() The business review of the Board of Directors in the first half of 2023 is as follows:

　　I. Description of the industry and main business of the company during the reporting period.

　　Jiuzhoutong is a technology-driven comprehensive service provider for the whole chain pharmaceutical industry. Based on the big health industry, the company’s main businesses include digital pharmaceutical distribution and supply chain business, general brand promotion business, self-produced and OEM business of pharmaceutical industry, new retail and franchise business (C-end), medical health (C-end) and technology value-added services, digital logistics technology and supply chain solutions.

　　The company is the largest private pharmaceutical commercial enterprise in China, ranking fourth in China pharmaceutical commercial enterprise, the first enterprise in the industry to be rated as 5A-level logistics enterprise and the only enterprise to be rated as one of the top ten intelligent warehousing and logistics demonstration bases in China. The company ranked 171st in Fortune "Top 500 Chinese Enterprises" and 99th in "Top 500 China Listed Companies" in 2023.

　　The company took the lead in implementing the transformation and upgrading from the traditional pharmaceutical distribution business to digitalization, platformization and internet in the industry, and combined with the needs of upstream and downstream customers, implemented the comprehensive service model of "pharmaceutical distribution+logistics distribution+product promotion" and achieved remarkable results. The company has built a "100 billion-level" pharmaceutical supply chain service platform, which is scarce in the industry, and completed the business layout of all-category procurement, omni-channel coverage and full-scenario service. Relying on the resource advantages of the 100 billion-level platform, it has hatched new businesses such as brand promotion business, self-produced and OEM business of pharmaceutical industry, new retail and franchise business of ten thousand stores (C-end), medical health (C-end) and technology value-added services, digital logistics technology and supply chain solutions. Gradually form a comprehensive health service platform that combines "wholesale and retail integration", "BC integration" and () to serve B-end and C-end users, which has the remarkable characteristics of multi-format and multi-platform in the industry.

　　(I) Highlights and analysis of the company’s performance in the first half of the year

　　In the first half of 2023, with the full recovery of China’s economy and society and the overall recovery of the pharmaceutical circulation industry, the company seized market opportunities, vigorously developed innovative business, and expanded new growth points. At the same time, the operating quality was comprehensively improved, which promoted the steady growth of the company’s operating performance, and the overall operating performance was better than the industry average.

　　During the reporting period, the company’s operating income continued to grow steadily, reaching 79.357 billion yuan, an increase of 16.73% over the same period of last year; Realized a net profit of 1.295 billion yuan, an increase of 17.09% over the same period of last year; Among them, the net profit attributable to the mother and the net profit deducted from the mother in the second quarter were 782 million yuan and 722 million yuan respectively, up 39.32% and 26.00% respectively from the first quarter, and the profitability continued to improve.

　　From January to June, 2023, the net cash flow generated by the company’s operating activities was 518 million yuan, a substantial increase of 125.22% compared with the same period of last year. Among them, the operating cash flow in the second quarter was greatly improved, and the cash payment was greatly increased. The net operating cash flow in a single quarter reached 3.54 billion yuan. In recent years, the net operating cash flow of the company turned positive in half a year for the first time, and the operating quality was significantly improved.

　　During the reporting period, the main reason for the steady growth of the company’s operating income and net profit deducted from the mother was that the company realized the accelerated growth of emerging businesses such as brand promotion, new retail of medicine, digital logistics technology and supply chain solutions, medical health and technical services on the basis of maintaining the steady growth of the pharmaceutical distribution business (14.01%), which helped improve the company’s operating performance in the first half of the year; Among them, the total generation of brand promotion business revenue increased by 38.74% compared with the same period of last year, and Mao Lijiao increased by 62.15% in the same period of last year; The operating income of new pharmaceutical retail business increased by 37.51% compared with the same period of last year, and that of Mao Lijiao increased by 26.00% in the same period of last year; The operating income of digital logistics technology and supply chain solutions increased by 38.05% compared with the same period of last year, and Mao Lijiao increased by 73.35% in the same period of last year; The operating income of medical health and technical services increased by 38.83% compared with the same period of last year, and that of Mao Lijiao increased by 43.27%. While ensuring the steady growth of operating income, the company’s profitability continues to improve.

　　During the reporting period, the company vigorously promoted the implementation of the four new strategies of "new retail, new products, Internet medical care and real estate securitization". The B2B platform of Medicine 99, the plan of "joining in ten thousand stores" of good pharmacists and the platform of "Power Health" all progressed smoothly, and the sales proportion of high-margin strategic products such as equipment, general generation and traditional Chinese medicine continued to increase, with "Bb/BC warehouse distribution integration", multi-warehouse networking and Kyushu ten thousand stores. On May 29, 2023, the company’s "Bb Integration Project" was selected as the "Typical Case of Digital Transformation of Listed Companies" issued by China Association of Listed Companies in 2023 (leading technology); In addition, the company’s "Bb/BC Warehouse and Distribution Integration Project" was selected as the "Typical Case of Digital Economy Development in 2023" (transformation category) selected by Securities Daily and 2023 Digital Economy Leaders Forum.

　　(2) The company’s main business operations and innovation achievements.

　　In the first half of 2023, the company’s main business operations and project innovations achieved remarkable results, with outstanding highlights in the following ten aspects:

　　1. The B2B e-commerce platform of Yaojiu empowers end customers such as single pharmacies and clinics in the whole chain. In the first half of the year, the self-operated business income reached 6.054 billion yuan, making it a leading digital medicine circulation platform outside the hospital in China.

　　In the first half of the year, the company’s digital distribution business for single pharmacies, clinics and other customers was steadily promoted. The self-operated trading income of the drug B2B e-commerce platform reached 6.054 billion yuan, a year-on-year increase of 15.84%. At present, the platform has 400,000 registered users and 350,000 active users, covering 99% of the country’s administrative regions. It is the leading digital medicine circulation platform outside the hospital in China. Seventeen "Yaojiujiu" companies have been established and operated in China, providing B2B e-commerce services for customers such as small chains, single pharmacies and clinics. The platform implements the business model of integrating purchasing and marketing, with responsibility, power and benefit to people. In addition, through digital and information management, the platform can provide comprehensive and accurate value-added services such as product flow analysis for upstream manufacturers, and provide unique "Bb/BC warehouse distribution integration" logistics services, "one-stop" trading services and supply chain financial services to enhance customer experience and promote the rapid transformation of the company from traditional pharmaceutical distribution business to digital pharmaceutical distribution business.

　　2. Retail e-commerce service platform business, the whole network serves large-scale pharmaceutical retail e-commerce platforms such as JD.COM and Ali, and the revenue scale in the first half of the year was 3.254 billion yuan, a substantial increase of 62.56% year-on-year.

　　In the first half of the year, the company continued to carry out the health product supply chain business for large-scale pharmaceutical retail e-commerce platforms such as JD.COM, Ali, Meituan, Dingdang, Ping An, Tik Tok, Aauto Quicker and Baidu, and the sales revenue reached 3.254 billion yuan, a substantial increase of 62.56% over the same period of last year; Among them, the drugs sold to JD.COM, Ali and Meituan’s self-operated platforms reached 2.219 billion yuan in the first half of the year, an increase of 83.30% over the same period of last year, making them important medical equipment suppliers. With the advantages of nationwide warehousing and logistics network and supply chain, the company can connect with the e-commerce platform system, and can realize many services such as automatic ordering, automatic inquiry, matching in the same city, unified settlement, and price control on the whole platform. The company’s retail e-commerce distribution division fully integrates the company’s resources, including the doctor-patient service of Power Health platform, the integration of Bb/BC warehousing and distribution, digital management, etc., and has provided "one-stop" all-network distribution and supply operation services for more than 1,500 brand enterprises such as (), Guangzhou Pharmaceutical Group, Beijing () and Shandong Dyne, and tracked the services to C-end consumers.

　　3. General generation brand promotion business, creating a "second curve" of sustained profit growth, with 1,251 agent product specifications, and sales revenue in the first half of the year was 8.637 billion yuan, up 38.74% year-on-year; Gross profit was 1.464 billion yuan, a substantial increase of 62.15% year-on-year.

　　In the first half of the year, the sales revenue of the company’s brand promotion business (including drugs and medical devices) reached 8.637 billion yuan, an increase of 38.74% over the same period of last year; The gross profit margin increased to 16.95%, and the gross profit was 1.464 billion yuan, a substantial increase of 62.15% over the same period of last year. It continued to create a "second curve" for the company’s profit growth, and its contribution to the company’s performance increased year by year.

　　During the reporting period, the company achieved sales revenue of 4.949 billion yuan from the brand promotion business of the general generation of drugs, an increase of 48.60% over the same period of last year; The gross profit margin increased to 25.95%, and the gross profit was 1.284 billion yuan, a substantial increase of 65.70% over the same period of last year; Among them, the sales of key varieties such as Kewei, Beiping and Kang Wang increased significantly, which led to a significant increase in terminal sales revenue and gross profit; At the same time, the company vigorously introduced 66 high-quality products, including 3 new products over 100 million yuan and 13 new products over 10 million yuan. By the end of the reporting period, the total number of product specifications of the company’s drugs reached 915 (it is estimated that there will be 19 product specifications exceeding 100 million in the whole year), including the bid-winning products of Zhejiang Huahai, Zhejiang Jingxin, Zhengda Tianqing, () and Yichang Renfu, as well as the products of foreign-funded enterprises such as AstraZeneca, Bayer, Japan Weicai and Takeda. The agent products cover all categories such as chronic diseases, tumors and anti-infection, involving clinical and OTC. The company has formed a relatively mature general brand promotion business model, including five modes: out-of-hospital agency for products with original research and failed bid, out-of-hospital agency for products with winning bid, orderly marketing for brand products, out-of-hospital agency for brand products and out-of-hospital agency for exclusive products.

　　During the reporting period, the company achieved sales revenue of 3.688 billion yuan from the brand promotion business of medical devices, an increase of 27.40% over the same period of last year; Gross profit was 179 million yuan, an increase of 40.55% over the same period of last year; We have represented 336 product specifications of Johnson & Johnson, Linuofa, Abbott, Fei Sen Yus (Hemodialysis) and other brand manufacturers. Focusing on domestic and foreign brand manufacturers, the company focuses on developing the national platform business of major surgery, cardiovascular and cerebrovascular intervention and IVD, strengthening the construction of basic service capacity of supply chain, establishing a unified digital platform, optimizing the logistics system, improving professional talents, and exploring and promoting the construction of full-link supply capacity, centralized distribution of consumables, and packaging solutions of laboratory departments.

　　4. The pharmaceutical industry produces its own products and OEM business, forming a cluster development of its own varieties, and the competitiveness of products is greatly improved.

　　In the first half of the year, the company actively developed the self-produced and OEM business of western medicine industry and Chinese medicine industry, forming a cluster development of its own varieties. In the first half of the year, the sales revenue reached 1.182 billion yuan, the gross profit margin was 22.16%, and the gross profit was 262 million yuan.

　　In the western medicine industry, the performance of Beijing Jingfeng Pharmaceutical Group Co., Ltd. (hereinafter referred to as "Jingfeng Pharmaceutical") under the company continued to grow, with an operating income of 187 million yuan in the first half of the year; Jingfeng Pharmaceutical mainly produces and researches antibiotics, diabetes, cardiovascular and cerebrovascular diseases and drugs for external use, including metformin hydrochloride tablets, compound clotrimazole cream and mupirocin ointment, among which metformin hydrochloride tablets (0.25*100s) won the bid for the third batch of national centralized procurement, furosemide injection won the bid for the eighth batch of national centralized procurement, calcium dobesilate capsules and amlodipine besylate tablets passed the national consistency evaluation, and acarbose tablets were obtained.

　　In the Chinese medicine industry, Jiuxin Chinese Medicine Group Co., Ltd. (hereinafter referred to as "Jiuxin Chinese Medicine"), a subsidiary of the company, achieved a sales income of 932 million yuan in the first half of the year; Jiuxin Chinese Medicine is committed to producing high-quality, safe and reliable Chinese medicine products. At present, it can produce many kinds of varieties, such as common decoction pieces, refined decoction pieces, direct oral decoction pieces, toxic decoction pieces, ginseng antler, medicine and food homology, etc. At the same time, it actively applies fresh-keeping technology and traceability technology to products, and has formed superior and characteristic products such as crystal grinding, product health preservation and tracing back to the original source, and created Jiuxin and Kyushu Tianrun.

　　In terms of OEM products, the company’s medical equipment OEM registered two self-owned brands, namely Body Health and Flesh, and obtained 5 MAH Class II product registration certificates, 16 Class I product registration certificates and 173 OEM device product specifications. The company’s drug OEM includes 355 product specifications such as tablets, capsules, oral liquids and compound granules. Through independent research and development and production of its own brand and OEM products, the company develops products with independent intellectual property rights and exclusive management rights, which enhances the competitiveness of the company’s products and lays the foundation for the implementation of new product strategy.

　　5. The "Ten Thousand Stores Joining" business of good pharmacists has fully empowered the digital management of offline joining pharmacies, and the number of stores has reached 15,856.

　　In the first half of the year, the company vigorously promoted the "Ten Thousand Stores Joining" plan. As of the disclosure date of the report, the "Ten Thousand Stores Joining" plan has maintained rapid expansion through the mode of "self-operated+joining", and 15,856 self-operated and joined pharmacies have been realized, with stores in 31 provinces, municipalities and autonomous regions, covering 291 prefecture-level cities and 1,301 counties and districts. It is estimated that the number of stores will exceed 30 in 2025.

　　As the largest OTC drug distributor in China and an enterprise with a modern logistics network all over the country, the company gives full play to the advantages of low investment cost, high efficiency and flexible operation of joining single pharmacies, and uses the self-developed "Store Connect" system to connect with the ERP system of joining pharmacies to fully empower the digital management of joining pharmacies. Provide pharmacy with systematic services such as manufacturer’s business collaboration (flow direction management and price maintenance, etc.), membership management, consultation for patients, medical insurance compliance, personal health management, chronic disease management, telemedicine, electronic medical records, e-commerce operation (O2O), etc. At the same time, provide pharmacy with community group purchase, city partner and various business training services to fill in the shortcomings of joining pharmacies. During the reporting period, the company devoted itself to the research and development of the core system of the "new retail" scene, built a digital platform for Kyushu Wandian, and helped the digital transformation of stores; "Store Connect" completed the system function upgrade, covering more than 5,000 stores; The two-terminal CRM system was launched, covering 18,000 B-terminal members and 15 million C-terminal members. There are more than 13,000 self-developed retail ERP stores. During the reporting period, the company actively expanded professional pharmacies, and the scale of prescription outflow in the first half of the year reached 210 million yuan. In the future, the company will strive to make good pharmacists join pharmacies into the most competitive retail pharmacy brand with the best service, the highest efficiency, the widest coverage of stores.

　　6. Good pharmacist’s B2C e-commerce general distribution business provides online "one-stop" all-network service for medical machinery enterprises, with sales revenue of 498 million yuan in the first half of the year and accumulated 33 million C-end users.

　　In the first half of the year, the company provided "one-stop" all-network B2C e-commerce general sales service for pharmaceutical machinery enterprises, achieving sales income of 498 million yuan, an increase of 43.2% over the same period of last year; Among them, the sales of "6.18" activities once again exceeded 100 million yuan, with a sales income of 110 million yuan, a substantial increase of 69.2% over the same period of last year. The company has 10 years of experience in pharmaceutical e-commerce, 300 e-commerce operation teams, 31 wholesale and retail integrated warehouse allocation capabilities, and accumulated 33 million C-end users. B2C e-commerce, a good pharmacist under the company, helps pharmaceutical machinery enterprises to realize the growth of channel business in the whole network through the trinity mode of "supply chain+digital marketing+doctor-patient operation". It has sold and operated online official flagship stores of nearly 40 brands such as Novartis, Harbin Pharmaceutical, (), Abbott Laboratories, Novo Nordisk, Lunan Pharmaceutical, Zhou Lin Spectrum, Johnson & Johnson, Hanmei and Bayer, and promoted products around the needs of pharmaceutical machinery enterprises, focusing on superior traffic to create explosive products in the whole network.

　　Up to now, the company has established good cooperative relations with many retail e-commerce platforms, such as Tmall, JD.COM, Pinduoduo, Tik Tok, Huawei Mall, Vipshop, etc., and adopted the mode of "all-network general sales+good pharmacist official website" to provide medical machinery enterprises with "one-stop" B2C e-commerce directly facing consumers, such as self-supply (product operation), flagship store operation, content operation, doctor IP operation, commercial insurance performance and digital marketing. During the reporting period, Good Pharmacist B2C e-commerce expanded six official flagship stores of Tik Tok brand, and Tik Tok Good Pharmacist Pharmacy ranked first in OTC drugs.

　　7. The "Power Health" service platform business empowers C-end users in the whole scene, and the special disease operation business has developed rapidly.

　　By the end of the reporting period, the company’s "Power Health" service platform has completed the "one cloud multi-terminal" basic capacity building for doctors, patients, insurance companies and medical institutions, and built an industry-leading business middle platform and data middle platform that combines "social+transaction". Among them, there are more than 630,000 doctors who provide online consultation and basic diagnosis and treatment services at the "Power Health" doctor’s end, which has realized the functions of appointment registration, online consultation, appointment physical examination, rapid drug purchase, health consultation and chronic disease management for C-end users; There are 35,000 registered pharmacies in the "Power Health" pharmacy. In the first half of the year, the cumulative prescription volume exceeded 32.87 million, and the daily prescription volume peaked at 230,000, achieving a year-on-year increase of 3,873% in online platform prescription business income and a year-on-year increase of 160% in consultation business income. Based on the company’s ability of "BC integration" and "joining in all stores", Power Health Insurance Company provided performance service combining O2O and B2C, and extended from drug payment pre-payment to consultation service. During the reporting period, the company undertook online consultation and drug direct compensation on many Internet platforms such as Ant Insurance and the insurance company’s Internet outpatient insurance, with a total of 109,000 consultations in the first half of the year, serving over 1.48 million patients.

　　During the reporting period, the specialized disease operation business of the company’s "Power Health" service platform developed rapidly, and the company focused on the operation of ophthalmology specialty business. The platform accumulated 4,109 ophthalmologists and more than 23,000 paying patients, with a cumulative sales of 7.17 million yuan in the first half of the year, an increase of 154% over the same period of last year; The company has completed all-round cooperation with Chaoju Ophthalmology, (), Taikang Tongji and Yingtong Technology, provided all kinds of online basic medical services by accessing professional institutions, and built a whole course management scheme combining medicine, medicine and insurance around a single disease.

　　8. Internet medical services, digital technology and operation empower Internet hospitals to build a professional prescription outflow platform.

　　During the reporting period, through the self-developed "Power Medicine Cloud" platform, the company empowered public medical institutions and three-party Internet medical platforms with digital technology and efficient operation capabilities, and has built and operated 19 Internet hospitals in public medical institutions and a number of Internet diagnosis and treatment platforms. The company invested in Hangzhou Hengsheng Yuntai Network Technology Co., Ltd., actively cooperated with the leading Internet hospital solution provider in China, and established a joint venture company with it to jointly promote the construction and operation services of Internet hospitals and prescription circulation platforms for public hospitals. With its full-category, omni-channel and full-scenario digital distribution and supply chain service platform formed in the medical and health industry for many years, As well as the industry-leading advantages of digitalization, platformization and internetization, we can give full play to the experience of the partners in the construction and operation of the top three official Internet hospital systems covering more than 900 public hospitals across the country, which can realize the full scene coverage of Internet hospitals and prescription circulation, and carry out online consultation (small programs) and prescription circulation business in Internet hospitals; Open up a number of innovative service models, such as online payment of medical insurance (consultation fees and drug fees), online settlement of medical insurance for chronic diseases, and zero inventory distribution of hospital varieties.

　　9. Integrate logistics Bb/BC warehouse allocation, make every effort to build a multi-terminal and efficient supply chain logistics service system, and realize "zero inventory" for customers and sharing 100,000 product specifications resources.

　　During the reporting period, the company continued to build a multi-end efficient supply chain logistics service system, and has put into operation six "BC integrated warehouses" in Hubei, Shanghai, Guangzhou, Beijing, Tianjin and Zhejiang, with a daily collection rate of over 99%, which greatly improved the service efficiency of the supply chain and met the needs of different customers. The company has completed the transformation of "Bb integration" of 22 companies in Hubei, Chongqing, Shandong, Henan, Beijing, Guangdong, Shanxi, Anhui, Sichuan, Zhejiang, Fujian, Shaanxi, Jiangsu, Xinjiang, Shanghai, Tianjin, Guangxi, Jiangxi, Inner Mongolia, Hebei, Gansu and Hunan, and put them into operation. In the next three years, the company will strive to complete "Bb/BC warehousing integration".

　　The industry-specific "Bb/BC integrated" efficient supply chain logistics service model built by the company can provide services to large B-end customers such as existing medical institutions and chain pharmacies, and at the same time, open high-quality and efficient supply chain services to small B-end (referring to single stores and clinics, etc.) and C-end consumers. Through the transformation of information and logistics systems, the company’s existing commodity inventory can be connected with pharmacies and wholesale enterprises, and direct delivery can be made to C-end and small B-end customers. While realizing "zero inventory", pharmacies and secondary distributors can enjoy the company’s existing resources of 100,000 commodity specifications, and comprehensively enhance the market competitiveness of Jiuzhoutong in the small B-end and C-end. The company’s "Bb Integration Project" has been selected as the "Typical Case of Digital Transformation of Listed Companies" (leading technology) published by China Association of Listed Companies in 2023, and "Bb/BC Warehouse Distribution Integration Project" has been selected as the "Typical Case of Digital Economy Development in 2023" (transformation category) selected by Securities Daily.

　　10. The public offering of REITs is progressing smoothly, and more than 3.3 million square meters of medical logistics storage assets and supporting facilities will be revitalized in batches.

　　By the end of the reporting period, with the support of relevant government departments at all levels, the company continued to declare and issue REITs (hereinafter referred to as "publicly offered REITs"). The company plans to issue public REITs in batches with its 3.3 million square meters of medical logistics storage assets and supporting facilities as the underlying assets, so as to revitalize the company’s huge storage logistics assets and supporting facilities, reconstruct the company’s business model in asset-light strategy, speed up asset liquidity, broaden diversified channels in equity finance, and establish a virtuous circle model of asset development, so as to enhance the company’s asset operation ability and realize diversified benefits.

　　The company plans to select some medical warehousing and logistics assets and supporting facilities in Wuhan as the first batch of assets to enter the pool. The assets to enter the pool this time are part of the assets of Wuhan Dongxihu Medical Logistics Center held by Jiuzhoutong Pharmaceutical Group Logistics Co., Ltd. (hereinafter referred to as "Jiuzhoutong Logistics"), which was rated as one of the top ten "National Intelligent Warehouse and Logistics Demonstration Bases" in China by the National Development and Reform Commission, the Ministry of Commerce and China Federation of Materials. Specifically, it includes the pharmaceutical storage complex building, the pharmaceutical storage sorting center, the No.1 building of the pharmaceutical storage support center, the No.2 building of the pharmaceutical storage support center, the No.3 building of the pharmaceutical storage support center, and the auxiliary rooms of the pharmaceutical storage support center, with a total construction area of 175,303.85 square meters.

　　The company has completed the first draft of the project declaration. According to the instructions of the Hubei Provincial Development and Reform Commission, it officially submitted the declaration documents in August and started the formal declaration procedure. The company has wholly established Hubei Kyushu Industrial Park Operation Management Co., Ltd., which is intended to be the operation management organization of future basic assets and provide operation management services for basic assets; Jiuzhoutong Logistics has wholly established Wuhan Kyushu Shourui Supply Chain Service Co., Ltd. (hereinafter referred to as "Kyushu Shourui"), and plans to inject the first batch of pharmaceutical warehousing and logistics assets into Kyushu Shourui, and will transfer its 100% equity to public offering REITs.

　　As one of the company’s major transformation strategies, the significance of this public offering of REITs includes: (1)REITs empower the company, help the company to enhance its corporate image and brand value, and effectively boost the influence of the capital market; (2) Build a asset-light strategy platform, speed up the reconstruction of the company’s asset-light strategy business model, revitalize the company’s pharmaceutical logistics storage assets and supporting facilities, speed up asset liquidity, and raise more working capital for the company; (3) Broaden diversified equity finance channels, establish a virtuous circle model of asset development, and reduce the company’s dependence on traditional debt financing methods; (4) Improve the company’s asset operation ability and realize diversified income.

　　If the company’s application for public offering of REITs is successful, it will have a positive impact on the optimization of the company’s financial indicators in the future, and will greatly enhance the owner’s rights and interests, and it is expected to become the first public offering of REITs in domestic pharmaceutical industry, the first public offering of REITs in pharmaceutical warehousing and logistics, and the first private offering of REITs in Hubei Province, with strong demonstration effect and positive social impact.

　　(C) Social responsibility and precise poverty alleviation

　　The company has actively fulfilled its social responsibilities. Up to now, the total value of donations has exceeded 43 million yuan. Among them, the total value of social assistance donations exceeded 27 million yuan, the total value of donations and materials to support the construction of rural and remote areas exceeded 7.8 million yuan, and the total value of donations to help the development of medical and health systems exceeded 2.7 million yuan. The company is enthusiastic about social hot issues and the needs of vulnerable groups, and actively participates in social welfare undertakings, and has won honors such as "National Red Cross Model Unit", "China Red Cross Charity Medal" and "Hubei Red Cross Charity Award".

　　In January 2023, the company, together with the Ministry of Industry and Information Technology, donated emergency medicines worth more than 2.62 million yuan to five designated counties (districts) such as Jialing District and nanbu county in Nanchong City, Sichuan Province, Luoning County and Ruyang County in Luoyang City, Henan Province, and Langkazi County in Shannan City, Xizang Autonomous Region, to help local prevention and control. In August 2023, floods and geological disasters were caused by extreme rainfall in Beijing, Tianjin and Hebei, causing heavy losses. The company donated more than 2.8 million yuan of materials to rush to the front line of disaster relief in Mentougou and Fangshan in Beijing, Gaobeidian in Baoding City, Hebei Province, and Langfang New Town to help local people to eliminate epidemic prevention and rebuild their homes after the disaster.

　　In addition, the company actively responded to the national rural revitalization strategy, donated money and materials to help rural revitalization and consolidate the achievements of poverty alleviation. During the reporting period, the company responded to the call of Hubei Province, supported Hubei’s "new farmers" college students to start businesses in rural areas, and donated 1 million yuan to the Youth Foundation to drive more young people to start businesses in rural areas and grow up. At the same time, through Hubei Charity Association, the company donated 1.5 million yuan to Xinjie Town in Suizhou, Suncai Village in Xiangyang and Qichun District in Hubei Province to help improve the level of rural livability and industry and build beautiful countryside.

　　(IV) Major business cooperation of the company

　　1. Major cooperation in medical equipment distribution business

　　During the reporting period, The company cooperates with () (pediatric drugs), China Resources Sanjiu (Ganmaoling Granule), Yangzijiang Pharmaceutical (Lanqin Oral Liquid, etc.), Zhengda Tianqing (hypertension and coronary heart disease drugs), Haisen Bio (cardiovascular drugs), Lunan Pharmaceutical (pediatric drugs), Huazhong Pharmaceutical (ibuprofen, etc.), Shandong Dyne (vitamin D drops), () (cough Well-known pharmaceutical companies in China and the United States such as SmithKline (Baiduobang) and Organon (contraceptive drugs), as well as well as well-known medical device companies such as () (IVD and equipment), Medtronic (pacemaker and vascular intervention), Fei Sen Yus (cardiopulmonary bypass, blood purification and equipment), Omron and Yuyue (sphygmomanometer, etc.) continue to deepen their strategic cooperation and provide them with digital medical device distribution, logistics warehousing and distribution.

　　In August, 2023, the company signed an "all-round strategic cooperative relationship" agreement with Johnson & Johnson Consumer Health China, upgrading the existing strategic cooperation to "all-round strategic cooperative relationship", further expanding the scope of business cooperation in the field of big health, and striving for a compound growth rate of over 40% in the next three years.

　　2. Major cooperation in brand promotion business of Zongdai

　　During the reporting period, the company continued to carry out in-depth strategic cooperation and business implementation with Dongyang Guangyao (HK01558) and Bayer Kang Wang, and the sales of three separate specifications of the flu variety "oseltamivir phosphate (Kewei)" and Kang Wang series products (personal care products such as Kangwang Hair Lotion) in OTC channels accelerated. In addition, the company continues to cooperate with famous enterprises at home and abroad, such as AstraZeneca (Betaloc), Novartis Pharmaceutical (Ophthalmology Medicine), Tianjin (), (), Guangxi Jinzizi, Lijun Pharmaceutical, Sanofi, Weicai (China) Pharmaceutical, etc., to provide them with omni-channel brand marketing solutions, enhance product market competitiveness and increase product market share.

　　3. Business cooperation of logistics supply chain solutions

　　During the reporting period, the first BC integrated warehouse (Hangzhou Tangqicang) operated by the company and Ali Health continued to operate with high quality, with a single-day peak of 190,000 in the first half of the year and a single-month peak of 1.91 million; The second BC integrated warehouse (Tianjin warehouse) cooperated by both parties operates efficiently, with a single-day peak of 15,000 orders and a single-month peak of 250,000 orders; The timely delivery rate of BC integrated warehouse is 99.99%, and the delivery accuracy rate is 99.999%. In addition, the company will continue to cooperate with Ali Health in four BC integrated warehouses in Central China and Northeast China (Changsha, Chengdu, Jiangxi and Shenyang) to jointly promote further cooperation in tripartite logistics and supply chain.

　　The digital marketing platform "I Maotai" customized by the company has been running smoothly since it was launched in March 2022. Up to now, the registered users of the "I Maotai" APP have reached more than 44 million, and the number of orders completed has exceeded 20 million. By using the self-developed digital intelligence logistics supply chain information platform and intelligent equipment, the company re-integrated and planned the internal and external logistics resources of Maotai, upgraded the logistics center processes and logistics equipment and facilities in various regions of Maotai, and established a logistics operation standardization system. Finally, the platform and intelligent logistics supply chain operation mode of "multi-region, multi-owner, multi-service provider, multi-warehouse and multi-transportation section" was realized.

　　During the reporting period, the company undertook a number of large-scale intelligent logistics projects, including Tongrentang Logistics Cloud Platform Decision Analysis System, Jiamusi Medical Science and Technology Industrial Park Project, Meixin Lairui Project, Henan Camel System Platform, Yadu Automated Logistics Equipment System, and Medical Insurance City Intelligent Logistics Center Construction, to provide enterprises inside and outside the industry with an integrated solution of intelligent logistics supply chain.

　　4. Major cooperation between banks and enterprises

　　During the reporting period, the company continued to maintain long-term cooperative relations with major banks and financial institutions such as securities and insurance. By the end of the reporting period, the company has carried out "general-to-general" strategic cooperation with the head offices or branches of large banks such as Bank of Communications, Bank of China, China Merchants Bank, Agricultural Bank, China Everbright Bank, China CITIC Bank, hengfeng bank, Minsheng Bank, Hankou Bank and Hubei Bank. Major financial institutions provide professional financial services for the company with the highest efficiency, the best scheme and the best price, and exert their influence in the financial market to provide "one-stop" financial services for the company’s massive upstream and downstream customers to meet the diversified financial needs of customers. Relying on the strategic cooperative relationship with the above-mentioned financial institutions, the company has improved its competitiveness in the big health industry and provided a strong guarantee for the steady operation of its main business.

　　At the end of March 2023, the company invited more than 100 guests from 32 large financial institutions, including Industrial and Commercial Bank of China, Agricultural Bank of China, Bank of China and China Construction Bank, to attend the "2023 Jiuzhoutong Financial Institutions Seminar" to discuss in depth the future cooperation direction, further broaden diversified financing channels, reduce financing costs, improve financing efficiency, and provide financial support for the subsequent development of various businesses of the company.

　　In May, 2023, the company held discussions and exchanges with the head office of Guangfa Bank, Ping An Finance, CMB Finance, China Post Finance, ABC Finance, BOC Finance, ABC Investment, CCB Investment, Guangyin Finance, Puyin Finance, Shanghai Trust, CITIC Finance and Bank of Communications Investment, and planned to discuss the company’s preferred shares, perpetual bonds, securitization investment of accounts receivable assets, pre-cultivation of public offering REITs and other products.

　　(five) the main policies of the industry and their impact on the company

　　During the reporting period, with the further deepening of the reform of the medical and health system, the supervision of the pharmaceutical industry has become increasingly strict, and the relevant policies of the industry, such as purchasing with quantity, "dual channels", "outpatient coordination" and "Internet+medical health", have been continuously deepened and implemented, which brings challenges as well as greater opportunities for the development of the pharmaceutical industry. In addition, the public offering of REITs is also supported by the continuous policies of the State Council, relevant ministries and local governments at all levels, which promotes the smooth progress of the public offering of REITs in pharmaceutical logistics and warehousing. The main analysis is as follows:

　　1. Normalization and institutionalization of quantity procurement.

　　The policy of purchasing with quantity mainly improves the concentration of the production and supply of generic drugs, and reduces the price of drugs while ensuring the quality of drug production, thus reducing the burden of patients’ medication. Up to now, the state has organized 8 batches of centralized drug collection, and 333 kinds of drugs have been selected. At present, centralized drug collection in China has entered the stage of normalization and institutionalization. In July this year, National Health Commission and other six departments issued key tasks for deepening the reform of the medical and health system in the second half of 2023, including: normalizing the centralized procurement of drugs and medical consumables; We will carry out centralized procurement of new batches of drugs and medical consumables organized by the state, and achieve a total of 450 drugs collected at the national and provincial levels. The "14th Five-Year Plan for National Medical Security" issued by the General Office of the State Council requires that by 2025, more than 500 kinds of drugs will be purchased centrally at the national and provincial levels.

　　The implementation of the policy of purchasing with quantity has more advantages than disadvantages on Jiuzhoutong’s business: before the country started centralized purchasing, the company had opened accounts in public hospitals in a few provinces and cities and carried out business, but the business in public hospitals in most areas was poor, and even public hospitals in some areas had not yet opened accounts; After the country started centralized procurement, all the subsidiaries of the company obtained the distribution right of the products won by the manufacturers to varying degrees, thus opening accounts in public hospitals all over the country and obtaining the distribution business of hospitals all over the country to varying degrees. Based on the above reasons, although the centralized purchasing policy has a great impact on the companies engaged in hospital business, for Jiuzhoutong, the centralized purchasing policy has enabled the company to develop hospital business and gain incremental development in the original blank market. The centralized purchasing policy has also brought rare development opportunities for the company’s off-campus market and general brand promotion business. Specifically:

　　(1) The company has expanded its business coverage in public hospitals. In the past three years, the company’s sales revenue in the channels of graded public hospitals (including urban and county-level public hospitals) has increased at a compound annual rate of 13.37%, and the number of effective customers in graded public hospitals has rapidly increased to 13,300, and the customer coverage has been further improved, which has obviously benefited from the influence of the procurement policy with quantity.

　　(2) With the superposition of policies such as "zero difference rate", "national varieties" and graded diagnosis and treatment, hospital prescriptions will flow to social pharmacies, and drugs for chronic diseases will flow to the third terminal, and the out-of-hospital market will usher in development opportunities. More than 70% of the company’s existing business is in the markets such as pharmacies and third terminals, and a complete service system has been formed; Drugs for chronic diseases in grade hospitals flow to the third terminal, and prescriptions flow out to pharmacies, which also brings great development opportunities to the company.

　　(3) The brand products that were purchased with quantity and lost the bid have turned to the off-campus market because they lost the in-hospital market of public hospitals. Because the company has the advantages of all-region, all-channel and all-scene supply chain service and a professional brand promotion team, there are more and more opportunities for the company to undertake brand products that have been lost.

　　(4) The implementation of quantity purchasing policy will accelerate the iteration of new products, and the entry of innovative drugs into public hospitals is limited by multiple factors, and high-end comprehensive private hospitals are an important entry channel choice. Since 2018, the company has fully deployed the private medical group in the head, improved the logistics management ability in the hospital through technical empowerment, and improved efficiency, optimized costs and reduced waste of resources by hosting supply chain services such as medicines and consumables in hospitals. The sales scale of the company in private hospitals has grown steadily. With this advantage, the company is actively promoting innovative drug companies and private hospitals to carry out real-world data research on drugs, providing reference for post-marketing clinical research and medication guidelines, which not only promotes the development of private hospitals themselves, but also promotes the cooperation opportunities between the company and innovative drug companies.

　　(5) Purchasing with quantity leads to the price reduction of drugs, which has caused some chronic diseases to spend less on drugs. In 1 yuan, the transportation expenses and registration expenses for patients to prescribe drugs in medical institutions are far greater than the expenses for drugs, which makes some patients buy drugs directly from pharmacies near home without going to the hospital, which also expands the market scale of pharmacies. Because the company has the channel advantage in the off-campus market, while striving for the distribution qualification of the winning varieties in quantity procurement, it can also get the opportunity to promote such varieties in the off-campus market as a general agent.

　　2, "outpatient co-ordination" and other policies quickly landed.

　　In February 2023, the National Medical Insurance Bureau issued the Notice on Further Improving the Integration of Designated Retail Pharmacies into Outpatient Overall Management, attaching great importance to the integration of designated retail pharmacies into outpatient overall management, and using the outpatient overall fund to expand the supply of medical services and ensure residents to better enjoy the convenience of overall medical insurance; At the same time, with the continuous promotion of "two channels" and retail pharmacy chain, the market scale of pharmaceutical retail industry will be further expanded, while the head pharmaceutical retail chain enterprises and "wholesale and retail integration" pharmaceutical circulation enterprises will take the lead in the trend of prescription outflow and have huge development space.

　　(1) The inclusion of pharmacies in outpatient co-ordination will promote the outflow of prescriptions and benefit the out-of-hospital market. Notice on further improving the integration of designated retail pharmacies into outpatient co-ordination management points out that medical insurance departments at all levels should take measures to encourage qualified designated retail pharmacies to voluntarily apply for opening outpatient co-ordination services. As a continuation of the "two-channel" policy, this policy will further promote the establishment of a basic medical insurance outpatient mutual aid security system in various places, and also reflect the determination of the medical insurance department to continue to promote the separation of medicines. Outpatient co-ordination will promote the outflow of prescriptions, which will benefit the out-of-hospital market as a whole, and specialized pharmacies focusing on chronic diseases will be promising.

　　(2) The "wholesale and retail integration" head enterprises with the advantages of prescription drug management will benefit first. Prescription outflow drugs are mainly prescription drugs, and the "wholesale and retail integration" head enterprise has the resource advantage of prescription drugs, which can give priority to obtaining industrial resources to meet the needs of patients and has certain competitiveness in the process of undertaking prescription outflow.

　　(3) Pharmacies with systematic and informational capabilities have the advantage of taking over the outflow of prescriptions. Pharmacies that can be included in the overall medical insurance should have the ability to connect with the hospital prescription outflow system and the medical insurance department system. In other words, pharmacies without corresponding systematization and informatization capabilities will not have the opportunity to undertake prescription outflow.

　　One of the important functions of Jiuzhoutong’s plan of "joining thousands of stores" for good pharmacists and expanding professional pharmacies is to serve the outflow of hospital prescriptions. As of the disclosure date of the report, the company’s "10,000 stores to join" plan has reached 15,856; Taking Wuhan as an example, good pharmacists’ pharmacies that have opened medical insurance have been included in the scope of outpatient co-ordination policy. The implementation of policies such as "outpatient co-ordination" and "dual channels" will bring great development opportunities for the company’s new retail business.

　　3. "Internet+medical care" welcomes favorable policies

　　In recent years, the state encourages and supports all parties to increase the layout of new generation information technologies such as 5G, big data and artificial intelligence in the medical industry. Relevant departments have successively issued a series of favorable policies to accelerate the development and popularization of Internet medical services, explicitly encouraging and accelerating the development of "Internet+medical health" and gradually bringing eligible "internet plus" medical services into the scope of medical insurance payment.

　　At present, China’s Internet medical services are mainly divided into Internet health consultation, Internet diagnosis and treatment, Internet hospitals and third-party platforms, etc. The units that can legally and legally provide Internet diagnosis and treatment services are mainly manifested in three forms, namely, independent Internet hospitals, the second name of offline entity hospitals, and offline entity hospitals that separately apply for Internet diagnosis and treatment qualifications.

　　In the past, for the sake of people’s life, health and safety, the relevant departments all substantially required that Internet diagnosis and treatment should not be conducted for the first time, that is, some common diseases and chronic diseases could only be followed up through information technology such as the Internet, and internet plus family doctors could sign up for services. In December, 2022, National Health Commission issued the Notice on Doing a Good Job in Internet Medical Services in COVID-19, which clarified that qualified medical institutions can prescribe online treatment related symptoms through the Internet diagnosis and treatment platform, and encouraged qualified third parties to deliver medicines to patients’ homes. This move is undoubtedly a great benefit to the Internet medical industry, which conditionally liberalized some medical services for the first visit, instead of forcing Internet medical services into the category of follow-up visits as in the past. The conditional liberalization of some initial consultations on Internet medical care means that more common diseases and chronic diseases can be directly treated through Internet medical care in the future, so as to meet the people’s medical needs and promote the rapid development of Internet medical care. At the same time, with the in-depth implementation of the policy of including the eligible "internet plus" medical service fees into the scope of medical insurance payment, it will further boost the development of the "Internet+medical health" industry.

　　Jiuzhoutong is developing a new model of "Internet medical treatment+prescription outflow+medical insurance", and has accumulated rich professional experience by cooperating with professional institutions to provide Internet hospital system construction and operation and supply chain services for a number of 3A hospitals and Internet diagnosis and treatment platforms in Tianjin, Hubei and Shanghai. In the future, the company will continue to deepen the Internet medical industry, strive to build a professional prescription outflow platform in the industry, and become an Internet hospital system construction expert in physical hospitals and an industry-leading generation operation service provider.

　　4. The development of traditional Chinese medicine welcomes opportunities.

　　In order to give full play to the characteristics and comparative advantages of Chinese medicine and promote the innovative development of Chinese medicine, the state has successively introduced a series of heavy favorable policies, and the top-level design of Chinese medicine policy system has been improved day by day, and the Chinese medicine industry has ushered in new opportunities for historical development. In March, 2022, the General Office of the State Council issued the 14th Five-Year Plan for the Development of Traditional Chinese Medicine (hereinafter referred to as the Plan), which clarified the basic principles and key tasks for realizing the high-quality development of traditional Chinese medicine in the new period and pushed the development of traditional Chinese medicine industry into a new stage. In the first half of 2023, the state continued to increase its support for traditional Chinese medicine, and proposed to further strengthen the scientific supervision of traditional Chinese medicine, increase the support and promotion for the development of traditional Chinese medicine during the 14 th Five-Year Plan period, further strengthen the development and registration management of new traditional Chinese medicine, and comprehensively strengthen the construction of county-level traditional Chinese medicine medical institutions.

　　The state strongly supports various policies for the development of Chinese medicine, which improves the status of Chinese medicine in China’s medical system. The development prospect of Chinese medicine industry is broad, and the Chinese medicine industry will usher in high-quality development opportunities, which brings historic opportunities for the development of the company’s Chinese medicine sector business.

　　Jiuxin Chinese Medicine, a subsidiary of the company, has built a network of authentic Chinese medicine resources covering the whole country. In the future, Jiuxin Chinese Medicine will continue to increase the construction of Chinese herbal medicine producing areas and devote itself to the standardized management of authentic Chinese medicinal materials production, which is in line with the guiding opinions in the Planning on "authentic Chinese medicinal materials production, traceability of Chinese herbal pieces, standardized protection of Chinese herbal medicine processing, and construction of third-party testing platform".

　　Jiuxin Chinese Medicine has built 11 GMP-certified modern decoction pieces enterprises nationwide, and has continuously improved the traditional processing methods of Chinese medicine by using high and new technologies, developed the pharmaceutical engineering technology of Chinese medicine, and established an information traceability system covering Chinese medicine and Chinese medicine decoction pieces. In the future, Jiuxin Chinese Medicine will continue to speed up the digitalization, networking and intelligent construction of Chinese medicine manufacturing industry, strengthen technical integration and process innovation, improve the manufacturing level of Chinese medicine equipment, and accelerate the standardization and modernization of Chinese medicine production processes and processes; "Intelligent manufacturing" is in line with the concept of "quality-oriented market price mechanism of Chinese herbal pieces" in the reform of traditional Chinese medicine. At the same time, Jiuxin Chinese Medicine is committed to producing a variety of high-quality, safe and reliable Chinese medicine products. In the future, it will continue to strengthen product quality control, enrich genuine medicinal products, big health products and other categories, and respond to the long-term goal of "enriching the supply of Chinese medicine health products" in the Plan.

　　5. REITs support policies are intensively introduced.

　　In recent years, the State Council, relevant ministries and commissions, local governments at all levels, CSRC, exchanges and other regulatory authorities have intensively issued relevant support policies for public offering REITs, and taken various measures to promote the normal issuance of public offering REITs.

　　The vigorous promotion of relevant policies by the regulatory authorities has further stimulated the enthusiasm of all parties involved in public offering REITs, and with the gradual expansion of the underlying assets and the normal issuance of public offering REITs, public offering REITs have entered an accelerated development period. Up to now, there are 29 publicly-funded infrastructure REITs that have been issued or audited in China, with a total market value close to RMB 100 billion.

　　In order to actively respond to the call of the national policy and effectively revitalize the existing assets, Jiuzhoutong, with the support of relevant government departments at all levels, continues to carry out the declaration and issuance of public offering REITs. The company plans to issue publicly-offered REITs in batches, with its 3.3 million square meters of medical logistics storage assets and supporting facilities as the underlying assets. At present, the project is progressing smoothly. Part of the assets of Wuhan Dongxihu Pharmaceutical Logistics Center held by Jiuzhoutong Logistics, the first batch of assets, was rated as one of the top ten "National Intelligent Warehouse Logistics Demonstration Bases" by the National Development and Reform Commission, the Ministry of Commerce and China Federation of Materials. The company has completed the first draft of the project declaration, formally submitted the declaration documents and started the formal declaration procedure; The company has wholly established Hubei Kyushu Industrial Park Operation Management Co., Ltd., which is intended to be the operation management organization of future basic assets and provide operation management services for basic assets; Jiuzhoutong Logistics has wholly established Kyushu Shourui Company, and plans to inject the first batch of pharmaceutical warehousing and logistics assets into Kyushu Shourui, and transfer 100% equity of the company to public offering REITs.

　　(VI) Industry and development trend of the company

　　The core business of the company is mainly the pharmaceutical circulation format in the big health industry. The industry description and development trend analysis are as follows:

　　1. Pharmaceutical circulation format

　　(1) The scale of the pharmaceutical circulation market is growing, and the industry concentration is gradually increasing.

　　According to the statistical analysis report on the operation of drug circulation industry in 2022, the sales scale of the national drug circulation market increased steadily in 2022; The total sales volume of seven categories of medical commodities in China was 2,751.6 billion yuan, a year-on-year increase of 6.0% after deducting incomparable factors.

　　In the last three years, the average annual growth rate of the sales scale of the pharmaceutical circulation industry was 5.6%, the average annual growth rate of the first four companies that sold over 100 billion yuan was 8.7%, and the average annual growth rate of Jiuzhoutong was 12.2%. The average annual growth rate of sales revenue of Jiuzhoutong in recent three years is not only higher than that of the industry, but also higher than that of the first four companies.

　　In addition, the concentration of the pharmaceutical circulation industry has been continuously improved. In 2022, the top 100 pharmaceutical wholesale enterprises in China accounted for 75.2% of the total size of the national pharmaceutical market in the same period, up 0.7 percentage points year-on-year. Among them, the main business income of four national leading enterprises such as Jiuzhoutong accounted for 45.5% of the total size of the national pharmaceutical market in the same period, up 1.3 percentage points year-on-year. Compared with countries such as the United States and Japan, which also refer to the overall goal of the industry, there is still much room for improvement in the concentration of pharmaceutical circulation in China. The Guiding Opinions of the Ministry of Commerce on Promoting the High-quality Development of the Pharmaceutical Circulation Industry during the Tenth Five-Year Plan period puts forward that by 2025, 1-3 large-scale digital and comprehensive pharmaceutical circulation enterprises exceeding 500 billion yuan and 5-10 exceeding 100 billion yuan will be cultivated, and the main business income of the top 100 pharmaceutical circulation enterprises accounts for more than 98% of the total national pharmaceutical market in the same period, which brings development opportunities for leading enterprises such as Jiuzhoutong. In recent years, the domestic market share of Jiuzhoutong has increased from 4.72% in 2019 to 5.76% in 2022. The company’s industry competitiveness has gradually increased and its market share has gradually increased.

　　(2) The changing trend of market channel pattern is obvious, and the market share outside the hospital is gradually increasing.

　　According to the statistical data of Minenet, China’s drug sales are divided into three major terminals and six major markets. From the sales distribution of the three major terminals, the market share of the first terminal, secondary hospitals and above is the largest, but it has shown a downward trend in recent years, accounting for 64.0%, 63.5% and 61.8% respectively from 2020 to 2022. The market share of the second terminal retail pharmacies has gradually increased, from 26.3% in 2020 to 29.0% in 2022; The market share of the third terminal primary care in 2020 -2022 is 9.7%, 9.6% and 9.2% respectively. From the trend, the market share of drugs in secondary and above hospitals has gradually declined, while the share of retail pharmacies has increased greatly.

　　Out-of-hospital market is the dominant market that Jiuzhoutong has been deeply cultivating for many years, accounting for more than 70% of the sales. The trend of increasing the overall share of out-of-hospital markets such as retail pharmacies and primary medical care will help the company achieve sustained and steady development in the dominant market.

　　(3) Digital distribution and supply chain management will become the new engine for the future development of the industry.

　　According to the research data of iResearch, in 2021, the B2B market scale of medical e-commerce in China has reached 207.2 billion yuan. Under the comprehensive effect of continuous improvement of policies and markets, the B2B market size of medical e-commerce in China is expected to reach 375.8 billion yuan in 2025, with huge development space.

　　With the gradual implementation of graded diagnosis and treatment and the in-depth implementation of the system of "two channels" and "outpatient co-ordination", the structure of B-end customers will change greatly, and the market share of primary diagnosis and treatment and retail pharmacy customers will gradually increase, and such customers mainly show the trend of high procurement frequency, small number of customers, high convenience and effectiveness requirements, that is, C-end customers at B-end, and circulation enterprises can only promote digital transformation, improve the efficiency of supply chain services, and establish a chain from procurement, sales, operation to effectiveness.

　　Jiuzhoutong is one of the earliest enterprises in China to develop medical e-commerce business. It first put forward the concept of FBBC in the industry. Relying on the Internet and digital tools, it is committed to building a supply chain service platform serving upstream enterprises (F-end), downstream B-end customers (including medical institutions, pharmacies, clinics, FMCG stores, government procurement groups, etc.) and C-end users, forming a three-dimensional and digital medical supply chain service system that integrates B2B/B2C/O2O. In the first half of 2023, the self-operated trading income of the company’s drug 99 B2B e-commerce platform reached 6.054 billion yuan, a year-on-year increase of 15.84%; At the same time, the revenue scale of large-scale pharmaceutical retail e-commerce platforms such as JD.COM, Ali, Meituan, Dingdang, Ping An, Tik Tok, Aauto Quicker and Baidu reached 3.254 billion yuan, a substantial increase of 62.56% year-on-year; The above totals 9.308 billion yuan, accounting for 11.74% of the main business income. The company’s digital distribution business has become an important business channel for the company.

　　(4) The change of drug circulation channels drives the Bb/BC integration of pharmaceutical logistics.

　　Centralized drug procurement changed the product structure of drug supply, which led to the re-adjustment and reshuffle of drug distributors and market share. The successful bidder paid more attention to cost control and put forward higher requirements for distribution efficiency. The substandard products turn to the off-campus market, which brings the market demand for retail pharmacy terminals, and the terminal orders tend to be fragmented, which also requires the pharmaceutical circulation industry to have refined service capabilities. Only by building an integrated supply chain platform of warehouse and distribution, promoting "Bb/BC integration" and providing convenient and efficient differentiated services to meet the new market demand of the terminal market can pharmaceutical commercial enterprises obtain historic development opportunities.

　　Jiuzhoutong Logistics is the first enterprise in the industry to obtain 5A-level pharmaceutical logistics, and Wuhan Dongxihu Pharmaceutical Logistics Center has been rated as one of the top ten national intelligent warehousing logistics demonstration bases (the only one in the pharmaceutical industry). At present, the company has 31 provincial-level pharmaceutical logistics centers and 110 regional logistics centers, among which six "BC integrated warehouses" in Hubei, Shanghai, Guangzhou, Beijing, Tianjin and Zhejiang have been put into operation. A total of 22 companies in Hubei, Chongqing, Shandong, Henan, Beijing, Guangdong, Shanxi, Anhui, Sichuan, Zhejiang, Fujian, Shaanxi, Jiangsu, Xinjiang, Shanghai, Tianjin, Guangxi, Jiangxi, Inner Mongolia, Hebei, Gansu and Hunan have completed the transformation and put into operation, which can be applied to multi-channel and multi-scene (ToB, ToC and Hunan). Jiuzhoutong Logistics has developed direct trunk lines and star-shaped branch lines, forming more than 4,000 distribution lines, which can achieve multi-stage combined transport and wide distribution coverage; Logistics centers around the country meet the national GSP quality standards, and the total service volume and efficiency are leading the industry; The automatic and intelligent logistics equipment independently developed by Jiuzhoutong has been put into use, achieving the purpose of reducing costs and increasing efficiency.

　　(5) The development space of cold chain logistics continues to increase.

　　With the rapid development of cold chain products such as biomedicine, vaccines and detection reagents in China, the demand for cold chain facilities in pharmaceutical logistics industry is increasing.

　　The market scale of cold chain logistics industry in China is growing steadily. According to the statistics of Ai Media Consulting, the market scale of cold chain logistics will reach 637.1 billion yuan in 2022, and it is expected to reach 868.6 billion yuan in 2025. At present, the cold chain logistics industry in China is in a period of standardized development. It is the development goal of the industry to build a modern cold chain logistics system and fill the shortcomings of cold chain logistics development. In the future, the cold chain logistics industry will develop towards intelligence, greening and standardization. With the more perfect layout of cold chain logistics industry, the gradual implementation of national standards and favorable policies, consumption upgrading and the deep integration of cold chain logistics with artificial intelligence and big data, China’s cold chain logistics industry will further develop.

　　2. New retail and joining formats of medicine

　　(1) The market scale of the retail pharmacy industry is increasing year by year, and the physical pharmacies have resumed rapid growth.

　　Judging from the scale of China’s retail pharmacy market, there is a steady upward trend year by year from 2013 to 2022. According to the data of the Minenet, the sales scale of physical pharmacies and online pharmacies (including drugs and non-drugs) in China reached 872.5 billion yuan in 2022, up 9.75% year-on-year.

　　Among them, the proportion of physical pharmacies in China was 70.1%, and the sales scale in 2022 was 611.7 billion yuan, up by 7.00% year-on-year, and the growth trend resumed.

　　(2) prescription outflow opens up the market space of 100 billion in retail pharmacy industry.

　　With the implementation of policies such as "zero difference rate" and quantity purchase, self-funded prescriptions of secondary and above hospitals began to flow to retail pharmacies; At the same time, the introduction of "dual-channel" and "outpatient co-ordination" policies has opened the door for pharmacies to be included in the co-ordination of medical insurance reimbursement; In September 2022, the "Measures for the Supervision and Administration of Drug Online Sales" was promulgated, which affirmed the online sale of prescription drugs at the policy level and continued to promote the standardization of drug sales around the principle of "online and offline integration". Driven by the above policies, the retail pharmacy market will gradually increase in volume in the future, with great market potential.

　　At the same time, all parts of the country actively promote the construction of prescription circulation platform, provide online circulation channels for prescription outflow, and further accelerate prescription outflow. According to the construction of prescription circulation platform disclosed by the medical insurance bureaus of various provinces and cities and official website of the Health and Health Commission, about 22 provinces and cities across the country have started the construction of prescription circulation platform, among which about 13 provinces and cities such as Guangdong Province, Hunan Province and Hubei Province have landed the platform construction, realizing the docking of hospitals and pharmacies; In addition, the anti-corruption work is expected to further promote the outflow of prescriptions. Retail pharmacies will become the main undertaker of prescription outflow, bringing development opportunities for Jiuzhoutong. The self-operated and franchised business of good pharmacists under Jiuzhoutong has developed rapidly. As of the disclosure date of this report, the number of self-operated and franchised pharmacies has reached 15,856, with stores in 31 provinces, municipalities and autonomous regions, covering 291 prefecture-level cities and 1,301 counties and districts. It is estimated that the number of stores will exceed 30,000 in 2025. At the same time, the company can take all kinds of OTC orders and prescription drug orders from grade hospitals by using the new retail model of "BC warehouse distribution integration" and "online and offline integration", which will greatly promote the company’s rapid development in the off-campus market.

　　(3) The joining mode can quickly seize the retail pharmacy market, and the chain rate of pharmacies has a large room for improvement.

　　In recent years, joining mode has increasingly become a trend of the expansion of chain pharmacies. According to the statistics of Minenet, during the expansion of the top 100 chains, the proportion of joining methods has greatly increased, from 24% in 2020 to 40% in 2021. Chain drugstore enterprises fully empower franchised pharmacies by providing information systems, training management and professional operation services; Franchised pharmacies can also operate effectively and efficiently with the help of the advantages of large chain commodity purchase price, standardized information system, trust of well-known brands and professional service training. The characteristics of light assets of franchised pharmacies contribute to the rapid expansion of chain pharmacies, give full play to the scale effect and reduce the proportion of expenses.

　　The Guiding Opinions of the Ministry of Commerce on Promoting the High-quality Development of the Pharmaceutical Circulation Industry during the Tenth Five-Year Plan period proposes that by 2025, the annual sales of the top 100 pharmaceutical retail enterprises will account for more than 65% of the total pharmaceutical retail market, and the retail chain rate of pharmaceuticals will be close to 70%; In recent years, the chain rate of pharmacies has increased from 50.50% in 2017 to 57.80% in 2022, with a rapid growth rate. However, compared with the plan of 70%, there is still a certain distance. There is a huge room for improving the chain rate of pharmacies in the next three years, which will bring development opportunities for Jiuzhoutong’s "joining all stores" project.

　　(4) pharmacies have entered the "new retail era", and online channels have grown strongly.

　　Relevant policies such as "Drug Circulation in internet plus" and "Medical Insurance Service in internet plus" have included the eligible "internet plus" medical service fees into the scope of medical insurance payment, encouraged designated medical institutions to provide "no-meeting" drug purchase services, and the medical insurance payment for online drug sales has also entered the stage of exploration and implementation. Driven by the "internet plus" policy, the pharmaceutical retail industry has entered an innovative development stage of transformation and upgrading.

　　Under the background of online and offline drug sales supervision and coordination, retail pharmacies have accelerated into the "new retail era". According to the data of Minenet, the sales scale of online pharmacies (including drugs and non-drugs) in China reached 260.8 billion yuan in 2022, and the proportion of online pharmacies (including drugs and non-drugs) increased from 5.80% in 2016 to 29.90% in 2022, and the "site" of online pharmacies continued to expand.

　　3. Brand promotion and operation format

　　(1) The specialization, refinement and intellectualization of the pharmaceutical industry have given birth to the demand for professional brand promotion and operation services.

　　In recent years, the division of labor in the pharmaceutical industry chain has been continuously refined, and the degree of specialization has been continuously improved. The marketing method relying on digital technologies such as big data and cloud computing has become a new trend in the development of the industry. Pharmaceutical machinery manufacturers have put forward more demands for professional brand promotion and operation services. On the one hand, pharmaceutical machinery enterprises tend to maintain high R&D investment in order to gain a sustainable competitive advantage, while reducing operating costs in other aspects. Therefore, it is effective to hand over sales links to professional brand promotion and operation service organizations to reduce marketing costs and ensure R&D investment. On the other hand, with the advent of the digital economy era, how to break the time and geographical restrictions through digital marketing and make products get omni-channel and full-range continuous exposure has become a new marketing problem for medical equipment manufacturers, which has brought business opportunities for brand promotion and operation service formats with digital marketing advantages such as Jiuzhoutong.

　　Jiuzhoutong continues to explore digital management and marketing mode in brand promotion and operation, and has achieved initial results. On the one hand, the company has established an omni-channel, intelligent marketing system on the marketing side, and comprehensively improved its marketing and customer acquisition capabilities by linking the distribution division, the retail e-commerce division, the B2B and B2C businesses of the group, and the business segments such as "Join Ten Thousand Stores", "Power Health" and Pharmaceutical Jiujiu. At the same time, with data intelligent analysis as the core, through diversified business layouts such as customer data platform, product analysis, intelligent operation, private domain operation, consulting and training, we provide rich and effective solutions for various teams such as data, products, operation, market and management; On the other hand, through applets, WeChat official account, WeChat community, tweets, Internet hospitals, flagship store operations, staff and patient education, the company has built an "online and offline integration" brand to empower product sales. At present, professional brand promotion and operation service providers have become an important choice for more and more medical equipment manufacturers to promote their products.

　　(2) deepen the implementation of medical reform policies such as purchasing with quantity, and accelerate the development of brand promotion and operation services.

　　The deepening implementation of relevant policies such as centralized purchasing has accelerated the development of brand promotion and operation service formats. Judging from the direct effect of the implementation of the medical reform policy, the prices of drugs that entered the centralized purchasing list generally dropped sharply, and the original drugs that did not enter the centralized purchasing list did not have the price advantage, which led to a drop in both quantity and price, which greatly impacted the overall hospital sales.

　　For the original drug research manufacturers, on the one hand, the pressure to continuously expand the hospital market has increased, and the per capita output of each product sales team has declined, so there is a demand for outsourcing hospital sales; On the other hand, it began to pay attention to the off-campus market, but its accumulation was relatively weak, and the demand for professional off-campus channel operation increased. Based on the above demand, the original research drug manufacturers pay more attention to the distribution channel ability and brand promotion ability of distributors. In order to realize the rapid promotion of the off-campus market, the original research brands tend to choose the integrated service provider of circulation and brand operation with strong distribution channel network and brand promotion experience, which provides a growing impetus for the development of brand promotion and operation industry.

　　4. Internet medical format

　　(1) Many factors, such as social needs and policy support, drive the rapid growth of Internet medical industry, and various application scenarios promote the deep integration of Internet and medical care.

　　China has a huge medical and health market, and the medical and health expenditure is huge and growing steadily, but there is still huge room for growth in per capita medical and health expenditure. In addition, driven by factors such as uneven distribution of medical resources, shortage of medical resources, aging population and rising prevalence of chronic diseases, it is even more necessary for China to develop the medical and health industry by using the characteristics of the Internet, so as to improve the quality and comprehensive services. In recent years, China’s Internet medical care has always maintained a high growth trend. According to the statistics of China Business Industry Research Institute, the market size of Internet medical care industry in China reached 223 billion yuan in 2021, up by 43.87% year-on-year, and it is expected to reach 309.9 billion yuan and 364.7 billion yuan in 2022 and 2023 respectively.

　　In recent years, the National Health Commission, the Medical Insurance Bureau, the National Development and Reform Commission, the Ministry of Commerce, the General Administration of Market Supervision and other departments have also issued policies, explicitly promoting and developing Internet medical services, supporting physical hospitals to provide diagnosis and treatment services to patients through the Internet, encouraging online follow-up visits for common/chronic diseases, prescription circulation, online sales of prescription drugs and other service formats, advocating online and offline integrated development, and demanding that drugs be accessible in accordance with the operating modes of "online booking for store access" and "online booking for store delivery". The introduction of these policies has brought new changes to the development of the industry, prompting more and more C-end users, doctors, medical institutions and pharmaceutical machinery enterprises to actively participate in it.

　　In the future, with a variety of application scenarios to promote the deep integration of "Internet+medical care", Internet medical services, medical informatization, medical e-commerce, Internet commercial insurance, medical intelligent hardware, etc. will become the focus of the industry and form a complete closed-loop medicine.

　　(2) Internet medical online users are growing rapidly, and the medical industry is accelerating to embrace the Internet.

　　According to the data of the 51st Statistical Report on Internet Development in China issued by China Internet Network Information Center (CNNIC), by December 2022, the number of Internet medical users reached 363 million, accounting for 34% of the total number of Internet users, up 21.70% year-on-year, making it the fastest-growing application in 2022. Today, with the development of Internet medical care in full swing, the medical industry is accelerating to embrace the Internet. Nevertheless, the utilization rate of online medical users in China is still low, and there is a large room for the application and development of internet medical care.

　　(6) Description of the company’s main business.

　　After years of transformation and upgrading, Jiuzhoutong’s existing main business mainly includes six aspects: digital pharmaceutical distribution and supply chain business, general brand promotion business, self-produced and OEM business of pharmaceutical industry, new pharmaceutical retail and franchise business, medical health and technology value-added services, digital logistics technology and supply chain solutions. During the reporting period, all businesses achieved steady operation, and some high-margin businesses expanded smoothly, and their operations continued to improve. The specific businesses are described in detail as follows:

　　1. Digital pharmaceutical distribution and supply chain business

　　The upstream customers of the company’s digital pharmaceutical distribution and supply chain business are mainly pharmaceutical manufacturers and agents, and the downstream customers mainly include secondary and above hospitals, primary medical institutions, chain and single pharmacies, large-scale Internet e-commerce platforms, Internet medical platforms and downstream pharmaceutical distributors (quasi-terminals). The company is in the middle circulation link of the pharmaceutical industry chain, and has gathered many upstream and downstream customers and variety resources. Relying on the advantages of the pharmaceutical logistics system, it has formed a natural medical equipment supply chain network platform.

　　After years of digital transformation, the company has set up a national unified drug 99 B2B trading platform (www.yyjzt.com), constantly enriching platform products and improving price rationality; The company independently developed the upstream supply chain SaaS system "Zhiyaotong", the cloud procurement system and the downstream SaaS system "Yundiantong", and built an electronic first-time interactive platform. Through the combination of platform intelligence, community marketing, industrial flagship operation, SaaS service and offline push, the company cooperated with relevant banks, and provided omni-channel and full-scenario digital distribution services for upstream customers with the help of the supply chain financial platform, and provided all categories and "one-stop" for downstream customers.

　　In the first half of the year, the revenue scale of the company’s digital pharmaceutical distribution and supply chain business was 67.488 billion yuan, accounting for 85.15% of the main business income; Among them, the revenue scale of digital distribution business such as B2B platform of Yaojiu reached 6.054 billion yuan, and the revenue scale of large-scale pharmaceutical retail e-commerce platforms such as JD.COM, Ali, Meituan, Dingdang, Ping An, Tik Tok, Aauto Quicker and Baidu reached 3.254 billion yuan, accounting for 13.79% of this business segment. By the end of the reporting period, there were 350,000 active users of the company’s drug 99 platform (www.yyjzt.com) and 199,000 active users of the "Zhiyaotong" platform.

　　2. General generation brand promotion business

　　Zongdai brand promotion business is a new business hatched from the company’s pharmaceutical distribution business. Relying on the company’s "new product strategy" and the advantages of all-category and omni-channel resource circulation, combined with the trend of CSO industry integration, outsourcing and branding, it focuses on retail channels, focusing on product mining and value product introduction, and empowers core product brands through a sound brand planning and operation system to provide omni-channel brand marketing solutions for partners.

　　The company’s general agent brand promotion business includes drug general agent brand promotion business and device general agent brand promotion business. Among them, the promotion business of drug general agent has initially formed five competitive business models, including the out-of-hospital agency for products that were originally researched and failed, the out-of-hospital agency for products that won the bid, the orderly marketing of brand products, the out-of-hospital agency for brand products and the out-of-hospital agency for exclusive products, so as to achieve a steady increase in sales scale and profitability. By the end of the reporting period, the total number of drug product specifications reached 915 (it is estimated that there will be 19 product specifications exceeding 100 million in the whole year), including the products of Zhejiang Huahai, Zhejiang Jingxin, Zhengda Tianqing, Dongyangguang, Yichang Renfu and other foreign-funded enterprises such as AstraZeneca, Bayer, Japan Weicai and Takeda. In the first half of the year, the company’s drug brand promotion business achieved sales revenue of 4.949 billion yuan, a year-on-year increase of 48.60%; Gross profit was 1.284 billion yuan, a substantial increase of 65.70% year-on-year.

　　The brand promotion business of the company’s medical devices focuses on domestic and foreign brand manufacturers, focusing on the development of major surgery, cardiovascular and cerebrovascular intervention, IVD national and regional platform business, strengthening the construction of basic service capabilities of the supply chain, establishing a unified digital platform, optimizing the logistics system, improving professional talents, and exploring solutions to promote the construction of full-link supply capabilities, centralized distribution of consumables, and packaging of laboratory departments. In the first half of the year, the sales revenue of the company’s medical device brand promotion business reached 3.688 billion yuan, an increase of 27.40% over the same period of last year; Gross profit was 179 million yuan, an increase of 40.55% over the same period of last year; We have represented 336 product specifications of Johnson & Johnson, Minimally Invasive Medical, Linuofa, Abbott, Fei Sen Yus (Hemodialysis), Roche, UA and other brand manufacturers.

　　3. Self-production and OEM business of pharmaceutical industry

　　Self-produced and OEM business in pharmaceutical industry is an important high-margin business segment of the company. This business is based on the existing varieties, brands, channels and marketing advantages, and uses the big data accumulated by the company’s "100 billion-level" supply chain service platform to develop self-operated industrial products and OEM business in a targeted manner, and then distribute them to terminal or C-end consumers through the company’s omni-channel sales network, including the following three segments:

　　(1) Western medicine industry

　　Jingfeng Pharmaceutical, a wholly-owned subsidiary of the company, is mainly engaged in drug production, sales, research and development, as well as professional medical incubators and third-party testing platforms. Its main products include diabetes series, antibiotics series, cardiovascular and cerebrovascular series, external medicine and other products. Based on the strategic positioning of "synergy of industrial chain value, matching of raw materials and preparations, and equal emphasis on R&D, marketing, production and incubation", Jingfeng Pharmaceutical continued to strengthen quality management and brand promotion, promote the consistency evaluation of generic drugs, create a large single product of metformin tablets, and cultivate high-quality products matching raw materials and preparations. During the reporting period, furosemide injection produced by Jingfeng Pharmaceutical won the bid for the eighth batch of national centralized purchase. Calcium dobesilate capsules (0.5g) and amlodipine besylate tablets (5mg) successively passed the consistency evaluation of generic drug quality and efficacy, and acarbose tablets obtained the Drug Registration Certificate.

　　(2) Chinese medicine industry

　　As a platform company of Chinese medicine industry, Jiuxin Chinese Medicine, a subsidiary of the company, is based on the big health industry of Chinese medicine, with authentic medicinal materials and quality assurance as its core competitiveness, and has carried out deep-rooted layout of the whole industrial chain in the fields of Chinese medicine resources, Chinese medicine research and development, Chinese medicine production, Chinese medicine marketing and Chinese medicine e-commerce.

　　In terms of Chinese medicinal materials resources, in order to control the quality from the source, Jiuxin Chinese Medicine has established 18 professional authentic medicinal materials companies in the core producing areas, standardized planting medicinal materials bases of 150,000 mu, 8 Chinese medicinal materials bases have passed the national GAP certification, and 10 medicinal materials varieties have won the industry honor of "three no one is complete" brand base; In the research and development of traditional Chinese medicine, Jiuxin Traditional Chinese Medicine has built a Chinese medicine technology research and development platform based on the application of Industry-University-Research, set up a Chinese medicine research and development team of more than 70 people, undertaken more than 30 national projects, and obtained more than 100 authorized patents; In the production of traditional Chinese medicine, Jiuxin Traditional Chinese Medicine has built 11 GMP-certified modern decoction pieces enterprises, two of which have passed CNAS national accreditation laboratory certification, and can produce common decoction pieces, refined decoction pieces, direct oral decoction pieces, toxic decoction pieces, ginseng antler, medicine and food homology and other products, with Jiuxin, Kyushu Tianrun, Jinguide Jitang and Zhenrentang. In the first half of the year, the company’s Chinese medicine industry grew steadily, achieving sales income of 932 million yuan.

　　(3)OEM products

　　Jiuzhoutong Medical Device Group Co., Ltd. (hereinafter referred to as "Jiuzhoutong Medical Device Group"), a subsidiary of the company, exerts its own industrial brand, focusing on household, low-consumption, rehabilitation, high-consumption and IVD varieties, obtains products by OEM, ODM, clinical achievement transformation, merger and acquisition, and establishes a product screening mechanism and its own supply chain, and builds a professional marketing team for household and medical care, fully tapping Jiuzhoutong’s marketing resources, constantly developing new channels to expand the market, and forming its own product Industry-University-Research Investment.

　　By the end of the reporting period, Jiuzhoutong Instrument Group has obtained 5 MAH Class II product registration certificates and 16 Class I product filing certificates, and established a product system of Body Health and Flesh with Wuhan Konitz Medical Technology Co., Ltd. as the main body, with 173 OEM instrument product specifications.

　　During the reporting period, the company’s OEM business developed rapidly, achieving an operating income of 63.17 million yuan in the first half of the year, an increase of 43.27% over the same period of last year; The gross profit was 18.17 million yuan, an increase of 45.79% over the same period of last year.

　　4. New retail of medicine and joining in ten thousand stores.

　　The new retail business is an important part of the company’s strategic business in the new three years. The company makes full use of the advantages of the established supply chain, empowers the company’s retail business, reaches C-end users, and expands the company’s digital retail and ten thousand stores to join through the mode of "ten thousand stores joining", "wholesale and retail integration" and the combination of online and offline.

　　At present, the company’s plan of "joining 10,000 stores" is progressing smoothly. As of the disclosure date of the report, the company has achieved 15,856 self-operated and affiliated pharmacies, with stores in 31 provinces, municipalities and autonomous regions, covering 291 prefecture-level cities and 1,301 counties and districts. The company is the largest distributor of OTC products in China, with modern logistics centers all over the country, which can provide rich variety resources and efficient distribution services for franchised pharmacies. At the same time, the company is committed to the research and development of the core system of the "new retail" scene, building a digital platform for Kyushu Wandian, and providing various digital empowerment services for franchised pharmacies through digital tools such as retail ERP, medical insurance interface, store link, smart drug link, CRM and live broadcast, including standardized store opening, management training, personnel management of city partners, and commodity management analysis such as purchasing analysis, sales diagnosis and inventory optimization. And the extension of business scenarios such as medical insurance compliance, commercial insurance drainage, O2O e-commerce, community group purchase, health management, etc., to fill the shortcomings of single pharmacies/small and medium-sized chains, and fully empower single pharmacies and small and medium-sized chains to be digital. During the reporting period, the sales scale of the company to franchised pharmacies increased rapidly, and the sales revenue to franchised stores in the first half of the year was 1.642 billion yuan, a year-on-year increase of 51%.

　　5, medical health and technology value-added services

　　On the basis of expanding and improving the pharmaceutical supply chain platform, the company continues to provide information technology value-added services, and extends to medical services, health management, medical technology and other big health fields to build a big health service platform and improve the content of big health services. At present, this business segment mainly includes:

　　(1) information technology development and value-added services

　　Over the years, the company has adhered to the technical strategy of integration of industrial upgrading and information innovation, and the information technology value-added services have covered business sectors such as production, retail and health management from the field of pharmaceutical distribution. During the reporting period, the company continued to independently develop and iteratively upgrade information technology to support internal management and external empowerment tools such as Shouying platform, Yaojiujiu B2B e-commerce platform, Zhiyaotong APP and Power Health platform. Efficient business collaboration between group and molecular companies, molecular companies and molecular companies, and automatic transmission and sharing of data in ERP system; The company’s supplier collaboration management platform integrates the company’s internal ERP system, LMIS system, financial collaboration system, etc. Through the system connection and authorization password, the upstream and downstream customers of the company can enter Jiuzhoutong system to query and provide the required information services, automatically generate orders and other services.

　　(2) R&D and service of big health platform and empowerment tools

　　During the reporting period, the company completed the brand matrix construction of the big health platform, in which the "Power Health" client and the doctor have realized a series of functions such as appointment registration, online consultation, appointment for physical examination, quick drug purchase, health consultation and chronic disease management. In addition, the platform also realizes the service functions such as pharmacy operation, prescription circulation in Internet hospitals, commercial insurance verification and comprehensive pharmacy service solutions through the "Power Health" pharmacy, hospital and insurance company. In terms of industry empowerment, the company provides internet intelligent tools empowerment services for upstream and downstream customers through system software such as "Smart Medicine Connect", "Power Medicine Cloud" and "Store Connect". The company’s "Power Health" service platform registered 35,000 pharmacies, over 630,000 doctors provided online consultation and basic diagnosis and treatment services, and over 1.48 million patients served by commercial insurance.

　　(3) Medical diagnosis service

　　During the reporting period, medical institutions such as Huangshi Guangci Geriatric Hospital Co., Ltd. and Longyang Street Community Health Service Center in Hanyang District of Wuhan provided the public with professional services such as diagnosis and treatment of traditional Chinese and western medicine, disease management, rehabilitation and pension, and health file management. At present, the internet hospital special disease service under Jiuzhoutong Health Technology Group Co., Ltd. (hereinafter referred to as "Health Technology Group") focuses on the operation of ophthalmology specialty. The platform has accumulated 4,109 ophthalmologists and more than 23,000 paying patients, and has completed cooperation with Chaoju Ophthalmology, Purui Ophthalmology, Taikang Tongji and Yingtong Technology to provide professional medical and health management services for patients. At the same time, Health Science and Technology Group completed the deep docking and operation of Tianjin Beichen, Shanghai Oriental, Shanghai Health Cloud and other institutions, and opened up the overall settlement of online medical insurance in Tianjin, realizing the closed-loop mode of specialized disease operation of Internet hospitals.

　　6. Digital Logistics Technology and Supply Chain Solutions

　　Jiuzhoutong Logistics, a subsidiary of the company, relies on the professional logistics management team and the self-developed "Kyushu Yuncang" system to build a "three networks in one" logistics supply chain system with wide coverage and comprehensive service types, which integrates warehousing, transportation and information networks. While meeting the company’s own business needs, we insist on exporting professional logistics systems, services and equipment to the market, and provide three-party logistics, pharmaceutical cold chain logistics, digital intelligent logistics and supply chain solutions and advanced logistics intelligent equipment for upstream and downstream customers and customers in non-pharmaceutical business areas, so as to realize the transformation from enterprise logistics to scientific, platform and ecological logistics supply chain enterprises. During the reporting period, the company’s digital logistics technology and supply chain solutions business realized revenue of 403 million yuan, an increase of 38.05% over the same period of last year; Gross profit was 103 million yuan, a substantial increase of 73.35% over the same period of last year. The company’s logistics and supply chain services mainly include the following four aspects:

　　(1) Three-party logistics

　　Through network operation, platform operation, digital management and intelligent production, the company’s logistics not only meets the company’s own business needs, but also provides professional three-party logistics supply chain services for customers inside and outside the pharmaceutical, consumer goods, tobacco and other industries. In terms of warehousing services, the company relies on experienced logistics team and advanced "Kyushu Yuncang" system to closely cooperate with upstream and downstream customers in the supply chain, providing customers with information system management of all aspects of logistics, realizing full link visualization and traceability of the whole process; In terms of transportation and distribution services, Jiuzhoutong has a pharmaceutical distribution network platform covering 96% of the country, with an average annual logistics volume of about 170 million cases, providing fast, punctual, safe and high-quality standardized medical transportation services for customers in various industries. At the same time, through the integration of internal and external logistics resources, we provide integrated logistics services of agent operation and supply chain warehousing and distribution to meet the personalized needs of customers for pharmaceutical distribution. During the reporting period, the company continued to provide nationwide integrated warehousing and distribution logistics supply chain services and related businesses for Ali Health, Fei Sen Yus, Dingdang Smart Pharmacy, Enwei Pharmaceutical, (), Zhengda Tianqing and other enterprises, and further strengthened incremental business development while maintaining the steady development of stock business.

　　(2) Medicine cold chain logistics

　　Through in-depth cooperation with (), the company conducted research on the cold chain packaging scheme of clinical samples, cell products, umbilical cord blood and other multi-temperature products at -196℃, -80℃, -15℃~-25℃, successfully explored the standardized operation mode of all aspects of biological clinical and blood products, and successfully applied for the national standard pilot enterprise of "Operation Specification for Cold Chain Logistics of Biological Samples for Medical Testing" in the industry. During the reporting period, the company continued to provide professional cold chain logistics services for Siemens, Mindray Bio, (), Xiamen Wan Tai, Changchun Jinsai, Shanghai Berger Medical, (), Kexing Vaccine, Kexing Equipment and other enterprises, and at the same time opened up 16 new customers including Unacon, Henan Mu Yuan, Shanghai Luangjie and Zhonghui Bio, further enhancing the business volume.

　　(3) The overall solution of digital intelligence logistics and supply chain.

　　The company independently built a software product system covering the whole process and scene of the logistics supply chain, and built a national unified data warehouse, data quality, labels, indicators and analysis model system through the "Kyushu Cloud Warehouse" platform to form enterprise data assets. Warehouse management system

　　(WMS), transportation management system (TMS), operation analysis system (OAS), order management system (OMS), billing management system (BMS), equipment control system (WCS), Iot, 12-wheeled four-way shuttle, automatic AGV robot and other products with industry leading advantages, to realize real-time visual tracking of the whole link, active early warning and prevention for customers.

　　Jiuzhoutong has been practicing in the field of supply chain logistics for 20 years. Hubei Jiuzhou Yunzhi Technology Co., Ltd. (hereinafter referred to as "Jiuzhou Yunzhi"), a subsidiary of the company, exports technical services, empowers external customers, and provides one-stop integrated delivery service of "planning+software+equipment+operation" for customers such as Beijing Tongrentang, () Medicine and Kweichow Moutai, and provides logistics solutions for enterprises with multiple industries, multiple owners and multiple formats. Kyushu Yunzhi explores a set of platform service application ecology based on aPaaS model architecture, builds an agile technical base for enterprises, builds a new generation of enterprise technology middle platform, business middle platform and application platform, and constantly empowers enterprises to independently develop and expand their capabilities by relying on integrated technical support. At the same time, by providing the support of all R&D tools, the development process is simplified, the personnel capacity requirements are reduced, the development efficiency is improved, and the delivery of business needs is agile.

　　Description: The above highly intelligent logistics centers can reduce labor intensity, improve operation efficiency and accuracy, and ensure operation throughput by using intelligent equipment in each process link.

　　(4) Research and development of logistics intelligent equipment

　　Jiuzhoutong Logistics has obtained 51 patents related to logistics intelligent equipment, such as "A Reversible Shuttle Car with Clamping Mechanism" and "A Elevator for Shuttle Cars". While providing intelligent logistics equipment solutions for the industry and outside, the company independently develops a full range of shuttle car products and supporting equipment (including box-type two-way shuttle car, box-type four-way shuttle car, fork-variable-pitch shuttle car, pallet four-way shuttle car, etc.), and supports-25℃.

Second, the discussion and analysis of the business situation

　　(I) The overall operation of the company during the reporting period.

　　During the reporting period, the company achieved an operating income of 79.357 billion yuan and a net profit of 1.343 billion yuan, up by 16.73% and 5.83% respectively over the same period of last year. The net profit after deducting non-homecoming was 1.295 billion yuan, an increase of 17.09% over the same period of last year. The main reason for the continuous growth of the company’s operating income, net profit attributable to the mother and net profit deducted from the mother is that the company has realized the accelerated growth of emerging businesses such as brand promotion, new retail and joining of medicines, digital logistics technology and supply chain solutions, medical health and value-added services on the basis of maintaining the steady growth of pharmaceutical distribution business, which has helped the company to improve its performance.

　　(2) Operating conditions of various businesses during the reporting period.

　　During the reporting period, the company achieved main business income of 79.257 billion yuan and main business gross profit of 6.651 billion yuan, up by 16.62% and 22.93% respectively over the same period of last year.

　　1. Growth of main business by business.

　　(1) Digital pharmaceutical distribution and supply chain business

　　During the reporting period, the company’s digital pharmaceutical distribution and supply chain business operated steadily, achieving sales revenue of 67.488 billion yuan, a year-on-year increase of 14.01%; The gross profit was 4.55 billion yuan, a year-on-year increase of 14.24%.

　　During the reporting period, the company continued to promote the digital transformation of distribution business, comprehensively promoted the platform of co-management of secondary agreements, improved the accuracy of the code comparison system, and upgraded services around the top 100 national chains, achieving an increase of 1.2 billion yuan in head customers and a 10% increase in customer satisfaction. Aiming at the outpatient channels of single pharmacies and clinics, the company promoted the "Drug 99" business model in an orderly manner, and provided comprehensive and accurate flow analysis for manufacturers through digital management tools such as Zhiyaotong platform, which helped the implementation and supervision of promotion policies and steadily increased the share of terminal business. In the first half of 2023, the operating quality of the company’s drug 99 platform improved steadily, with the overall guest list increasing by 6% and the member guest list increasing by 12%; There were 175,000 monthly customers, up 13.5% year-on-year.

　　(2) General generation brand promotion business

　　During the reporting period, the company’s brand promotion business (including drugs and medical devices) maintained high-quality growth, achieving sales income of 8.637 billion yuan, a year-on-year increase of 38.74%; Gross profit was 1.464 billion yuan, up 62.15% year-on-year.

　　Brand promotion of generic drugs: During the reporting period, the company achieved sales revenue of 4.949 billion yuan, a year-on-year increase of 48.60%; The gross profit reached 1.284 billion yuan, up 65.70% year-on-year, mainly due to the sharp increase in sales of key varieties such as Kewei, Beiping and Kang Wang. By improving the working mechanism of brand operation, the company established a multi-media and multi-platform brand promotion service provider cooperation resource pool, and successfully completed the planning, promotion and implementation of Kewei brand. At the same time, focus on the introduction of high-quality new products, and implement the core product project system. In the first half of the year, 66 high-quality products were introduced, including 3 new products exceeding 100 million yuan and 13 new products exceeding 10 million yuan.

　　Brand promotion of equipment general agent: During the reporting period, the company achieved sales revenue of 3.688 billion yuan, up 27.40% year-on-year; The gross profit reached 179 million yuan, up 40.55% year-on-year, mainly due to the steady growth of existing project business and the incremental expansion of new project business.

　　(3) Self-produced and OEM business of pharmaceutical industry

　　During the reporting period, the company’s self-produced pharmaceutical industry and OEM business achieved sales revenue of 1.182 billion yuan, with a gross profit margin of 22.16%.

　　Western medicine industry: During the reporting period, the company achieved sales income of 187 million yuan and gross profit margin of 36.44%, which was mainly due to the decrease in the purchase price of raw materials and the optimization of product technology. The company comprehensively upgraded the top-level marketing design, optimized the organizational structure and assessment mode, and further strengthened the production guarantee and R&D system. Furosemide injection won the bid for the eighth batch of national centralized procurement, and calcium dobesilate capsules (0.5g) and amlodipine besylate tablets (5mg) successively passed the consistency evaluation of generic drug quality and efficacy. In July 2023, the oral hypoglycemic drug acarbose tablets obtained the Drug Registration Certificate.

　　Traditional Chinese Medicine Industry: During the reporting period, the company realized the sales income of self-produced varieties of 932 million yuan, with a gross profit margin of 18.85%. Traditional Chinese medicine production and research projects continued to generate income, and three national key R&D projects, namely clean cutting project, Codonopsis pilosula project and intelligent production of Angelica sinensis and Astragalus, were completed, and the provincial-level project of breeding new varieties of Coptis chinensis and Fritillaria hupehensis and the municipal-level project of Banxia Houpu decoction were accepted, and 8 projects were declared; The brand building of traditional Chinese medicine has achieved initial results, and won many honorary titles such as "Top 100 Chinese Medicine Enterprises in China in 2022" and "Medicine-Retail Terminal Brand in China in 2023".

　　(4) New retail business of medicine

　　During the reporting period, the company’s self-operated online and offline retail business achieved sales revenue of 1.442 billion yuan, a year-on-year increase of 37.51%; The gross profit was 234 million yuan, a year-on-year increase of 26.00%. The company’s retail business takes the brand of good pharmacist as the carrier, and relies on Jiuzhoutong’s powerful supply chain and rich upstream and downstream customer resources to build four business systems of "joining ten thousand stores, new retail O2O, direct chain stores and professional pharmacies" to build an all-round retail ecological network.

　　During the reporting period, the company steadily promoted the expansion of franchise stores, improved the operating quality of franchise stores, continuously optimized the digital platform of Kyushu Wandian, helped the digital transformation of stores, improved the national retail operation team, improved the service satisfaction of stores and enhanced customer stickiness. As of the disclosure date of the report, the total number of stores of good pharmacists nationwide reached 15,856; At the same time, the company actively expanded the O2O service of franchise stores, improved the O2O expansion standards of franchise stores, and tapped cooperative customers through key measures such as new franchise stores and order fairs. The O2O business covered more than 2,200 stores.

　　(5) medical health and technology value-added services

　　During the reporting period, the company’s medical health and technology value-added services realized revenue of 105 million yuan, up 38.83% year-on-year, and realized gross profit of 39 million yuan, up 43.27% year-on-year.

　　Medical and health services: the company focused on ophthalmology specialty business, and the sales of ophthalmology business increased by 154% in the first half of the year, with a total of 4,109 ophthalmologists and over 23,000 paying patients; The company’s insurance business undertakes online consultation and drug direct compensation for many Internet platforms such as Ant Insurance and the insurance company’s Internet outpatient insurance, with a total of 109,000 consultations in the first half of the year; The company’s medical institution business takes the "Power Medicine Cloud" system as the core, deeply cultivates the operation services for public medical institutions and Internet platforms, and completes the deep docking and operation of institutions such as Tianjin Beichen, Shanghai Dongfang and Shanghai Health Cloud; Through systematic management and development of platform business, the company’s pharmacy business actively expanded online platform prescription business and consultation business. The annual cumulative prescription volume exceeded 32.87 million, and the daily prescription volume peaked at 230,000. In the first half of the year, the online platform business income increased by 3,873% year-on-year, and the consultation business income increased by 160% year-on-year.

　　Information technology research and development: By the end of the reporting period, the company had obtained 436 patents and 588 software copyrights.

　　(6) Digital logistics technology and supply chain solutions

　　During the reporting period, the company’s digital logistics technology and supply chain solutions business realized revenue of 403 million yuan, up 38.05% year-on-year, and gross profit of 103 million yuan, up 73.35% year-on-year. The revenue of digital logistics technology and supply chain solutions increased significantly compared with the same period of last year in Mao Lijiao, mainly because the business scale of digital logistics technology and supply chain solutions of the company increased significantly during the reporting period, which led to an increase in gross profit.

　　During the reporting period, the company further upgraded the "Bb Integration" system, which greatly improved the efficiency of terminal logistics and supported the expansion of the company’s business scale. The logistics system developed by the company, which is the first in the industry to carry out gray box docking with multi-box robots, has innovated the fifth-generation picking technology of Jiuzhoutong, and improved the picking efficiency by nearly 50%.

　　The two B2C medical logistics cloud distribution projects (Tangqicang and Tianjin Warehouse) jointly carried out by the company and Ali Health have successfully expanded the self-owned WMS system from B-end to professional C-end mode, and achieved great success in system stability, operational efficiency, error rate and flexibility, which fully demonstrated the company’s unique ability in medical logistics from planning and construction, system research and development, implementation and operation, and other complete sets of technical and operational management experience, which will strongly support different logistics formats inside and outside the company.

　　During the reporting period, the R&D team of the company completed the research and development of the integrated development platform and four sub-application systems of OWTB(OAS, WMS, TMS, BMS) based on the pharmaceutical industry, and completed the preparation of the training manual, laying a solid foundation for building an integrated digital and intelligent solution for the industry. The company continues to optimize the digital intelligence system of Kyushu Yuncang, increase the research and development of intelligent equipment, and develop in the direction of digitalization and intelligence.

　　2. Analysis on the growth of main business channels

　　The company has now completed the full terminal channel coverage of pharmaceutical circulation.

　　2. Internet platform business (the fourth terminal) refers to the supply chain services of medical and health products provided by the company to Internet platforms such as Ali Health and JD Health; Jiuzhoutong Internet platform business refers to the e-commerce supply chain business of medical and health products provided by the company to end customers such as hospitals, pharmacies and clinics.

　　3. Downstream businesses are mainly regional alliance distributors. With the advantages of supply chain, the company deepens cooperation with downstream businesses and jointly develops pharmacies and primary medical markets in grassroots areas, remote areas and rural areas through the empowerment of resources and services.

　　4. Shangchao and other channels refer to the medical and health products supply chain services provided by the company to Shangchao, maternal and child specialty stores, government agencies, factories and mines, universities and research institutions.

　　During the reporting period, the sales growth of various channels of the company is described as follows:

　　With the gradual advancement of digital transformation, the functions of the company’s digital distribution platform are becoming more and more perfect. Some retail pharmacy businesses, grassroots and private medical services are transferred from offline to online, and the proportion of B2B e-commerce channel business is increasing year by year.

　　(1) The first terminal

　　During the reporting period, the company continued to expand the market of urban public hospitals and county-level public hospitals, and achieved sales revenue of 19.91 billion yuan (excluding e-commerce business), up 18.17% year-on-year, of which: urban public hospitals increased by 23.29% and county-level public hospitals decreased by 17.09%. By the end of the reporting period, the sales of the first terminal accounted for 25.12%.

　　The company actively participated in the national and local bidding for the distribution of purchased varieties with quantity, and achieved great results. By the end of the reporting period, the company had won a total of 2,480 distribution rights for national procurement with quantity, including 270 exclusive distribution rights (including 102 provincial exclusive distribution rights), effectively covering 13,300 public hospital customers.

　　(2) the second terminal

　　During the reporting period, the company’s second terminal retail pharmacy channel (wholesale customers, excluding retail and e-commerce business) achieved sales revenue of 14.28 billion yuan, up 11.87% year-on-year, of which: chain pharmacy sales increased by 10.58%; The sales of individual pharmacies increased by 24.85%. By the end of the period, the sales of the second terminal accounted for 18.02%.

　　By the end of the reporting period, the company had more than 6,000 effective chain pharmacy customers (covering about 180,000 retail pharmacies); Covering about 196,800 single retail pharmacies.

　　(3) the third terminal

　　During the reporting period, the company’s third terminal achieved sales revenue of 7.689 billion yuan (excluding e-commerce channel business), up by 26.27% year-on-year, of which primary medical institutions increased by 29.71% and private medical institutions increased by 23.31%. By the end of the period, the sales of the third terminal accounted for 9.70%.

　　During the reporting period, the company continued to develop private hospital business and signed 23 new private hospitals. By the end of the reporting period, there were 221,500 effective customers in the company’s primary medical institutions and 13,300 effective customers in private hospitals.

　　(4)B2B e-commerce channels

　　During the reporting period, the company’s B2B e-commerce channel business achieved sales revenue of 9.308 billion yuan, up 28.78% year-on-year, accounting for 11.74% of sales. Among them, the company continued to provide supply chain services for medical and health products for domestic Internet platforms (the fourth terminal, including Ali Health, JD Health, Meituan, Dingdang and other important domestic Internet traffic platforms), and was the main supplier of its medical and health products. In the first half of the year, the sales revenue of the Internet platform (the fourth terminal) reached 3.254 billion yuan, a substantial increase of 62.56% year-on-year. At the same time, Jiuzhoutong Internet platform (self-operated) channel business achieved sales revenue of 6.054 billion yuan in the first half of the year, up 15.84% year-on-year.

　　(5) Downstream commercial distributor channels (alliance quasi-end customers)

　　During the reporting period, the company achieved sales revenue of 23.941 billion yuan to downstream commercial distributors, up 13.03% year-on-year, accounting for 30.21% of sales.

　　(6) Shangchao and other channels

　　During the reporting period, the company’s sales revenue from supermarkets and other channels reached 2.687 billion yuan, down 4.00% year-on-year, accounting for 3.39% of sales.

　　(7) Retail channels

　　3. Medical device business

　　During the reporting period, the company’s medical device segment achieved sales revenue of 17.064 billion yuan, a year-on-year increase of 21.89%; The gross profit was 1.147 billion yuan, a year-on-year increase of 13.11%. The company’s medical device business mainly includes commercial business and industrial business, in which the commercial business focuses on the development of upstream core suppliers and the chain coverage of downstream core hospitals and the top 100, focusing on improving the market share of equipment and IVD production lines, and building the service capacity of medical device professional digital supply chain; During the reporting period, the company started IVD assembly line packaging projects in Hubei, Jiangsu and Sichuan, and won the bid for Zhenjiang People’s Hospital, Sichuan People’s Jinniu Hospital, Sichuan Cancer Hospital, Wuhan Taikang Tongji Hospital and Shenzhen Huiliu Hospital. The industrial business focuses on household, rehabilitation, low-consumption, high-consumption and IVD categories, and obtains its own products by OEM, ODM, holder, clinical achievement transformation, acquisition and merger, etc. It has registered two self-owned brands, namely Body Health and Flesh, obtained 5 second-class product registration certificates, 16 first-class filing certificates and 173 OEM product regulations. During the reporting period, 18 new OEM products were produced and listed in the company’s holding factory, and 67 new OEM product specifications were added.

　　4. Chinese medicine business

　　During the reporting period, the overall sales revenue of the Chinese medicine sector of the company was 2.247 billion yuan (including the Chinese medicine industry), up 30.51% year-on-year; The gross profit was 401 million yuan, a year-on-year increase of 25.69%; Among them, the traditional Chinese medicine industry plate realized the sales income of self-produced varieties of 932 million yuan and the gross profit of 176 million yuan. Adhering to the brand concept of "authentic medicinal materials" and "quality first", the company provides customers with diversified products and services. The business of Chinese medicine pharmacies includes fine drinking series and general drinking series, which can meet various needs such as high-end gifts, home health care and daily tea. The medical service of traditional Chinese medicine includes four series, namely, ordinary decoction pieces for medical sale, small packaged decoction pieces for medical sale, classic prescriptions for medical sale and special prescriptions for medical sale. There are more than 1,000 varieties of decoction pieces and more than 6,000 specifications for the four series, which can meet the needs of medical institutions for graded decoction pieces in one stop. There are more than 30 core varieties of Chinese herbal medicine business and more than 100 standing varieties, and 30 Chinese herbal medicine variety bases have been built or under construction. Among them, 22 Chinese herbal medicine base varieties such as Coptis chinensis, Poria cocos and Gastrodia elata have been put on the quality traceability platform of Chinese herbal medicines.

　　5. Biological products and medical beauty business

　　During the reporting period, the business of biological products developed rapidly, achieving sales income of 1.205 billion yuan, up 41.63% year-on-year. The company’s biological products business focuses on blood products and relies on the platform advantages of Jiuzhoutong to provide safe and efficient blood products services for medical institutions, retail terminals and patients. The company’s Biological Products Division has 100 professional marketers, 16 business varieties and 136 business specifications. Relying on the network resources of Jiuzhoutong, the business has established a nationwide blood products marketing network by adopting the marketing mode of combining in-hospital development with off-campus retail. The business has covered 31 provinces in China, serving 25,900 customers, including more than 3,000 hospital customers.

　　During the reporting period, the medical and beauty business grew strongly, and the sales revenue increased by 107.82% year-on-year. The company’s medical beauty business focuses on medical beauty market segmentation, providing "one-stop" procurement services for medical beauty exclusive drugs and consumables, and is committed to providing safer, more efficient and compliant product promotion and services for the medical beauty industry, and building the first commercial brand in the medical beauty industry. During the reporting period, the company’s medical and aesthetic division reached strategic cooperation with many head suppliers at home and abroad; As of June 30, 2023, the company’s medical and beauty business has covered 5,446 medical and beauty institutions, with 1,471 online active customers.

　　6. Great health and ecological investment

　　The company’s big health ecological investment continues to focus on innovative drug research and development, genome detection, cancer screening, in vitro diagnosis and other cutting-edge medical fields. During the reporting period, the oncolytic virus OH2 injection, a product of Wuhan Binhui Biotechnology Co., Ltd., which was invested by the company, was approved by the National Medical Products Administration Drug Evaluation Center to be included in the breakthrough treatment variety, and was awarded the fast-track qualification by the FDA of the United States. In August 2023, it obtained the A certificate of Pharmaceutical Production License for therapeutic biological products issued by Hubei Drug Administration, which was used to treat unresectable stage III or IV melanoma that was resistant or progressed after PD-1 treatment. Nelatinib maleate tablets, a product of Fukang (Shanghai) Health Science and Technology Co., Ltd. invested by the company, have been approved for clinical trials in National Medical Products Administration, and will be used in advanced non-small cell patients with rare EGFR diseases. At present, this indication has not been approved globally, and it belongs to Class 2.4 new drugs.

Third, risk factors

　　1. Operational risks

　　(1) the risk of business model

　　The company continues to establish a market-oriented business model of industrial Internet service platform, which puts forward higher requirements for all business links: it needs to have pricing ability in procurement and sales, cost and expense control ability, and logistics and distribution ability; It is necessary to strengthen fund management, inventory management, credit management and management of subordinate subsidiaries; It is necessary to continuously strengthen the research and development of logistics, cold chain technology and information technology to reduce business costs and provide quality services. Once there are problems in the above links, the company will face the risk of declining profitability.

　　(2) Risks related to information system security

　　Information system is an important technical support system for the management of modern pharmaceutical logistics enterprises. With the continuous expansion of the company’s business scale and the deepening of cross-regional business development, the company will put forward higher requirements for information system construction in terms of business concentration and standardized operation, collaborative management information, integration of industry and finance, and improvement of logistics management and human resource management. Although the company has continuously increased the investment, development and application of information systems, and completed the construction of national network infrastructure, it has adopted dual-machine backup and other ways to avoid the security risks of information systems; However, the company may still have the risk that the information system cannot meet the needs of the rapid development of logistics business in terms of software and hardware, and there are also risks such as computer software and hardware failure, system being attacked by hackers, and information resource security being threatened.

　　(3) Market competition risk

　　The company has set up subsidiaries in 31 provinces (autonomous regions and municipalities directly under the Central Government), established pharmaceutical logistics facilities and marketing networks, and is in a leading position in the development of the depth and breadth of the national pharmaceutical market network. However, since the implementation of the "two-vote system", some large central enterprises and local state-owned enterprises have accelerated the merger and reorganization of local pharmaceutical enterprises, and companies in the same industry have also continuously increased their investment in the pharmaceutical circulation field and the control of marketing outlets, making the competition in the pharmaceutical market in China increasingly fierce. At the same time, although the company’s business cooperation relationship with upstream suppliers and downstream customers is formed through years of development and maintenance, due to market competition factors, the company still cannot guarantee that the existing upstream suppliers and downstream customers will continue to maintain their business cooperation relationship with the company for a long time. If the company cannot continue to improve its ability to serve upstream suppliers and downstream customers, the company’s market share may decline, which will have an adverse impact on the company’s business, financial status and operating performance.

　　(4) Risk of drug quality management

　　Drug trading and medical and health services are industries subject to special control. On December 1, 2019, the revised Drug Administration Law was officially implemented, which strengthened the supervision of the whole process of drugs, comprehensively increased the punishment for the production and sale of counterfeit drugs and inferior drugs, stipulated various punishment measures such as confiscation, fine, order to suspend production and business for rectification, revocation of licenses, prohibition of employment, etc., improved the civil liability system, and put forward the principle of punitive damages; The Drug Administration Law cancels GSP and GMP certification, but clearly requires the establishment and improvement of drug traceability system and drug alert system, and pharmaceutical enterprises will face stricter supervision in the whole chain, cycle and process. As a wholesaler and distributor of health products such as drugs and medical devices, although the company strictly follows the relevant standards, it carries out quality control in all aspects of business activities, such as purchasing qualification review, product acceptance quality, product storage and maintenance, product sales, product delivery review, product transportation, product after-sales service, etc., to prevent any quality accidents, but because the company is not a product manufacturer, it cannot control the production quality of drugs. At the same time, There will also be product quality accidents in the circulation of drugs for various reasons, so the company may still have drug quality liability problems in product procurement or sales, which will bring risks to the company’s business operation.

　　2. Managing risks

　　At present, the company’s business is in a stage of rapid development. Most of the construction and business development of modern pharmaceutical logistics centers are invested and carried out by the company by setting up subsidiaries. By the end of the reporting period, the company has completed the distribution of 31 provincial pharmaceutical logistics centers and 110 prefecture-level logistics centers. With the increasing number of pharmaceutical logistics centers, the continuous improvement of business outlets and the rapid expansion of business scale, the complexity and management difficulty of the company’s operation and management will gradually increase. In order to cope with management risks, the company implements the group management mode, trains and cultivates personnel, and uses advanced information technology to control all business links of subordinate companies to prevent risks and ensure the realization of the overall business objectives of the group. Although the above measures have been taken, due to the different development stages and modes of the subordinate companies and business units of the company, the quality and management level of personnel are also uneven, and they may also face the risk of violating relevant laws and regulations in industry and commerce, taxation, customs, food and drug, safety and so on, and being punished accordingly.

　　3. Policy risks

　　Our products are special commodities, which are easily influenced by relevant national and local policies, especially the reform of medical and health care, medical security and pharmaceutical circulation system. The reform of the three systems of medical treatment, medical insurance and drug supply will deeply change the pattern of the pharmaceutical circulation field and trigger the differentiation and reorganization of the pharmaceutical market. The company’s business is greatly influenced by the relevant national policies, so the company faces certain policy risks.

　　4. Financial risks

　　(1) The risk of bad debts in accounts receivable

　　At the end of 2021, 2022 and June 2023, the book value of the company’s accounts receivable was 26,406,280,400 yuan, 27,576,379,100 yuan and 33,535,624,600 yuan respectively. The company collects accounts receivable at the end of each year. Therefore, the company usually has a larger balance of accounts receivable than the end of the year. To this end, the company attaches importance to the credit management of downstream customers, constructs a credit management system, and regularly cleans up and collects accounts receivable. However, in order to further expand the market share, increase sales revenue, and adjust the business structure to expand the market of medical institutions, accounts receivable may increase, so the company may have the risk of bad debts in accounts receivable.

　　(2) Current liabilities account for a relatively high risk

　　At the end of 2021, 2022 and June 2023, the company’s current liabilities accounted for 94.11%, 93.86% and 93.95% of the total liabilities respectively. The high proportion of current liabilities of the company is caused by the operating characteristics of the pharmaceutical circulation industry. The high proportion of current liabilities puts some pressure on the company’s debt repayment ability.

Iv. analysis of core competitiveness during the reporting period

　　(1) A comprehensive service platform for digital distribution and supply chain with all categories, all channels and all scenes in the pharmaceutical industry.

　　1. All categories

　　The company has accumulated a wealth of business categories, including western medicine, Chinese patent medicine, Chinese herbal medicines, medical devices, family planning products, biological products, health care products and cosmetics, totaling 589,500, of which 77,800 are Chinese and western medicines, 320,200 are devices, 115,400 are Chinese medicines, and 76,100 are health care products and cosmetics, which can meet the needs of the downstream.

　　2, omni-channel

　　The company has established an omni-channel distribution network which is scarce in the industry, covering more than 96% of the administrative areas in China, including urban and county-level public hospitals (the first terminal), chain and single pharmacies (the second terminal), grassroots and private medical institutions (the third terminal), Internet traffic platforms (the fourth terminal) and downstream pharmaceutical distributors (quasi-terminal) customers; The company’s omni-channel B-end customers are about 472,800, including 13,300 customers in urban and county-level public hospitals, 202,800 customers in chain and single pharmacies (the total number of retail pharmacies is about 370,000), 234,800 customers in grassroots and private medical institutions (including more than 13,300 customers in private hospitals), more than 12,000 downstream pharmaceutical distributors and nearly 10,000 other customers, which can guarantee various OTC varieties and hospital clinical varieties.

　　3, the whole scene

　　Relying on the core advantages of all categories and all channels, the company actively expands service scenarios to upstream suppliers, downstream customers and C-end consumers, and increases the business layout of general brand promotion, "integration of wholesale and retail", "integration of BC warehouse" and "joining in ten thousand stores", which has transformed the company from a simple pharmaceutical distribution enterprise to a comprehensive service provider such as digital distribution, general brand promotion, third-party logistics and logistics technology under the blessing of digitalization and interconnection. From the retail business that relies solely on physical pharmacies or e-commerce platforms to the C-end consumers as the precise service end, it can provide full-scene medical and health services that combine "medical+medicine+insurance" online and offline.

　　(two) efficient operation of digital, platform, Internet industry service capabilities.

　　1. Digitization

　　The company is one of the few enterprises in the industry with independent research and development of national unified business, logistics and financial information systems, and has management systems including supply chain service platform, ERP system, financial sharing system and logistics integrated service platform (LMIS), which has laid a solid foundation for building a unified Internet digital service platform of the Group and providing digital service capabilities. The company’s digital system can not only improve the management level and operational efficiency internally, but also provide value-added services externally, and also support efficient and safe logistics supply chain services. In the first half of 2023, the company continued to deepen the implementation of the digital transformation plan, and 16 digital transformation sub-projects were smoothly promoted, greatly improving the customer experience and the level of external business empowerment. Among them, the company’s financial sharing cloud platform and "Bb Integration Project" were selected as "Typical Cases of Digital Transformation of Listed Companies" issued by China Association of Listed Companies in 2022 and 2023 respectively; "Bb/BC Warehouse and Distribution Integration Project" was selected as "Typical Cases of Digital Economy Development in 2023" (transformation category) selected by Securities Daily and "2023 Digital Economy Leaders Forum".

　　2. Platformization

　　The company has built an omni-channel "expressway" platform covering chain pharmacies, single pharmacies/clinics, hospitals/primary medical institutions, county-level commercial alliance distributors (quasi-terminals) and Internet medicine supply chain, and used this platform to operate different categories of medicines, instruments, traditional Chinese medicines, consumer goods, brand promotion, industrial self-produced and OEM products. In addition, the company has built six platforms covering the whole country, including product marketing platform, logistics sharing platform, e-commerce and information operation platform, financial sharing platform, supply chain value-added service platform and ecological investment and financing platform.

　　3. Internetization

　　Starting with the distribution and retail of medicines, the company has built Internet trading platforms such as Medicine 99 B2B Platform (www.yyjzt.com) and "Smart Medicine Link" APP, as well as Internet toolkits to provide enabling services for customers. In the first half of 2023, the sales scale of the platforms reached 6.054 billion yuan, making it a leading digital medicine circulation platform outside hospitals in China. Internet service tools such as "Power Medicine Cloud", "Store Connect" and "Medical Assistant" launched by the company empower many offline hospitals, pharmacies, primary medical institutions and other customers to provide cloud warehouse background service support for the pharmaceutical supply chain and Internet medical prescriptions.

　　(C) the leading "wholesale, retail, warehouse and distribution integration" pharmaceutical logistics supply chain service system in China

　　1. Industry-leading pharmaceutical logistics resources and technical support

　　As the first 5A-level logistics enterprise in the pharmaceutical industry and the only demonstration base of intelligent medical storage in China, the company has a large-scale pharmaceutical supply chain service platform infrastructure, including 141 warehouses and 4.26 million square meters of operating and supporting facilities, including 2.71 million square meters of warehouse facilities conforming to GSP standards, including 562 cold storages (with an area of 48,900 square meters and a volume of 112,500 cubic meters), and the logistics network resources cover more than 96% of the country.

　　After 20 years of technical precipitation and evolution, the company has cultivated a logistics management team with innovative application thinking, and through independent planning and integration, independent system research and development, and self-developed intelligent equipment, it has realized data interconnection and data caliber unification of all subsystems in the logistics field, and built a professional and healthy logistics supply chain service platform with wide coverage and full service, which integrates warehousing, transportation and information network, and realized real-time visual tracking of the whole link, active early warning and prevention, intelligent scheduling, collaborative control and data-driven decision-making. The company builds an integrated multi-warehouse collaborative cloud warehouse platform, which links 31 provincial-level hub warehouses and 110 municipal-level regional warehouses through the main warehouse, and realizes the ecological and networking mode of sharing resources, complementing advantages, partnership and mutual drainage between internal and external warehouses.

　　2. Continuously improve the whole warehouse logistics and multi-terminal service capabilities.

　　Using the supply chain resources accumulated in B-end for many years, the company opened its own supply chain system and full warehouse logistics services to B-end and C-end customers, so as to provide better services for B-end customers and C-end users. For B-end customers, the company realizes the sharing of inventory resources, warehouse transportation and distribution resources and information platform between B-end customers and the company by creating online and offline "one-stop" services, and finally realizes the platform development of B-end business; For C-end users, the company realizes the functions of workflow reengineering, full-link data pull-through, standardized data flow, multi-warehouse intensive management, customized distribution timeliness and so on through integrated support, full-link data and intelligent logistics technical support.

　　The company continues to improve its full-warehouse and multi-terminal service capabilities. At present, "BC Integrated Warehouse" has been launched in all e-commerce business areas in Hubei, Shanghai, Guangzhou, Beijing, Tianjin and Zhejiang, with a daily revenue rate of over 99%, which greatly improves the service efficiency of the supply chain and meets the needs of different customers. The company has completed the transformation of "Bb integration" of 22 companies in Hubei, Chongqing, Shandong, Henan, Beijing, Guangdong, Shanxi, Anhui, Sichuan, Zhejiang, Fujian, Shaanxi, Jiangsu, Xinjiang, Shanghai, Tianjin, Guangxi, Jiangxi, Inner Mongolia, Hebei, Gansu and Hunan, and put them into operation. In the next three years, the company will strive to complete "Bb/BC warehousing integration".

　　With the full warehouse logistics and multi-terminal service capabilities, the company has formed the core advantages of "fast performance, good service and excellent cost" in the industry, achieving 100% timely customer response rate, 96% timely receipt rate, 98% timely delivery rate and 99.99% accuracy rate respectively, only 80 minutes for order processing, and 12 hours and 24 hours for distribution in the same city and province respectively, thus realizing stocking, management and circulation.

　　3. Diversified core products and services

　　Over the years, the company has adhered to technological innovation and formed different product matrices to meet the diversified needs of customers, among which the core services and products are the integration of supply chain warehouse and distribution, professional cold chain, technical output and intelligent equipment. With regard to the integration of warehousing and distribution in the supply chain, the company can provide customers with logistics warehousing services integrating delivery, warehousing, storage, sorting, code scanning, distribution and return, distribution services such as national pre-warehouse, trunk branch line and landing distribution, and provide logistics operation services. In terms of professional cold chain, in order to meet customers’ different cold chain service needs, the company insists on building pharmaceutical cold chain logistics products by enriching storage resources, improving network capacity and fine operation management mode, and at the same time, the three sectors of storage, trunk line and distribution work together to provide customers with high-quality, excellent service and low-cost customized services. In terms of technology export and intelligent equipment, the company determined the target by investigating customer demand, and communicated with customers many times in the whole process of project planning and design, software and intelligent equipment research and development, system integration implementation, operation improvement and after-sales, and finally exported technical services and intelligent equipment products.

　　(4) Industry-leading new business incubation and business innovation support capabilities.

　　1. Ability to support new formats

　　The company relies on the "100 billion-level" pharmaceutical supply chain service platform with all categories, all channels and all scenes, as well as the digital, platformized and Internet-based industrial service capabilities with efficient operation, and opens up the industrial chain layout and explores new formats. For example, the "Zhiyaotong" system is used to empower production enterprises and realize effective management of sales personnel, categories and customers; Using the developed "power medicine cloud" system to help the prescription circulation of physical hospitals; Empower the management of "ten thousand stores to join" pharmacies by using the developed "store link" system; Empowering primary medical institutions with "medical assistants"; Using the platform of "Drug 99" to support the business of pharmacies and clinics. At the same time, according to the needs of innovative business and technological development, the company continued to attract all kinds of outstanding talents from outside, which effectively promoted the company’s business development and technological innovation.

　　2, business innovation ability

　　The company has strong business innovation ability. In the past ten years, the company has continuously optimized and changed its business model. After the transformation from the traditional mode of "quick approval and quick distribution" for customers of pharmacies, clinics and primary medical institutions to the comprehensive service provider mode of "pharmaceutical distribution+logistics distribution+product promotion" for omni-channel, the company began to incubate new businesses such as "Power Health" platform, "Third Party Logistics" service platform, ecological circle investment platform and supply chain technology value-added service platform with the help of the superior resources of "100 billion-level" sales platform.

　　(E) Flexible and efficient private system and distinctive "home" cultural brand advantages.

　　1, private system and talent advantage

　　As the largest private pharmaceutical circulation enterprise in China, the company has the competitive advantages of flexible mechanism and efficient decision-making. In terms of talent competitiveness, the company’s core management team members include the company’s founder, professional managers trained internally for many years and high-end talents introduced from outside, covering business management, technology research and development, marketing, financial management, logistics operation and other aspects, and most of them have been deeply involved in the medical and health industry for many years, with an average working life of more than 15 years. They have a deep understanding and understanding of the industry development trend and the company’s development strategy, laying a solid foundation for the company’s sustained and steady development. Since 2014, in order to fully mobilize the enthusiasm of employees, attract and retain outstanding management talents and core backbone, further improve the corporate governance structure, improve the company’s long-term incentive mechanism, and promote the company’s long-term, sustained and healthy development, the company has promoted the restricted stock incentive plan or employee stock ownership plan every year. The incentive targets include company directors, middle and senior managers, senior managers of subsidiaries, core technicians and core business personnel of the group, etc., ensuring that personal interests are closely related to the company’s interests, forming a benefit-sharing and strong execution.

　　2. Cultural and brand advantages

　　The company’s years of pioneering and development practice has formed an original ecological "home" cultural system with the main connotation of creating a culture of common cause and respecting the culture of employees, and advocated the concepts of "equality, friendship, mutual help and common progress". In addition, the company adheres to the core values of "customer-centered, performance-oriented, culture-driven, and quality-oriented", constantly integrates culture, enhances the cohesion, centripetal force and competitiveness of the group by using the "home" cultural ties, and gives full play to the important role of corporate culture in enhancing the core competitiveness of enterprises, which has always provided a steady stream of spiritual power for the company’s development.

　　As the first private brand of pharmaceutical circulation, the company has the courage to undertake social responsibilities, adhere to the concept of "people-oriented", pay attention to social hot issues and the needs of vulnerable groups, and participate in social welfare undertakings through donations, voluntary services, charitable activities and other forms. The company also cooperates with government departments, industry associations, non-governmental organizations and other parties to give full play to the advantages of enterprises and take active actions in the fields of medical education, poverty alleviation and disaster relief. In the past three years, in the face of the complicated and severe prevention and control situation, the company has always adhered to, responded quickly and actively mobilized from management to employees, strictly implemented the prevention and control regulations, implemented the main responsibility of enterprises, and deployed prevention and control and material supply to meet the needs of the public.

Phoenix"Legend of Deification andNezha: Birth of the Demon ChildPreview posters of three animated films

1905 movie network news Today, Light Striped House Film released the 2019 domestic animation blockbuster list and exposed a set of pilot concept posters. This is also the cooperation with the "Big Three" series of domestic animation (), and then the color bar house zoomed in and announced three heavyweight and large-scale domestic original animations at one time. They are the domestic animation "Myth Trilogy" Ne Zha Legend of Deification and "Phoenix".

　

From the poster style, we can easily find that these three films are intended to create diversified Chinese style animations with "freshness". They are rooted in China’s traditional culture and boldly made original adaptations. The mysterious and legendary poster content also makes us daydream about the final presentation effect of these three films, and 2019 will become a new era for the vigorous development of domestic animation.

　

Guo Man’s "Myth Trilogy" debuted to create a comedy, epic and love women Chinese style animation blockbuster.

　

The domestic animation "Myth Trilogy" released this time — — Ne Zha Legend of Deification’s Phoenix. From the poster of the pilot concept and the information explained, we can see its pursuit of high quality.

　

From the lively and dynamic poster of the film Ne Zha, we can easily find that the film has a strong comedy style. The gods are contrary to the normal state of the gods, with exaggerated expressions and various forms, which is in sharp contrast with the baby who should be quiet in its infancy but sticks out a "talon". This not only shows the bold setting of the film to create Nezha as a "magic boy" in troubled times who came into the world by mistake, but also presents a colorful and interesting story with full laughter. This time in Ne Zha, the striped house film was also produced by Cocoa Bean Animation Film and Television Co., Ltd., with jiaozi as the director. Previously, the animated short film "Hit, Hit a Big Watermelon", also produced by Cocoa Bean Animation and directed by jiaozi, scored a high score of 8.6 in Douban, and was called "the best original animated short film for Chinese" by netizens. This film won more than 30 awards in 27 professional competitions at home and abroad. They will also escort Ne Zha this time.

　

When it comes to Legend of Deification, it is the first epic animated film in China to bring the image of "Jiang Ziya" to the big screen. The film "deifies" Jiang Ziya, the "leader of the gods", and tells the story that Jiang Ziya, who was demoted to the world, found himself. The ink-and-wash poster released this time is inspired by the allusion of "Jiang Taigong fishing", showing an extremely desolate temperament. Jiang Ziya’s hook hangs above the water, waiting for the willing to take the bait; And the girl who is underwater in the dark seems to be waiting for rescue. And the production company of this film Legend of Deification — — Chuan He Dao, whose core team is also the most powerful team of teachers and students from China Communication University, the top animation institution in China. At the same time, they are also the original team. As one of the directors of Legend of Deification, Mr. Well Lee is also a well-known domestic famous animation tutor and director, who has escorted many classic films; Another director, Cheng Teng, once won the silver prize of the 41st American Academy Award for his film "There is a Day Behind the World". This time, they will jointly create an epic production of domestic animation for the film Legend of Deification, combining the traditional Chinese style with the modern steampunk style, presenting a grand world outlook and shocking war scenes.

　

The last film, Phoenix, focuses on Chinese tribal civilization for the first time, showing a heavy southwest ethnic style, remolding the ancient cultural symbol "Phoenix" with a brand-new story, and is an animated work that focuses on "female growth". The pilot concept poster takes an upward phoenix as the visual center, and the sun behind its head represents light and hope, and also conveys the character of the protagonist of the story. The little girl, the protagonist who appeared directly below the poster, lit up her surroundings and herself with fire in the shadow. In addition, the tail of the phoenix in the poster is covered by shadows, suggesting the struggle between the two forces; It also reflects the inspirational story of Yala, a girl who is not afraid of the dark and grows up through repeated experiences. Similarly, Qichao Mao, the director of the film Phoenix, and Magic Studio, the producer, also made outstanding achievements. The sci-fi animated short films created by them were invited to participate in the 70th Cannes International Film Festival and won the "Best Director Award" in independent screening activities. Director Qichao Mao also won the 54th Golden Horse Award this year with this short film. With such a cast, I believe Phoenix will present us with a different story of "women’s growth".

　

"Color Stripes" Animation Launches a New Journey of Domestic Animation in 2019

　

As a leading domestic animation film enterprise, Light Striped House Film aims to become the base camp of animation in China, and has invested in nearly 20 animation companies with great potential in two years. Previously, he successfully launched the animated film "Big Fish Begonia" and so on, creating a box office score of more than 1.1 billion yuan. The 2019 film list released this time — — Ne Zha Legend of Deification and Phoenix are both from the animation company of Striped House.

　

Three high-quality original animated films are released in one year, which fully reflects the strength and determination of Caitiaowu Film Industry to escort domestic animation. The striped house film industry has always focused on promoting the development of "high quality" and "diversified" domestic animation. After trying the beautiful and violent Chinese style animation, this time I want to create a "myth trilogy" of domestic animation and establish a new style of the country. This is mainly reflected in the following aspects: First, the originality of the story. The three films do not copy the original story, but are completely adapted on this basis; Second, the diversity of types. Ne Zha, directed by jiaozi, is a hilarious comedy animation, Legend of Deification, directed by Cheng Teng and Well Lee, is an oriental epic magical adventure animation, and Phoenix, directed by Qichao Mao, is a "female growth" animation featuring the southwest ethnic style, both of which are rare types in the domestic animation market. What kind of surprises this "myth trilogy" will bring to the market is expected.

　

The films Ne Zha Legend of Deification and Phoenix were jointly released by Horgos Striped House Film Co., Ltd. and Chengdu Cocoa Bean Animation Film Co., Ltd., Beijing Zhongchuan Hedao Culture Development Co., Ltd. and Chengdu Magic Animation Studio respectively. These three domestic animations, which will be released in 2019, are also waiting for everyone’s test.

　　On November 2nd, the 28th China Prize for Journalism and the 15th Taofen Award for the Yangtze River were officially announced.

　　CCTV, Yangguang and Guoguang, affiliated to the Central Radio and Television General Station, ranked first in all kinds of media in China with the total number of awards of 35 works. Among them, "Carry out the Reform to the End" and "Design of the Report Matrix of the Nineteenth National Congress on the Zero Home Page of CCTV" won special prizes, 12 works including "Beginning of Heart" won the first prize, and one person won the Yangtze River Taofen Award.

　　First, innovative reporting methods, major theme publicity has become the winner.

　　CCTV’s "Carry out the Reform to the End" made an in-depth and panoramic report on comprehensively deepening the reform for the first time. While reflecting strong ideological and theoretical depth, it vividly told the reform story that happened around the people and sang the strongest voice of the era of comprehensively deepening the reform.

　　"Special Program to Celebrate the 90th Anniversary of the Founding of the People’s Liberation Army of China", with innovative ways of expression and full use of new technologies such as AR and VR, perfectly presents the majestic military parade on the battlefield.

　　The "Live Report of the Party Representative Channel" highlights the transparency and openness of the Party Congress with real-time pictures and real details.

　　Second, the ability to set and guide online issues has been continuously enhanced, and many works have sparked heated discussions.

　　"Heart in Heart" carefully selected a large number of precious images of the Supreme Leader General Secretary when interviewed by CCTV in different periods, and combined with the information footage taken by local TV stations, it portrayed the general secretary’s firm belief of taking the people as the center.

　　The Road to Public Servants uses various technical means, such as a mirror to the end and three-dimensional projection, to show the distinctive political character and leadership style of the general secretary’s "being a public servant forever".

　　"The VR Panoramic Live Broadcast of the Launch Mission of Tianzhou-1" adopts the new technology of VR live broadcast, creating a record of the whole live broadcast of the rocket launch at the nearest distance (100 meters) in history. The audience can not only face the shocking visual impact of the rocket launch directly through the screen, but also get an all-round immersive experience in rocket hoisting, transshipment and other links.

　　The comprehensive use of multimedia forms, such as "H5 Report of the Friends Circle of the Anchor of Yangguang" and "International Sharp Review" of Guoguang, has comprehensively enhanced the dominant position of mainstream media in the online public opinion field.

　　Third, the news column is aggressive, highlighting the brand image of the reception desk

　　With the implementation date of the National Anthem Law as the background, Chaoguang News was carefully organized and arranged, which lasted for 82 years in less than half an hour, vividly showing the theme of patriotism from a historical perspective. The topic of Guoguang’s Roundtable Proceedings follows closely the social hotspots, and Chinese and foreign hosts and guests have diverse and unique perspectives on the interpretation and analysis of the topic, and there are many unique insights.

　　Four, a number of award-winning foreign communication works reflect the strength of accurate communication.

　　"Going Home" Guoguang is a special program specially produced to commemorate the 80th anniversary of the Nanjing Massacre. It is effectively pushed overseas by integrating the Internet, English Global China Plus client, WeChat and other platforms, which has aroused deep thinking of historical facts by listeners and netizens from all over the world.

　　In Memory of Gao Mang (Russian) is in line with the background of Sino-Russian friendship. It tells the story of friendly exchanges between Chinese and Russian people with the sound of literature, and explores the transnational cultural exchange phenomenon of "Russian literature in China" with the clue of Mr. Gao Mang’s "life translation" to reveal the connotation of traditional friendship between Chinese and Russian people.

　　In the selection of this year’s China Prize for Journalism, one person from the General Desk, the People’s Daily and Xinhua News Agency won the prize. The winner of the reception desk is Ren Jie (female, deputy director of the planning department of Voice of China in china national radio).

Car control news (text/CHEK every day)

Release Planning: The launch conference of ET Extended Range Four-wheel Drive Edition in Xingtu Xingyue announced that five flagship products will be launched in the next two years, including E09 flagship SUV, E07 six-seat SUV and E08 luxury MPV.
E08 model debut: As the brand’s first high-end luxury MPV officially rolled off the assembly line, marking the entry into various stages of testing.
Design concept: E08 adopts Starway "Aesthetics of Wind" 2.0 design language, One Box integrated body design, minimalist and smooth lines, and low drag coefficient to improve endurance and comfort.
Front face design: E08′ s front face is inspired by the family design of "Cyber Butterfly", which symbolizes the beautiful meaning of "turning cocoons into butterflies", and incorporates future scientific and technological elements to highlight the natural aesthetics of high-end new energy brands.
Side of the car body: The waistline with slight radian is inspired by the astronaut’s view of the horizon of the earth. The car body shows the change of sculptural light and shadow, reflecting luxury and freedom.
Hub design: the hub draws lessons from the oriental symmetry aesthetics, and is formed by the superposition of two squares. The smooth curve reflects stability and elegance.
"Black technology" door opening design: equipped with VIP oversized door opening function, it can be directly opened to the third row of seats, which is convenient for passengers to enter and exit, enhancing convenience and luxury experience.
Tail design: the rear design echoes the front face, and L-shaped headlights are adopted to show the harmonious beauty of the overall design.
Market Positioning: The release of E08 further enriches the product matrix of Xingtu brand, providing more diversified car scenes to meet the needs of different consumers.

CHEK community, the first car enthusiast community in China to promote intelligent cars+AI partners, pays attention to smart cars, competing products benchmarking, data reporting, intelligent driving, takeover rate, dangerous takeover mileage, endurance achievement rate, parking success rate, garage rubbing times, intelligent cockpit, evaluation indicators and car owners. …

As a car owner, I have a deep understanding and practical experience of this car. The following will share my experience in appearance, interior, space, power, control and safety.

I. Appearance

The exterior design is fashionable and atmospheric, and the streamlined body lines are both beautiful and optimized for wind resistance. The front face is designed in a Volkswagen family style, and the wide air intake grille and sharp headlights complement each other, showing a strong recognition. Whether driving in the city or on the highway, sagitar’s appearance can attract a lot of attention.

Second, the interior

Sagitar’s interior design is simple and exquisite, with reasonable functional layout and convenient operation. The center console is simple and clear, and all kinds of buttons and knobs are within reach. The seat is comfortable in material and superior in texture, giving people a high-quality driving experience.

Third, space

Sagitar’s driving space is spacious and comfortable, providing sufficient head and leg space in both front and rear rows. The trunk has a large volume, so it is very convenient to load luggage in daily travel.

Fourth, motivation

Sagitar provides a variety of power versions to choose from, and the version I choose can provide smooth and abundant power output on urban roads and highways. Fast acceleration response, easy to drive.

V. Manipulation

The sagitar chassis has stable adjustment and proper roll control when cornering, giving people a solid driving experience. The steering system is accurate, the steering wheel feels moderate, and it is easy and pleasant to drive.

VI. Safety

Sagitar is equipped with rich safety configuration, including multiple electronic stability systems, etc., to provide all-round protection for drivers and passengers. The high-strength body structure further enhances passive safety and ensures driving safety.

In short, sagitar has excellent performance in appearance, interior, space, power, control and safety, and it is worth recommending.

　　On October 29th, 2024, at the event site of Hohhot Station, the alcohol and hydrogen products tasting tour of "alcohol is better than oil province", the alcohol and hydrogen duo "Remote Xingzhi H9M alcohol and hydrogen electric light truck" and "Remote Xinghuan H alcohol and hydrogen electric heavy truck" under the remote new energy commercial vehicle were officially launched. Among them, the remote Xingzhi H9M has three characteristics, namely "intelligence", "excellence" and "completeness". The perfect ADAS intelligent driving assistance function brings greater safety, and the alcohol-hydrogen electric power system brings it a strong endurance of over 1000km, which is a brand-new benchmark for leading the new energy heavy-duty light truck market remotely. On the day of the event, Remote provided the first batch of users of Xingzhi H9M with a six-fold car purchase gift such as "direct cash reduction, zero interest loan and insurance subsidy". The number of orders for alcohol and hydrogen products signed at the event site was 1233, which accelerated the popularization and application of alcohol and hydrogen electric vehicles in the northern region.

　　Alcohol and hydrogen power, green first

　　Alcohol, hydrogen and electric boost the transformation and upgrading of logistics in the northern region

　　On July 31, the central government issued the Opinions on Accelerating the Overall Green Transformation of Economic and Social Development, which systematically deployed the overall green transformation, and methanol filling was clearly included in the green transportation infrastructure construction plan. Inner Mongolia actively responded to the national double carbon strategy and accelerated the optimization of energy structure and the green development of the logistics industry. Compared with traditional fuel, methanol fuel has higher combustion efficiency and lower emissions, which is an ideal choice for commercial vehicles to realize green transformation. Developing alcohol-hydrogen electric vehicles is the best practice to realize the diversification of new energy structure. The arrival of Xingzhi H9M undoubtedly provides a new solution for the energy transformation in Inner Mongolia and the green upgrade of urban distribution logistics.

　　In addition, Xingzhi H9M can also promote the logistics industry in the northern region to reduce costs, increase efficiency and speed up development. The strong adaptability of methanol fuel has created the wide adaptability of alcohol-hydrogen electric light truck in low temperature area, which can effectively make up for the shortcoming that pure electric product batteries are not cold-resistant. Xingzhi H9M is equipped with an intelligent thermal management system integrating alcohol and electricity, which can be started quickly in the extremely low temperature environment of -20℃ to ensure uninterrupted and efficient operation throughout the year. At the same time, the alcohol-hydrogen electric vehicle also has super economy, which can save more than 40% of the fuel cost per kilometer compared with the same level fuel vehicle, and will greatly reduce the operating cost of the logistics industry.

　　Smart and excellent, peace of mind to make money.

　　Remote Xingzhi H9M to Build the "All-round King" of Freight Industry

　　As the leading brand of new energy commercial vehicles, remote new energy commercial vehicles have always been committed to promoting the development of the industry with technological innovation. With advanced intelligent technology, excellent product quality and strong ability to flexibly adapt to the transportation needs of the whole scene, the remote Xingzhi H9M has successfully won enthusiastic response from the guests at the scene. With the three strong product highlights of "intelligence, Excellence and completeness", we will achieve the "all-round king" of the freight industry with safety, Dora, multi-profit and multi-scenarios.

　　Remote Xingzhi H9M cooperates to create a "smart benchmark" in the field of new energy light trucks through powerful intelligent upgrade of software and hardware, and drives the safety leap with technology, so that users can create wealth safely at their fingertips. It is equipped with ADAS 2.0 intelligent driving assistance function, which is an intelligent auxiliary technology to build commercial vehicles remotely with passenger car-level hardware standards. The all-round protection system effectively creates a safer and more secure environment for users to create wealth. Xingzhi H9M will also be fully equipped with remote full-stack self-developed intelligent core three-electric system and liquid-cooled battery, which greatly enhances the cycle life of the battery, and the efficiency of the electric drive system can reach 97.86%, making it an efficient and durable ideal choice for users in the process of creating wealth.

　　According to the specific operational requirements of the new energy light truck user "dorado Earn", Xingzhi H9M has been optimized in many aspects, such as battery life, load bearing and maintenance. In terms of battery life, thanks to the blessing of the alcohol-hydrogen electric new energy technology route, the battery life can exceed 1000km；; On the load bearing, Xingzhi H9M is built on a heavy-duty platform, and equipped with the industry’s first double-gear electric drive bridge, with a peak power of 185kW and a peak wheel end torque of 9000N·m, which doubles the lead in new energy light truck competing products and heavy-duty climbing. The chassis uses long-term maintenance technology, and also provides a long-term warranty commitment for key components of the vehicle. According to statistics, 300,000 kilometers or 8 years can save more than 30,000 yuan.

　　The comprehensive and advanced Xingzhi H9M will fully meet the needs of users to create wealth. It is not only suitable for home decoration, green transportation, cold chain transportation, rice and flour grain and oil, LTL logistics, drinks and other application scenarios with high freight density. With a cruising range of more than 1000km, it can also achieve full coverage of urban distribution, suburban and intercity transportation needs, and it can be called the "all-around king" in the field of new energy light trucks. Once released, the new product stood out from many rigorous competitions such as energy saving, accelerated braking, climbing and wading, and won five awards such as the "All-around Gold Award" in the 9th China New Energy Logistics Vehicle Challenge of NEVC2024.

　　The listing of Remote Xingzhi H9M not only demonstrates the leading position and technological innovation ability of Remote in the field of new energy commercial vehicles, but also deeply empowers the green transformation of logistics economy in the northern region, leading the industry to realize the operational advantage of "saving alcohol than oil, and worry-free remote".

On September 13th, the brand-new Ford was officially launched, with a price of RMB 309.8-399.8 million. Some models of the new car were upgraded in towing qualification, the engine performance was slightly improved, and the car was also equipped with 8155 chips.

The envy of the old car owners of the new car should be that the Kunlun Peak Edition model has added 2.1 tons of towing qualification, and at the same time, the blind area monitoring area of the new car has also been upgraded, expanding the monitoring range, making it easier to observe the trailer in real time, and the driving mode has also added a special towing mode, which greatly improves the driving safety under towing conditions.

Although the new Ford Explorer is equipped with a combination of 2.3T engine and ＋10AT gearbox, the maximum power of the engine is increased to 213kW, the peak torque is 445N·m, and the official acceleration of 100 kilometers is only 7.2s.

It is worth noting that the fuel tank capacity of the new car has also increased from 73L to 81L, which is about 90-110km more cruising range, which better caters to consumers’ demand for long-distance travel.

The appearance of the new car has not been significantly adjusted, mainly according to the different models, providing new styles of different sizes of rims. In addition, some models can also be equipped with new Caribbean gray, Bering Sea gray and Peto Lake blue body color matching, so that users can choose a more personalized appearance.

The layout of the car is the same as that of the old model, and six-seat and seven-seat layouts are provided. The new model of Kunlun Peak Edition is made of suede in many places, which looks more luxurious and exquisite. In addition, the new car is also equipped with 8155 chips, 5G car network and Baidu map, which makes the car smoother and smarter. At the same time, it is equipped with the BlueCruise driver assistance system, which supports the functions of changing lanes with the turn signal lever and intelligent comity in the lane, making driving easier.

In addition, the new Ford Explorer canceled the knee airbag, mobile phone key PAAK, APA one-button parking assistance, voice control second row seats and other configurations.

summary

On the whole, the new explorers are mainly optimized for some pain points of the old models, which is more in line with the positioning of light off-road SUVs. At the same time, the new towing qualification also brings more playability. However, compared with the models of the same class, it has more advantages, not only has stronger power, but also has plug-in models to choose from.

I hope that the new car can also launch a hybrid version in the future, and then reduce the terminal discount more, so as to win the favor of more consumers.

Text/July 7

PS: The proofreader has gone to give birth to a child. Welcome to help us pick the wrong words together. Thank you! ! ! !

In September 2023, child star Ashton Chen was 35 years old.

In the past, the little monk with a bottle and a cute milk has grown into a big boy. For Ashton Chen, filming in the past two years has become a joke, and few works have come out.

Now Ashton Chen spends more time enjoying life.

Recently, some netizens exposed a group of photos of Ashton Chen having a party with friends. Ashton Chen was wearing a black coat, a cap and smoking a cigar. It was very pleasant.

This kind of life is enviable.

However, when Ashton Chen was a child, he suffered far more than other children of the same age, which made him rich today, not only for himself, but also for his family.

It is precisely because of this that Ashton Chen’s father was once appraised as taking his son as a cash cow.

In order to make this cash cow grow more luxuriantly, he even adopted the way of "abuse" to make his son grow up, but is this really the truth?

One,

Ashton Chen’s father is called Chen Tongshan.

A native of Shutanggou Village, Dajindian Town, Dengfeng City, Henan Province, has a high degree of education. Many of his classmates graduated from the Air Force Political College of the People’s Liberation Army in China and embarked on the road of politics.

But Chen Tongshan took a very different road.

This is related to the origin of Chen Tongshan, who was born in a martial arts family. His father’s name is Chen Chengwen and he has been practicing martial arts in Shaolin for more than 60 years.

When he was about 8 years old, Chen Tongshan practiced martial arts with his father.

Later, he also entered Shaolin Temple and became one of the "Eight donkey kong" of Shaolin. While enjoying this reputation, Chen Tongshan also has the responsibility to promote Shaolin Wushu.

Chen Tongshan does have this strength and has won many awards for Shaolin Temple.

In the early 1980s, Chen Tongshan took part in many martial arts competitions, won many honors with his good skills, and entered the county-run sports school as a martial arts coach through the selection of Dengfeng County Sports Committee.

In 1985, he transferred to Shaolin Temple Wushu School and taught many disciples with extraordinary skills.

In the year when Ashton Chen was born, Chen Tongshan was officially hired as the principal of Shaolin Martial Arts School, and he established the school-running philosophy of "starting from a boy, making a hero a teenager".

It was this idea that made Ashton Chen suffer enough in his childhood.

As soon as Ashton Chen was born, Chen Tongshan made a plan for his son’s future. He must train his son to be a success, so Ashton Chen just learned to walk.

Chen Tongshan took Ashton Chen to Shaolin Temple and became a Shaolin disciple, learning from Shi Yongxin.

In order to record his son’s growth, Chen Tongshan also filmed a documentary, in which we can see Ashton Chen’s childhood.

Chen Tongshan’s training of Ashton Chen was so harsh that it could even be described as "abuse".

Before dawn, Chen Tongshan was in bed, tugging at Ashton Chen’s little hand, carrying him out of bed, washing his face with cold water, and then began to practise.

The process of exercising was even more painful. Later, when Chen Tongshan recalled himself, he felt that he had gone too far and was too cruel.

In order to bend Ashton Chen down and let him split, Chen Tongshan ignored his son’s cry of pain, pressed it hard and pressed it directly, and the painful Ashton Chen only shed tears.

Ashton Chen’s crying didn’t make Chen Tongshan soft-hearted, and he still stuck to his plan.

It is Chen Tongshan who is so strict. Ashton Chen, who is just five years old, has a solid basic skill and can even perform some boxing in a decent way.

It also makes Chen Tongshan feel very gratified.

At the same time, it also won Ashton Chen a chance to make a film.

Second,

In order to promote Chinese Wushu, in 1993, Chen Tongshan established the Shaolin Wushu Performance Troupe and began to perform all over the world. He went to more than 30 countries and regions.

He has made great contributions to the promotion of China traditional culture.

When Ashton Chen was five years old, he went to Taiwan Province with the troupe. He also performed a program with an old master and played a set of boxing on the stage.

MengMeng’s appearance is loved by many people.

At that time, there was a man sitting in the audience. After he saw Ashton Chen’s performance, he shone at the moment. After the performance, he found Chen Tongshan:

"Your son’s boxing is good, his basic skills are solid, and he is so lovable. Making a movie will definitely be popular."

This man is none other than Zhu Yanping, a great director who enjoys a certain reputation in Taiwan Province. The Slam Dunk shot by Jay Chou is his work.

For such a person, Chen Tongshan certainly attaches importance to it.

Moreover, letting Ashton Chen make a film has many advantages, besides making his son a star, it can also indirectly promote martial arts culture.

In this way, the two hit it off, and there was the movie shaolin popey.

In fact, at the beginning of filming this film, Zhu Yanping was not confident, and specially invited a "traffic star" for the box office.

That is, in a few months at that time, Jimmy Lin, which was popular in Southeast Asia, was known as the "Asian whirlwind".

Although Ashton Chen has been trained by Chen Tongshan to be very sensible, there is still a problem when shooting. He is afraid of heights.

In shaolin popey, there are many scenes that need to be played by Weiya.

After being hanged, Ashton Chen cried with fear, but Chen Tongshan, a martial arts instructor, didn’t show any respect at all because he was his own son.

Yell directly below: "Xiaolong, don’t cry, you are a man."

Zhu Yanping beside him shook his head and stopped: "He is still a 5-year-old child, not a man. Please put him down quickly."

Chen Tongshan is asking the staff to let his son go.

This shows how strict Chen Tongshan is with his son. Under such a strict father, Ashton Chen is destined to have a different childhood from other children.

Third,

From 1994 to 2006, Ashton Chen had a very hard time in these 12 years.

I lived like a robot, practicing, filming and reading, with almost no entertainment time. At that time, a reporter ran to interview Ashton Chen and asked, "What is your greatest wish?"

Ashton Chen smiled shyly: "I hope I can keep my hair long."

Because of filming, Ashton Chen often needs to shave his head. In summer, the sun is strong, and the children’s skin is tender. Ashton Chen is often sunburned and peeled off from his head to his neck ……

How many children in ordinary families have suffered from this?

For ordinary children, they are eager to have a holiday when they go to school, but for Ashton Chen, going to school is a rare time to relax.

Because when filming, you don’t just have to film. When you are free, besides reciting lines, you also follow several culture teachers to teach him to study. Besides eating and sleeping, he has almost no free time.

Ashton Chen used his childhood to gain fame and a lot of wealth.

Chen Tongshan was in charge of all this wealth, and changed the name of the martial arts school to "Linsi Ashton Chen Martial Arts School". With the fame of Ashton Chen, the martial arts school recruited many students.

It is precisely because of this that many people who don’t know Chen Tongshan think that he regards his son as a cash cow.

In order to make his son famous, Ashton Chen was treated so harshly, but in fact it was not. How could the world use his son as a tool father?

Compared with the father of ordinary people, Chen Tongshan’s requirements for his son are just a little stricter.

In the eyes of ordinary people, those harsh trainings were actually experienced by Chen Tongshan when he was a child. In his view, boys should suffer hardships.

This burly man is just loving his son in his own way.

In 2006, Chen Tongshan chose a good school for Ashton Chen in China, and the environment was very private, so fans wouldn’t bother him, but Ashton Chen didn’t go.

By this time, Ashton Chen had his own ideas, and he didn’t want to live a step-by-step life of filming, attending classes.

He wants to go abroad to study film and television production, and he has chosen a school in Manhattan. This is the first time that Ashton Chen has made a decision for himself and opposed Chen Tongshan’s consciousness.

If Chen Tongshan really regards his son as a cash cow, he will definitely object.

Because at that time, it happened that Ashton Chen was in full swing.

After hearing Ashton Chen’s opinion, Chen Tongshan finally obeyed Ashton Chen’s choice and let him study abroad, although he didn’t want to.

It was then that Ashton Chen disappeared from public view.

It was not until 2008 that it returned to the public’s sight again, but at this time, the entertainment industry was already a different world, although Ashton Chen appeared in many works later.

But it didn’t catch fire.

However, Ashton Chen’s life is still very chic, because he has a very good father.

Many parents of foreign child stars use their children’s money to squander, while Chen Tongshan uses the money to invest, start a company, buy real estate and so on.

It is said that there is a commercial street in Dengfeng, Henan, which is owned by Ashton Chen.

Although Ashton Chen rarely filmed in recent years, he became a film and television production company, acting as a director and producer himself, and invested in Oscar Studios, the largest cinema in Henan. ……

Ashton Chen himself has already achieved wealth freedom, lived in a villa and drove millions of luxury cars, and has become a winner in life.

If Chen Tongshan hadn’t been so strict with Ashton Chen, he wouldn’t be here today.

However, Chen Tongshan’s way of educating children is not worth recommending. In our country, many parents believe in the educational concept of "a dutiful son is born with a stick".

Under high pressure, there is no benefit to children’s physical and psychological growth.

Children, in particular, are fragile and sensitive. They will always remember the painful and happy scene when they were young. As parents, they should give their children more happy memories.

Whether poor or rich, happiness is the most precious thing in this world.

The picture comes from the network, please contact to delete the infringement.

Editor in charge:

　　Cctv newsOn September 14th, the National Health and Wellness Committee held a special press conference to introduce the relevant information and answer questions from reporters about the recently issued documents such as Management Measures for Internet Diagnosis and Treatment (Trial), Management Measures for Internet Hospitals (Trial), Management Standards for Telemedicine Services (Trial) and Management Measures for Clinical Application of Medical Technology.

　　Reporter: The definition of Internet hospitals has two forms. One is the Internet hospital of physical medical institutions, and the other is relying on physical Internet institutions. What is the difference between the two Internet hospitals, and then what is the difference in this supervision? How will the online behavior of Internet medical care be connected with medical insurance in the future?

　　Jiao Yahui, Deputy Director of Medical Administration and Hospital Authority of National Health and Wellness Committee:Answer the first question first, that is, what is the difference between the two forms of Internet hospitals. One form is the physical medical institutions, such as Run Run Run Shaw Hospital and Huaxi Hospital, which feel that there are not enough talents at present. In addition to using doctors from our hospital to provide services through the Internet, we also want to use doctors from Shanghai and Beijing to provide services. Then we can build a platform for Internet hospitals ourselves or cooperate with Internet companies to build a platform. Doctors from Beijing and Shanghai can provide services for patients in Run Run Run Run Run Run Shaw Hospital and Huaxi Hospital through this platform.

　　In this case, the entity hospitals should apply for the Internet Hospital as the second name, such as Run Run Run Shaw Internet Hospital or Huaxi Internet Hospital. Doctors in these hospitals in Beijing and Shanghai can directly practice in this Internet hospital, and there is no need to go through the procedures of multi-point practice or practice change again, so as to stimulate the vitality of medical staff, liberate productivity and maximize the role of high-quality medical resources. This is the first type of Internet hospital.

　　The second type of Internet hospital is a third party that applies for hosting an Internet hospital. It must establish close cooperation with a physical medical institution. It cannot be a pure virtual Internet hospital online or in the cloud, so there is no way to supervise it, and there is no way to accept and deal with medical disputes. The entity hospital signs an agreement with the third party that holds the Internet hospital. When the agreement comes into effect, the Internet hospital can take effect. If the agreement is changed and abolished, it is necessary to re-apply for the Internet hospital. For example, Run Run Shaw Hospital or Huaxi Hospital does not cooperate with third parties, and the Internet hospital has no physical medical institutions to rely on when setting up, so this Internet hospital will be cancelled.

　　The third party and the entity medical institution that run the Internet hospital are independent subjects who bear legal responsibilities. When a medical dispute occurs, they should apply to the health administrative department registered in the entity hospital for medical dispute.

　　The basic standards and supervision of these two types are the same, and they must meet the basic standards of Internet hospitals, and they must be supervised by the provincial Internet medical service supervision platform and incorporated into the local quality control system. At the same time, a community of responsibility is formed between the Internet hospital applied by the third party and the relying entity medical institutions. The entity hospital and the third party should bear the corresponding supervision responsibility first, which is conducive to our online and offline integrated supervision of the Internet hospital. The behavior of Internet hospital diagnosis and treatment should also be included in the performance appraisal and hospital grade evaluation of the entity medical institutions.

　　Regarding the second question, the document of the General Office of the State Council pointed out that for some Internet medical treatment behaviors that meet the requirements, corresponding medical insurance and price policies should be formulated, whether they belong to the category of basic medical care or market pricing. First, there must be charging items. If they belong to the category of basic medical services, medical insurance should be reimbursed, which is not the category of basic medical services, so they should be borne by patients. Because not all Internet medical treatment behaviors belong to the category of basic medical care, they do not necessarily have to be included in the scope of medical insurance reimbursement. The policies on price and medical insurance reimbursement have now been placed under the management of the National Medical Insurance Bureau, and we will actively cooperate with them.

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