Sinochem Pharmaceutical Co., Ltd. held its 2022 mid-year work meeting and development strategy seminar from July 22 to July 23 in Nanjing. The meeting systematically summed up and reviewed the company's operation in the first half of 2022, conducted in-depth discussions around the strategic planning of each department, and made a comprehensive deployment of key tasks in the second half of the year.

1 Overcome Difficulties, Make Active Efforts to Stabilize Growth

Huang Yonghong, Chief Financial Officer of SINOCHEM delivered 2022 mid-year performance report. It was pointed out in the report that when medical device distribution services confront the impact of the national centralized mass procurement policy, the company encountered difficulties and challenges in a sharp decline in operating performance; however, the company has increased investment in research and development, and made significant progress in the promotion of industrial projects; meanwhile, the pharmaceutical business has seized development opportunities, with operating performance hitting a record high. In the first half of the year, the company's operating scale was basically the same as that of the same period of the last year, and the profit achieved a year-on-year increase of 5%, laying a solid foundation for the achievement of the annual target.

Progress of Various Key Topics in the First Half of 2022

Industrial Projects

Significant progress has been achieved in the development of key intermediate technologies, and the technical data are superior to those of the benchmarking enterprises; the project evalsuation report in each dimension has been completed and passed the pre-review of the expert group of the Science and Technology Committee of the Business Division

Pharmaceutical Business

The business scale has increasingly expanded, and the business profit reached a record high for the same period, with a year-on-year increase of 42%; the profit structure has continued to improve, and the proportion of gross profit of the content business has increased to 42%

Medical Instruments

The medical instrument business actively responded to the impact of centralized procurement. On the one hand, it optimized the inventory structure and resolved the risks associated with inventory. On the other hand, it vigorously developed new businesses and diversified the product portfolio. The medical materials business increased sales efforts and expanded business increments, and sales revenue has increased by 76% compared to the year before.

2 Focus on Strategy, Concentrate Minds and Efforts for Development

Afterwards, all the participants collectively learned from Chairman Ning Gaoning's thoughts and insights on "strategically good products", and earnestly drew experience for broadening minds in the subsequent strategic seminars. At the seminar, heads of each business unit and functional department made corresponding report on the planning of each department, analyzed the characteristics of the business environment, explained the strategic development ideas, and clarified key matters to be implemented. The participants discussed and exchanged ideas on the content of the report.

A consensus has been reached through discussion: the industrial transformation based on advanced technologies is an important development measure with milestone significance for the company, and various works of the industrial project must be solidly promoted; the drug marketing business has achieved remarkable results by insisting on intensive content development, and the company should continue to promote its competitiveness along three strategic paths, namely R&D customization, registration, and large commodities; given that the external environment for the medical device distribution service business has undergone fundamental changes, it is necessary to accelerate the realization of business transformation and improve independent marketing capabilities.

3 Stride Forward Hand-in-Hand, Forge Ahead with Courage into New Territories

Dong Jianhua, member of the Party Committee of the Chemical Business Division, Secretary of the Party Committee and Executive Director of SINOCHEM delivered the mid-year work report titled "Head Toward Lofty Goals Hand-in-Hand" and deployed work tasks for the second half of the year. In the report he firstly conveyed the spirit of the group's mid-year meeting, and conducted in-depth interpretation over the 14th Five-Year Plan of the Chemical Business Division. All employees of the company were called on to deeply understand the management policy requirements of the group and the business division, accelerate the integration into mainstream industries of the business division in the promotion of industrial strategies, strictly implement all control requirements in internal management.

It was fully affirmed the company's achievements in the first half of 2022, and deeply analyzed the company's current situation. Based on a systematic analysis of the domestic and foreign macro environment and the pharmaceutical industry situation, Dong Jianhua put forward requirements for the work in the second half of the year:

Head Toward Lofty Goals

"Lofty Goals" refer to the company's development strategy of integrating research, production and sales. In the second half of the year and in the future, the company will carry out various operation and management work around the strategic goals, give full play to the marketing advantages of the pharmaceutical and medical instrument business, increase investment in research and development, and make up for the shortcomings of the industry, so as to realize the strategic leap in the company's development process.

Stride Forward Hand-in-hand

An expedition requires a solidary team. The company will give full play to the spirit of teamwork and build a team that is refined, efficient and orderly. Synchronously, targeted efforts will be made for the improvement of the ability of the leading talent team, the replenishment and business skills improvement for the industrial team, the medical device marketing team and the core commodity marketing team, so as to effectively align the core team with each strategy.

At the end of the meeting, Dong Jianhua emphasized the principle of "natural selection and survival of the fittest" as the current internal and external environment of the company has undergone and is undergoing major changes, with opportunities and challenges coexisting. All employees of the company are called on to align development philosophy and make concerted efforts in promoting, witnessing and sharing transformation, bounds and leaps of SINOCHEM.