Core Viewpoint - The lawsuit against Yipinhong Pharmaceutical by Huiyou International, claiming 528 million yuan in damages, highlights significant risks in intellectual property management and product selection within the pharmaceutical industry in China [1][2]. Group 1: Background of the Dispute - A decade-long collaboration between Yipinhong and Huiyou International, initiated in 2014 to develop the drug Prelidil, has deteriorated due to market changes and regulatory actions [2]. - The market for Prelidil plummeted from 4.5 billion yuan in 2018 to 600 million yuan in 2019 after it was placed on a key monitoring list by the National Health Commission, leading to the cessation of their partnership [2]. Group 2: Financial Performance and Challenges - Yipinhong has faced continuous financial struggles, with a 42.07% year-on-year revenue decline in 2024 and a net loss of 540 million yuan; the first three quarters of 2025 also showed a revenue drop of 34.35% and a loss of 136 million yuan [4]. - The company was penalized for collusion in the seventh national centralized procurement, resulting in the loss of qualification for a product and a refund of 266 million yuan to healthcare insurance [4]. Group 3: Industry Implications and Management Issues - The lawsuit reveals significant management flaws in the pharmaceutical sector regarding collaboration structures, intellectual property ownership, and contract execution, particularly in a heavily regulated environment [6]. - The original valuation of the intellectual property injected into the joint venture was 88 million yuan, with the current claim being six times that amount, indicating a reassessment of technology value [6]. - The ongoing legal battle serves as a warning for the entire pharmaceutical industry about the critical importance of strategic product selection and robust intellectual property management [6].