Huiren Pharmaceuticals SprintIPO Purchasing Data Far Larger Than Supplier Sales

Medicines Network January 17th, 15 years after its establishment, because of the "Huiren Kidney Bao" popular market Huiren Pharmaceuticals began to sprint IPOOn December 6, 2016, Huiren Pharmaceuticals disclosed its prospectus on the official website of the CSRC, which plans to raise RMB 1,983 million, of which RMB 986 million will be used to expand productionBeijing News reporter found that the company has been repeatedly reported by residents for environmental pollution problemsBeijing News reporter on January 11 on the spot visited Huiren Pharmaceutical Factory, found that Huiren Pharmaceutical Shern has completed the installation of environmental protection facilities, but the factory area can still smell a strong smell of Chinese medicine, in the factory straight line distance of about 200 meters is residentialHuiren Pharmaceuticals hinted at environmental protection management risks in its prospectus, but stressed that waste has been disposed of in strict accordance with the relevant environmentalregulationsand corresponding standardsin addition to environmental issues, the reporter found that the authenticity of its procurement data is also unconvincing: in 2014 to a supplier to purchase even more than the supplier's sales for the yearIn addition, the company's combined advertising revenue in recent years accounted for 37% of revenue, while research and development costs accounted for less than 3%from Guanghexiang procurement amount and Guanghexiang sales do not match
Huiren Pharmaceutical Factory, Chinese medicine flavor is diffuse, from its main products and other raw materials mainly for ChinesemedicinalAccording to the prospectus, Huiren Pharmaceuticalco, formerly known as Huiren Co., Ltd., was founded on April 3, 2002, and its main business is the research and development, production and sales of traditional Chinese medicine and chemical drugsin Huiren Pharmaceutical selling products, Huiren Renbao is Huiren Pharmaceutical's revenue pillarAccording to the prospectus, Huiren Pharmaceuticals' operating income for 2013, 2014 and 2015 was RMB457 million, RMB908 million and RMB1,485 million, respectively, while Huiren Renbao's sales revenue was RMB96.49 million, RMB619 million and RMB1.277 billion, respectively, accounting for RMB21.33%, 68.49% and 18.86% of its main business revenueHuiren Kidney Treasure series includes kidney tablets, kidney treasure and kidney treasure syrup According to its prospectus, Huiren Kidney Bao is made of 22-flavored Chinese herbs, and Huiren Pharmaceuticals is purchasing Chinese herbal medicine stalks in Gansu, Ningxia, Jilin, Zhejiang, Anhui and other areas the amount spent on the purchase of Chinese herbal medicines in each year from 2013 to 2015 and January-June 2016 was RMB63.26 million, RMB135 million, RMB142 million and RMB29.11 million, respectively of which Changbaishan Protection and Development Zone Guanghexiang Sanye Co., Ltd is an important supplier of Huiren Pharmaceuticals, the national enterprise credit information disclosure system found that Guanghexiang Sanying registration time is September 11, 2014 The prospectus disclosed that in 2014, Guanghexiang Sayes sold 4.76 million yuan to Huiren Pharmaceuticals, ranking fourth among the largest suppliers However, The 2014 annual report disclosed by Guanghexiang in the national enterprise credit information disclosure system shows that its 2014 full-year sales were only 1.81 million yuan, a difference of 2.95 million yuan from the purchase amount disclosed by Huiren Pharmaceuticals a financial source told the Beijing News reporter, supplier sales data and buyers disclosed data inconsistent, from the accounting standards point of view, there may be due to industry characteristics and other reasons, accounting recognition of income will be different "It is reasonable that the purchaser may have made the purchase to the supplier in 2014, but due to the different ways in which the accounting recognized the income, the money may have been recorded as a pre-receivable and later recognized as 2015 revenue, which is a more reasonable explanation." "
by 2015, Guanghexiang Sanye sold 46.32 million yuan to Huiren Pharmaceuticals, the largest supplier of Huiren Pharmaceuticals Guang Hexiang's own disclosure of sales data show that its full-year sales of 55.58 million yuan, Huiren Pharmaceutical shopping amount accounted for 83.34 percent of Guanghexiang's annual sales The two sides are each other's most important customers, but by the first half of 2016, Guanghexiang was removed from Huiren Pharmaceuticals' list of the top five suppliers January 13, the Beijing News reporter called Guang Hexiang to stay in the industrial and commercial system contact phone, to understand its supply and procurement data with Huiren Pharmaceuticals, but a man who connected to the phone said that he was not Guang hexiang and hung up the phone supplier sales data, Huiren Pharmaceuticals was also punished by regulators for problems with the purchase of raw materials In November 2016, the "Decision on Administrative Penalties" issued by the Jiangxi Provincial Food and Drug Administration stated that Huiren Pharmaceuticals was suspected of producing and selling "Ginkgo leaves" that did not meet the national supplementary inspection standards Jiangxi Province Food and Drug Administration believes that Huiren Pharmaceuticals production of Ginkgo biloba drugs
unqualified because of the purchase of raw materials unqualified caused January 11, Jiangxi Province Food and Drug Administration website disclosed the September to December 2016 drug production supervision and inspection and treatment, showing that Huiren pharmaceutical products such as Chinese medicine tablets there are 13 items of general defects, requiring enterprises to carry out rectification Huiren Pharmaceuticals is not the first time because of product quality issues by the regulatory authorities, public information shows that Huiren Pharmaceuticals for the production of inferior or non-conforming drugs in 2013, 2015 and 2016 a total of 8 administrative penalties total advertising revenue accounted for 37% in recent years
Huiren Pharmaceuticals still has a high gross margin and low net profit margin phenomenon According to the 's prospectus, Huiren Pharmaceuticals' revenue climbed to RMB1,485 million in 2013, up 225 percent from RMB265 million in 2015, while Huiren Pharmaceuticals' gross profit climbed to RMB1,256 million from RMB265 million Huiren Pharmaceuticals' performance growth or stems from the launch of Huiren Kidney Bao in 2012 According to the prospectus, Huiren kidney tablets of the overall gross margin is higher, the expansion of its sales scale led to a rise in gross margin According to prospectus data, in 2013, 2014, 2015 and January-June 2016, Huiren Pharmaceuticals' main business gross margin was 57.95 percent, 77.89 percent, 84.61 percent and 83.25 percent, respectively 83.25% gross margin, the highest among listed companies in the same industry Tonghuashun data show that among the 64 listed companies that produce Chinese medicine, Huiren Pharmaceuticals' gross margin can rank third, second only to Qizheng Tibetan medicine and step-by-step pharmaceutical Compared with the six pharmaceutical companies that also produce renal supplements, Jiuzhitang, with the highest gross margin, was only 59.45% Although Huiren Pharmaceuticals Kidney Bao products gross margin is high, but its actual net profit margin is not high In the first half of 2016, Huiren Pharmaceuticals' total revenue was 759 million yuan, with a gross profit of 632 million yuan and a net profit of 77.76 million yuan the key of which is Huiren Pharmaceutical's high sales costs In the first half of 2016, Huiren Pharmaceuticals' sales expenses amounted to 485 million yuan, with a sales cost rate of 63.9% most of the sales expenditure, Huiren Kidney bao used in advertising According to the prospectus statistics, from 2013 to the first half of 2016, Huiren Pharmaceutical's total sales expenses amounted to 1,938 million yuan, of which 1.345 billion yuan was invested in advertising and business publicity, that is, the monthly advertising expenses amounted to 32 million yuan From 2013 to the first half of 2016, total advertising expenses accounted for 37.26% of total revenue Research and development expenses as a share of revenue have been below 3% for the reporting period repeatedly reported for pollution reporter struck a note that Huiren Pharmaceuticals was repeatedly reported for environmental protection issues On August 24, 2016, the People's Network ," "Netizens to Jiangxi Provincial Party Secretary message by the official reply" report, referring to Nanchang County residents message, "Huiren Pharmaceutical often releasea large amount of polluting gas, very pungent, seriously affecting our lives." at the time, the official reply said that on November 16, 2015, Nanchang County environmental protection department interviewed Huiren Pharmaceuticals, asking enterprises to further improve the waste gas control facilities and normal operation of the management facilities After the enterprise rectification, in May 2016, residents' representatives on the ground to see the enterprise environmental protection measures, said that the enterprise's pollution control work July 27, 2016, Jiangxi Province Environmental Protection Department official website disclosed that the central environmental protection inspection team in July into Jiangxi to accept the case of environmental letters and visits, there is "Nanchang City, Nanchang County Huiren Pharmaceutical snorted at night emissions, has been reported to Nanchang County Environmental Protection Bureau, the Environmental Protection Bureau said the enterprise environmental protection facilities, but the problem has not been resolved" report The investigation and prosecution disclosed by the Jiangxi Environmental Protection Department at that time showed that on the day of the letter and visit, the environmental monitoring and monitoring personnel of Nanchang County Environmental Protection Bureau carried out on-site verification and rapid inspection of the enterprise and the surrounding environment No irritating odors were smelled at the site or in the surrounding environment Ammonia and hydrogen sulfide gas were not detected " Sprint IPO before the shutdown to do tens of millions of environmental remediation" January 11, the Beijing News reporter came to Nanchang County Small Blue Industrial Park, repeatedly reported Huiren Pharmaceutical New Factory is located in the industrial park Huiren Avenue Outside the gate of Huiren Pharmaceutical Factory, the reporter noticed a real-time display of the pollutant emissions of enterprises Display data show that Huiren pharmaceutical nitrogen, VOC, hydrogen sulfide emission indicators for excellent, bad odor for good plant, a large chimney about 50 meters high, marked with Huiren medicine font, and has been emitting white smoke Beneath the chimney is a variety of enclosed environmental protection facilities Beijing News reporter sat on the scene, from the closed environmental protection facilities can hear the roar, the scene is basically no workers Beijing News reporter at the scene observed that Huiren Pharmaceutical series covers a wide area, the factory gate opposite the school, east and south are enterprises , factories, the west is residential real estate The west side of the property is located at a straight-line distance of about 200 meters from Huiren Pharmaceutical Factory Reporters in Nanchang County Environmental Protection Bureau official website a "Jiangxi Province pollution source a factory a system enterprise basic information table" to see, Huiren Pharmaceutical Small Blue Industrial Park plant construction time is june 2013, next to the residential property is opened in 2012 and the downwind of Huiren Pharmaceutical Factory (January 11 for the east wind), the reporter smelled a strong smell of Chinese medicine, this taste continued until the afternoon near 5 o'clock before the dissipation Several owners of residential in the west of Huiren Pharmaceuticals told the Beijing News that they can usually smell a smell of Chinese medicine, especially near Huiren Pharmaceutical's street-side residential, the smell is more intense for environmental protection issues, January 12, the Beijing News reporter also called Huiren Pharmaceuticals to learn more, when the reporter proposed to visit the enterprise environmental protection facilities and production situation, Huiren Pharmaceutical Securities Department said that the company is currently in a silent period, and The Secretary is not out, not convenient reception, but can be sent to its mailbox to understand the problem Beijing News reporter in the evening to send the outline of the interview to its provided mailbox, but as of the 16th issue did not respond January 12, the Beijing News reporter came to Nanchang County Environmental Protection Bureau to understand Huiren Pharmaceutical's environmental protection issues Wan Ningguo, head of the Environmental Protection Bureau's monitoring team, told the Beijing News that in June last year Huiren Pharmaceuticals had taken the initiative to stop production for environmental remediation, environmental protection facilities construction has invested tens of millions, last December after the Department of Environmental Protection acceptance, the environmental protection facilities are in line with the standards