Lingkang Pharmaceuticals averages 3.7 academic meetings per day?

Pharmaceutical Network, June 16th, June 8, Lingkang Pharmaceutical Group Co., Ltd(hereinafter referred to as "Lingkang Pharmaceuticals", 603669.SH) on the SSE on the company's 2019 annual report of the responseThe 2019 report disclosed that Lingkang Pharmaceuticals sales expenses of 1.092 billion yuan, accounting for 66.81 percent of operating income, higher than the industry average, of which marketing service fees of 1.07 billion yuan, accounting for 97.98 percent;Reporters noted that the marketing cost of 387 million yuanIn 2019, Lingkang Pharmaceuticals held 1380 academic conferences, attended by nearly 15,000 participants, the company to accept the cost of such outsourced services included in the above-mentioned marketing feesIt has been calculated that the average cost of an academic conference in 2019 will be about $280,000, and on average 3.7 academic meetings will be held on average based on 365 days a yearTo this end, the reporter on the flow of enterprise sales costs and adjustment plans to write to Lingkang Pharmaceutical, June 4 evening, Lingkang Pharmaceutical Securities Department in an interview with reporters, said that with the "two-vote system" policy in more provinces, pharmaceutical manufacturers independently or commissioned a third party to promote products model to further improve, resulting in sales costs and sales costs rate also increased year by yearThe higher proportion of sales expenses to income is a common phenomenon in the pharmaceutical industryThe proportion of sales expenses is much higher than that of the same industry
Lingkang Pharmaceuticals was established in 2003 and listed on the Shanghai Main Board in 2015, as a pharmaceutical company dominated by specialty chemicals, with solid overall growthThe company is a well-known enterprise in the domestic chemical and pharmaceutical preparation industry, in a number of sub-product market areas in a leading positionLeading products cover intestinal nutrition drugs, anti-infective drugs, digestive system drugs and other important areasDuring the 2016-2019 reporting period, Lingkang Pharmaceuticals achieved operating income of RMB 479 million, RMB 1.005 billion, RMB 1.669 billion and RMB 1.635 billion, respectivelyNet profit attributed to the owners of the parent company was RMB154 million, RMB161 million, RMB183 million and RMB 202 million, respectivelyIt is worth noting that while Lingkang Pharmaceuticals' operating income has increased significantly, the growth rate of sales expenses has also accelerated significantlyAccording to the announcement, from 2015 to 2019, Lingkang Pharmaceuticals' sales expenses reached 10.16 percent, 11.27 percent, 53.63 percent, 72.79 percent and 66.8 percent Among them, the sales expenses of Lingkang Pharmaceuticals increased rapidly in 2017, from RMB544 million in 2016 to RMB539 million in 2017, an increase of 890.81 percent year-on-year Up to 2019, The sales expenses of Lingkang Pharmaceuticals reached RMB 1,092 million, accounting for 66.81 percent of operating income, higher than the industry average 　　For the substantial increase in sales costs, Lingkang Pharmaceuticals in an interview with reporters admitted that, with the gradual implementation of the "two-vote system" policy, pharmaceutical manufacturers gradually from the original distribution agents agents to the pharmaceutical distribution enterprises , before the implementation of the "two-vote system" policy, distribution agents at the same time bear regional, localproduct promotion and Distribution function, therefore, in the mode of cooperation with distribution agents, pharmaceutical production enterprises sales costs are relatively low, and in the mode of cooperation with pharmaceutical distribution enterprises, pharmaceutical circulation and distribution enterprises only assume the product distribution function, product marketing by the pharmaceutical production enterprises independently plan and arrange or entrust professional third-party marketing service providers, sales costs are relatively high 　　The above-mentioned people added that the company will gradually strengthen the control of downstream channels, through the gradual establishment of direct team, strengthen the control of downstream channels, reduce circulation links 　　The annual academic conference 13.8
announcement shows that the composition of marketing services including marketing fees, market research fees, marketing planning fees, consulting services and other projects, mainly to entrust outsourcing services 　　Lingkang Pharmaceuticals mentioned that the company's marketing activities, mainly to entrust outsourcing, the company's business management center is responsible for the promotion service company selection work, and selected qualified promotion service company signed a promotional service agreement, according to the amount of work provided by the work, the effect of both sides of the pricing 　　From the composition of The marketing service costs of Lingkang Pharmaceuticals in 2019, the marketing fee is 387 million yuan, the market research fee is 352 million yuan, the marketing planning fee is 246 million yuan, and the information service fee is RMB85 million 　　In this regard, some investors in the exchange platform to question, Lingkang Pharmaceuticalmarketing marketing and market research costs of 730 million yuan, is the company's profit 3.5 times, is it reasonable? 　　In analyzing the rationality of marketing expenses, Lingkang Pharmaceuticals pointed out that marketing fees mainly refer to The company entrusted by Lingkang Pharmaceuticals to third-party promotion companies to carry out marketing activities, including hospitals terminals to carry out drug promotion and promotion; 　　A total of 1,380 academic conferences and nearly 15,000 participants were held in 2019, providing doctors and professionals with a better understanding of the company's products, a deeper understanding of the company's indications and efficacy, and a reference for their prescription Annual maintenance of nearly 3855 customers, medical terminals up to more than 6500 　　This means that the average cost of an academic conference in 2019 will be about $280,000, with an average of 3.7 academic meetings per day based on 365 days a year 　　In terms of market research fees, the promotion services company collected about 2.6 million pieces of information on the same products and competing products in 2019, providing market decision-making basis for Lingkang PharmaceuticalS elling department and laying a solid foundation for adopting effective market strategy The company's fees for accepting such outsourced services are mainly included in the market research fee project 　　Lingkang Pharmaceuticals said that the pharmaceutical industry sales costs are generally higher The company further improve selling strategy, strengthen independent academic promotion and sales terminal development efforts At the same time, due to the intensification of market competition, the company adopted the sales network extension and sinking strategy, so that the sales cost rate is slightly higher than the same industry In order to improve the competitiveness and influence of products and brands, consolidate the original market, compete for market share, promoters need to face more end-customer groups, through continuous communication and collaboration to complete more complex promotion altogether, complete the sales growth task, thus matching the corresponding marketing costs have its own necessity and rationality, in line with industry characteristics 　　Although the top five payment objects for marketing services spent by Lingkang Pharmaceuticals in 2019 did not show specific names, according to its information, their business content is sales promotion, market research, market development, channel management, etc., the above-mentioned payment objects are not related parties 　　Research and development investment accounted for less than 3% although the sales costs of Lingkang Pharmaceuticals are increasing, but its research and development costs are lower than the industry average 　　According to the 2019 annual report, Lingkang Pharmaceuticals realized operating income of RMB163,500.04 million, down 2.06% YoY, and net profit attributable to the owner of the parent company was RMB20,159.25 million, up 10.34% YoY, with net profit attributable to shareholders of listed companies deducting non-recurring profit and loss of RMB13,898.89 million, up 27.08% Yoy 　　In 2019, Lingkang Pharmaceuticals, while consolidating the aforementioned major varieties, has actively expanded new varieties of high gross margin, and made great progress, mainly for cardiovascular products (injection of stony sequoia, injection of nimagolin, etc.), liver disease treatment products (injection of acetyl cysteine, etc.), pressure-lowering products (injection of hydrochloric acid LaBellor, etc.) Up to now, Lingkang Pharmaceutical saued at 109 varieties and 191 drug production approval documents, of which 48 varieties were included in the national medical insurance directory, and 13 varieties were included in the national base medicine catalog 　　However, the reporter noted that in 2019, the company's research and development expenditure, 3,843.7 million yuan, an increase of 56.56 percent year-on-year, accounting for 2.33 percent of the year's operating income, lower than the industry average 　　Comparing with the same industry companies, the amount of research and development investment in 2019 was RMB79,064 million, accounting for 3.64% of operating income, while Haichen Pharmaceuticals' research and development investment amounted to RMB49.7668 million, accounting for 6.99% of operating income 　　In this regard, Lingkang Pharmaceutical said that the company will continue to increase investment in research and development innovation, the introduction of outstanding research and development personnel, improve the research and development environment and other initiatives to promote the registration progress of the eight varieties, such as the left Kanitin injection and the listing work 　　In addition, Lingkang Pharmaceuticals will actively promote the quality and efficacy of generic drugs to evaluate, in preparation for the market competitive advantage of related products, the new project on generic drugs focused on leading, exclusive or first, technical barriers or policy barriers of the project, the use of Boao Super Hospital platform, docking domestic and foreign advanced pharmaceutical enterprises, especially in the field of anti-tumor, cardiovascular, digestive system and other major diseases innovative drugs, generic drugs research and development