The establishment of Shanghai Pharma Northern will enhance the Group's capability to operate and manage its business in the northern region, and will expand its network in the northern market. Shanghai Pharma Northern will become an effective platform for the Group's development in Beijing and Bohai Economic Rim as well as its expansion in the northeast, northern, northwest and central western areas for direct investment and business operation. The construction and development of the platform will assist the Group in tapping the economic district in Beijing, strengthening the strategic cooperation and policy coordination between the Central and Beijing governments, and further increasing its nationwide influence.
Shanghai Pharmaceuticals' sales revenue from the Beijing market is expected to exceed RMB10 billion for 2011. The Group will consolidate the equity and distribution resources of its subsidiaries in the northern region. It will also further coordinate assets and business management and boost its core competitiveness through restructuring.
Shanghai Pharma Northern will continue to develop its high-margin businesses in advantageous areas, including high-end medicines, vaccines and high value medical consumable materials while establishing channels to accelerate its penetration into the mass market and expand its market share in distribution of drugs in the Essential Drug List, exploring and making breakthroughs with new business model. Shanghai Pharma Northern will focus on increasing competitiveness in different market segments and enhancing both its leading position as well as servicing capability by providing a variety of professional services and integrated, innovative value-added solutions for customers. It will also strive to become an outstanding bellwether of the China pharmaceutical distribution sector who working closely with distributors and suppliers and having the best customer service with the highest efficiency.
Shanghai Pharmaceuticals also announced to invest RMB100 million in establishing an IT platform in Beijing based on Health Link Information Technology Limited, a subsidiary of SPH Keyuan to facilitate the integration process of the Group's IT infrastructure. The Group will also set up a research center and service team for providing comprehensive IT solutions in the pharmaceutical and health sectors. This would help provide both the Group and the market with professional IT solutions in the pharmaceutical perspective, which will further enhance the competitive advantages of its leading information system and unique IT services.
As an important step to establish presence, Shanghai Pharmaceuticals plans to invest in the pharmaceutical manufacturing and open research and development bases in Beijing. Thus, the Group will be having two important correspondence bases in Shanghai and Beijing and optimize its strategic industrial structure across the southern and northern regions of China. This will further enhance the nationwide coverage of the Group's full value industry chain and strengthen its leading position in the pharmaceutical industry.
The establishment of Shanghai Pharma Northern will allow the Group to develop and optimize its management platform, raise the integrative operation standards and further enhance the industry consolidation in the northern market. It also shows that Shanghai Pharmaceuticals would optimize the management structure in the execution of its national strategy in order to strengthen the functionality in the regional center.
Mr. Lu Mingfang, Chairman of Shanghai Pharmaceuticals, will become the Chairman of Shanghai Pharma Northern responsible for the overall resource coordination in the Group and market expansion in the northern pharmaceutical market, while the former General Manager of CITIC Pharma, Mr. Sun Changsen, will be the General Manager of Shanghai Pharma Northern.
About Shanghai Pharmaceticals Holding Co., Ltd.
Shanghai Pharmaceuticals is the only integrated pharmaceutical company in the PRC that has leading positions in both pharmaceutical product and distribution markets. It was China's second-largest pharmaceutical distributor and third-largest pharmaceutical producer. The Group adopts an integrated vertical business model and provides solutions in pharmaceutical manufacturing, distribution, logistics storage and retail. The Group currently offers more than 400 pharmaceutical products as well as pharmaceutical distribution and supply chain solutions to more than 7,600 hospitals and medical institutions in China. The Group also operates approximately 1,700 self-operated and franchise stores nationwide.
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SOURCE Shanghai Pharmaceuticals Holding Co., Ltd.
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