Summary of Business and Present Offering

We are an herbal health, diet, and nutrition company. The Company’s mission is to provide herbal health, diet and vitamin nutritional supplements through three (3) operational subsidiaries, as explained below.

The Company was incorporated in the State of California on January 1, 2000. On January 27, 2016, the Company entered into a change of control whereby our controlling shareholder, Jian Yang, purchased a controlling interest in the Company. On that same date, Jian Yang entered into a stock purchase agreement with Fusion Diet Systems, Inc. a Utah corporation dba, Fusion Naturals (“Fusion Naturals”). Fusion Naturals was originally incorporated in Utah on April 20, 2010. On January 9, 2017, the Company created a new corporation in the State of California called Bio Essence Pharmaceutical, Inc. to serve as a health supplements manufacturer (“BE Pharma”). Then, on January 12, 2017, the Company created its third subsidiary, Bio Essence Herbal Essentials Inc. (“BE Essentials”). The Company serves as a holding corporation for these subsidiaries.

The Company is headquartered at 8 Studebaker Drive in Irvine, California 92618 and the company’s website is located on the Internet at http://www.bioessencecorp.com. Our telephone number is (949) 706-9966. An organizational chart appearing on the next page provides an illustration of the relationship between the entities identified above.

The primary focus of BE Pharma is producing products for BE Essentials and Fusion Naturals, along with providing original equipment manufacturing and private label services to other companies. BE Essentials targets and develops traditional Chinese medicines (“TCM”) in the form of single herbs, granules, pills, and tablets. It also offers special formulated dietary supplements and medical food. The Company intends to develop this subsidiary into one that is engaged in integrated health and to provide its customers to interact with dietitians, nutraceutical practitioners, and traditional integrative wellness doctors worldwide. Fusion Naturals is developing a focus on mass market sales of its products. It currently offers functional supplements, beauty supplements and collagen products.

The Company sells its products through channels such as TCM practitioners, online websites such as Amazon and its own proprietary website, and brick-and-mortar stores, such as GNC, Vitamin World, TJ Max, Home Goods, Marshalls, and Grocery Outlets.

An investment in the Shares offered under the IPO and Resale are highly speculative in nature, involve a high degree of risk, and are suitable only for persons who can afford to risk the loss of the entire amount invested.  Before purchasing any of these securities, you should carefully consider the following factors relating to our business and prospects.  If any of the following risks occurs, our business, financial condition or operating results could be materially adversely affected.  In such case, the trading price of our common stock could decline, and you may lose all or part of your investment. 

An investment in the Shares offered under the IPO and Resale are highly speculative in nature, involve a high degree of risk, and are suitable only for persons who can afford to risk the loss of the entire amount invested.  Before purchasing any of these securities, you should carefully consider the following factors relating to our business and prospects.  If any of the following risks occurs, our business, financial condition or operating results could be materially adversely affected.  In such case, the trading price of our common stock could decline, and you may lose all or part of your investment. 

Risks Related to Our Business and Industry 

The herbal, vitamin, and nutraceuticals industry is an intensely competitive market.

While there is evidence of strong consumer appeal, we cannot assure you that consumers will continue to embrace using herbs, vitamins, or nutraceuticals. Many factors must be considered when investing in this industry due to regulations set by both U.S. and international committees that oversee the industry. We face significant competition from others in this industry. The herbal, vitamins and nutraceuticals industry is highly fragmented with smaller companies offering products to large multi-national corporations, which have large, integrated manufacturing lines. These large corporations can produce a more robust supply of herbs, vitamins, and nutraceuticals products. There are many ‗friendly competitors that may not compete directly with our operations but supply us or provide source product for our end product. These companies may in turn help our competitors by providing the same source product for their products.

There are thousands of herbal, vitamin and nutraceuticals companies both privately held and publicly traded today. Many have greater financial resources than our company and to the extent we compete directly with any given company with said greater financial resources, we may be at a disadvantage. Other risks within our industry are outlined within this Private Placement Memorandum and are related to regulations set forth by industry committees and to the extent the Food and Drug Administration (“FDA”) is involved, they could have an effect on what source products we use and cannot use. No assurances can be made that any ruling from the FDA or other organization will not ban the use of any source product which may hurt our sales.

We may not be able to compete successfully against current and future competitors.

While many companies compete directly against us for market share, others complement us by providing resource product to produce our end product. Many of our competitors have financial resources that extend far beyond ours, which may adversely affect our ability to compete. We cannot make any assurances to you that we will be successful in our business endeavors if we (a) are unable to compete with a competitor, (b) lose our ability to source product from a competitor or partner, (c) are unable to raise sufficient funds to compete against others, (d) lose our employees to a competitor, or (e) lose advantages over our product offerings against a superior competitor due to price, branding, marketing, and/or distribution power.

We hold no patents on our products, and our business employs proprietary technology (know-how) and information may be difficult to protect and/or infringe on the intellectual property rights of third parties.

The Company currently relies on trade secrets, proprietary know-how, and technology methods that we seek to protect, in part, by confidentiality agreements. We cannot assure you that these agreements will not be breached, that we will have adequate remedies for any breach, or that our trade secrets and proprietary know-how will not otherwise become known or be independently discovered by others. We currently do not hold patents from the United States Patent and Trademark Office (“USPTO”) or hold any FDA approvals. Management believes that part of applying for a patent allows competitors to copy our products and would force the company to file lawsuit against the offending parties upon infringement. As a small company, management believes that it is more effective to mitigate this risk by relying on our trade secrets than to file a patent and allow others to review our processes. Therefore, our success depends, in part, on our ability to keep competitors from reverse engineering our products, methods, know-how and maintain trade secrecy and operate without infringing on the proprietary rights of third parties. Additionally, as a herbal, nutraceuticals company, we are not bound by any law or rules to obtain FDA approval for any of our products at this time.

We cannot assure you that the patents of others will not have an adverse effect on our ability to conduct our business, that any of our trade secrets and applications will be protected, that we will develop additional proprietary technology (know-how) or methods that is defensible against theft or will provide us with competitive advantages or will not be challenged by third parties.

Regulations and oversight by the FDA or other governmental entities may adversely affect our business.

We may be subject to regulations or oversight implemented by the FDA, which may materially affect our ability to conduct business, including, but not limited to, limit the number or types of products we are able to produce. Additionally, regulations may change over time. Added oversight from the FDA or other governmental entities may increase the cost associated with operating as an herb, vitamin, and nutraceuticals company, which would adversely affect our shareholders.

Negative media coverage on our industry may adversely affect our business and the value of our common stock.

While we strive to produce high quality products, there have been reports of fraud, misrepresentation, and counterfeiting relating to herbs and vitamins in our industry. As a result, some regulatory agencies have initiated investigations into these allegations, including investigations into some of our competitors. While we are not the target of any investigation, business may diminish or be adversely affected by the negative publicity affecting our industry as a whole, which would in turn negatively affect the value of our common stock. Future media coverage or administrative investigations may further damage the reputation of our industry, which may harm our reputation and the value of our common stock.

We were acquired in a stock purchase transaction via a change of control by the current majority shareholder in the Company.

Our majority shareholder, Jian Yang acquired the Company in 2016. We are currently making efforts to develop additional products to grow our business after years of stagnation. Our management believes there are strong merits to our business and seek to meet those challenges. However, we have not been profitable and there can be no assurance that we will operate profitably or will have adequate working capital to meet our obligations as they become due. Investors must consider the risks and difficulties frequently encountered by early stage companies, particularly in rapidly evolving markets. Such risks include adequately adapting to a competitive market, managing our operations, and expanding our business in a sustainable way.

We cannot be certain that our business strategy will be successful or that we will successfully address these risks. In the event that we do not successfully address these risks, our business, prospects, financial condition, and results of operations could be materially and adversely affected, and we may not have the resources to continue or expand our business operations.

We have experienced losses and we may not achieve or sustain profitability in the future.

We have suffered losses over the last two years. These losses are outlined in detail in our audited financial statements. We have no ability to predict if we will become profitable. We anticipate that our cost of revenues and operating expenses will increase substantially in the foreseeable future as we continue to grow our business and develop our new products. These efforts may prove more expensive than we currently anticipate, and we may not succeed in increasing our revenues sufficiently to offset these higher expenses. Many of our efforts to generate revenues from our business are new, and any failure to increase our revenues or generate revenues from our products could prevent us from attaining or increasing profitability. We do not expect to be profitable in the foreseeable future and we cannot be certain that we will be able to attain profitability on a quarterly or annual basis, or if we do, that we will sustain profitability.

We have a need to raise additional capital.

The Company may not be able to fully develop and implement its objectives without additional capital beyond this private offering. We may require additional financing in order to meet the milestones and requirements of its plans. Additional funding might be required for staffing, marketing, public relations and the necessary research to expand the scope of its business plan on a global scale. The issuance of additional securities could dilute existing shareholders. Bio Essence funding plans include selling additional capital stock and/or borrowing to fund the aforementioned expenses. We may approach hedge funds, venture capital groups, private investment groups, or other institutional investment groups in our efforts to achieve future funding.

We depend heavily on our management, without whose services, our business operations could cease.

At this time our management is wholly responsible for the development and execution of our business plan. Our management is under no contractual obligation to remain employed by us, although they have no present intent to leave. If our management should choose to leave us for any reason before we have hired additional personnel our operations may fail. Even if we are able to find additional personnel, it is uncertain whether we could find qualified management who could develop our business along the lines described herein or would be willing to work for compensation we could afford. Without such management, we could be forced to cease operations and investors in our common stock or other securities could lose their entire investment.

Bio Essence might experience the risk of managing growth.

We are a small company with 13 employees. We expect to experience a period of significant expansion in headcount, facilities, infrastructure and overhead and anticipate that further expansion will be required to address potential growth and market opportunities. Future growth will impose significant added responsibilities on members of management, including the need to identify, recruit, maintain and integrate managers. Our future financial performance and its ability to compete effectively will depend, in part, on its ability to manage any future growth effectively.

We expect to expand our operations by increasing its sales and marketing efforts, research into other development opportunities such as functional beverages and TCM products and services. The anticipated growth could place a significant strain on our management, and operational and financial resources. Effective management of the anticipated growth shall require expanding Bio Essence management and financial controls, hiring additional appropriate personnel as required, and developing additional expertise by existing management personnel. However, there can be no assurances that these or other measures implemented by Bio Essence shall effectively increase its capabilities to manage such anticipated growth or to do so in a timely and cost-effective manner. The failure to effectively manage growth could have a material adverse effect on Bio Essence operations.

The requirements of being a public company may strain our resources and distract our management, which could make it difficult to manage our business, particularly after we are no longer an “emerging growth company.”

We are required to comply with various regulatory and reporting requirements, including those required by the SEC. Complying with these reporting and other regulatory requirements are time-consuming and expensive and could have a negative effect on our business, results of operations and financial condition.

As a public company, we are subject to the reporting requirements of the Securities Exchange Act of 1934 (“Exchange Act”) and requirements of the Sarbanes-Oxley Act of 2002 (“SOX Act”). The cost of complying with these requirements may place a strain on our systems and resources. The Exchange Act requires that we file annual, quarterly and current reports with respect to our business and financial condition. SOX require that we maintain effective disclosure controls and procedures and internal controls over financial reporting. To maintain and improve the effectiveness of our disclosure controls and procedures, we must commit significant resources, may be required to hire additional staff and need to continue to provide effective management oversight. We will be implementing additional procedures and processes for the purpose of addressing the standards and requirements applicable to public companies. Sustaining our growth also will require us to commit additional management, operational and financial resources to identify new professionals to join the Company and to maintain appropriate operational and financial systems to adequately support expansion. These activities may divert management's attention from other business concerns, which could have a material adverse effect on our business, financial condition, results of operations and cash flows. We cannot predict or estimate the amount of additional costs we may incur as a result of becoming a public company or the timing of such costs.

Regulations, including those contained in and issued under the SOX Act and the Dodd–Frank Wall Street Reform and Consumer Protection Act of 2010 (“Dodd-Frank”), increase the cost of doing business and may make it difficult for us to retain or attract qualified officers and directors, which could adversely affect the management of our business and our ability to obtain or retain listing of our common stock.

The current regulatory climate for public companies, even small and emerging growth companies such as ours, may make it difficult or prohibitively expensive to attract and retain qualified officers, directors and members of board committees required to provide for our effective management in compliance with the rules and regulations which govern publicly-held companies, including, but not limited to, certifications from executive officers and requirements for financial experts on boards of directors. The perceived increased personal risk associated with these recent changes may deter qualified individuals from accepting these roles.  For example, the enactment of the SOX Act has resulted in the issuance of a series of new rules and regulations and the strengthening of existing rules and regulations by the SEC.  Further, recent and proposed regulations under Dodd-Frank heighten the requirements for board or committee membership, particularly with respect to an individual’s independence from the corporation and level of experience in finance and accounting matters.  We may have difficulty attracting and retaining directors with the requisite qualifications. If we are unable to attract and retain qualified officers and directors, the management of our business could be adversely affected.

If we complete a financing through the sale of additional shares of our common stock in the future, or we acquire property through the issuance of shares of our common stock in the future, then shareholders will experience dilution.

The most likely source of future financing presently available to us is through the sale of shares of our common stock. Any sale of common stock will result in dilution of equity ownership to existing shareholders. This means that, if we sell shares of our common stock or issue stock as consideration for a purchase, more shares will be outstanding, and each existing shareholder will own a smaller percentage of the shares then outstanding. To raise additional capital, we may have to issue additional shares, which may substantially dilute the interests of existing shareholders. Alternatively, we may have to borrow large sums, and assume debt obligations that require us to make substantial interest and capital payments.

As of the date of this filing, we have earned revenue. However, we cannot guarantee we will be successful in continuing to generate revenue or be successful in raising funds through the sale of shares to pay for the Company's business plan and expenditures. Failure to generate revenue or to raise funds could cause us to go out of business, which would result in the complete loss of your investment.

We will be obligated to develop and maintain proper and effective internal controls over financial reporting.

We may not complete our analysis of our internal controls over financial reporting in a timely manner, or these internal controls may have one or more material weaknesses, which may adversely affect investor confidence in our company and, as a result, the value of our common stock.

Ensuring that we have adequate internal financial and accounting controls and procedures in place so that we can produce accurate financial statements on a timely basis is a costly and time-consuming effort that will need to be evaluated frequently. Section 404 of SOX Act requires public companies to conduct an annual review and evaluation of their internal controls and attestations of the effectiveness of internal controls by independent auditors. We will be required to perform the annual review and evaluation of our internal controls no later than for the fiscal year ending January 31st on any given year. However, we initially expect to qualify as a smaller reporting company and as an emerging growth company, and thus, we would be exempt from the auditors' attestation requirement until such time as we no longer qualify as a smaller reporting company and an emerging growth company. We would no longer qualify as a smaller reporting company if the market value of our public float exceeded $75 million as of the last day of our second fiscal quarter in any fiscal year following this offering. We would no longer qualify as an emerging growth company at such time as described in the risk factor immediately below.

We are in the early stages of the costly and challenging process of compiling the system and processing documentation necessary to evaluate our internal controls needed to comply with Section 404. During the evaluation and testing process, if we identify one or more material weaknesses in our internal control over financial reporting, we will be unable to assert that our internal controls are effective. If we are unable to assert that our internal control over financial reporting is effective, we could lose investor confidence in the accuracy and completeness of our financial reports, which would cause the price of our common stock to decline.

There is no minimum offering.

There is no minimum number of shares of common stock that must be sold by the Company prior to the closing of the IPO. As a result, there can be no assurance that Bio Essence will raise sufficient funds through this Offering to carry out its Business Plan as currently proposed, or that the net proceeds from the initial subscriptions for common stock will be in an amount sufficient to enable Bio Essence to continue operations in any meaningful manner.

Bio Essence might experience potential fluctuations in operating results.

Significant annual and quarterly fluctuations in Bio Essence results of operations may be caused by, among other factors, the volume of revenues generated by Bio Essence, the timing of new product or service announcements and releases by Bio Essence and its competitors in the marketplace, and general economic conditions. There can be no assurances that the level of revenues and profits, if any, achieved by Bio Essence in any particular fiscal period shall not be significantly lower than in others, including comparable fiscal periods. Bio Essence expense levels are based, in part, on its expectations as to future revenues.

As a result, if future revenues are below expectations, net income or loss may be disproportionately affected by a reduction in revenues, as any corresponding reduction in expenses may not be proportionate to the reduction in revenues. As a result, Bio Essence believes that period-to-period comparisons of its results of operations may not necessarily be meaningful and should not be relied upon as indications of future performance.

We have not developed independent corporate governance.

We do not presently have audit, compensation, or nominating committees. This lack of independent controls over our corporate affairs may result in conflicts of interest between our officers, directors and our stockholders. We presently have no policy to resolve such conflicts. As a result, our directors have the ability to, among other things, determine their own level of compensation. Until we comply with such corporate governance measures to form audit and other board committees in a manner consistent with rules of a national securities exchange, there is no assurance that we will not be subject to any conflicts of interest. As a result, potential investors may be reluctant to provide us with funds necessary to expand our operations.

The relative lack of public company experience of our management team may put us at a competitive disadvantage.

As a company with a class of securities registered under the Exchange Act, we are subject to reporting and other legal, accounting, corporate governance, and regulatory requirements imposed by the Exchange Act and rules and regulations promulgated under the Exchange Act. Our management team lacks significant public company experience, which could impair our ability to comply with these legal, accounting, and regulatory requirements. Such responsibilities include complying with federal securities laws and making required disclosures on a timely basis. Our senior management may not be able to implement and effect programs and policies in an effective and timely manner that adequately responds to such increased legal and regulatory compliance and reporting requirements. Our failure to do so could lead to the imposition of fines and penalties and further result in the deterioration of our business.

Our profitability depends upon achieving success in our future operations through implementing our business plan, increasing sales, and expanding our customer and distribution bases, for which there can be no assurance given.

Profitability depends upon many factors, including the success of the Company’s marketing program, the Company’s ability to identify and obtain the rights to additional products to add to its existing product line, expansion of its distribution and customer base, maintenance or reduction of expense levels and the success of the Company’s business activities. The Company anticipates that it will continue to incur operating losses in the future. The Company’s ability to achieve profitable operations will also depend on its ability to develop and maintain an adequate marketing and distribution system.

Bio Essence needs to continue to attract and retain professional and qualified personnel, which may require the issuance of stock warrants or options.

Bio Essence’s ability to realize its objectives is dependent on its ability to attract and retain additional, qualified personnel. Competition for such personnel can be intense, and there can be no assurance that Bio Essence’s results will not be adversely affected by difficulty in attracting and/or retaining qualified personnel. To the extent it does enter into employment agreements, there can be no assurance that such agreements shall fully protect Bio Essence from competitive injury if any of these individuals leave the company.

One method of attracting talent is issuing stock warrants or options. This provides the Company with a way to compensate key personnel. If issued, the warrants and options would also have a dilutive effect on the interests of the purchasers of stock, thus triggering the anti-dilution rights of the Founders. Moreover, in the event Bio Essence requires additional equity financing pursuant to the shares offered under this Offering, purchasers of the additional shares may experience further dilution to the extent that such shares may be issued for a value less than the price paid for shares offered hereunder.

We will be controlled by existing shareholders after this offering.

Upon the completion of this Offering, the directors and officers currently in place will continue to oversee the Company’s operations. Jian Yang, our former director and majority shareholder, will continue likely continue to maintain control of the Company by virtue of owning a majority of the Company’s issued and outstanding common stock.

As a result, Ms. Yang will likely have a significant influence on the affairs and management of the Company, as well as on all matters requiring stockholder approval, including electing and removing members of its board of directors, causing the Company to engage in transactions with affiliated entities, causing or restricting the sale or merger of the Company and changing the company’s dividend policy. Such concentration of ownership and control could have the effect of delaying, deferring or preventing a change in control of Bio Essence even when such a change of control would be in the best interests of the company’s other stockholders.

Notably, all of Ms. Yang’s shares are being registered under the Resale. As such, there is a possibility that Ms. Yang may divest herself of a majority, or all, of his stock in the Company. This would lead to a change in control over the Company. At this time, the Company believes that such a divestiture is unlikely. While the results of the Resale are unpredictable, the Company believes that, at the close of the Resale and IPO, it will likely remain controlled by Ms. Yang or a small number of shareholders.

Limitations on director and officer liability and our indemnification of our officers and directors may discourage stockholders from bringing suit against a director.  

Article IX, Section 4 of the Bylaws provide that officers and directors will be indemnified by the Company to the fullest extent of California law. These provisions may discourage stockholders from bringing suit against a director for breach of fiduciary duty and may reduce the likelihood of derivative litigation brought by stockholders on our behalf against a director. In addition, our Certificate of Incorporation and Bylaws provide for mandatory indemnification of directors and officers to the fullest extent permitted by governing state law.  

A downturn in general economic conditions could cause adverse consequences for the Company operations.

The financial success of the Company may be sensitive to adverse changes in general economic conditions in the United States, and any States in which we do business, such as recession, inflation, unemployment, and interest rates. Such changing conditions could reduce demand in the marketplace for the Company's services and products. Management believes that the impending growth of the market, mainstream market acceptance and the targeted product line of the Company will insulate the Company from excessive reduced demand. Nevertheless, the Company has no control over these changes.

Risks Related to Our Common Stock

Our stock price may be volatile or may decline regardless of our operating performance, and the price of our common stock may fluctuate significantly .

Once our shares begin trading, the market price for our common stock is likely to be volatile, in part because our shares have not been traded publicly. In addition, the market price of our common stock may fluctuate significantly in response to a number of factors, most of which we cannot control, including:

These and other factors may lower the market price of our common stock, regardless of our actual operating performance. The stock markets and trading facilities, including the OTC Bulletin Board, have experienced extreme price and volume fluctuations that have affected and continue to affect the market prices of equity securities in many companies. In the past, stockholders of some companies have instituted securities class action litigation following periods of market volatility. If we were involved in securities litigation, we could incur substantial costs and our resources, and the attention of management could be diverted from our business.

Future sales of our common stock, or the perception in the public markets that these sales may occur, may depress our stock price.

Sales of substantial amounts of our common stock in the public market after this offering, or the perception that these sales could occur, could adversely affect the price of our common stock and could impair our ability to raise capital through the sale of additional shares. Upon completion of this offering, we will have 38,209,000 shares of common stock outstanding—assuming all shares of the IPO are sold.  Our shares of common stock offered herein will be freely tradable without restriction under the Securities Act, except for any shares of our common stock that may be subsequently held or acquired by our directors, executive officers and other “affiliates,” as that term is defined in the Securities Act, which will be restricted securities under the Securities Act. Restricted securities may not be sold in the public market unless the sale is registered under the Securities Act or an exemption from registration is available.

In the future, we may also issue our securities in connection with investments or acquisitions. The amount of shares of our common stock issued in connection with an investment or acquisition could constitute a material portion of our then-outstanding shares of our common stock. Any issuance of additional securities in connection with investments or acquisitions may result in additional dilution to you.

If securities or industry analysts do not publish research or publish inaccurate or unfavorable research about our business, our stock price and trading volume could decline.

The trading market for our common stock will depend in part on the research and reports that securities or industry analysts publish about us or our business. We do not currently have and may never obtain research coverage by securities and industry analysts. If no securities or industry analysts commence coverage of our company, the trading price for our common stock could be negatively impacted. If we obtain securities or industry analyst coverage and if one or more of the analysts who cover us downgrades our common stock or publishes inaccurate or unfavorable research about our business, our stock price would likely decline. If one or more of these analysts ceased coverage of us or fail to publish reports on us regularly, demand for our common stock could decrease, which could cause our stock price and trading volume to decline.

Our internal controls over financial reporting may not be effective and our independent registered public accounting firm may not be able to certify as to their effectiveness, which could have a significant and adverse effect on our business and reputation.

As a public company, we are required to make a formal assessment of the effectiveness of our internal controls over financial reporting under Section 302. In addition, at such time as we cease to be an “emerging growth company,” as more fully described in these Risk Factors, we will be required to comply with Section 404. At such time, we may identify material weaknesses that we may not be able to remediate in time to meet the applicable deadline imposed upon us for compliance with the requirements of Section 404. In addition, if we fail to achieve and maintain the adequacy of our internal controls, as such standards are modified, supplemented or amended from time to time, we may not be able to ensure that we can conclude on an ongoing basis that we have effective internal controls over financial reporting in accordance with Section 404. We cannot be certain as to the timing of completion of our evaluation, testing and any remediation actions or the impact of the same on our operations. If we are not able to implement the requirements of Section 404 in a timely manner or with adequate compliance, our independent registered public accounting firm may issue an adverse opinion due to ineffective internal controls over financial reporting and we may be subject to sanctions or investigation by regulatory authorities, such as the SEC. As a result, there could be a negative reaction in the financial markets due to a loss of confidence in the reliability of our financial statements. In addition, we may be required to incur costs in improving our internal control system and the hiring of additional personnel. Any such action could negatively affect our results of operations and cash flows.

Our management and other affiliates have significant control of our common stock and could control our actions in a manner that conflicts with the interests of other stockholders.

After the offering, we anticipate that our current majority shareholder—Jian Yang—will continue to beneficially own the majority of our common stock, representing the majority of the voting power of our outstanding capital stock. As a result, Ms. Yang will be able to exercise considerable influence over matters requiring approval by our stockholders, including the election of directors, and may not always act in the best interests of other stockholders. Such a concentration of ownership may have the effect of delaying or preventing a change in our control, including transactions in which our stockholders might otherwise receive a premium for their shares over then current market prices.

We do not expect to pay any cash dividends for the foreseeable future.

The continued operation and growth of our business will require substantial cash. Accordingly, we do not anticipate that we will pay any cash dividends on shares of our common stock for the foreseeable future. Any determination to pay dividends in the future will be at the discretion of our Board of Directors and will depend upon our results of operations, financial condition, contractual restrictions relating to indebtedness we may incur, restrictions imposed by applicable law and other factors our Board of Directors deems relevant. Accordingly, if you purchase shares in this offering, realization of a gain on your investment will depend on the appreciation of the price of our common stock, which may never occur. Investors seeking cash dividends in the foreseeable future should not purchase our common stock.

Our Shares will likely be considered “penny stocks”

Our shares likely will be “penny stocks” as that term is generally defined in the Exchange Act and the rules and regulations promulgated thereunder to mean equity securities with a price of less than $5.00. Our shares thus will be subject to rules that impose sales practice and disclosure requirements on broker-dealers who engage in certain transactions involving a penny stock. Penny stocks are volatile and subject to additional regulation. As such, an investment in the Company is especially risky and should be done only if the investor is comfortable losing part or all of his or her investment.

Detailed Description of Business

Overview

Bio Essence is a leader in the nutraceutical industry. Our mission is to provide natural, simple, and effective products that support wellness and vitality. Because we believe that quality of life is key, our focus is on preventative measures, rather than treatments. As such, we have pioneered the convergence of modern science with traditional medicines that have been in use for centuries. Since its establishment in 2000, Bio Essence has extended its reach to the Asian market in Taiwan, Hong Kong, and China, as well as into the United Kingdom and various regions internationally.

Vision

We envision a world in which a clean, healthy, lifestyle, supported by holistic products and practices, is the foundation of preventative medicine.

Values

Our core values consist of the “Five T’s”:

Corporate History

Bi o E ss e nc e was i nc orpor a t e d in t h e St ate of C a li f or n ia on Ja nu a r y 1, 2000, as an herbal, vitamin supplement, and functional foods company. On January 27, 2016, the Company entered into a change of control whereby its former controlling shareholder sold his shares in the Company to the Company’s current majority shareholder, Jian Yang. On that same date, Jian Yang entered into a stock purchase agreement with Fusion Naturals.

Fusion Naturals was originally incorporated in Utah as Nutri-Fusion Systems, LLC on April 20, 2010. On January 9, 2017, the Company created a new corporation in the State of California called Bio Essence Pharmaceutical, Inc. to serve as a health supplements manufacturer (“BE Pharma”). On January 12, 2017, the Company created Bio Essence Herbal Essentials Inc. dba, Bio Essence Health Science (“BE Essentials”) to handle its sales and customer service business. The Company serves as a holding corporation for these three subsidiaries. We are headquartered at 8 Studebaker, Irvine, CA 92618 and our corporate website is www.bioessencecorp.com.

Bio Essence Herbal Essentials dba Bio Essence Health Science

www.bioessence.com

For Physicians, By Physicians

BE Essentials focuses on providing safe, effective, and potent dietary supplements and services to healthcare practitioners. Our company employs well-trained, dedicated professionals who possess advanced medical knowledge, have an appreciation for innovative technological methodology, and are willing to promote the BE Essentials vision.

BE Essentials is unique in its integration of Traditional Chinese Medicine (“TCM”) with the modern technological advancements and knowledge found in Western healthcare practices. By implementing multiple practices, we have the means to formulate nutrient-rich herbal products that promote prevention versus treatment.

BE Essentials consistently makes strides in the development and promotion of the Global Integrative Medicine Platform, an online system that advocates for natural prevention of disease and personalized nutrition.

Products

Service

Personalized nutrition services will be part of the future of preventative care, and BE Essentials is proud to be at the forefront of this exciting revolution. We understand that when it comes to nutrition and health challenges, no two people are exactly the same, and we take pride in providing personalized nutrition services to patients through our healthcare practitioner network. Our experts combine genetic DNA testing with our proprietary personal lifestyle survey to get a holistic sense of a patient’s health condition. Leveraging this data, they are then able to design personalized nutritional formulas based on unique individual needs. Our quality-assured, individually formulated supplements are created by an FDA-registered manufacturing partner.

The Global Integrative Medicine Online Platform is tailored to provide effective and timely management of health data for both practitioners and patients. It also offers convenience for patients who seek personalized nutrition service and virtual doctor’s office visits.

Outlook

We anticipate a 20% growth in the next two years as a result of product line expansion in the anti-aging market. As we increase our focus on anti-aging products, we will expand our distribution into individual pharmacies and amongst service providers specializing in anti-aging. Additionally, we are working through our Chinese practitioner’s network to offer personalized nutrition services in China.

Fusion Naturals

www.heyfusion.com

Real Ingredients for Real Products

At Fusion Naturals, we believe that beauty should come from within naturally. That’s why we combine our clinically proven, simple, clean, and wholesome products with a genuine concern for our customers’ health and wellness. On the production side, our supply chain coordinators and quality control staff personally select and inspect each ingredient. On the consumer side, staff dietitians connect with our customers personally in order to cater to their individual needs and support them wherever they are on their wellness journey.

Fusion Naturals produces a variety of nutritional supplements free of preservatives, GMOs, soy, dairy, and gluten, as well as a selection of vegan-friendly products. We strive to keep our products green, and our small batch sizes guarantee that our products are fresh.

Products

Sales Channels

Our online distributors include Walmart.com, Jet.com, Lucky Vitamin, Billion Vegan, and Amazon. Our brick-and-mortar partners include GNC, TJ Max, Vitamin Shoppe, Vitamin World, and the Fresh Market. Our products are also currently under review by Target, Ulta Beauty, and Wholefoods.

Outlook

We project 2.5 million dollars in sales in 2019. With stronger brand recognition and a broader distribution, we anticipate reaching 40 million dollars in sales within 5 years.

Bio Essence Pharmaceutical

Customized care, effective solutions

BE Pharma develops and manufactures a selection of supplement products that are in accordance with the regulatory standards set by the United States Food and Drug Administration. We gladly support both individualized and joint research and development ventures.

BE Pharma offers four types of services to customers.

BE Pharma’ production process involves the following four steps:

Industry Overview

The world-wide herbal supplements and nutraceuticals market is expected to reach sales of over $278 billion by 2020. While Eastern consumers are aware of benefits of consuming herbs and vitamins, consumers around the western world are looking for natural alternatives to traditional approaches to western medicine. According to Global Industry Analysts, Inc., herbal supplements and remedies cause little to no side effects and provide greater efficacy also illustrates how the market continues to experience robust growth. Factors that fueled growth in the marketplace includes herbs in preventive health and alternative medicine regimens, supplier innovations, and Current Good Manufacturing Practices (CGMP) for dietary supplements by the FDA.

According to the National Health Interview Survey by the Center of Disease Control and Prevention’s National Center for Health Statistics, one in five U.S. adults regularly take herbal supplements. North America is the largest region for herbal supplements and remedies, according to Global Industry Analysts, Inc., accounting for the largest market share. Asia-Pacific and Japan make up the other important markets for herbal supplements on a global basis. In terms of growth rate, the Asia- Pacific market, led by China and India has the highest CAGR of 10.5% through the end of 2017. Multi- herbs also dominate the market, capturing a significant share of overall herbal supplements and remedies world-wide.

Other new trends that are entering into this market are the rising demand for natural health and food supplements. Fish oils, herbal supplements and other natural offerings such as probiotic acidophilus and detoxes are emerging as alternatives to conventional synthetic supplements. Food supplements such as Omega 3s, herbal extracts, multi-vitamins, probiotics, chondroitin, and glucosamine experienced healthy growth rates over the past few years. There is also increased demand for herbal and botanical products in multi-formula and combo packed format, as well as chewable capsules and tablets.

The U.S., China, India and Japan Vitamin and Dietary Supplement Market

Euromonitor International expects that the U.S. vitamin and dietary supplement market will grow by 53% to $28.7 billion by 2021. With more consumers focused on a diet full of natural, whole foods, as well as functional, value-added products like nutritional beverages and dietary supplements, the market is well positioned to continue its growth. Transparency Market Research estimates that the global nutraceuticals market will reach $278.95 billion by year 2020 with a CAGR of 7.3%. The estimates are due in part to the growing conscious of consumers towards functional foods and beverage, dietary supplements and personal care.

Vitamin and dietary along with herbal supplement sales in China has grown double digits for the past ten years to over $20 billion per year in 2017. Social and demographic factors play a huge role in China as the working age population of 18-59 years old in

China is projected to decline from 925 million today to 700 million in 2050. By that time, nearly 500 million people will be over the age of 60, compared with 200 million today. China has a strong history in herbal and botanical products along with Hong Kong and Taiwan.

The market in India is largely controlled by pharmaceutical drug manufacturers, while 30% is controlled by Ayurveda medicine manufacturers. The Indian market is rapidly growing due to supplements and nutraceuticals being viewed as lifestyle products. Popular supplement categories in India are joint care, hair loss, memory, and childcare products.

The Japanese market for vitamins and dietary supplements had experienced stagnation due to economic pressures; however, it has recently recovered with government initiatives and changing regulations. The market in Japan is estimated to be worth $30 billion per year in sales.

Challenges

Domestic and International growth of the nutraceuticals industry appear to be in a healthy position overall and future forecasts given by well-known market research analytic firms have placed strong figures for its continued progress. The industry currently enjoys favorable demographics as many Americans and citizens around the world are focused on wellness, which includes a diet full of natural, whole foods, as well as functional, value-added products like nutritional beverages and dietary supplements. Clean labels with simple ingredients and clear messaging also add to this broad appeal.

With the growth of the nutraceuticals industry, provisions from the Food Safety Modernization Act (FSMA) brings new regulations that nutraceutical companies will face various manufacturing challenges. With these additional regulatory challenges, companies are adjusting their production to meet growing consumer demand for clean label products, responsibly sourced ingredients, sustainable packaging and pressure to extend shelf life for their supply chain. To reduce further risk under FSMA, nutraceutical companies are utilizing good manufacturing practices (GMP) and designating hygienic zoning programs to differentiate between unprocessed and processed food locations.

At present, there are thousands of herbal, vitamin and nutraceuticals companies both privately-held and publicly-traded today. While many compete directly against each other for market share, others complement each other by providing resource product to produce the end product. Many have financial resources beyond our ability to compete. We cannot make any assurances to you that we will be successful in our business endeavors if we (a) are unable to compete with a competitor, (b) we lose our ability to source product from a competitor or partner, (c) we are unable to raise sufficient funds to compete against others (d) we lose our employees to a competitor, or (e) we lose advantages over our product offerings against a superior competitor due to price, branding, marketing, and/or distribution power.

Our Solution

Personalized nutrition services will be part of the future of preventative care, and BE Essentials is proud to be at the forefront of this exciting revolution. As we rise to meet the demands of increasingly knowledgeable and health-conscious consumers, we look forward to helping usher in a world in which a clean, healthy, lifestyle, supported by holistic products and practices, is the foundation of preventative medicine.

Opportunities

The global dietary supplements market is expected to reach $278 billion USD by 2024, at a Compound Annual Growth Rate of 9.6% from 2016 to 2024 (Grand View Research, Inc.). At 31.4 % market share, the United States supplement market represents the largest single country of the global supplement industry (NBJ Global Supplement Business Report). However, at $43.5 billion, Asia’s total supplement sales surpassed U.S. sales for the first time in 2018. China has been a notable area of opportunity in the industry, gaining the most market share of any global market by adding $10 billion in annual sales over the past ten years.

Compared with the consumer market ten years ago, consumer demand for individualized nutritional products has increased. In the past, brands recommended products to consumers; but with the popularity of information technology, the richness of shopping channels, and the broadening of consumer horizons, consumers are increasingly aware of what they want and they are looking to the industry to provide it.

There are currently three major trends in the consumer demand for supplement products:

Issues

As the pressures of life increase and its pace accelerates, people know the importance of taking nutritional supplements. But there are so many health care products available that not everyone knows how to choose the optimal product for their own unique needs.

Although some companies offer a personalized nutrition program, they typically develop their personalized diet programs, consultations, or dietary packages based only on information obtained through questionnaires that focus on dietary habits and physical activity. Others use biometric data monitors to generate their personalized nutrition plans by combining a few existing products. Although these models are taking individual data into account to provide personalized nutrition programs, dietary recommendations, or dietary products, these products are only a slight improvement over the “one size fits all” model.

BE Essentials’ Personalized Nutrition

BE Essentials recognizes what people need and what the market could not offer: a holistic solution for consumers who are in need personalized nutritional care.

Bio Essence Personalized Nutrition = Scientific Testing + Expert Knowledge + Internet Platform

Scientific Testing

Nutritional genomics will focus on the interaction of dietary nutrition and genes at the molecular level and assess that impact on human health. This work will allow us to establish nutritional interventions based on individual genomic structural features. These advances will provide a means with which to propose a more personalized nutrition policy, so that the results of nutrition research can be more effectively applied to the prevention of disease and achieve the purpose of promoting human health.

Expert Knowledge

NCP (nutrition care process) is a specialized field that relies on nutrition-related knowledge and professional medical diagnostic methods. According to the definition of the American Dietetic Association, nutrition care is divided into four steps: nutrition assessment, nutrition diagnosis, nutrition intervention, and nutrition monitoring and evaluation.

Internet Platform

By leveraging digital technologies such as the Internet, big data, and artificial intelligence, experts provide consumers with more suitable medical nutrition treatment solutions through remote nutrition consultation services and interpretation of data.

Our Process

Our process for providing personalized nutrition services is simple. After the customer registers online, provides a DNA sample, and completes our lifestyle survey, our experts will formulate a unique supplement just for them. That product will then be created by our FDA-registered manufacturing partner and shipped directly to the customer.

Our Strengths

DNA Testing

BE Essentials enables consumers to obtain personalized health consultation management services through genetic testing. In this way, an individual can understand his or her own genetic background, detect the body's disease-associated susceptibility genes, and predict their risk of disease. This knowledge allows for early prevention and early treatment, so that diseases will occur less, occur later, or not occur at all, thereby improving quality of life and extending lifetimes.

With genetic testing, individuals can take the initiative to truly understand their own health situations. Because each person's genes are different, the most effective methods of health care differ for each individual. Genetic testing allows for the development of personalized solutions so that customers can better care for their bodies.

Blindly taking nutritional supplements can cause unnecessary harm to the body. For example, people with susceptibility genes for cirrhosis diseases should not supplement with iron-based health care products for a long time because iron can induce the occurrence of cirrhosis of the liver. Similarly, people with susceptibility genes for lupus erythematosus should not add a lot of protein. Genetic testing allows customers to understand the fundamentals of the body and avoid the harm that could occur from blindly taking health care products.

Internet Platform

Our online platform tailors the optimal health care plan for each person's own situation through the management and interpretation of big data. In order to effectively manage health in real time, data can be collected using wearable technology. Customers can then use our online platform to interact with doctors and the manufacturers of health care products. With every visit, they are guaranteed to obtain the most accurate information for their individual health situation.