
     statement  or  term,  are  not to be  construed  as  limiting  the  general
     statement  or term to any  specific  item or matter set forth or to similar
     items or matters, but rather as permitting the general statement or term to
     refer to all other items or matters that could  reasonably  fall within its
     broadest possible scope; and

     (i)  an  accounting  term not  otherwise  defined  herein  has the  meaning
     assigned to it, and every  calculation  to be made hereunder is to be made,
     in  accordance  with Canadian  Generally  Accepted  Accounting  Principles,
     applied on a consistent basis.

                                       3

                                     PART 2

                             ESTABLISHMENT OF ESCROW

Appointment of Escrow Agent

2.1  Dragon and the Vendors  hereby  appoint  the Escrow  Agent to act as escrow
agent,  and the  Escrow  Agent  agrees  to such  appointment,  on the  terms and
conditions set forth in this Agreement.

Power of Attorney Forms

2.2  Together with the Escrow  Shares,  each Vendor will deposit with the Escrow
Agent ten undated  executed  share transfer power of attorney forms in favour of
Dragon (the "PoA Forms") and each Vendor  hereby  authorizes  Dragon to complete
such Vendor's PoA Forms for the purpose of effecting the return and cancellation
of the Escrow Shares as may be provided for pursuant to this Agreement.

Acceptance of Deposits

2.3  The Escrow Agent hereby  acknowledges  receipt of the Escrow Shares and PoA
Forms and  concurrent  with the execution of this Agreement will deliver to each
Vendor a receipt for the Escrow Shares they deposited.

                                     PART 3

                                  ESCROW AGENT

Escrow Shares and PoA Forms

3.1  The Escrow  Shares and PoA Forms  deposited  with the Escrow  Agent will be
held in escrow  and  dealt  with by the  Escrow  Agent in  accordance  with this
Agreement.

Terms and Conditions

3.2  The Escrow Agent accepts its duties and obligations under this Agreement on
the following terms and conditions:

     (a)  the Escrow Agent may rely upon any notice, request, statement, waiver,
     consent, receipt, certificate or any paper or document furnished to it, and
     executed  with or  without  seal by any of  Dragon or a Vendor or any other
     Person, not only as to its due execution and the validity and effectiveness
     of its  provisions  but  also  as to the  truth  and  acceptability  of any
     information therein contained, and the Escrow Agent will not be required to
     determine the  authenticity of signatures or the power and authority of any
     signatory to execute any document;

                                       4


     (b)  the  Escrow  Agent may engage  such  professional  advisers  and legal
     counsel as it  determines  to be  necessary or advisable in order to fulfil
     its obligations under this Agreement;

     (c)  the Escrow  Agent will not be  required to make any  determination  or
     decision  with respect to the validity of any claim made by any Party or of
     any denial thereof but will be entitled to rely  conclusively  on the terms
     hereof  and the  documents  tendered  to it in  accordance  with the  terms
     hereof;

     (d)  the duties and  obligations  of the Escrow Agent  hereunder are purely
     administrative  in nature and the  Escrow  Agent will not be liable for any
     error of  judgement,  or for any act done or step taken or omitted by it in
     good faith, or for any mistake of fact or law, or for anything which it may
     do or  refrain  from  doing in  connection  herewith,  except for the gross
     negligence, wilful default or dishonesty of its employees or agents;

     (e)  upon the Escrow  Agent's  delivery of the Escrow  Shares in accordance
     with the  provisions  of this Escrow  Agreement,  the Escrow  Agent will be
     automatically  and  immediately  released  from all duties and  obligations
     under this  Agreement  to any Party and to any other Person with respect to
     any of the Escrow Shares held in escrow under this Agreement;

     (f)  the  Escrow  Agent may,  if the Escrow  Agent  deems it  necessary  or
     desirable,  seek advice and  directions  from the Supreme  Court of British
     Columbia with respect to its duties and obligations hereunder; and

     (g)  the duties and  obligations of the Escrow Agent  hereunder will at all
     times be  subject  to the  orders  or  directions  of a court of  competent
     jurisdiction in the Province of British Columbia.

Consents and Waivers

3.3  The Escrow Agent will have no duties  except as expressly set forth herein,
and will not be bound by any notice of a claim or demand with  respect  thereto,
or any  waiver,  modification,  amendment,  termination  or  rescission  of this
Agreement,  unless  received  by it in writing,  and  executed by Dragon and the
Vendors,  and, if the Escrow Agent's duties,  obligations or liabilities  herein
are affected, unless it gives its written consent thereto.

Interpleader

3.4  The Escrow  Agent may, at any time,  give notice to all other  Parties that
the Escrow Agent is terminating its duties and obligations hereunder, and

     (a)  at any time more than 30 days after it gives such notice; and

     (b)  before  the  other  Parties  jointly  direct  the  Escrow  Agent as to
     delivery of the Escrow Shares in its possession to some other Person,

                                       5

may deliver the Escrow Shares in its  possession to the Supreme Court of British
Columbia by way of interpleader and will thereupon be released of its duties and
obligations hereunder.  The Parties agree that in no event will the Escrow Agent
be held liable for any failure to deliver all or a portion of the Escrow  Shares
during the period referred to in ss.3.4(a).

Indemnity

3.5  The Vendors,  collectively,  and Dragon (each an "Indemnifying Party") will
jointly and  severally  indemnify  and save  harmless  the Escrow Agent from and
against any and all actions,  suits,  investigations,  proceedings  or claims of
every kind (each an "Escrow Agreement Claim") and any and all expenses,  losses,
damages  or  liabilities,  including  reasonable  attorney's  fees  and  charges
incidental  thereto  (collectively   "Liabilities")  as  and  when  incurred  or
sustained,  and the  reasonable  fees and  expenses  incurred by Escrow Agent in
investigating  or  defending  an Escrow  Agreement  Claim to which it may become
subject or otherwise  involved in any capacity  insofar as such Escrow Agreement
Claims or Liabilities  arise out of or are based,  directly or indirectly,  upon
the Escrow Agent's performance of its duties and obligations  hereunder,  except
to the extent that the Escrow  Agent's  agents or employees  are guilty of gross
negligence,  wilful default or dishonesty in the  performance of such duties and
obligations.  If an  Indemnifying  Party pays an amount to the  Escrow  Agent in
respect of a Liability  hereunder,  then such Indemnifying  Party is entitled to
recover  from the  other  Indemnifying  Party  one-half  of the  amount  of such
Liabilities paid.

Fees and Expenses

3.6  The  Indemnifying  Parties will jointly and severally  reimburse the Escrow
Agent  for any and all  fees  and  expenses  incurred  in  connection  with  the
performance  of its  duties  hereunder,  including  but not  limited to fees and
expenses incurred pursuant to ss.3.4. If an Indemnifying Party pays an amount to
the  Escrow  Agent in  respect  of any fees and  expenses  hereunder,  then such
Indemnifying  Party is entitled  to recover  from the other  Indemnifying  Party
one-half of the amount of such fees and expenses paid.

Escrow Agent's Counsel

3.7  Each of the parties  confirms  that it is aware that the Escrow  Agent is a
corporation  that is  controlled  and directed by Lang  Michener,  which acts as
counsel to Dragon.  The Escrow Agent may not retain Lang  Michener as counsel in
the event of any dispute hereunder.

                                     PART 4

                               RELEASE FROM ESCROW

Release of Escrow Shares

4.1  The Escrow Agent will release the Escrow Shares and PoA Forms held by it in
escrow and discharge its obligations hereunder only in accordance with

                                       6


     (a)  joint written  instructions  from Dragon (executed by a senior officer
     other  than  any  Vendor  who  is  a  senior   officer)  and  the  Vendors'
     Representative,

     (b)  in the  circumstances of ss.4.5(a),  ss.4.5(b) or ss.4.7,  the written
     instruction of Dragon,

     (c)  in  the  circumstances  of  ss.4.8,  the  written  instruction  of the
     Vendors' Representative that is not disputed by Dragon, or

     (d)  an award or decision of an arbitrator pursuant to Part 5or an order of
     a court of competent jurisdiction in a final determination.

Delivery

4.2  Upon  receipt of the  instructions  described  in ss.4.1,  the Escrow Agent
will,  within five Business Days,  deliver the applicable  Escrow Shares and PoA
Forms in accordance with such instructions.

Joint Direction

4.3  Notwithstanding  any  other  provision  of this  Part,  but  subject  to an
applicable award,  decision or order referred to in ss.4.1(d),  the Escrow Agent
may act in  accordance  with a written  direction  executed by all other Parties
amending  the  procedures  set forth in this Part or the Escrow  Agent's  duties
under this Agreement.

Conditions for Release of DCS Escrow Shares

4.4  Dragon and the  Vendors  acknowledge  that the DCS Escrow  Shares have been
deposited  under  this  Agreement  in support  of  certain  representations  and
warranties made by the Vendors to Dragon,  and will be released from escrow only
if no claim (a "Claim") is made by Dragon  against the Vendors for a breach of a
representation  or warranty  made by the  Vendors to Dragon  under Part 3 of the
Share Purchase Agreement or, if a Claim is made, upon its resolution.

4.5  If

     (a)  no  Claim  is made by  Dragon  by the  first  anniversary  of the date
     hereof, Dragon will deliver a notice under ss.4.1(b) instructing the Escrow
     Agent to deliver 40% of the DCS Escrow Shares to the Vendors,

     (b)  no Claim  is made by  Dragon  by the  second  anniversary  of the date
     hereof, Dragon will deliver a notice under ss.4.1(b) instructing the Escrow
     Agent to deliver the remaining DCS Escrow Shares to the Vendors,

     (c)  if a Claim is made by Dragon, any DCS Escrow Shares and PoA Forms that
     are in escrow at the date the  Claim is made  will  remain in escrow  under
     this Agreement until an instruction,  award, decision or order is delivered
     under ss.4.1(a) or (d), and

                                       7


     (d)  upon a final  determination  being made in respect of a Claim,  Dragon
     and the Vendors will  instruct the Escrow Agent on the  disposition  of the
     DCS  Escrow  Shares  and PoA Forms,  with any  determination  as to the DCS
     Escrow  Shares  and PoA  Forms,  if  any,  to be  returned  to  Dragon  for
     cancellation  to be made in accordance with the provisions of Part 8 of the
     Share Purchase Agreement.

Conditions for Release of ADCS Escrow Shares

4.6  Dragon and the Vendors  acknowledge  that the ADCS Escrow  Shares have been
issued in anticipation of the exercise of the Dragon Convertible  Securities (as
defined  in the  Share  Purchase  Agreement)  and  are  subject  to  release  or
cancellation  in the  circumstances  set out in Schedule B of the Share Purchase
Agreement.  Dragon covenants that while any Dragon Convertible Securities remain
outstanding it will provide a monthly report to the Vendors and the Escrow Agent
confirming  whether and to what extent the Dragon  Convertible  Securities  have
been exercised, expired unexercised or otherwise been cancelled.

4.7  On a  quarterly  basis,  or sooner at the  request of the Vendors or at the
discretion  of Dragon,  Dragon will  deliver a written  notice  under  ss.4.1(b)
instructing the Escrow Agent to deliver to the Vendors or Dragon, as applicable,
the ADCS Escrow Shares and PoA Forms subject to release or cancellation pursuant
to Schedule B to the Share Purchase Agreement.

Release Requested by Vendors

4.8  If  Dragon  fails  to  deliver  a notice  when  required  under  ss.4.5(a),
ss.4.5(b)  or ss.4.7,  the Vendors may request the release of the Escrow  Shares
and PoA Forms as provided under ss.4.5(a),  ss.4.5(b) or ss.4.7 by delivering to
the Escrow Agent and Dragon a statutory declaration (the "Vendors' Declaration")
executed by the  Vendors'  Representative  that the Vendors are  entitled to the
release of the

     (a)  DCS Escrow Shares as no Claim has been made by Dragon, or

     (b)  ADCS Escrow Shares on the basis of the calculations provided by Dragon
     under ss.4.6.

If within 10 Business Days of the receipt of the Vendors' Declaration the Escrow
Agent has not  received  from  Dragon a written  notice  that it  disputes  such
declaration,  the Escrow Agent will release the applicable Escrow Shares and PoA
Forms to the Vendors.

Pro Rata Release of Escrowed Shares

4.9  Any release of Escrow Shares to the Vendors  hereunder  will be made in the
following proportions:

                  Yan-Lin Han               70%
                  Zhan-Guo Weng             20%
                  Xue-Mei Liu               10%


                                       8
 
Voting of DCS Escrow Shares

4.10 The Vendors  will be entitled to exercise all voting  rights in  connection
with the DCS Escrow  Shares  notwithstanding  their deposit in escrow under this
Agreement.

Voting and Dividends - ADCS Escrow Shares

4.11 Neither the Vendors nor any other  person will be entitled to exercise  any
voting rights or receive any dividends or  distributions  in respect of the ADCS
Escrow Shares until they have been released from escrow under this Agreement.

Exchanging Share Certificates

4.12 If any release of Escrow Shares under this Part 4would  require a number of
shares  to be  released  that is less  than the  number  represented  by a share
certificate,  then the Escrow Agent is hereby authorized and directed to arrange
for the  splitting  of a share  certificate,  with such shares to be released in
accordance with the  instructions  described in ss.4.1 and a certificate for the
balance of the shares to be returned  into escrow.  The parties  (other than the
Escrow  Agent)  will  cooperate  with the Escrow  Agent to  complete  its duties
hereunder  including  providing any certificates or other documents requested by
the Escrow Agent

                                     PART 5

                               DISPUTE RESOLUTION

Submission to Arbitration

5.1  If,  at any  time,  there  is a  dispute,  controversy  or  claim  (each  a
"Dispute")  with  respect  to any  matter  arising  out of or  relating  to this
Agreement,  such Dispute will be referred to arbitration in accordance  with the
arbitration  provisions  of the Share  Purchase  Agreement,  and each Party will
accept as final and binding and proceed in good faith  diligently  to  implement
the award or decision of the arbitrator.

                                     PART 6

                               GENERAL PROVISIONS

Governing Law

6.1  This  Agreement  will be  exclusively  governed  by,  and  interpreted  and
construed in  accordance  with,  the laws  prevailing in the Province of British
Columbia and the Parties irrevocably and unconditionally attorn to the exclusive
jurisdiction of the courts of British  Columbia and all courts having  appellate
jurisdiction thereover.

                                       9

Notice

6.2  Every notice,  request,  demand or direction  (each a "Notice") to be given
pursuant  to this  Agreement  must be in writing and must be  delivered  by hand
(e.g.  Federal Express or other reputable  courier service) or sent by facsimile
transmission or other similar form of written  transmission by electronic means,
in each case addressed as follows:

     (a)  If to Dragon, at:

          1900 - 1055 West Hastings Street
          Vancouver, British Columbia
          Canada V6E 2E9
          Attention:  Secretary
          Telecopier:  (604) 669-4243

     (b)  If to either Yan Lin Han or Zhan Guo Weng, at:

          c/o Shanxi Weiqida Pharmaceutical Co. Ltd.
          Datong Economic and Technology Development Zone
          Shanxi, China 037300
          Telecopier:  +86-352-6116451

     (c)  If to Xue-Mei Liu, at:

          c/o Yongfeng Enterprise
          9/F, Tower B, Yingjia Center
          No. 2, Dongsanhuan Nanlu, Chaoyang District
          Beijing, China 100022
          Telecopier:  +86-10-6566-2924

          with a copy to:

          Bull, Housser & Tupper
          Barristers & Solicitors
          3000 - 1055 West Georgia Street
          P.O. Box 11130
          Vancouver, BC  V6E 3R3
          Attention:        Marion V. Shaw
          Facsimile:        (604) 641-4949

     (d)  If to the Escrow Agent, at:

          LML&S Services Inc.
          1500 - 1055 West Georgia Street
          P.O. Box 11117
          Vancouver, British Columbia
          Canada V6E 4N7
          Attention: Secretary
          Telecopier:  (604) 685-7084

                                       10


or to such other  address or  transmission  receiving  number as  specified by a
Party by Notice to the other Parties.

6.3  A notice delivered or sent in accordance with the preceding section will be
deemed to be given and received

     (a)  at 9:00  a.m.  on the day of  delivery  or  receipt  at the  place  of
     delivery  or receipt  if that day is a  Business  Day at that place and the
     delivery or receipt is before that time on that day,

     (b)  at the time of  delivery  or receipt if received on or after 9:00 a.m.
     and before 4:00 p.m. at the place of delivery or receipt on a day that is a
     Business Day at that place, and

     (c)  at 9:00 a.m.  at the place of delivery or receipt on the next day that
     is a Business Day at that place,  if delivered or received on a day that is
     not a Business Day at that place or after 4:00 p.m. at that place.

Language of Document

6.4  All  correspondence  in respect of this  Agreement  or the  enforcement  of
rights of the parties hereunder will be made in the English language only.

Time of Essence

6.5  Time is of the essence in the  performance  of each  obligation  under this
Agreement.

Termination and Discharge of Escrow Agent

6.6  This  Agreement  will  terminate and the Escrow Agent will be discharged of
its obligations in any of the following circumstances:

     (a)  the Escrow Shares are properly released in accordance with Part 4;

     (b)  this  Agreement is terminated by the Escrow Agent under ss.3.4 and the
     Escrow Shares are safely in the hands of the new appointee or the court; or

     (c)  the  destruction  or  corruption  of the Escrow  Shares,  if any, as a
     result of Force Majeure.

Force Majeure

6.7  No Party  will be  liable to any other  Party for  default  or delay in the
performance of its  obligations  under this Agreement to the extent such default
or delay is caused by an occurrence of Force Majeure.

                                       11


Entire Agreement

6.8  The Escrow  Agent is not a party to,  and is not bound by,  any  provisions
which may be  evidenced  by, or arise out of,  any  agreement  other than as set
forth in the express provisions of this Agreement.

Waiver and Consent

6.9  No delay or failure  by a Party to  exercise  any of its rights  under this
Agreement constitutes a waiver of any such right. No consent or waiver,  express
or implied,  by a Party to, or of any breach or default by another Party of, any
or all of its obligations under this Agreement will,

     (a)  be valid  unless it is in writing and stated to be a consent or waiver
     pursuant to this ss.6.9,

     (b)  be  relied  upon as a consent  to or  waiver  of any  other  breach or
     default of the same or any other obligation,

     (c)  constitute a general waiver under this Agreement, or

     (d)  eliminate or modify the need for a specific consent or waiver pursuant
     to this ss.6.9 in any other or subsequent instance.

Severability

6.10 If any provision of this Agreement is at any time  unenforceable or invalid
for any reason,  it will be severable  from the remainder of this Agreement and,
in its application at that time, this Agreement will be construed as though such
provision was not contained herein and the remainder will continue in full force
and effect and be construed as if this  Agreement had been executed  without the
invalid or unenforceable provision.

Amendments

6.11 This Agreement may not be amended except in writing signed by each Party.

Further Assurances


6.12 Each Party will  execute  and deliver  such  further  agreements  and other
documents  and do such  further  acts and  things as  another  Party  reasonably
requests to  evidence,  carry out or give full force and effect to the intent of
this Agreement.

No Agency

6.13 Each Party is an independent contractor and nothing herein will, or will be
deemed to, create any  employer/employee,  agency,  partnership or joint venture
relationship  among the Parties or to give any Party any right or  authority  to
act as the agent of,  assume or create any  obligation on behalf of or to pledge
the credit of any other Party.

                                       12

Assignment

6.14 This Agreement and the individual rights and obligations  hereunder may not
be  transferred  or  assigned  in  whole  or in part by any  Party,  whether  by
contract,  operation  of law or  otherwise,  without  the  consent of each other
Party,  and any purported  transfer or  assignment  without such consent will be
null and void.  Nothing in this  ss.6.14 will be deemed to limit or restrict the
Escrow Agent's rights under ss.3.4.

Enurement

6.15 This Agreement and the  provisions  hereof will enure to the benefit of and
be binding  upon the  Parties  and their  respective  successors  and  permitted
assigns.

Survival

6.16 All rights and  obligations of the Parties  occurring  before the effective
date of termination of this Agreement and all rights and  obligations  expressly
stated to  continue  after,  or accrue as a result of, the  termination  of this
Agreement  are  separate  and  distinct  rights and  obligations  binding on the
Parties, will survive its termination and will continue in full force and effect
and nothing  herein  will  affect the  enforceability  of such  provisions.  For
greater certainty,  the premature  termination of this Agreement will not affect
the rights and obligations of any Party under ss.3.4, ss.3.5 and Part 6.

Counterparts

6.17 This Agreement may be executed in any number of  counterparts,  in original
form or by facsimile, each of which will together, for all purposes,  constitute
one and the same  instrument,  binding  on the  Parties,  and each of which will
together be deemed to be an original,  notwithstanding  that each Party is not a
signatory to the same counterpart.

IN WITNESS  WHEREOF this  Agreement  has been  executed by the Parties as of the
Effective Date.


DRAGON PHARMACEUTICAL INC.


Per:   /s/ Dr. Alexander Wick                      
       ----------------------------------
       Authorized Signatory


LML&S SERVICES INC.


Per:                                                 
       ----------------------------------
        Authorized Signatory

                                       13



Signed, Sealed and Delivered by Yan-Lin Han)
in the presence of                         )
                                           )
                                           ) /s/ Yan-Lin Han 
---------------------------------------    ) -------------------------------
Witness (Signature)                        ) YAN-LIN HAN
                                           )
                                           )
---------------------------------------    )
Name (please print)                        )
                                           )
                                           )
---------------------------------------    )
Address                                    )
                                           )
                                           )
---------------------------------------    )
City, Province                             )
                                           )
                                           )
---------------------------------------    )
Occupation                                 )




Signed, Sealed and Delivered by Zhan-Guo   )
Weng in the presence of:                   )
                                           )
                                           )
                                           )
                                           ) /s/ Zhan-Guo Weng 
---------------------------------------    ) -------------------------
Witness (Signature)                        ) ZHAN-GUO WENG
                                           )
                                           )
---------------------------------------    )
Name (please print)                        )
                                           )
                                           )
---------------------------------------    )
Address                                    )
                                           )
                                           )
---------------------------------------    )
City, Province                             )
                                           )
                                           )
---------------------------------------    )
Occupation                                 )


                                       14
                                       

  

Signed, Sealed and Delivered by Xue-Mei Liu)
in the presence of:                        )  
                                           )
                                           )
                                           ) /s/ Xue-Mei Liu 
--------------------------------------     ) ----------------------
Witness (Signature)                        ) XUE-MEI LIU
                                           )
                                           )
---------------------------------------    )
Name (please print)                        )
                                           )
                                           )
---------------------------------------    )
Address                                    )
                                           )
                                           )
---------------------------------------    )
City, Province                             )
                                           )
                                           )
---------------------------------------    )
Occupation                                 )


                                       15