Sinopharm Modern: Achieve operating revenue of 9.363 billion yuan by 2025 with stable and resilient operational quality

On March 27, Shanghai Modern Pharmaceutical Co., Ltd. released its 2025 annual report. During the reporting period, the company achieved operating revenue of RMB 9.363 billion. Affected by the normalization of centralized procurement and the decline in prices of pharmaceutical intermediates and APIs, this represented a year-on-year decrease of 14.39%. Net profit attributable to shareholders of listed companies was RMB 942 million, with a degree of compression in profit margins.

On March 27, Shanghai Modern Pharmaceutical Co., Ltd. released its 2025 annual report. During the reporting period, the company achieved operating revenue of RMB 9.363 billion. Affected by the normalization of centralized procurement and the decline in prices of pharmaceutical intermediates and APIs, this represented a year-on-year decrease of 14.39%. Net profit attributable to shareholders of listed companies was RMB 942 million, with a degree of compression in profit margins.

Operating quality stays resilient, with ongoing cost reduction and efficiency improvement

In terms of operating quality, operating efficiency, and financial structure, the company’s fundamentals remain sound. During the reporting period, the company’s cash collection rate from operating revenue reached 102.53%, indicating strong cash recovery capability; its inventory turnover ratio and accounts receivable turnover ratio were 3.09 times and 8.75 times, respectively, reflecting relatively strong asset operating efficiency. In terms of cash flow, the company’s net cash flow from operating activities was RMB 1.698 billion, still maintained at a relatively high level, reflecting that the cash-generating ability of its main business remains solid; at the same time, the company’s asset-liability ratio is at a relatively low level.

Meanwhile, Guo Yaofang Modern has continued to promote cost reduction and efficiency improvement and expense control. The period expense ratio decreased year-on-year by 3.57 percentage points. Among them, the company strengthened control over sales expenses, actively promoted marketing model transformation and upgrading, and thereby drove the continued downward trend in sales expenses, effectively offsetting some of the pressure on profitability. This demonstrates the management side’s proactive ability to adjust operating pace.

The industry landscape is reshaped, and the industrial chain and product capabilities build differentiated advantages

As a core platform for the development of the chemical pharmaceutical industry within Sinopharm Group, Guo Yaofang Modern has strong advantages in integrating industrial resources and conducting large-scale operations. On the one hand, the company relies on mechanisms within Sinopharm Group such as “industry-commerce coordination” and “industry-research coordination,” maintaining alignment with Sinopharm Holdings and research institutes, and continuously deepening resource integration across multiple dimensions including commercial distribution, technology R&D, and medical services. On the other hand, the company has formed a complete industrial chain system covering intermediates, APIs, and formulations, and, through integrated management, strengthens cost control and production capacity coordination.

In terms of product and technology layout, Guo Yaofang Modern continues to推进 development system building and upgrading of technology platforms, with R&D investment consistently staying at a high level. In 2025, the company established 50 new R&D projects throughout the year, applied for 50 patents (including 29 invention patents), obtained 41 authorized patents, and received 2 clinical approval letters for improved new drugs. R&D achievements continue to be implemented. At the same time, the company accelerates its internationalization efforts. In 2025, it added 12 overseas registration approvals, including 10 registrations in countries along the “Belt and Road.” In the 11th batch of national centralized procurement, six of its products were selected, further solidifying market share.

Specifically, Guo Yaofang Modern focuses on accelerating the layout of high-end complex formulations and improved new drugs, driving the product structure to extend from traditional bulk products to higher value-added areas. The 2025 annual report shows that some core products maintain leading positions in their respective sub-sectors. Among them, products such as cefuroxime axetil tablets and sodium methylprednisolone succinate for injection have market shares among the leading positions in the industry.

Compared with companies led primarily by innovative drug R&D, Guo Yaofang Modern places greater emphasis on leveraging a mature product system. It improves product competitiveness through process optimization, dosage form upgrades, and consistency evaluations, and, together with its large-scale production capabilities, strengthens cost advantages. As a result, it has stronger operational resilience in the context of the normalization of centralized procurement.

In addition, in March this year, Guo Yaofang Modern obtained the上市 license-related rights for baclofen hydrochloride tablets (50 mg) through an agreement-based approach. This product is currently in the application and registration stage, showing that Guo Yaofang Modern operates with a dual-engine drive of “self-developed R&D” and “external acquisition (BD).” In the mature formulations domain, it supplements product reserves through external acquisition, continuously enriching its product pipeline and expanding the product matrix of offerings that can participate in competition under centralized procurement conditions.

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