Core Viewpoint - Longjin Pharmaceutical has received a delisting notice from the Shenzhen Stock Exchange due to continuous financial losses and insufficient revenue, marking a significant decline in its operational performance over the years [1][2]. Company Overview - Longjin Pharmaceutical was established in 1991, initially focusing on the development of injectable drugs, particularly the injection of Ligusticum wallichii, which became its flagship product [3]. - The company has a long history of clinical use for Ligusticum wallichii, with over 11,000 related research papers published [3]. Financial Performance - The company reported a negative net profit for the fiscal year 2023, with operating revenue falling below 1 billion yuan, leading to a delisting risk warning [2]. - Longjin Pharmaceutical's annual revenue has fluctuated between 100 million to 300 million yuan, with a peak of 700 million yuan in 2021, but adjusted revenue was only around 200 million yuan [7]. - The net profit has shown a downward trend, with the adjusted net profit turning negative for the first time in 2019 and remaining negative for six consecutive years until 2024 [7][8]. Business Challenges - The company attributes its poor performance to policy impacts on its main product, including restrictions on medical insurance coverage and centralized procurement policies [9]. - Longjin Pharmaceutical has struggled to diversify its product line beyond its flagship product, despite efforts in research and external investments [9]. - The company has attempted to pivot towards pharmaceutical promotion services and personal care products, but these ventures have not yet turned profitable and face high operational costs [9].

Core Viewpoint - *ST Longjin is facing the risk of delisting due to continuous financial losses and regulatory challenges in the traditional Chinese medicine injection market, particularly affecting its main product, the injection of lamp flower extract, which previously accounted for over 90% of its revenue [1][4][11]. Company Overview - Longjin Pharmaceutical was established in September 1996 and listed on the Shenzhen Stock Exchange in 2015, focusing on the development, research, production, and sales of therapeutic drugs for cardiovascular and metabolic diseases, with its leading product being the injection of lamp flower extract [3][4]. - The company was the first in China to produce and list the injection of lamp flower extract, achieving sales of 34.52 million bottles in 2013. However, since 2018, the company's profitability has sharply declined, with continuous losses from 2019 to the present [3][5]. Financial Performance - The 2024 performance forecast indicates that Longjin Pharmaceutical expects a net profit loss of between 29.82 million yuan and 44.38 million yuan, with a non-deductible net profit loss ranging from 38.00 million yuan to 56.56 million yuan. This is attributed to a 67% price drop of the lamp flower extract due to centralized procurement policies [4][5]. - From 2019 to 2023, the company's net profit has been negative for five consecutive years, with losses of 39.89 million yuan, 2.53 million yuan, 1.03 million yuan, 57.34 million yuan, and 81.10 million yuan respectively [5]. Market Challenges - The injection of lamp flower extract has seen a significant decline in sales, dropping from 2.858 million bottles in 2017 to 1.278 million bottles in 2021, largely due to stricter regulations and limitations on its use in medical insurance [7][8]. - The traditional Chinese medicine injection industry is experiencing a downturn, with the market size for hospital use of traditional Chinese medicine injections plummeting over 50% from 2016 to 2022, from 88.06 billion yuan to 40.61 billion yuan [11]. Regulatory Environment - The regulatory landscape has tightened, with the National Medical Insurance Directory limiting the reimbursement and usage of traditional Chinese medicine injections, particularly affecting the lamp flower extract [8][11]. - The company has faced challenges such as safety re-evaluation pressures, market competition, and public trust issues due to adverse reactions associated with traditional Chinese medicine injections [13][14]. Strategic Adjustments - Experts suggest that traditional Chinese medicine companies should enhance product quality through re-evaluation, strengthen clinical research, and optimize product structures to adapt to market demands and regulatory changes [15][16]. - Longjin Pharmaceutical has attempted to diversify its product offerings and increase research and development investments, but has yet to find new growth points [9][16].