Liaoning, Sept 4, 2019 — From September 2 to 4, 2019, a delegation of SIIC and SPH executives visited SPH’s subsidiaries in Liaoning. The group included Shen Xiaochu (Secretary of the Party Committee and Chairman at SIIC), Ge Dawei (Deputy Secretary of the Party Committee and Deputy Chairman at SIIC, Secretary of the Party Committee and Deputy Chairman at SPH), Cho Man (President and Executive Director at SPH), Shen Bo (Executive Director, Vice President and CFO at SPH), and department heads from SPH.
SPH Herbapex Pharma (TCM Manufacturer)
On September 2, the delegation visited SPH Herbapex Pharma’s upgraded production lines for formula granules as well as its TCM Health Center.
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SPH Herbapex Pharma operates a TCM Manufacturing and Testing Park, a Healthcare Industry Park, and a Marketing and R&D Center. The company produces 47 varieties of drugs in tablet, granule and capsule forms (in 71 specifications) and processes more than 10,000 tons of Chinese medicinal ingredients annually. As a pilot manufacturer in Liaoning, SPH Herbapex Pharma produces 622 types of formula granules each year, with an annual capacity of 2,000 tons. It also owns other production lines for health care and food products.
Mr. Shen Xiaochu shared his expectations for SPH Herbapex Pharma: first, the company should try to get a firmer foothold in the formula granules market while exploring new ways to expand its health care products. Second, the company should seize market opportunities to align its strategies and innovations with the requirements of governments and contribute to Liaoning Province’s economic revitalization.
SPH Shenxiang Health Medicine (Base of Genuine Regional Medicinal Ingredients)
On the morning of September 3, the delegation toured the Wild Ginseng Base of SPH Shenxiang Health Medicine, a wholly owned subsidiary of SPH STCM.
Shenxiang Health Medicine specializes in the production of TCM and health care products, including Chinese wild ginsengs, cordyceps sinensis, donkey-hide gelatin, dendrobium candidum, American ginseng, cubilose and other tonics and processed products. The company has built eight cultivation bases for medicinal herbs nationwide. To ensure the quality of medicinal materials, the company uses standardized process, monitoring the cultivation of materials and the processing of decoction pieces. The Wild Ginseng Base’s traceability system of the entire industry chain ensures the outstanding quality of its products.
SPH Northern Pharma (R&D, Pilot-Scale Experiment and Commercialization Bases)
On the afternoon of September 3, the delegation visited SPH Northern Pharma. The local management team showcased its ADC and chemical drug R&D pilot-scale experiment and commercialization project.
SPH Northern Pharma is poised to be a world-class R&D, pilot-scale experiment and manufacturing base for chemical drugs, antibody drugs, ADC drugs. It is also an industry-leading MAH plant for new drugs and high-end preparations. The plant includes two phases: Phase 1 (July 2015–October 2017) is the chemical drug R&D, pilot-scale experiment and commercialization project, which began operations in November 2017. The local government named it Liaoning microemulsion and liposome preparations engineering laboratory and consider it as a service platform. Phase 2 is the ADC R&D, pilot-scale experiment and commercialization project, which was rolled out on August 23, 2019.
Mr. Cho Man noted that SPH Northern Pharma, as a platform serving both internal and external customers, should aim for higher performance standards, while developing differentiated chemical API products to improve profitability and competitiveness.
Mr. Ge Dawei stressed that SPH Northern Pharma is pivotal in expanding SPH’s product portfolio and business partnerships. Additional incentives and the pursuit of a performance culture will inspire talents to achieve better results.
Mr. Shen Xiaochu pointed out that the ongoing Phase 2 project should be benchmarked against international standards for quality and site management. He urged the company to explore internal management approaches, expand the talent pool and enhance safety compliance, to become a sustainable, efficient and profitable enterprise.
Liaoning PHFT (Pharmaceutical Distribution)
On September 4, the delegation visited Liaoning Pharmaceutical Foreign Trade Corporation (“Liaoning PHFT”), which became a subsidiary of SPH in May 2018.
The company is dedicated to the sales, import and export of pharmaceuticals, medical devices and consumables, and provision of cold-chain logistics and distribution services, information technology services, and third-party logistics services. It operates businesses across Liaoning, Jilin, Heilongjiang, Inner Mongolia and Tianjin.
SPH KDL Health (Liaoning) (Pharmaceutical Distribution)
In February 2018, SPH KDL Health (Liaoning) became a key member of the SPH family to facilitate the company’s expansion in northeast China.
SPH KDL Health (Liaoning) is engaged in the sales of pharmaceuticals (e.g. TCMs and Western medicines, Class 2 psychotropic drugs), medical devices, health care and food products (including food formula for medical use), and cosmetics. Its business footprint covers Liaoning, Harbin and Changchun, and areas like Beijing and Shanxi in Northern China.
Liaoning Meiya and SPH Liaoning API Industrial Park (Green API Manufacturer)
Liaoning Meiya is a key wholly-owned subsidiary of SPH New Asiatic, committed to the manufacturing of aseptic APIs and cephalosporin intermediates. Zeng Chuiyu, Chairman at SPH New Asiatic, gave a presentation on the Liaoning Meiya relocation project and the construction of SPH Liaoning API Industrial Park.
Mr. Ge Dawei praised the two companies for their achievements. He offered three suggestions: first, the companies should identify and focus on their core advantages to thrive in a highly competitive market and adapt to the dynamic regulations. Long-term planning and integration of technological innovations with the internet are important to achieve this goal; second, a robust incentive mechanism is needed to align individuals’ benefits with corporate interests and better motivate the teams. It is necessary to optimize the compensation system and offer more competitive packages to attract and retain talent. Third, team building, talent cultivation and corporate culture development should be put high on the list of priorities to pave the way for the companies’rapid growth.
Mr. Shen Xiaochu noted that the pharmaceutical industry is undergoing unprecedented changes in both production and sales. He put forward three key points: first, every company must position itself clearly and consolidate its industry position by seeking mergers and acquisitions; second, big data technologies can be deployed in logistics to help reduce costs and boost efficiency; third, companies should prioritize the needs of authorities and the population and actively fulfill their social responsibility. He believes the API production bases in Liaoning are of great significance to the sustained production and supply of essential drugs, which are indispensable for the population’s health. SPH is not a regional business, it is on the road to becoming a global conglomerate. The Liaoning market is SPH’s focus in Northern China. The employees here will play an increasingly important role in business development. Clear strategies and close teamwork will help SPH thrive in the future.