Market Position and Growth - Sihuan Pharmaceutical has become the largest cardio-cerebral vascular drug manufacturer in China's prescription drug market by market share since 2007[3]. - The Group achieved a market share of 8.3% in China's cardiovascular prescription drug market in 2018, maintaining its position as the largest manufacturer in this sector[52]. - The Group ranked 11th among pharmaceutical companies in China's hospital market with a market share of 1.4%[53]. - Revenue from CCV products increased by 22.7% year-on-year to approximately RMB1,450.3 million, accounting for 87.2% of the Group's total revenue[83]. - Revenue from non-CCV products increased by 120.6% year-on-year to approximately RMB212.0 million, accounting for 12.8% of the Group's total revenue[83]. Research and Development - The Group has approximately 600 R&D experts and focuses on therapeutic areas with considerable unmet clinical demand[4]. - The Group is reallocating more resources to R&D projects to drive short- to mid-term growth and enhance long-term development capabilities[16]. - R&D expenditure increased by 25.5% to approximately RMB297.0 million, representing 17.9% of total revenue[31]. - The Group's innovative drugs platform has submitted over 700 domestic patent applications and has been granted approximately 300 domestic patents and over 80 overseas patents[45]. - The Group's R&D efforts are focused on both innovative and generic drugs, with a commitment to optimizing product offerings and expediting drug launches[36]. Financial Performance - The Group recorded a revenue of approximately RMB1,662.3 million, representing a year-on-year increase of 30.0%[27]. - Loss attributable to owners of the Company was approximately RMB2,019.9 million, primarily due to impairment loss on goodwill[28]. - Adjusted profit attributable to owners of the Company increased year-on-year by 7.6% to approximately RMB824.0 million, excluding goodwill impairment[28]. - Gross profit was approximately RMB1,368.0 million, with a year-on-year increase of 33.4% and a gross profit margin increase from 80.2% to 82.3%[29]. - Loss for the period totaled approximately RMB1,964.1 million, compared to a profit of RMB786.2 million in the same period last year[124]. Product Development and Approvals - The Group's first self-developed anti-diabetic drug Janagliflozin commenced phase III clinical trials in China, progressing well[21]. - The Group established a joint venture with Strides Pharma Global Pte Limited for supplying and distributing 4 drugs in China[32]. - The Group's innovative drug XZP–5809 received approval for clinical trials from phase I to III in China[24]. - The production approval application for Eslicarbazepine Acetate, an epilepsy treatment drug, has been accepted by NMPA and is included in the Priority Review Process, making the Group the first and only domestic enterprise to submit this application in China[38]. - The Group has achieved drug registration approval for the compound amino acid injection (20AA) (500 ml), which is the only fourth-generation high branched-chain amino acid injection containing 20 types of amino acids, aimed at treating hepatic encephalopathy[37]. Clinical Studies and Evidence - A large-scale clinical study for Cinepazide Maleate Injection involved 1,301 patients and demonstrated its effectiveness in improving prognosis and reducing disability rates in stroke patients[56]. - The safety of Cinepazide Maleate was confirmed through a clinical study involving 19,847 patients conducted at the People's Liberation Army General Hospital[56]. - The Group is conducting a multi-center RCT clinical study to verify the efficacy of Cerebroside-kinin Injection in patients with hypertensive cerebral hemorrhage[56]. - The results of a national multi-center RCT study on Cerebroside-kinin for ischemic stroke patients confirmed its effectiveness in improving neurological functions and prognosis[56]. - The Group's systematic review of Cerebroside-kinin for ischemic stroke and cerebral hemorrhage has led to published meta-analysis results in key medical journals, enhancing the evidence-based level of the product[56]. Strategic Initiatives and Market Adaptation - The Group is expected to launch several generic drugs in the coming years, enriching its product portfolio and generating new revenue streams[36]. - The Group's efforts in adapting to national policy changes include promoting clinical pathways and rational drug use, with multiple products recommended in the 2018 national guidelines[60]. - The introduction of the Monitoring Drug List in July 2019 is expected to impact prescription and procurement patterns in the pharmaceutical industry[90]. - The company aims to strengthen its supply of raw materials to reduce costs and enhance the competitiveness of its generic products[91]. - The company plans to enhance drug R&D resources and optimize product structure through mergers and acquisitions and international collaborations[89]. Financial Position and Investments - Cash and cash equivalents reached approximately RMB4,936.5 million, up from RMB3,314.8 million as of December 31, 2018[131]. - Total investments conducted during the period amounted to approximately RMB554.9 million, primarily in short-term financial planning products[132]. - The Group maintained net cash of approximately RMB4,917.5 million, up from RMB3,219.8 million as of December 31, 2018, indicating a strong financial position[136]. - The Group's capital expenditure for the period amounted to RMB 179.2 million, with RMB 133.4 million spent on property, plant, and equipment, RMB 28.4 million on land use rights, and RMB 17.4 million on intangible assets[174]. - The Group's investment in R&D capital expenditure was RMB 41.6 million, including RMB 26.9 million on property, plant, and equipment, and RMB 14.7 million on intangible assets[179]. Shareholding and Corporate Governance - Dr. Guo Weicheng holds 5,928,928,699 shares, representing 62.64% of the total shareholding[190]. - Dr. Zhang Jionglong has an interest in 5,474,346,813 shares, also accounting for 62.64% of the total shareholding[190]. - The company maintains a register of substantial shareholders as required under Section 336 of the SFO[199]. - The substantial shareholders with 5% or more interests include various entities, but specific percentages are not disclosed in the provided content[199]. - As of June 30, 2019, no directors or chief executives had any interests or short positions in the shares of the company[196].

Company Overview - Sihuan Pharmaceutical has maintained its position as the largest manufacturer of cardio-cerebral vascular (CCV) prescription drugs in China since 2007[4]. - The Group ranks as the eleventh largest pharmaceutical company in China's hospital prescription drug market based on hospital purchase amounts[4]. - In 2018, Sihuan Pharmaceutical celebrated its eighteenth year of operation, continuing to expand its R&D pipeline across five major medical therapeutic areas: CCV system, central nervous system, metabolism, oncology, and diabetes[4]. - Major products include Oudimei, Yuanzhijiu, Kelinao, Wei'ao, Yeduojia, and Mainokang, which are widely used for treating various CCV diseases[3]. - The company has developed a differentiated marketing and sales model since its inception in 2001, contributing to its growth and market leadership[13]. - Sihuan Pharmaceutical was listed on the main board of the Singapore Exchange on March 23, 2007, marking a significant milestone in its corporate development[13]. Research and Development - The Group's R&D capabilities have been recognized, with several products receiving patent protections in China, including a 20-year patent for the synthesis process of Kelinao[13]. - Sihuan Pharmaceutical's commitment to innovation is evident in its ongoing development of new products and technologies to address unmet medical needs in the market[4]. - Acquired 60% interest in Shandong Xuanzhu Pharma Co., Ltd. to enhance R&D capabilities for innovative drugs[14]. - The Group obtained clinical trial approval for the innovative anti-diabetic drug Janagliflozin from the CFDA[16]. - The Group's innovative patent drug Imiglitin Dihydrochloride received approval for Phase II/III clinical trials from the CFDA[17]. - The Group's U.S. R&D Centre focuses on developing innovative small and large molecule drugs, particularly in immunotherapy[17]. - The Group's partnership with Covance supports the global development of its drug candidate pipeline[16]. - The Group's innovative antihypertensive drug Tylerdipine Hydrochloride received clinical trial approval[16]. - The Group's first diabetes patented innovative drug commenced Phase III clinical trials in China, with three other innovative drugs entering Phase II and three entering Phase I clinical trials[26]. - The Group's self-developed oncology drug Pirotinib received full clinical trial approval from the CFDA for Phases I, II, and III[16]. Financial Performance - The Group's revenue increased by 6.2% from RMB2,745.8 million to RMB2,917.4 million in 2018[20]. - Profit attributable to owners of the Company rose by 11.8% to RMB1,620.0 million in 2018[21]. - Basic earnings per share increased by approximately 11.8% over 2017 to approximately RMB17.1 cents in 2018[21]. - Gross profit margin improved to 81.5% in 2018, up from 72.4% in 2017[22]. - Net profit margin increased to 57.6% in 2018, compared to 53.9% in 2017[22]. - Total assets reached RMB15,443.5 million in 2018, an increase from RMB13,591.9 million in 2017[22]. - Cash and cash equivalents rose significantly to RMB3,314.8 million in 2018 from RMB831.9 million in 2017[22]. Market Expansion and Strategy - The Group established a Global Business Development Department to expand its international presence in major therapeutic areas[18]. - Sihuan Pharmaceutical aims to optimize its product resources through mergers and acquisitions to accelerate its internationalization process[30]. - The company is focusing on targeted marketing management to expand hospital coverage for its growth stage products[29]. - The Group believes that its investment in R&D over the past years is yielding positive results, positioning it well for future growth in the Chinese pharmaceutical market[31]. - The Group's strong market presence and product portfolio position it well for future growth and expansion in the pharmaceutical industry[4]. Environmental, Social, and Governance (ESG) - Sihuan Pharmaceutical engaged a third-party consultancy to identify and sort out risk factors to strengthen its ESG system and avoid related risks during the reporting year[35]. - The Board of Directors established an ESG management system based on the group's risk management framework, overseeing sustainable development strategies and monitoring performance[36]. - The Risk Management Committee is responsible for coordinating and monitoring risk management and establishing ESG development strategies for the Group[36]. - The Group's ESG report is published annually, covering efforts and achievements in sustainable development and social responsibility[34]. - The company emphasizes compliance with environmental regulations, including waste gas and wastewater management, and greenhouse gas emissions[44]. - The company is committed to energy saving and emission reduction, as well as ecosystem protection[41]. - The company focuses on employee rights protection, occupational health, and career development[41]. - The company has established communication channels with stakeholders, including customer service centers and feedback surveys[41]. Product Development and Approvals - The Group obtained production approval for exclusive first-to-market generic drug Roxatidine Acetate Hydrochloride for Injection[15]. - The Group's innovative drug platform has submitted over 600 domestic patent applications and has been granted 176 domestic patents and 69 overseas patents[170]. - The Group's Metformin Hydrochloride Tablet has passed the bioequivalence test, becoming the first manufacturer in China to achieve this through a supplementary application[173]. - The Group has scheduled several new products to be launched in the coming years, focusing on oral solid dosage forms for bioequivalence testing to enhance profitability[173]. - The Group's first diabetes innovative patented new drug Janagliflozin commenced Phase III clinical trials in China[162]. Employee Welfare and Community Engagement - The Group provides various employee benefits, including paid annual leave, marriage leave, maternity leave, and housing subsidies for high-end talent[124]. - Sihuan Pharmaceutical has a zero-tolerance policy towards child labor and forced labor, ensuring all employees are at least 18 years old[124]. - The Group actively contributes to community development through charitable events and initiatives[123]. - The Group prioritizes fair employment practices, ensuring no discrimination based on gender, age, ethnicity, religion, disability, or marital status[124]. - 183 employees participated in a charity campaign called "Run for Love," funding milk for children from poverty-stricken families for one academic year[138]. Compliance and Risk Management - The Group has established a comprehensive training system that includes orientation, induction, and on-the-job training to enhance employee skills and knowledge[132]. - The Group has implemented a whistle-blowing system to address complaints and ensure confidentiality[123]. - Employees in high-risk departments are required to sign a Compliance Undertaking Letter to enhance compliance requirements[123]. - The Group has established policies on community engagement to understand the needs of the communities where it operates[158]. Sustainability and Environmental Impact - Total exhaust gas emissions decreased from 28,843.4 (10,000 standard cubic meters) in 2017 to 26,814.7 in 2018, representing a reduction of approximately 7.1%[97]. - The Group reduced 42.5 tons of non-hazardous waste through recycling during the year[103]. - The Group has prioritized environmentally-friendly products with lower toxicity during the procurement of hazardous chemicals[84]. - The Group has conducted regular assessments of occupational hazards with no indicators exceeding safety standards[88]. - The Group has implemented the Hazardous Chemical Safety Management Protocol to manage hazardous chemicals effectively during procurement, transportation, storage, usage, and disposal[84].