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].
四环医药(00460) - 2018 - 年度财报