Realcan(SZ:002589) Xin Jing Bao·2025-07-04 02:31Core Viewpoint - The recent announcement by Ruikang Pharmaceutical Group indicates significant governance issues, particularly involving the company's board secretary and vice president, Li Zhe, who has been placed under detention by the Jinan Municipal Jiyang District Supervisory Committee due to previous disclosure violations [1][2]. Group 1: Governance and Management Changes - Li Zhe has been involved in multiple governance issues, including receiving a warning from the Shandong Securities Regulatory Bureau for failing to disclose major litigation and related party transactions in a timely manner [2][3]. - Following Li Zhe's detention, the company has appointed Wang Xiuting as the acting board secretary, ensuring that the board and supervisory committee continue to operate normally [1][2]. Group 2: Financial Performance and Risks - Ruikang Pharmaceutical has faced declining financial performance, with revenues decreasing from 272.3 billion in 2020 to 79.66 billion in 2024, representing a cumulative decline of 70.7% over the five-year period [6]. - The company reported a net profit of 2.61 billion in 2020, which turned into a loss of 18.31 billion in 2022, and has accumulated nearly 1.5 billion in losses from 2021 to 2024 [6]. Group 3: Controversial Transactions - A controversial related party transaction involving the acquisition of a 76.01% stake in Zhejiang Hengjiu Medical Equipment Co. for 1.51 billion has raised concerns due to the high valuation of the target company, which has reported zero revenue and significant losses in recent years [4][5]. - The acquisition's rationale has been questioned, particularly given the company's ongoing financial struggles and the potential for conflicts of interest among executives involved in the transaction [5][6].