Core Viewpoint - The traditional Chinese medicine injection industry is undergoing a systematic transformation that is crucial for its future, driven by new regulatory policies aimed at ensuring safety, efficacy, and quality control [1][2][5]. Regulatory Changes - The recent policy document emphasizes that if oral formulations can meet clinical needs, injection formulations will not be approved for market entry, and similar restrictions apply to muscle versus intravenous injections [1]. - A re-evaluation of existing injection products will be conducted over the next 5 to 10 years, marking a significant regulatory upgrade aimed at addressing safety and efficacy concerns [1][2]. Industry Challenges - The injection industry has faced significant challenges, including frequent adverse reactions and insufficient evidence of efficacy, which have highlighted deep-seated issues within the sector [2]. - The shift from an experience-driven to a market-driven evaluation process will lead to the elimination of products lacking sufficient evidence, accelerating the trend of declining sales for many companies [3]. Financial and Operational Impact - The financial burden of compliance with new regulations, including investments in research, clinical trials, and quality control systems, poses a significant challenge for small and medium-sized enterprises [3]. - Companies will need to upgrade their entire value chain from research and development to sales in response to new quality control requirements [3]. Structural Transformations - The re-evaluation policy is expected to drive four major structural changes in the industry: a shift from experience-driven to evidence-driven practices, from rough production to precise manufacturing, from marketing-led to research-driven strategies, and from a single market focus to diversified international markets [3][4]. Strategic Responses - Companies are advised to form specialized working groups to assess their products, focus resources on core products, and consider partnerships to share costs [4]. - Emphasizing evidence-based medicine and enhancing production quality through smart manufacturing and closed-loop management systems are critical for compliance and competitiveness [4]. Legal Framework - The re-evaluation policy is supported by legal frameworks that require ongoing verification of drug safety, efficacy, and quality, ensuring that public health interests are prioritized [5]. - Companies can challenge unreasonable evaluation standards through administrative litigation, fostering a constructive interaction between regulation and industry [5]. Future Outlook - Successfully navigating the re-evaluation process will enable companies to better handle future challenges, including negotiations with health insurance and regulatory oversight, while also enhancing the global perception of traditional Chinese medicine [5][6]. - The transformation is seen as a necessary step for the industry to gain trust and recognition in the global medical community, ensuring the safe and effective use of traditional Chinese medicine [6].

Core Viewpoint - Multiple *ST companies are facing delisting risks as they have received pre-delisting notices from the exchange due to various financial and trading indicators [2][5][6] Group 1: Financial Indicators and Delisting Notices - As of May 11, six *ST companies have received pre-delisting notices, with five touching financial delisting indicators and one touching trading delisting indicators [2] - The new delisting regulations have introduced stricter conditions for *ST companies to remove delisting risk warnings, requiring internal control audit reports to be unqualified; otherwise, delisting will occur [2][3] - *ST Zhongcheng, *ST Renle, and *ST Gongzhi received negative internal control audit opinions for their 2024 financial reports, indicating significant financial distress [3][5] Group 2: Specific Company Cases - *ST Zhongcheng announced on May 7 that it received a pre-delisting notice due to a negative net asset value for 2023 and a negative internal control audit opinion for 2024 [3][4] - *ST Renle received a pre-delisting notice on May 6, with a reported net asset of -387 million yuan for 2023 and -404 million yuan for 2024, along with negative audit opinions [5] - *ST Gongzhi also received a pre-delisting notice due to negative audit opinions for its financial reports [5] Group 3: Additional Delisting Factors - *ST Longjin is set to exit the A-share market due to negative profit and revenue figures, having received a pre-delisting notice on April 25 [6] - *ST Hengli faced delisting risks for failing to disclose its 2024 annual report on time, with a reported negative net profit and revenue below 100 million yuan [7] - *ST Jiyuan triggered the delisting indicator by having its stock price below 1 yuan for 20 consecutive trading days, leading to a pre-delisting notice [9]