Intro to Desert Health Products

[Admin]

DHPI is striving to build an international presence with a broadening line of:
Natural Products for Nutrition, Anti-Aging and Footcare

Desert Health Products, Inc. ("DHPI" or the "Company") has a broadening line of natural and organic products focused on nutrition, anti-aging and footcare. Management is targeting the large and growing international marketplace.

There is a large and growing market for natural products. This market encompasses foods, beverages, supplements and personal care items. The target is consumers who are concerned about health and wellness. The worldwide nutraceutical industry is estimated to be nearly $50 billion annually, and it continues to grow. According to a report by the U.S. Senate Special Committee on Aging (September 2001), the market in the U.S. alone is estimated to be $27 billion.

DHPI has an extensive product line of natural products. Management hopes to offer up to 500 products within a few years. New anti-aging and footcare products seem to hold particular promise. The Company has entered into a joint venture with Hebei YiXian Food Company of China to provide a new generation of nutritional drink for the Chinese marketplace.

Management is planning a worldwide marketing effort. The Company has offices in Europe, China and South America and has tradename and logo Class 5 registration in 30 countries.

New products are expected to contribute to strong sales growth. Management expects that operating earnings for 2004 will turn positive, and a large increase is in prospect for 2005. These results hinge importantly upon the Company's ability to raise additional operating capital.

The stock appears to be significantly undervalued.

[Admin]

The market for natural and organic products is large and growing. It encompasses foods, beverages, supplements and personal care items. The target is consumers who are concerned about health and wellness.


The 23rd annual Natural Products Expo West, which is the largest natural products tradeshow in North America, took place in Anaheim, California, on March 4-7, and it attracted more than 2,500 exhibitors and 36,000 attendees from 86 countries.


Nutraceuticals. Nutraceutical, a term coined in 1992 by Dr. Stephen DeFelice, founder and chairman of the private, nonprofit Foundation for Innovation in Medicine, Cranford, New Jersey, is defined as any substance that is a food or a part of a food and provides medical or health benefits, including the prevention and treatment of disease. Within this definition fall the categories of vitamins, supplements, minerals and herbal remedies. Taking this definition literally, beverages fortified with vitamins and minerals or dietary supplements would be considered nutraceuticals, although some consider food and beverages with health enhancing benefits as being functional foods and often consider nutraceuticals as products sold in medicinal form that have physiological benefit or provides protection against chronic disease.


Nutraceuticals are expected to register significant growth, aided by better understanding of the links between diet and disease, the aging population, increased concern for personal health (a million people turn 50 each day), rising healthcare costs and consumer interest in preventive programs.


The U.S. is the largest market for nutraceuticals, followed by Japan and then Europe. On a per-capita basis, Japan is the leader with per- capita consumption at $166.00, the U.S. at $136.00 and Europe at $92.00. The growth forecast for the supplement industry has been estimated at 3-5% through 2005, with the figures being as high as 30% in Asia. According to the Nutrition Business Journal, San Diego, California, the dietary supplement market generated $18.7 billion in sales in 2002.


There is no clear formula for success in developing a nutraceuticals business. Rhonda Witwer, a Business Development Manager at Monsanto, listed the results of a survey in which important factors included research/clinical trials, consumer awareness of health benefits, media attention, FDA approval of health claims, a proprietary position and proprietary technology. Other keys to success include marketing and distribution expertise, research on health benefits, raw materials, regulatory expertise and manufacturing know how. Formulating products for specific maladies leads to product differentiation. Logo and trademark identification are considered important for product recognition.


Nutraceuticals are subjected to a variety of regulatory requirements. In the U.S., functional foods may contain nutraceuticals, but they are regulated like conventional food and they also compete with traditional foods and are distributed through grocery stores. Nutraceuticals, however, are distributed through drug stores, health food stores, supermarkets and on line. With nutraceuticals, if the ingredients were used prior to 1994, they are not new dietary ingredients. If an ingredient was not used before 1994, the manufacturer needs to notify the FDA 75 days before marketing.


Business Strategy


DHPI's is in the business of identifying, packaging, distributing and selling branded and store brand (private label) products focused on nutrition, anti-aging and footcare. The Company has worked to get approval of its products on an international level. DHPI has recognized that prospective business is dependent on favorable consumer recognition of its tradenames, and it has applied for Class 3 (cosmetics and cleaning preparations) and Class 5 (pharmaceuticals) trademarks to cover many of its products on a global level.


To bring their products to market, DHPI identifies companies that have strong marketing and sales forces with whom they can partner to have their products approved by the regulatory authorities. To support its international development interests, the Company has established business offices in Norway and in China. The European office will be moving to London. An office has also been opened in Ecuador.


DHPI has a desire to expand its product lineup and marketing through acquisitions. It has acquired Royal Products, Inc. (www.royalproducts.net) to distribute its product through network marketing. The Company is also focused on developing strategic relationships with individuals or companies to further product introductions. DHPI has set up a joint venture with a Hebei YiXian Food Company, a Chinese food company that has the marketing tools and other resources that should lead to a successful nutritional beverage introduction.


On the technical side, DHPI does not do research but licenses the products or formulations from companies or individuals. It has established a strong scientific advisory board, headed by Leonard Makowka, M.D., Ph.D, who in conjunction with Joann Cavanagh, H.N.T., A.H.G., National Director of Sales, and on-site nutrition therapist with credentials in the fields of nutrition, supplements, stress management, nutrition therapies, weight management and Western herbalism, identifies opportunities.

[Admin]

The DHPI product offerings are extensive, with over 500 formulations covering vitamins, minerals and antioxidants, specialty supplements including Chinese herbal formulas, weight management products, feminine products that address hormone fluctuation, specialty products such its footcare product and burn and scald product.


There are a couple of new products that appear to have particular promise:


Anti-Aging Products. A line of anti-aging products, exclusive to DHPI, that were developed by nationally known dermatologists. These products are ready for immediate introduction into the marketplace. The products include LaVraie Night-time Treatment Cream, LaVraie Treatment Cleanser, LaVraie Treatment Under Makeup Cream, LaVraie Treatment Toner and LaVaie Two-phase Treatment Mask and Lift. Ingredients include herbals, glycolic acid and moisturizers. This product line has a high gross margin.


FOOTCARE™. A Skin Conditioning System - An innovative, patented product designed specifically to treat the dry skin and other skin conditions often associated with diabetes. This topical skin care system is formulated to provide deep skin moisturizing, enhance healthy looking skin and make the skin feel fresh again. It is a two-phase product with Phase One being a natural ex-foliate to remove dead/dry skin, and Phase Two is an antioxidant that fights the free radicals that are harmful to the cells, helps improve the microcirculation of the skin and moisturizes the skin.


Here is the remainder of the Company's product line:


Vitamins. These include Antioxidant and Multi Vitamin Tablets.


Minerals. These include multi-mineral tablets, chromium picolinate, colloidal minerals, Selenium Plus™ and Super Minerals with Aloe Vera™.


Specialty supplements. The Company uses scientific research to create its innovative specialty supplements based on naturally derived ingredients. All of these supplements contain targeted nutrition to provide safe and effective natural remedies to common ailments. The products include Alcotrol™AsthmaCalm™, Brain Boost™, Desert Boost™, Enhanced Performance II™, Enercoffee™, Euro Fiber™, Ginkgo Biloba, glucosamine complex, liver p.s. tablets, Lyco/Men™, Migrasafe-N™, OsteoDense Plus™, pain and joint support creme, shark cartilage and time-released melatonin.


Weight Management Products. In response to the obesity epidemic in the U.S. and many other parts of the world, DHPI has developed a line of products to assist in weight reduction and management. These weight loss products incorporate natural ingredients that help to reduce appetite, accelerate metabolism, diminish carbohydrate cravings and encourage fat loss. The products include Weight Loss-N™, Natural Lean™, NiteLean Plus™, Thermoburn™ and Fat Inhibitor™.


Herbal/Botanical Products. DHPI uses botanical ingredients cultivated from reputable growers with strict quality standards. The products include Aloe Vera Juice, Bee Pollen, Cat's Claw, Grape Seed Extract, Noni, Pau d'arco, Propolis, Royal Jelly, Saw Palmetto, St. John’s Wort and Progesterone/Yam Cream. The Company also markets Allergy Relief, an anti-diabetes tablet, Perfect Feet™, Dong Quai/Damiana™, Hangover Control and Snore Relief™.


FemAID Products Support Systems. FemAID is a comprehensive nutritional program formulated for women experiencing hormonal fluctuations, such as pre-menstrual syndrome (PMS), perimenopause and menopause. The FemAID line is a combination of nutritional supplements, phyto (plant) hormones and herbs to help women maintain optimal health and alleviate uncomfortable symptoms resulting from hormonal and nutritional imbalance. Products include Women's Basic Formula I, Women's Basic Formula II, Bone Support, Amino Acid Complex, Essential Fatty Acid Support, Phytoestrogen Support, Essential Pro Cream, Vitality Support, Calm Support, Sleep Support, Essential Passion and Essential Feminine Moisture.


Ayurvedic Products. For more than 5000 years, a health system referred to as "Ayurveda", meaning "the science of life" has been practiced in India. This system of natural medicine uses a holistic approach to healing using specialized herbal formulas to balance the body. The Company's Ayurvedic herbal formulas blend the traditional ancient wisdom with current scientific research and manufacturing methods. Products in this category include Antioxidant Formula, Ashwagandha Root Extract, Bacopin and Ginkgo Complex, Bio Q-10, Bio Selenium, Bioperine®, Boswellin® and Curcuminoids, Citrin® Forte, Curcuminoids, DGL Plus Ginger™, Glucosamine Plus Boswellin® Blend, Gugulipid® Plus Hawthorn Complex, Gugulipid® Plus Lactospore, Gymnema & Alpha-Lipoic Complex, Lactospore® Chewables, Lactospore® Probiotic and Picroliv® Boswellin® Blend.


Skin/Personal Care Products. DHPI's skin care and personal care products are designed to maintain and protect the natural inheritance of youthful smoothness and the radiant vitality of healthy skin. DHPI specializes in state-of-the-art formulations that meet the industry standards and qualifications from all natural accepted products to Beta/Alpha Hydroxy items. The product line includes Intensive Mag C Gel, Alpha Hydroxy Gel, Micellular Facial Cleanser, Macroemulsion Moisturizer and Progesterone/Yam Cream.


Burn and Scald Relief. This product is a topical application that can be used to treat burns and scalds without pain, festering, infection and scarring. The treatment has an immediate effect, and the healing time is reduced. The product is made from all natural Chinese herbs, and it is patented in China. It has won awards in China and the Brussels Eureka '98, Merite De L'Invention.


Pet Care Products. DHPI has used the same high standard used in developing products for humans in the development of its pet care line. The products are formulated using natural raw materials, such as aloe vera, active essential oils, efficacious herbs, natural emollients and other natural ingredients.


Children's Chewable Multi-Vitamins. These vitamins are available in cherry, orange and grape flavors, supplying the required nutritional needs of active children. DHPI is also introducing a children's nutrition and weight loss line, developed by Dr. Leondard Makowka.


Spf 30 Plus. An aloe vera-based sun screen product is planned to be introduced in late 2004.


Pregnenalone. This is designed to act quickly and profoundly to restore balance to the basic stress chemistry of the body. It seems to be a potent and quick-acting brain nutrient. Pregnenalone is believed to strengthen the myelin sheath membranes that are vital to the healthy functioning of the brain and nervous system.


DHEA. Dehydroepiandrosterone, or DHEA as it is more commonly called, is the most abundant steroid in the bloodstream and is present at even higher levels in brain tissue. Supplemental DHEA appears to have anti-aging and anti-obesity influences.

[Admin]

The Company has sales contracts with two companies. It has a relationship with sales of private labeled products for Wright Sports and Nutrition that began in 2003 to private label their products. Rayfield Wright, President of Wright Sports and Nutrition, was a star football player with the Dallas Cowboys, making five Super Bowl and six Pro Bowl appearances. He was a candidate for the National Professional Football Hall of Fame as well as the Ring of Honor. The product line focuses primarily on professional athletes and aging baby boomers that associate themselves with professional athletes and have similar needs for supplements. These products are being sold to Brookshire Brothers supermarket chain, United Foods and Apollo Men's spas. Discussions to expand the distribution channels are underway with a variety of large mass merchandise chains.

DHPI has established a 10-year private-labeling agreement with Scottsdale, Arizona-based EIC for the FootCare product in Mexico and with all Indian Nations within the U.S. EIC's first contract for this product is with the Osage Nation, and it is expected to exceed $155,000. Management is hopeful that more contracts will be forthcoming.

In addition, the Company has the Joint Venture in place with Hebei YiXian Food Company and a contract to use Dr. Makowka's name as described in the Marketing section.

DHPI owns or has applied for trademarks registered with the U.S. Patent and Trademark Office. One must apply for trademark registration outside the U.S. DHPI has registered the Desert Health Products, Inc. trade name and logo as Class 5 in the following countries: Argentina, Brazil, Canada, Egypt, France, Germany, Hong Kong, Indonesia, Italy, Malaysia, Mexico, Norway, Spain, Sweden, Taiwan, Britain and Northern Ireland. Federally registered trademarks have a perpetual life, as long as they are renewed on a timely basis and used properly as trademarks, subject to the rights of third parties to seek cancellation of the trademarks. DHPI believes that its registered and unregistered trademarks and other proprietary rights are valuable assets and believes they have significant value in the marketing of its products. DHPI vigorously protects its trademarks against infringement.

DHPI's marketing strategy is to build relationships with companies that have relationships with retail customers, either through distributors or retail operations. The Company is developing a niche market by focusing on mid-size companies that need branded or private label products in small and affordable volumes. DHPI's in-house packaging and contract packaging agreements enable it to provide multiples of various sizes and bottles to meet the requirements of its customers.

The Company has acquired network marketer, Royal Products Inc., which is a wholly owned subsidiary, and it is also focused on developing strategic relationships with individuals or companies that can further their product introductions. It has set up a joint venture with a Hebei YiXian Food Company, a Chinese food company that has the marketing tools and resources that should lead to a successful nutritional beverage introduction.

Dr. Leonard Makowka, the head of the Company's scientific advisory board and a renowned liver transplant specialist, has signed a 10-year contract with DHPI which allows DHPI to use his name, Dr. Mak, on its products.

Desert Health has contracts with a half dozen or so contract manufacturers that have FDA-approved facilities, Good Manufacturing Practice (GMP) registration and, in some cases, topical drug licenses. These companies' manufacturing capabilities include creams, gels, capsules and tablets. Management believes that it is able to meet the contract packaging needs of customers worldwide.

[Rincon de la Paz]

CT,

Do you have any guidance on how to trade a stock with such low volume like DHPI ?

I looked at the historical quotes and there are many days where there are no trades. I plan my exit points before I purchase a stock. However, with very low liquidity, this is a concern.

My impression is that this is a long term hold.

Thanks.

I appreciate your efforts in creating a Christian investment community.

- Quy -

[Admin]

Thanks for the kind comment, but it's not about me, it's about Him, and everyone here functioning as one body. That's the way He intended it. Jesus taught it, Paul preached it, now it's up to us, to do it.

The Bible calls us a peculiar people, and we are. At least I am, just ask my wife. As this community continues to grow in numbers, populated by Christians who also happen to be investors, we will find ourselves a powerful force both in the natural, and the spiritual.

"Many hands make for light work"

OK, out of the pulpit and on to your question about DHPI. My approach to investing is two-fold. I trade stocks, and I buy companies. Let me explain:

Trading -
From a purely technical standpoint, if I see a undervalued, healthy, profitable company poised to make a 20%+ run within 60 days, I will buy their stock on the signal and sell at my target which is usually 20% below the company's true valuation.

Investing-
When I see an incredibly undervalued company, with a unique product, idea, or service, combined with a staggering market for what they offer, I get to know the people behind the comapny. No matter how brilliant, solid or sexy the business plan is, the men or women at the helm are what makes or breaks a company. I look deeper than their degrees, leadership resume, and all those kooky letters after their name. I look into their heart. I look for integrity. I look for women and men who understand and live the principles our forefathers built this great nation upon. I look for men and women who pray. Who call upon the Lord when making tough decisions. Who utilize a portion of their profits to benefit those less fortunate. When I am able to locate all of the above under one roof, I get excited. Very, very excited, because I know God himself has a vested interest in what takes place there. I don't trade their stock, I buy the company. Not the whole company mind you, just all I can. As my trading (above) pays off, I buy more. I do not set an exit price. I do determine how much I am willing to pay per share, and then I add, at $1.00, .12 cents, .40 cents, the roller coaster effect in the early stages of a companies growth have no effect on me. The longer the roller coaster ride lasts, the more opportunities I have to add to my position before my utlimate purchase price is hit. Once that happens, I simply wait and grow old with the company. When I buy a company, I'm not looking for a 20-50% return, I'm looking for 10-50-100 fold increase. Patience is a virtue. It takes patience and faith to buy companies. Trades might pay some bills and support the ministries, but Investing opens the door to a legacy. Unless Jesus comes first, when they finally put me in the ground, I want to know that the day after I'm gone, the Aids-orphans in Africa will still eat, learn and be loved. I want the women and children who have been abused at the hands of someone who promised to love them forever, to still be safe. When I close my eyes that final time, I want the peace of knowing, that the Gospel will continue to be preached in the Barrio's of Mexico. So you see, when I buy a company, I have to be careful, because it's not about me, or building bigger barns, it's all about them.

Which makes it all about Him.........

I hope I answered your question

Have a safe and happy 4th.

Blessings
CT

[Rincon de la Paz]

CT,

Thank-you for the clarification between your trading stocks and your investing stocks. I am glad to read of the faith you have in your investing stocks and your plan for the coming rewards.

I also pray for your success.

- Quy -