CHINA SXT PHARMACEUTICALS, INC. ANNOUNCES STRATEGIC INITIATIVE TO APPLY AI TECHNOLOGY ACROSS THE TCM SUPPLY CHAIN

Rhea-AI Summary

China SXT Pharmaceuticals (NASDAQ: SXTC) announced an AI Insight Initiative to explore applying artificial intelligence and digital tools across its Traditional Chinese Medicine raw-material supply chain. The company plans to evaluate AI-supported methods for cultivation environment monitoring, origin and authenticity assessment, quality evaluation and grading, and supply-demand forecasting and circulation efficiency. The stated goals are improved transparency, operational stability, traceability, and stronger quality oversight while preserving traditional TCM production principles.

The company said the initiative is part of long-term operational planning to support data-informed supply chain management and more reliable resource planning.

News Market Reaction

+10.18%

16 alerts

+10.18% News Effect

+8.9% Peak Tracked

-15.0% Trough Tracked

+$1M Valuation Impact

$15M Market Cap

1.2x Rel. Volume

On the day this news was published, SXTC gained 10.18%, reflecting a significant positive market reaction. Argus tracked a peak move of +8.9% during that session. Argus tracked a trough of -15.0% from its starting point during tracking. Our momentum scanner triggered 16 alerts that day, indicating notable trading interest and price volatility. This price movement added approximately $1M to the company's valuation, bringing the market cap to $15M at that time.

Data tracked by StockTitan Argus on the day of publication.

Key Figures

Registered direct size: $10,000,000 Offering price: $0.15 per share Pre-funded warrant exercise: $0.001 per share +5 more

8 metrics

Registered direct size $10,000,000 Registered direct offering announced Jan 09, 2026

Offering price $0.15 per share Registered direct of 66,666,666 Class A shares or pre-funded warrants

Pre-funded warrant exercise $0.001 per share Exercise price for pre-funded warrants in Jan 09, 2026 offering

424B5 gross proceeds $9.95 million Prospectus supplement dated Jan 12, 2026

424B5 net proceeds $9.11 million Estimated net from Jan 12, 2026 offering

Shares issued in 424B5 12,000,000 shares Class A Ordinary Shares at $0.15 in Jan 12, 2026 offering

Pre-funded warrants registered 54,666,666 shares Class A shares issuable upon exercise of pre-funded warrants

Shelf registration capacity $600,000,000 Form F-3 shelf filed Nov 10, 2025

Market Reality Check

Price: $0.0500 Vol: Volume 53,407,921 is 2.69...

high vol

$0.0500 Last Close

Volume Volume 53,407,921 is 2.69x the 20-day average of 19,831,847, indicating elevated trading interest pre-announcement. high

Technical Price at $0.0963 is trading well below the 200-day MA of $1.63, and sits 98.77% under the 52-week high of $7.84.

Peers on Argus

Sector peers show mixed, mostly negative moves: DERM -2.85%, IRWD -1.94%, OGI -4...

Sector peers show mixed, mostly negative moves: DERM -2.85%, IRWD -1.94%, OGI -4.17%, TKNO -5.38%, while BIOA gained 12.46%, suggesting stock-specific dynamics around SXTC rather than a unified sector trend.

Historical Context

2 past events · Latest: Jan 09 (Negative)

Pattern 2 events

Date	Event	Sentiment	Move	Catalyst
Jan 09	Capital raising	Negative	-87.9%	Registered direct equity offering with significant gross proceeds and dilution.
Jan 08	AI strategy update	Positive	-37.5%	Launch of AI insights program for portfolio, market analysis, and AI clinics.

Pattern Detected

Recent news included a large registered direct offering followed by strategic AI initiatives; capital-raising news aligned with a sharp selloff, while earlier AI news coincided with a negative reaction despite its strategic framing.

Recent Company History

Over the past week, China SXT announced a $10 million registered direct offering at $0.15 per share on Jan 09, 2026, which coincided with a -87.92% move, highlighting strong market sensitivity to dilution. A prior AI-focused strategic initiative on Jan 08, 2026 to deploy analytics across product planning, market intelligence, and AI-supported TCM clinics saw a -37.5% reaction. Today’s AI supply-chain initiative extends this technology-focused strategy against a backdrop of recent capital raising.

Regulatory & Risk Context

Active S-3 Shelf · $600,000,000

Shelf Active

Active S-3 Shelf Registration 2025-11-10

$600,000,000 registered capacity

An effective Form F-3 shelf dated Nov 10, 2025 allows China SXT to offer up to $600,000,000 in securities, with at least one usage via a 424B5 on Jan 12, 2026. This structure provides flexibility for additional capital raises through equity, debt, or other securities as detailed in future prospectus supplements.

Market Pulse Summary

The stock surged +10.2% in the session following this news. A strong positive reaction aligns with t...

Analysis

The stock surged +10.2% in the session following this news. A strong positive reaction aligns with the company’s narrative of using AI to modernize its Traditional Chinese Medicine supply chain. Investors previously faced substantial dilution from recent offerings totaling about $10 million in gross proceeds and a larger shelf of up to $600,000,000. Any sustained strength would need to contend with this capital-raising overhang and the stock’s position far below its $1.63 200-day moving average.

Key Terms

pre-funded warrants, form f-3 shelf registration, 424b5, schedule 13g, +4 more

8 terms

pre-funded warrants financial

"Pre-Funded Warrants to purchase up to 54,666,666 Class A Ordinary Shares at a purchase price of $0.149"

Pre-funded warrants are financial instruments that give investors the right to purchase a company's stock at a set price, but with most or all of the purchase price paid upfront. They function like a coupon or gift card for stock, allowing investors to buy shares later at a fixed price, which can be beneficial if they want to avoid future price increases. This makes them important for investors seeking flexibility and certainty in their investment plans.

form f-3 shelf registration regulatory

"filed a Form F-3 shelf registration to offer and sell up to $600,000,000"

A Form F-3 shelf registration is a pre-approved filing that lets a foreign company already following U.S. disclosure rules register securities in advance and sell them later as needed. Think of it like a pre-authorized credit line for issuing shares or bonds: it makes raising money faster and more flexible. Investors watch for these filings because future offerings can change share supply, dilute ownership, and affect price and liquidity.

424b5 regulatory

"Prospectus Supplement (Debt Securities)"

Form 424B5 is a final prospectus document filed with the SEC that delivers the definitive terms of a securities offering after a company’s registration statement becomes effective. It gives investors the concrete details they need — price, number of shares, intended use of proceeds, and updated risk information — much like a product label that lists exact specifications before you decide to buy. Investors use it to verify final deal terms and assess potential impact on their holdings.

schedule 13g regulatory

"Singapore investor Ching Choon Hwa has filed a Schedule 13G disclosing passive ownership"

A Schedule 13G is a formal document that investors file with the government when they acquire a large ownership stake in a company, usually for investment purposes rather than control. It helps keep the public informed about who owns significant parts of a company's shares, which can influence how the company is managed and how investors make decisions. Filing this schedule is important for transparency and understanding the ownership landscape of publicly traded companies.

variable interest entity regulatory

"operating in China through subsidiaries and a variable interest entity"

A variable interest entity (VIE) is a company structure where one party controls another company’s operations and economic outcomes through contracts or special arrangements instead of owning a majority of its voting shares. For investors, VIEs matter because the controlling party’s financial results, debts and risks can appear in the controller’s reports even though ownership looks separate, so understanding VIEs helps assess true exposure, governance limits and transparency—like spotting a puppet controlled by strings rather than direct ownership.

holding foreign companies accountable act regulatory

"potential U.S. trading limitations under the Holding Foreign Companies Accountable Act"

A U.S. law that forces companies listed on U.S. exchanges to allow independent inspections of their financial audits and to prove they are under reliable oversight; if they can't, they risk being removed from the exchanges. For investors, it’s like requiring regular safety inspections for a car: it increases confidence by revealing whether financial statements are trustworthy and warns of higher risk or possible loss if a company fails to meet the standard.

traditional chinese medicine pieces medical

"sales of Traditional Chinese Medicine Pieces ("TCMPs"), including Advanced TCMPs"

Prepared pieces of traditional Chinese medicine are the raw plant, mineral or animal materials that have been cut, dried and sometimes processed into standardized slices or chunks for use in herbal treatments. For investors, they matter because quality, consistency and regulatory approval of these pieces affect product safety, supply chains and sales; think of them like prepackaged ingredients for a restaurant—if the ingredients vary or are restricted, the business’s output and revenue can be directly affected.

tcm homologous supplements medical

"and TCM Homologous Supplements ("TCMHS"), today announced"

TCM homologous supplements are products made from ingredients long used in Traditional Chinese Medicine that are also regarded as safe to eat, so they serve as both food and health remedies—think of ginger or goji berries being used in a meal and a tonic. Investors care because how regulators classify these items, how consumers perceive their safety and benefits, and different labeling or approval rules can strongly influence sales, margins and market access compared with plain foods or medicines.

AI-generated analysis. Not financial advice.

TAIZHOU, China, Jan. 15, 2026 (GLOBE NEWSWIRE) --  China SXT Pharmaceuticals, Inc. (NASDAQ: SXTC) (“China SXT” or the “Company”), a specialty pharmaceutical company focusing on the research, development, manufacturing, marketing, and sales of Traditional Chinese Medicine Pieces (“TCMPs”), including Advanced TCMPs (Directly-Oral TCMP and After-Soaking-Oral TCMP), fine TCMPs, regular TCMPs, and TCM Homologous Supplements (“TCMHS”), today announced as part of its Artificial Intelligence (AI) Insight Initiative to explore the application of Artificial Intelligence (AI) and related digital technologies across the Traditional Chinese Medicine (TCM) raw-material supply chain. This initiative is part of the Company’s long-term plan to improve supply chain transparency, operational stability, and quality oversight.

The Company plans to explore the use of AI-supported analytical methods in key supply chain areas such as cultivation environment monitoring, origin and authenticity assessment, quality evaluation, and material grading. China SXT also intends to examine the potential use of AI in supply-demand forecasting and circulation efficiency, with the goal of supporting more consistent and data-informed supply chain management.

By enhancing digital analytics and process visibility across critical stages of the TCM raw-material supply chain, China SXT aims to strengthen traceability, reinforce quality control, and support more reliable resource planning. These efforts align with the Company’s broader strategy of applying technology to improve overall operational management while preserving the traditional principles of TCM raw-material production.

“Applying AI to our supply chain management is an important part of our long-term operational planning,” said Feng Zhou, Co-Chief Executive Officer and Director of China SXT. “Through the use of digital tools and AI-supported analysis, we aim to enhance supply chain reliability and strengthen our quality assurance capabilities.”

About China SXT Pharmaceuticals, Inc.

Founded in 2005 and headquartered in Taizhou City, Jiangsu Province, China, China SXT Pharmaceuticals, Inc. is an innovative pharmaceutical company focusing on the research, development, manufacture, marketing and sales of traditional Chinese medicine pieces, which is a type of Traditional Chinese Medicine that has been processed to be ready for use. For more information, please visit www.sxtchina.com.

Safe Harbor Statement

This press release contains forward-looking statements. Forward-looking statements include statements concerning plans, objectives, goals, strategies, future events or performance, and underlying assumptions and other statements that are other than statements of historical facts. These statements include, among others, statements regarding the Company’s plans to regain compliance with the minimum bid price requirement. The Company’s actual results may differ materially from those expressed in any forward-looking statements as a result of various factors and uncertainties. The reports filed by the Company with the Securities and Exchange Commission discuss these and other important factors and risks that may affect the Company’s business, results of operations and financial conditions. For these reasons, among others, investors are cautioned not to place undue reliance upon any forward-looking statements in this press release. The Company undertakes no obligation to publicly revise these forward-looking statements to reflect events or circumstances that arise after the date hereof.

For more information, please contact:

Feng Zhou, Chief Executive Officer

Email: fzhou@sxtchina.com

FAQ

What is China SXT Pharmaceuticals (SXTC) announcing on January 15, 2026?

China SXT announced an AI Insight Initiative to explore AI and digital technologies across its TCM raw-material supply chain.

Which supply chain areas will SXTC explore using AI?

The company will explore AI for cultivation monitoring, origin/authenticity assessment, quality evaluation and grading, and supply-demand forecasting.

What are the stated goals of SXTC's AI initiative for shareholders and operations?

Goals include improved supply chain transparency, operational stability, enhanced quality oversight, traceability, and more reliable resource planning.

Will the SXTC announcement change product lines or pricing immediately?

No immediate product, pricing, or financial changes were disclosed; the announcement describes exploratory efforts and long-term planning.

Does the SXTC AI initiative involve changes to Traditional Chinese Medicine production principles?

The company said it intends to apply AI while preserving traditional TCM raw-material production principles.

Who commented for China SXT on the AI supply chain initiative?

Feng Zhou, Co-Chief Executive Officer and Director, commented that applying AI is an important part of the company's long-term operational planning.