() The operating comments of the Board of Directors in 2023 are as follows:

　　I. Discussion and analysis of business conditions

　　(a) business overview:

　　The year 2023 is a crucial year for the implementation of the 14th Five-Year Plan. The state has actively regulated and stimulated the market vitality, and all walks of life have made unremitting efforts to promote China’s economic stabilization and recovery. 2023 is also a year of product innovation competition for global biomedical enterprises. Various new drugs are constantly introduced and the research and development process is accelerating. In 2023, the company also followed the market closely, not only the sales performance at home and abroad was gratifying, but also the clinical progress of several R&D products was very smooth. During the reporting period, the company achieved an operating income of 2.608 billion yuan, a year-on-year increase of 52.31%, and a net profit of 340 million yuan, turning losses into profits compared with the previous year.

　　Turning losses into profits is an important embodiment of the company’s continuous optimization of its strategy, improvement of its operating efficiency and profitability, and effective grasp of development opportunities. With the implementation of the first round of insulin centralized purchase in 2022, with the help of the price advantage of centralized purchase and the opportunity of nearly 10,000 new hospitals, and the advantages of the original market brand effect and its own professional academic promotion team, the company rapidly expanded its team and accelerated its market coverage. In 2023, the company adopted a marketing strategy combining differentiation and collaboration, supplemented by multi-form and multi-level marketing activities, which further increased the penetration rate of the grassroots market while ensuring the stable growth of the original market. In 2023, the sales volume of the company’s products increased rapidly, the market share continued to increase, and the market share at the grassroots level continued to rise, completing the company’s strategic goal in the first round of insulin collection. In 2023, the company’s domestic sales revenue reached 2,182,057,000 yuan, an increase of 51.93% over the same period of last year. The sales volume of domestic preparation products increased by 66.36% year-on-year, among which the sales volume of basic (long-acting) insulin products increased by 32.47% year-on-year, and the sales volume of instant (quick-acting) and premixed insulin products increased by 112.38% year-on-year.

　　In 2023, despite the complicated international situation, the company continued to deepen its sales cooperation with new and old customers with its solid customer base and good brand effect, and achieved rapid market breakthroughs in countries along the Belt and Road Initiative. During the reporting period, the company’s international sales revenue was 326,606,200 yuan, an increase of 131.78% over the same period of last year.

　　R&D innovation is the basic guarantee for the company’s sustainable development. During the reporting period, the new pre-mixed insulin compound preparation GZR101 injection independently developed by the company also completed the first administration to subjects in phase Ib clinical trials, and the first administration to subjects in phase IIb clinical trials was also completed for the long-acting (GLP-1RA) product under research for type 2 diabetes and obesity/overweight indications. In addition, the clinical trial of the innovative therapeutic biological product GZR18 oral tablet was accepted by National Medical Products Administration in November of the same year. In 2023, the company continuously improved its R&D pipeline and laid out R&D work in other fields. In July 2023, it obtained the Notice of Approval for Clinical Trials of GLR1023 Injection from National Medical Products Administration. This is the first approved monoclonal antibody bio-similar drug for the treatment of adult moderate to severe plaque psoriasis that meets the indications of systemic therapy or phototherapy. The approval of this new product will further enrich the company’s product line and provide new kinetic energy for the company’s sustainable development.

　　At present, the company has successfully developed six core insulin products, five of which are mainstream insulin analogues in the global insulin market. In the first half of 2023, the company’s application for the listing of three biologically similar drugs, Ganjing, Laifu and Insulin Aspartate Injection, has been officially accepted by the US FDA. In the second half of 2023, the company welcomed the pre-approval inspection of the US Food and Drug Administration (FDA) for three bio-similar drugs: Glargine, Laifu and Insulin Aspartate Injection. At present, the company has received the initial feedback from the FDA, and the company still needs to improve related matters. The company will complete the rectification as soon as possible according to the opinions of the FDA. These three insulin injections are the first Chinese-made insulin declared in the United States, and they are also important milestones in the internationalization of Ganli. In the second half of 2023, the application for marketing license of insulin glargine injection, insulin lispro injection and insulin aspart injection submitted by the company to EMA in Europe was also formally accepted by EMA. In the first quarter of 2024, the company welcomed the pre-approval inspection by the European Food and Drug Administration (EMA) for three bio-similar drugs, namely glargine, lispro and insulin aspart injection. At present, the company has received the initial feedback from EMA, and is in the process of preparing for the reply. The company will actively reply to these technical questions and meet the requirements of EMA. The company will continue to build overseas brands, broaden the sales channels in overseas markets, and promote the overseas sales coverage of the company’s products, so that more diabetics around the world can enjoy more effective and affordable insulin products.

　　(II) During the reporting period, the company mainly completed and focused on the following work:

　　1. Quickly promote clinical research and development projects.

　　In 2023, the company invested 581,565,600 yuan in R&D projects, accounting for 22.30% of sales revenue. Among them, the expenditure on R&D is 501,022,400 yuan, accounting for 19.21% of the sales revenue; Capitalized R&D investment is 80,543,200 yuan, accounting for 13.85% of the total R&D investment.

　　R&D and innovation have always been the foundation of Ganli Pharmaceutical, and the company has never stopped advancing and exploring on the road of product development and technological innovation. The company insists on independent innovation and research and development, with endogenous development as the main driving force. At the same time, it has made breakthrough progress in the field of diabetes treatment, actively invested in drug research and development in other fields, and also laid out research and development pipelines in the field of autoimmune drug research and development. Up to the disclosure date of the report, the research and development projects in the clinical stage include GZR18 injection, GZR18 tablets, GZR4 injection and GZR101 injection. In addition, GLR1023 injection has received the Notice of Approval for Drug Clinical Trial approved and issued by National Medical Products Administration (NMPA), and is accelerating the phase I clinical trial.

　　(1) long-acting GLP-1RA (glucagon-like peptide -1 receptor agonist): GZR18 injection.

　　GZR18 injection, a new drug under research in our company, is a long-acting GLP-1RA (glucagon-like peptide -1 receptor agonist), and its homology with human endogenous GLP-1 (glucagon-like peptide -1) is as high as 94%. The indications of this drug are type 2 diabetes and obesity/overweight. In May, 2023, the company carried out a phase Ic clinical study of GZR18 injection with obesity/overweight indications in China. In June of the same year, the company completed the first subject administration in the phase IIb clinical trial of this indication, and further explored the application of this drug in the direction of weight loss indications. In August, 2023, the company completed the head-to-head phase IIb clinical trial of GZR18 injection with the indication of type 2 diabetes, and the first subject administration.

　　Globally, the market scale of GLP-1RA is growing rapidly, and it is expected to reach $145.4 billion in 2030 (data source IQVIA database). In China, the proportion of GLP-1RA in the domestic diabetes drug market is still low compared with the global market, which shows that the GLP-1RA market in China has great development potential. The company’s adoption of the research and development strategy of dual clinical promotion between China and the United States will also help the company to expand its sales space in the international and domestic markets in the future.

　　At present, a large number of domestic pharmaceutical companies have entered the GLP-1RA track, but if they really want to occupy a higher market share in the future, apart from the current R&D speed competition, the key point still depends on the commercialization ability of each company’s products. The commercialization of products is influenced by product efficacy, company capacity and commercial sales team. The company has obvious advantages in these aspects: first, on the basis of ensuring the effectiveness of drugs, the company actively seeks product differentiation and superiority to cope with fierce market competition. At present, the company is the first company to choose domestic single-target GLP-1RA to evaluate the drug effectiveness head-to-head with Smeglipeptide injection, and the company’s GZR18 injection is a weekly preparation product, and its indications include obesity/overweight besides diabetes. At present, the research of GLP-1RA in obesity/overweight indications by various companies is still in the initial stage of the global market, and no related weekly preparation product has been approved for marketing in China. The company’s layout in advance has obvious product differentiation advantages. Second, the company has sufficient production capacity and strong product supply guarantee ability. The company has sufficient land and plant reserves, leading the large-scale production capacity, and continuously increasing the production capacity, which can meet the potential supply demand of the rapidly growing market in China and even the world in the future. Third, the company has been deeply involved in the field of diabetes treatment for many years, with leading and rich commercialization experience and a professional academic promotion team of more than 2,000 people. The sales channels are mature and the brand advantages are obvious, which is conducive to the rapid commercialization of the company’s products after listing.

　　(2) innovative oral GLP-1ra: gzr18 tablets.

　　The GLP-1RA preparation (GZR18 tablets) under study by the company adopts a new oral absorption-promoting technology, which combines drug molecules with absorption enhancers through preparation technology to improve the bioavailability of drug molecules, thus realizing the oral administration of GZR18 molecules. GZR18 tablet is a new type of hypoglycemic agent in the treatment of type 2 diabetes mellitus, which can significantly improve some key pathophysiological defects of type 2 diabetes mellitus patients, and this drug enriches the research and development pipeline of the company’s new oral hypoglycemic drugs, and at the same time brings more treatment options for diabetic patients.

　　In November, 2023, National Medical Products Administration (NMPA) approved GZR18 tablets, an innovative therapeutic biological product declared by its subsidiary Gan Lishong, and the approved indication was type 2 diabetes. In April, 2024, GZR18 tablets were administered to the first subjects in a phase I clinical study in China with the indication of type 2 diabetes.

　　At present, there is only one oral GLP-1RA on the market worldwide. The clinical trial of GZR18 tablets developed by the company was approved in China. This important progress not only reflects the company’s continuous innovation in the field of drug research and development, but also marks a solid step in the research and development of new oral hypoglycemic drugs.

　　(3) the fourth generation insulin analogue: GZR4 injection.

　　GZR4 injection is a kind of innovative therapeutic biological product under research by our company, which belongs to the fourth generation of insulin analogues. It is expected to be administered subcutaneously once a week in human body to achieve stable control of basal blood sugar. GZR4 injection is expected to significantly reduce the frequency of insulin injection in patients. Compared with daily preparations, insulin weekly preparation is expected to reduce insulin injection by more than 300 times a year, greatly reducing the injection frequency, helping to overcome the injection obstacles of patients, reducing the treatment burden, and is expected to improve the overall compliance and quality of life of patients. At present, no insulin weekly preparation products have been approved for marketing in the world, and the company’s GZR4 injection is expected to provide a new treatment option for patients.

　　In April, 2023, the company completed the first subject administration in the China Ib phase clinical trial of GZR4 injection in patients with type 2 diabetes. In September of the same year, GZR4 injection was administered to the first subject in China Phase II clinical trial. In addition, the company is actively promoting the American clinical trial of GZR4 injection.

　　Diabetes is a chronic disease that requires long-term medication. Insulin is an indispensable treatment and final drug in the field of diabetes treatment, and basic insulin is the cornerstone of insulin treatment. At present, the basic insulin products are mainly Japanese preparations, accounting for a high proportion of the insulin market. However, with the iterative upgrading of products and the continuous upgrading of patients’ demand for insulin products, insulin weekly preparation products will be another heavy product to change the current sales pattern of insulin market. The company has always been a domestic leading enterprise in the three generations of basic insulin sales market. The layout of insulin weekly preparation products is not only the strategic choice of the company, but also the embodiment of the company’s corporate purpose of providing better treatment options for diabetic patients.

　　(4) The fourth generation of new premixed insulin compound preparation: GZR101 injection.

　　GZR101 injection is the fourth-generation premixed insulin compound preparation independently developed by our company, which is made by mixing long-acting basic insulin GZR33 and quick-acting insulin aspart, and is intended to be used for treating diabetes. It is expected that GZR101 injection can simulate the biphasic mode of physiological insulin secretion once a day, give consideration to fasting and postprandial blood sugar control, steadily reduce blood sugar, improve the standard rate of blood sugar control, simplify treatment, improve patient compliance and reduce treatment burden, optimize long-term management of diabetes, and help reduce or delay the occurrence of complications. In December, 2023, GZR101 injection was administered to the first subjects in the head-to-head phase II clinical trial with Degumen Asparagi insulin injection.

　　China’s insulin market is mainly premixed market, and the proportion of second-generation insulin is still higher than that of developed countries in Europe and America. With the further implementation of centralized purchasing policy in China, the price of three-generation premixed insulin products has decreased, the accessibility of patients has improved, and the trend of three-generation insulin replacing the second-generation insulin has accelerated. With the advantage of centralized purchasing, the company achieved rapid market access and accelerated grass-roots coverage, and the premixed insulin products Suxiulin 25 and Ruixiulin 30 were quickly released. On this basis, the company continues to lay out the fourth-generation pre-mixed insulin compound preparation product GZR101 injection, which will also continuously improve patients’ compliance and enrich patients’ medication choices.

　　(5) Monoclonal antibody biological analogue: GLR1023 injection.

　　Based on the long-term strategic development, with the help of the company’s rich R&D and GMP production experience in large-scale fermentation process amplification of insulin, chromatographic purification of recombinant protein and formulation process development, the company has entered the field of monoclonal antibody drugs, focusing on the development of large-scale animal cell culture technology. The production process of anti-drugs is similar to that of insulin, and it also needs to go through cell expansion culture, fermentation culture, multi-step purification, preparation filling and other steps. For example, the production of antibody drugs on the market will help improve the utilization efficiency of the company’s future production line.

　　GLR1023 injection, as a biological analogue of Secukinumab independently developed by our company, is a fully humanized recombinant monoclonal IgG1κ antibody. The antigen binding site of its Fab segment can specifically bind to human interleukin-17a, inhibiting its interaction with IL-17A receptor, and it is used to treat adult moderate to severe plaque psoriasis that meets the indications of systemic therapy or phototherapy.

　　In July 2023, the company received the Notice of Approval for Clinical Trials of GLR1023 Injection issued by National Medical Products Administration, and the approved indication was to treat adult moderate to severe plaque psoriasis that met the indications of systematic therapy or phototherapy. GLR1023 injection is the first clinically approved monoclonal antibody biological similar drug in the company. The company will speed up the product development of the biosimilar drug (GLR1023 injection) of Scochizumab, and strive to provide an inclusive, adequate, safe and equivalent drug treatment scheme for psoriasis patients as soon as possible, so as to benefit more patients.

　　As of the end of the reporting period, only Skochizumab injection produced by Novartis, the original research manufacturer, was approved for listing in China. According to the data of the NationaPsoriasisFoundation of the United States, there are about 125 million patients with psoriasis in the world, and the global prevalence rate can reach 2-3%. Both men and women are likely to get sick at all ages. In 2023, the global sales of Scochiyou monoclonal antibody injection was US$ 4.98 billion (data source: Novartis 2023 financial report). In April, 2019, National Medical Products Administration approved Scochizumab for the treatment of psoriasis. The drug market is growing rapidly, with sales of about 500 million yuan and 1.5 billion yuan in China in 2020 and 2021 respectively. However, based on the annual treatment cost of 40,400 yuan, in 2021, only about 30,000 patients will be treated with skunk izumab. The market penetration rate of Scochizumab is still less than 1% (data source is open). At present, there has not been any generic drug of Scochizumab injection approved for listing in China. GLR1023 injection has a good market prospect and broad market space. If approved for listing, it will enrich the company’s product pipeline and is expected to enhance the company’s core competitiveness.

　　(6) oral hypoglycemic agent SGLT-2 (sodium-glucose co-transporter -2) inhibitor: englejing tablet.

　　As a small oral hypoglycemic agent developed by the company, Engelje Tablet is an inhibitor of SGLT-2 (sodium-glucose co-transporter -2). By inhibiting SGLT-2, it can reduce the reabsorption of glucose by kidney, lower the renal glucose threshold, and increase the excretion of glucose in urine, thus playing a role in lowering blood sugar.

　　In July, 2023, the company’s listing application for Engelje tablets was accepted by National Medical Products Administration. Englijing tablet is the first SGLT-2 inhibitor that the company applied for listing, and it is expected to be approved in 2025. After listing, it will provide a new choice for the majority of diabetic patients with inclusive, safe and equivalent hypoglycemic effects, so as to benefit more patients.

　　At present, the original research products and 15 generic drugs of Boehringer Ingelheim Company in Germany have been approved for listing in China. According to IQVIA database, in 2022, Engler’s net global sales were $14 billion, and in 2030, it is estimated that global sales will reach $37.2 billion. According to the data of Rong Yun, the sales of Engelje tablets in domestic hospitals in 2022 was 348 million yuan, up 42% year-on-year, and the market grew rapidly. Engelje tablets have a good market prospect and broad market space. If approved for listing, it will expand the company’s hypoglycemic product line, which is conducive to enhancing the company’s comprehensive market competitiveness in the field of diabetes medication and consolidating the company’s market leading position in the domestic diabetes treatment field.

　　2. Strengthen the refined management of marketing.

　　In 2023, the company strengthened the implementation of refined market management, based on the principle of "reducing costs and increasing efficiency", formulated grassroots academic activities according to local conditions, and improved the coverage of grassroots markets. In the specific implementation process, in order to improve the academic level of primary doctors and solve the after-sales problems of patients, and to increase the accessibility of patients’ insulin products as the final result, the company promotes doctors to improve their understanding and cognition of insulin products, improve their diagnosis and treatment level, help patients popularize their knowledge of diseases and treatment, and do a good job in the management of chronic diseases by carrying out inclusive activities such as academic exchanges and after-sales guidance.

　　In terms of academic promotion, the company organized and participated in nearly 20 national large-scale academic conferences, including the 25th National Academic Conference of Diabetes Branch of Chinese Medical Association (CDS) and the 20th National Academic Conference of Endocrinology (CSE). By participating in large-scale national academic conferences, the company not only strengthened the cooperation and exchange between the company and the national endocrinology circle, but also enhanced the awareness of grassroots doctors on the company’s products, and further consolidated and strengthened the brand image of Gan Li. In addition, all regions continue to strengthen the academic promotion activities in the grassroots market, improve the disease awareness rate, diagnosis rate and control rate of grassroots diabetic patients, reduce the drug cost of grassroots patients, and improve the quality of life of patients.

　　In terms of patient care, in 2023, the company published 848 popular articles and videos on diabetes in the public account and video number platform, and carried out 78 live broadcasts, benefiting more than 450,000 people with diabetes. The company has started a 24-hour after-sales function in Ganli Guan ‘ai applet to help patients solve the problem of product use efficiently and quickly, and to help patients control sugar scientifically. The company continues to adhere to the patient-centered concept, continue to fulfill its mission and social responsibility, and is committed to providing affordable insulin products for more diabetic patients.

　　By the end of the reporting period, the sales volume of domestic preparation products increased by 66.36% year-on-year, among which the sales volume of basic (long-acting) insulin products increased by 32.47% year-on-year, and the sales volume of instant (quick-acting) and premixed insulin products increased by 112.38% year-on-year. With the continuous growth of domestic preparation sales and income, the company’s sales expense ratio also decreased from 63.46% in the same period in 2022 to 36.27% in 2023.

　　3. Steadily promote international market development.

　　Compared with the imported original drugs, the insulin biological similar drugs of our company are safe, effective and cheap, which can bring more choices to patients while ensuring the quality of the drugs. In international cooperation, the company aims to meet the treatment needs of patients and improve the treatment status of more patients, and combines its own R&D innovation resources to introduce its insulin products and production technologies into emerging markets and apply them to overseas localized production, breaking the situation that the original research drugs monopolize the market and patients’ choices are limited.

　　Even though the current international political situation is complicated and changeable, the company still shows a steady strategic pace and continues to promote the development of the international market. We know that a stable and efficient international market layout is very important for the long-term development of the company. To this end, we constantly expand our international sales team, maintain close communication and negotiation with overseas customers, and deepen cooperation with large international pharmaceutical companies to jointly meet market challenges. These cooperations not only enhanced the company’s international influence, but also brought more technical and market resources to the company. At the same time, we constantly improve our local production capacity to ensure that we can launch more high-quality products that meet the needs of the international market.

　　In the Asia-Pacific region, India, as one of the company’s key target markets, has a huge population base and a high incidence of diabetes, which makes the diabetes drug market have huge room for growth.

　　According to the data of the 10th IDF Global Diabetes Map, by 2021, about 74.2 million adults aged 20 to 79 in India have diabetes, ranking second in the world with an incidence rate of 8.3%. It is estimated that by 2045, this number will increase to 125 million; In addition, 39.4 million patients in India have not been diagnosed with diabetes, and the undiagnosed rate is as high as 53.1%. It can be predicted that the diabetes market still has great growth space and potential. In May, 2023, the pre-filled insulin glargine injection pen registered by the company in cooperation with Indian customers was approved for listing in India, which marked that the company officially obtained the commercial license to sell related products to India. In the future, the company will continue to deepen cooperation with Indian customers and jointly explore localized production opportunities in more fields.

　　Apart from India, Indonesia also has significant population advantages and future market potential, with a population of about 276 million (2022), making it the fourth most populous country in the world, with a per capita GDP of 4,332.7 US dollars (2021) (data source: World Bank database).

　　According to the data of the 10th IDF Global Diabetes Map, about 19.5 million adults aged between 20 and 79 in Indonesia were diagnosed with diabetes, with an incidence rate of 10.8%, while the undiagnosed rate was as high as 73.3%, ranking first in the world. The company has successfully cooperated with large pharmaceutical companies in Indonesia, and has made remarkable achievements in the local filling and production of insulin glargine injection pre-filled pens and insulin aspart injection pre-filled pens. In January 2023, these two products stood out in the tender of the Indonesian government and successfully won the order. This achievement is a full affirmation of the company’s product quality and Indonesia’s localized production capacity, and also a strong proof of the depth and breadth of cooperation between the company and large Indonesian pharmaceutical companies.

　　In addition, in October, 2023, the company’s insulin aspart injection and reusable pen insulin syringe won the bid in the bidding procurement project of drugs and medical devices of Kazakhstan government. According to the bidding results, the winning bid will meet the demand of Kazakh market in the coming year and provide stable and high-quality treatment options for local diabetic patients. Winning the bid will not only meet the urgent needs of the Kazakhstan market, but also be expected to further promote the company’s business expansion in countries along the "Belt and Road", which is also an important milestone of the company’s internationalization strategy.

　　In Latin America, according to the data of the 10th IDF Global Diabetes Map, by 2021, about 33 million adults (aged 20-79) in Latin America have diabetes, of which Brazil has about 15.7 million (aged 20-79), accounting for 47.5% of the total number of diabetic patients in Latin America, ranking first. In the first quarter of 2023, due to the lack of production capacity of foreign insulin manufacturers, the supply of insulin in Brazil was in short supply, and millions of quick-acting insulin products were urgently needed. This matter caused widespread concern in all walks of life and the pharmaceutical industry in Brazil. Regarding the drug risks faced by patients in Brazil, the company responded quickly, attached great importance to this bidding activity, actively contacted relevant departments in Brazil, and conducted several rounds of in-depth communication to ensure accurate understanding and meet local actual needs. After strict bidding procedures and official product technical review, the company’s insulin aspart injection and reusable pen insulin syringe won the bid in April 2023 with their excellent quality. In July 2023, the company has successfully shipped and delivered the first batch of products, which not only eased the pressure of insulin supply in Brazil, but also provided timely and effective treatment options for local diabetic patients. This achievement of the company has been widely reported and praised by the Brazilian media, thus enhancing the company’s reputation and influence in the international market. This not only attracts more countries in Latin America to actively seek cooperation with the company,It also laid a solid foundation for the company to expand a broader market in the region.

　　During the reporting period, the company obtained 6 new drug registration approvals for its insulin preparation products in emerging markets. Among them, in April 2023, the company’s insulin glargine injection was approved in Bolivia, which marked that the company officially obtained the commercial license to sell insulin glargine injection to Bolivia, and it was also the first time that the company was approved as a drug marketing license holder (MAH) in Latin America. In addition, the acceptance by FDA and EMA of the European and American marketing applications of the company’s insulin glargine injection, insulin lispro injection and insulin aspart injection is an important step in the internationalization process of the company, and it is also another milestone progress in the process of China’s insulin entering the European and American markets. In the future, the company is expected to seize the European and American markets through excellent product quality and cost advantages with years of experience in research, development, production and sales in the domestic diabetes drug field.

　　During the reporting period, the reusable pen-type insulin syringes and disposable insulin pen needles successfully passed the product certification under the new EU regulations, and successfully obtained the CE(ConformityEurope) logo. CE certification is a kind of product safety certification, which aims to ensure that the products put into the European market meet European safety and health requirements, and it is also a compulsory certification for products to enter the European Union. The company has become one of the first medical device manufacturers in China to obtain MDR certification of the new European medical device regulations, which is a strong proof that the company’s products have been recognized by the European Union, and has also played a positive role in promoting the vision of "laying out the global market".

　　For a long time, the company has been actively participating in various forms of exchange activities to improve brand awareness and influence, including government foreign exchange meetings, academic conferences in the field of diabetes and business exhibitions in the pharmaceutical industry. In June 2023, our company participated in the 83rd annual scientific meeting of American Diabetes Association (ADA), and displayed the global brand image of our company on the largest academic stage in the world. In addition, the company has participated in CPHIChina for many years in a row, displaying the international brand image of the company by setting up a booth to attract international business partners; In July of the same year, the company participated in the local diabetes symposium with its partners in the number one public hospital in Thailand to promote the listing of the company’s insulin glargine products in Thailand, and participated in the local promotion meeting for supporting Thai customers.

　　During the reporting period, the Company obtained the advanced certification of AEO(AuthorizedEconomicOperator). Advanced customs AEO certification is the highest credit rating in the customs credit management system. It can enjoy 22 preferential measures in five categories and 49 joint incentive measures for keeping promises implemented by relevant state departments, and also enjoy customs clearance convenience measures in 52 countries or regions where AEO is mutually recognized, which has a positive role in promoting enterprises’ international export credibility, strengthening the safety of overseas supply chains and expanding the overseas competitiveness of products. This not only reflects the advantages of commercial competitiveness of Gan Li, but also fully recognizes the excellent management of the company in the field of international trade.

　　The company will continue to make efforts to build overseas brands, broaden the sales channels in overseas markets, and promote the overseas sales coverage of the company’s products, so that more diabetics in the world can enjoy more effective and affordable insulin products.

　　4. The projects under construction were accelerated.

　　In order to meet the company’s future development strategy, improve the company’s product technology competitiveness and comprehensive R&D and production capacity, during the reporting period, the company accelerated the construction of various projects under construction, so as to enhance the development potential of the company and meet the market growth demand.

　　With the continuous expansion of domestic and international product markets, in order to meet the company’s growing demand for orders and help the company expand overseas markets, the preparation workshop expanded by Beijing headquarters passed GMP compliance inspection in January 2023 and reached the state of being put into production.

　　According to the sound product standards, process standards and quality standards, the company plans to build a high-standard production base, and strives to become the largest production base of hypoglycemic drugs in China with the most complete product range and the most concentrated innovative products. The first phase project of Shandong Linyi production base includes biopharmaceutical workshop, chemical workshop, medical equipment workshop and other supporting facilities. During the reporting period, Ganli Shandong completed the finishing work of related supporting facilities construction and the equipment installation, debugging and verification of each production line, and actively promoted the process verification and product registration and declaration of each production line as planned.

　　5. Strengthen production quality management

　　"Quality first and innovation forever" is the company’s corporate purpose. The company adheres to the scientific corporate culture and is always committed to providing higher quality drugs and better services for diabetic patients. During the reporting period, the Company always adhered to quality as the lifeline, established a relatively comprehensive quality management system, continuously strengthened quality supervision, ensured that every production link strictly followed the requirements of the National good manufacturing practice (GMP), guaranteed the quality and safety of the Company’s products, and provided high-quality and reliable drugs for the majority of patients.

　　(1) Strengthen the construction of integrated production management system of the whole group.

　　With the continuous production of some production lines of its subsidiary Ganli Shandong, the company attaches great importance to the construction of its production management system and product quality assurance. In order to ensure that the production process of Ganli Shandong meets the requirements of high standards and high quality, during the reporting period, the company conducted a comprehensive audit of Ganli Shandong to evaluate the compliance and effectiveness of its production management. On this basis, the headquarters of Gan Li cooperated with Gan Li Shandong to draft the operation rules related to production, which covered all aspects such as raw material procurement, production process control and quality inspection, and provided clear guidance and basis for the increasing production activities of Gan Li Shandong. At the same time, it also laid a solid foundation for the overall development of the company and the maintenance of brand image. In the future, the company will continue to strengthen the management and support of Gan Li Shandong and other subsidiaries, strengthen the construction of the whole group’s integrated production management system, actively promote the standardization of the whole group’s production process and the controllability of the whole production process, create quality advantages and ensure the consistency and stability of the company’s product quality.

　　(2) Strengthen staff training and quality culture construction.

　　In addition to improving the quality management system, the company has also made remarkable efforts in the construction of quality culture. During the reporting period, the company held a variety of quality culture construction activities, aiming at improving employees’ understanding of GMP concept and promoting the inheritance and renewal of knowledge and experience related to production quality within the company. Through online and offline activities, the company has improved employees’ sense of participation and realized an entertaining learning atmosphere. These activities not only enhanced the employees’ understanding and application ability of GMP knowledge, but also implemented the GMP concept throughout the company, ensuring that employees can combine theoretical knowledge with practical work, which provided a strong guarantee for the improvement of the company’s product quality.

　　(3) Strengthen quality risk control.

　　In order to strengthen the ability of quality risk management and control, the company regularly carries out quality risk assessment and inspection, identifies potential quality risks in the production process, and formulates emergency systems and response plans to improve the institutional framework to ensure that product quality is always under control, realize quality assurance in the whole production process, and escort the production of high-quality products.

　　6. Strict and strict safety in production, and build a dam for the company’s safety in production.

　　Ganli Pharmaceutical always takes "safety first, prevention first, comprehensive management" as the overall policy of safety work and adheres to the safety management concept of "people-oriented, safe development". Adhere to high standards and strict requirements, continuously improve the safety management system, do a good job in safety production, and actively fulfill social responsibilities.

　　(1) constantly improve the standardization system.

　　During the reporting period, Beijing Headquarters organized and improved the safety working mechanism, revised and updated more than ten safety management systems in accordance with relevant national and local laws and regulations, standardization of safety production and requirements of ISO45001 occupational health and safety management system, and cooperated with its subsidiary Gan Lishan to compile and implement various safety production management systems and safety production operation procedures for various posts, so as to promote the standardization of the safety management system within the Group.

　　(2) Ensure the implementation of safety responsibilities.

　　During the reporting period, in order to ensure the implementation of safety responsibilities, the company formulated the EHS safety management manual for all departments of the company in accordance with the system documents, specification requirements, management regulations and other relevant rules and regulations of safety production combined with the actual situation of the post, clarifying the main responsibilities of personnel at all levels and the standards for work implementation, providing strong support for the gradual development of safety work, prompting employees to form a "safety systematization" behavior consciousness and further strengthening the implementation of safety responsibilities of personnel at all levels.

　　(3) Strengthen the construction of safety culture

　　The safety awareness of employees is the foundation of safe production. During the reporting period, the company vigorously carried out the construction of safety culture, strictly trained personnel, improved the management level of safety management personnel, warned employees to improve their safety awareness, and abided by safety production operation standards and norms. Through the combination of network platform and offline practice, a three-level safety education system covering all employees was built, and several special drills such as fire evacuation drills, electric shock and limited space were carried out to improve the emergency response ability of all employees. During the reporting period, the company also won the honorary title of "Beijing Safety Culture Construction Demonstration Enterprise".

　　(4) Deepen the "full closed loop" rectification of hidden dangers.

　　During the reporting period, the company continued to carry out the construction of double prevention mechanism, covering the whole plant area for risk identification and hierarchical control, and relying on the risk cloud platform of government departments to monitor the risk sources. The company takes the "major investigation and rectification of potential safety hazards" as the main line, covering all levels of personnel, all posts and all job sites, and takes self-examination and mutual inspection as the main forms to find and control potential safety hazards in time, eliminate safety weaknesses and ensure that safety risks can be found and solved in time. In addition, combined with the national safety production situation, the company carried out special inspections on hazardous chemicals, electricity, fire and gas, and took closed-loop rectification and review measures for safety risks to ensure that all production met the Group’s safety standards. During the reporting period, the company conducted more than hundreds of daily inspections, special inspections and comprehensive inspections for dozens of times, so as to nip in the bud, continuously promote the investigation of potential safety hazards, and take responsibility for the smooth progress of production and operation and the safety of employees.

　　7. Talent development promotes strategic landing

　　In the increasingly competitive business environment, the company practices the core talent values of "results-oriented, creating value" around the R&D strategy and internationalization strategy, and makes the talent-driven enterprise development strategy land by upgrading the talent management and training system.

　　The company is constantly exploring innovative practice ways of talent development. By formulating a number of assessment and incentive policies, we will retain key talents, constantly stimulate the motivation of talents, encourage talents in all business fields to take on challenges and strive to become a high-performance team. In terms of incentives, the company issued two equity incentive plans in succession in 2021 and 2022, covering 742 person-times of core talents in various business fields, in order to encourage talents to maximize and support the company to achieve its strategic goals, so that talents can truly become the owners of the company. The company issued the third incentive plan in February 2024, injecting a boost into the construction of the core team. Adhering to the strategy of talent echelon construction, we will further optimize the "successor project", increase the training of middle and senior managers of the company, enhance their strategic thinking, global vision, corporate governance and influence, and establish a middle and senior talent team that can promote the company’s development and organizational goals, and help the company’s international development. Customized courses are set up in the successor project to cultivate the ability of middle and senior managers to give practical solutions when dealing with complex business, and help talents to improve their three abilities of propaganda vision, strategic influence and business sensitivity and related knowledge and experience. In addition, by adding a company-level live sharing meeting, managers of various departments are invited to share their management practice experience, industry information and strategic goals to promote progress, etc., to further help "successors" know the current operating situation and strategic direction of the company and enhance their strategic thinking and overall concept.

　　The company continues to pay attention to attracting ambitious and high-potential talents. By accurately benchmarking colleges and universities, we will actively organize and carry out diversified school-enterprise interaction to promote the deep integration of Industry-University-Research. The core lies in exporting corporate brands, attracting the attention of universities, and establishing long-term strategic cooperation with universities through teaching probation, course interaction, co-construction of off-campus practice bases, joint training of specialists and masters, open days and other modes to realize resource sharing and complementary advantages, and jointly cultivate talents needed for industry development. At the same time, the company focuses on cultivating core talents, and continues to tap high-potential talents with excellent professional knowledge and global vision in universities around the world through the "Future Leaders Program" project, and cultivate them into leaders who can lead the company’s international development.

　　The company attaches great importance to and actively participates in the construction of corporate culture, and is committed to shaping and promoting the corporate culture that conforms to the company’s strategic goals and values. Through a series of well-planned cultural activities, such as training, value propaganda, honor recognition and professional quality training, the company’s cultural values are spread in a multi-dimensional, all-round and multi-angle way, and the corporate culture is further strengthened to ensure that the corporate culture is deeply rooted in people’s hearts, enhance employees’ sense of identity and belonging to the corporate culture, and enhance the cohesion and cooperation spirit among employees. At the same time, according to the feedback from employees and the real-time changes in the market, we will flexibly adjust and continuously adjust and optimize corporate culture strategies in various forms such as cultural co-creation, and strive to create a positive, healthy, harmonious and dynamic corporate culture environment to provide strong spiritual motivation and support for realizing the company’s long-term goals.

　　Ii. the industry in which the company is located during the reporting period.

　　1. Changes in industry policies

　　Under the policy background of the "Tenth Five-Year Plan", in 2023, all kinds of policies in the pharmaceutical industry frequently occur, and opportunities and challenges coexist.

　　(1) National centralized procurement with quantity

　　By December, 2023, nine batches of drugs and four batches of high-value consumables have been organized at the national level, and the centralized procurement of national pharmaceutical consumables has gradually entered a normal state. Under the policy of "integrating recruitment and procurement, linking quantity and price", the rules of centralized procurement have been gradually improved, especially in meeting the actual clinical needs, ensuring supply, deepening the credit evaluation mechanism of recruitment and procurement, and so on.

　　Among them, the sixth batch of insulin special procurement that the company participated in bidding was the first batch of centralized procurement of biological products organized by the state. In June, 2023, the National Health Insurance Bureau issued the Notice on Further Doing a Good Job in the Implementation of the Agreed Quantity of Centralized Procurement of Drugs (Insulin Special) Organized by the State. The "Notice" stipulates that "in principle, the agreement will be renewed based on the agreed purchase volume of this medical institution in the previous year, and the purchase volume of selected products in Class A will not be reduced". The state will continue to support the selected enterprises with low prices in centralized procurement and implement the spirit of centralized procurement contract; At the same time, the "Notice" clearly stated that "medical institutions should strictly implement the agreed volume of centralized procurement and strengthen the assessment of the implementation of the agreed volume of medical institutions".

　　In February, 2024, the Office of Joint Procurement of Drugs organized by the State issued the Notice on Submitting Purchase Data Related to the Range of Continuous Procurement of Insulin after the Expiration of the Centralized Procurement Agreement. The range of data submitted by this successive procurement is still six procurement groups, which is the same as the first round of centralized procurement (the sixth batch of centralized procurement of drugs organized by the state). This data reporting is conducted by online direct reporting, and the reporting volume of medical institutions at all levels should be compared with the historical purchasing volume in 2023. In principle, the total reporting volume of each medical institution should not be less than 80% of the purchasing volume of the previous year, and the reporting volume of Class A human insulin products selected in the first round of centralized purchasing should not be less than 40% of the purchasing volume of this product in the previous year; For class A insulin analogue products selected in the first round of centralized purchase, the reported amount shall not be less than 60% of the purchase amount of this product in the previous year. When the reported amount of medical institutions is less than 80% of their historical purchases, medical institutions are required to explain, and medical institutions that have historical purchases but do not participate in the reporting need to pay special attention. In the policy of continuous procurement, the state gives an appropriate tilt to the products selected in the first round of centralized procurement of Class A products, and in the draft of continuous procurement opinions, it clearly puts forward the procurement rules that are beneficial to the enterprises selected in the first round of centralized procurement with low prices, such as increasing the price of pre-filled products with lower prices on the basis of the first round of centralized procurement.

　　On March 29th, 2024, the Office of Joint Procurement of Drugs organized by the State issued the National Centralized Drug Procurement Document (insulin special connection), which stipulated that all enterprises should complete the submission of application materials before 10am on April 23rd, 2024, and publicly declare the information on the same day. This procurement cycle starts from the execution date of the successful selection result to December 31, 2027.

　　A. Rules for bid selection in this centralized procurement:

　　The product price lines of the selected categories in each purchasing group are clearly defined in this insulin purchasing document, and the predictability of the selection rules is significantly improved, which is helpful for enterprises to formulate rational quotation strategies according to strategic planning. The price difference of all kinds of selected products is smaller than that of the first centralized purchase, which promotes orderly competition in the market.

　　As can be seen from the price line of Class A products, the price line of the second-generation insulin is consistent with the price line of the third-generation meal and premixed insulin analogues. This rule will further promote the process of replacing the second-generation insulin with the third-generation insulin, help improve the accessibility of medication for diabetic patients in China, and continuously enhance their sense of acquisition and happiness. Compared with the guiding price line of this centralized purchasing document, the bidding price of five products in our company is lower than this A price line.

　　C. Analysis of purchasing demand data in the first year

　　In the first year of continuous centralized purchasing, the total purchase demand was 242 million pieces, which was 28 million pieces higher than that of the last centralized purchasing, with a growth rate of 13%. The implementation of the national special centralized purchase of insulin has reduced the price of insulin products in China, greatly reduced the burden of patients’ medication, promoted the awareness rate, treatment rate, control rate and diagnosis rate of diabetes in China, made more patients willing and able to choose and use insulin products in time, and further expanded the insulin market in China. Our company’s purchasing demand in the first year accounts for 17% of the total demand, and its share is second only to Novo Nordisk. Our company’s purchasing demand increased by 9% compared with the last year. Among them, our company accounted for 24% of the purchasing demand of the third-generation insulin in the first year, which was 10% higher than that in the last first year.

　　Among the purchasing demand in the first year of this centralized purchase, the purchasing demand of third-generation insulin was 168 million, accounting for 70% of the total demand, which was 36% higher than that in the first year of the last centralized purchase. The demand for second-generation insulin in the first year accounted for 30%, a decrease of 12% compared with the previous one. It can be seen that after the implementation of the first special insulin collection policy, the market share of the third-generation insulin has been rapidly improved, the intergenerational upgrade of insulin has been accelerated, and domestic enterprises are also seizing the opportunity to seize more market share.

　　As the leading enterprise of domestic insulin, especially the leader of the third-generation insulin, Ganli Pharmaceutical actively responded to the national policy, and many products won the bid as Class A in the first round of insulin collection, which reduced the burden of patients’ medication, and also kept sinking the academic promotion of the third-generation insulin market in the market, effectively seeking benefits for patients.

　　The purchase demand of our company in the first year of this centralized purchase is 41.77 million pieces, which is 25.13 million pieces more than that in the first year of the last centralized purchase, with a growth rate of 151%. Among them, the third-generation insulin products accounted for 24% of the first-year purchasing demand of the whole third-generation insulin, which was 10% higher than the last first-year purchasing demand, and the number of all products has reached the second place in the industry, second only to Novo Nordisk.

　　In the last centralized procurement, the company won the bid for all products, and many products were selected in Class A, and nearly 10,000 medical institutions were admitted. The company seized the opportunity, rapidly expanded the academic promotion team, deepened and refined the management of the grass-roots market, and constantly improved the market recognition of the company’s brand. The sales volume of various products increased rapidly and the market share continued to expand, which laid a solid foundation for this collection. In this first year’s purchasing demand, all products of the company have achieved high growth, among which the growth of meal time and premixed products is even more impressive, with the growth rates of 381% and 564% respectively.

　　The company has always followed the pace of national policies, actively participated in the continuous procurement of insulin, and solidly promoted all the work to ensure the efficient implementation of the collection results, provide more comprehensive, professional and meticulous services for more patients, and continuously improve the quality of life of patients.

　　(2) Adjustment of national medical insurance catalogue

　　On December 13th, 2023, the National Medical Insurance Bureau issued the National Drug List of Basic Medical Insurance, Work Injury Insurance and Maternity Insurance (2023). The total number of drugs in the new medical insurance drug list reached 3088, including 1698 kinds of western medicine and 1390 kinds of Chinese patent medicine; There are still 892 kinds of Chinese herbal pieces. Compared with the 2022 edition, the total number of drugs in this edition has increased by 126. 143 drugs out of the catalogue participated in the negotiation or bidding, of which 121 drugs were successful, with a negotiation success rate of 84.6% and an average price reduction of 61.7%. The success rate and price reduction were basically the same as in 2022. The new catalogue was officially implemented on January 1, 2024. Adjusting the national medical insurance drug list is related to every insured person and is a major event related to the national economy and people’s livelihood. It is the core concept of medical insurance work to let drugs return to the essence of saving lives, so that patients can use and afford them, and ensure that every penny is spent more, which is also the initial intention and goal of the adjustment of the national medical insurance drug list. From the perspective of maintaining the fairness of patients’ medication, improving the relationship between doctors and patients and facilitating reasonable clinical treatment, the national medical insurance drug list is dynamically adjusted every year. At the same time, the functional orientation of "ensuring basics" is firmly grasped, and the affordability of medical insurance funds is regarded as the "bottom line" that must be adhered to, and efforts are made to meet the basic drug needs of the majority of insured people. The inclusion of 126 new drugs in medical insurance means that more patients will enjoy the benefits brought by medical insurance.

　　(3) outpatient co-ordination policy

　　In 2023, the National Health Insurance Bureau issued the Notice on Further Improving the Integration of Designated Retail Pharmacies into the Overall Management of Outpatients, which included retail pharmacies in the scope of overall fund payment. In accordance with the principle of "steady progress and gradual expansion", encouraging qualified township hospitals, street health service centers, community health service stations, village health clinics and non-public medical institutions to participate in the outpatient service of designated retail pharmacies is conducive to improving the convenience and accessibility of the insured. With the policies of chronic and special diseases in outpatient service, "dual channels" and outpatient co-ordination, the market opportunities of retail pharmacies are gradually highlighted. The academic promotion team of the company assists retail pharmacies to carry out policy-based academic promotion and publicity work, so that patients can fully understand that retail pharmacies can provide medical insurance co-ordination services, and deeply introduce and analyze the professionalism and advantages of pharmacies in medical insurance settlement, so as to enhance customers’ trust and recognition of retail pharmacies and further enhance the market share of the company’s products.

　　(4) Medical and health services

　　In May 2023, the National Health and Wellness Commission and the State Administration of Traditional Chinese Medicine issued the Notice on Carrying out the Action of Comprehensively Improving Medical Quality (2023-2025). The goal of this action is to further establish the awareness of quality and safety in the whole industry in three years, improve the quality and safety management system and management mechanism, and further improve the multi-governance mechanism of medical quality and safety management with government supervision, institutional autonomy, industry participation and social supervision. Further consolidate the quality and safety management of basic medical care, improve the refinement, scientificity and standardization of medical quality and safety management, further optimize the allocation of medical resources and the balance of services, improve the ability of diagnosis and treatment of major diseases and the level of medical quality and safety, and continuously improve people’s satisfaction with medical services. To meet the people’s growing needs for a better life as the fundamental purpose, to promote the high-quality development of medical and health services as the theme, to improve the quality of supply as the main direction, pay equal attention to Chinese and Western medicine, strengthen total quality and safety management, promote the expansion of high-quality medical resources and regional balanced layout, and continuously enhance the people’s sense of acquisition, happiness and security.

　　In December 2023, the state issued the Guiding Opinions on Comprehensively Promoting the Construction of Close County Medical and Health Communities. The construction of a compact county medical community is to form a community of responsibility, management, service and interests by establishing a certain management and operation mechanism for county-level medical institutions and grassroots township hospitals in the county, and to form a ladder of assistance and promotion. From the development of a single institution to pay more attention to the coordinated development of all member units in the medical community, better optimize the integration and sinking of resources, and let the people get a higher level of medical and health services. The construction of compact county medical community is a systematic reconstruction of county medical and health system, and the issuance of guiding opinions provides guidance and guidance for comprehensively promoting this work. According to the guidance, by the end of 2025, more than 90% of counties and cities will basically build a compact county medical community; By the end of 2027, the compact county medical community will basically achieve full coverage.

　　With the management of chronic diseases gradually sinking to primary medical institutions, the company pays close attention to the development trend of relevant policies in the primary market, continuously strengthens the investment in academic promotion in rural areas, primary health medical institutions, retail pharmacies and other markets, and continuously improves the quality of service for primary diabetic patients and the market recognition of the company’s products by enhancing the professional ability of academic promotion and the refined management ability of the market.

　　2. The industry status of the company.

　　With the continuous listing of new drugs in the diabetes market in recent years, the structure of the diabetes market is constantly changing. Although the current patient penetration rate of new hypoglycemic agents is low, they occupy a high market share and will have a large profit margin in the future. DPP-4 inhibitors, SGLT-2 inhibitors and GLP-1 receptor agonists in China entered the market late, and are currently in a high-speed development stage with great market potential.

　　In recent years, the global sales of GLP-1RA products have increased rapidly, and more and more pharmaceutical companies have begun to lay out this product. The company also participated in the layout of this product earlier, and is now trying to seek product differentiation and superior efficiency to cope with the fierce market competition. And the company is the first company to select domestic single-target GLP-1RA for head-to-head evaluation of drug effectiveness with Smegliptide injection. In addition, the innovative drug GZR18 injection (indications are type 2 diabetes and obesity/overweight respectively) is a weekly GLP-1RA preparation product, which is more competitive than other single indication or daily preparation products under research. At present, although there are many pharmaceutical companies researching this product, there are few pharmaceutical companies with sufficient commercialization capacity and mature commercialization team. The company not only has sufficient production capacity of insulin products, but also has rich production capacity of supporting equipment. Not only that, the company’s professional academic promotion team of more than 2,000 people around the world will also be a powerful guarantee for the company to rapidly promote the sales of new products in the future. At present, the company has also deployed oral hypoglycemic agents, such as DPP-4i, SGLT-2i, oral GLP-1RA, etc. The company’s DPP-4i sitagliptin phosphate tablet is the first oral hypoglycemic drug independently developed by the company, which was approved for listing in China in June 2022. As of the disclosure date of the report, oral GLP-1RA product GZR18 tablets have completed the first administration to subjects in phase I clinical trials. The continuous listing of oral hypoglycemic drugs will further consolidate the company’s position in the field of diabetes treatment.

　　Diabetes is a chronic disease, which needs intensive treatment over time. Insulin is an irreplaceable end product for treating diabetes. Although the proportion of insulin in the market structure has decreased, it still accounts for the largest proportion, and the total amount is still increasing, and the future market is considerable.

　　From the European and American markets, as the world’s largest insulin sales market, 90% of its insulin products are sold in third-generation insulin products. Three main products of the company, insulin glargine injection, insulin lispro injection and insulin aspart injection, have been officially accepted by FDA and EMA as marketing applications for treating diabetes. According to the commercial and supply agreement signed between the company and Sandoz in 2018, after the approval of the company’s three insulin products, Ganjing, Laifu and Mendong, Sandoz will carry out the commercial operation of drugs in the United States, Europe and other specific regions, and Ganli Pharmaceutical will be responsible for drug development (including clinical research) and supply. If the products are successfully approved by FDA and EMA, the US and European markets are expected to bring considerable profit increment space to the company, which is expected to drive the company to usher in a new round of rapid growth.

　　With the development of emerging market economy and the improvement of consumption power, emerging markets are gradually becoming an important source of global insulin market demand. However, in recent years, the supply problems of foreign insulin manufacturers have occurred from time to time, while our company has stable production capacity supply, excellent quality standards and obvious price advantages, and overseas customers actively seek cooperation with our company. The company also seized the opportunity, accelerated the expansion of customers, expanded overseas orders, and continuously improved the company’s international revenue growth.

　　With the implementation of the special centralized purchase of insulin in China in 2022, it not only promoted the increase of the total insulin market in China, but also accelerated the process of replacing the third generation with the second generation of insulin and replacing the import with domestic products. As a national enterprise that mainly produces three generations of insulin products, our company won the bid for all products in this centralized procurement, and many products were selected as Class A, and nearly 10,000 new medical institutions were obtained. By virtue of the advantages of Class A products, the company seized most of the foreign-funded enterprises with high market share, which greatly increased the market share of the company’s third-generation insulin. The company also seized the opportunity, expanded the academic promotion team, accelerated the grass-roots coverage, and realized the rapid volume of products after centralized collection. With the deepening of centralized purchasing and the effective implementation of the company’s sales strategy, in 2023, the company’s sales of basic (long-acting) insulin products increased significantly, reaching 32.47%; Meal-time (quick-acting) and premixed insulin products grew more rapidly, with a growth rate of 112.38%. Compared with before centralized purchase, the sales volume of the company’s products doubled, and the market share of the products increased greatly. The company basically achieved the strategic goal of centralized purchase of insulin in the first round.

　　In 2024, the state clearly showed its policy support for the original A-class selected enterprises in the insulin continuous procurement policy. The company will also continue to actively respond to the national policies, seize the opportunity and actively participate in the national procurement of insulin, so that more diabetic patients in China can use the third-generation insulin products of Ganli.

　　The continuous growth of the company’s product sales also benefits from the company’s rich product line. In the insulin market, the company is a comprehensive company with three generations of products in the current insulin sales enterprises. The company’s approved oral hypoglycemic product, sitagliptin, is expected to go on sale this year, which will form a joint force with the company’s insulin preparation product sales and help the company’s product sales growth. The company is researching GZR18 injection, GZR4 injection and GZR101 injection. After going on the market, it will continuously enrich the drug selection of diabetic patients and enhance the brand influence and market share of the company. The GLP-1RA weekly preparation products that the company is developing for overweight or obesity will also open up more market space for the company and create new profit growth points. In addition to the rich layout in the field of diabetes, the company’s R&D products also involve research fields such as eukaryotic and prokaryotic protein engineering, tumor, cardiovascular and metabolic diseases, etc. In recent years, the company’s R&D investment ratio is at a high level in the industry.

　　At present, the company is also one of the few companies that produce diabetes supporting devices by themselves. The products listed by the company include reusable pen insulin syringes, non-reusable pen syringes, disposable injection pen needles and disposable insulin pen needles. In addition to supporting the use of the company’s insulin products, related products are also actively exploring business development and cooperative business to help the company create more profit growth points.

　　Iii. Business of the Company during the reporting period

　　(1) Main business of the company

　　The company is a high-tech enterprise mainly engaged in the research, development, production and sales of insulin analogues and injections, with a complete insulin research and development pipeline. As a leading high-tech biopharmaceutical enterprise in China, our company has successfully independently developed a number of China’s first three-generation insulin analogues, making China one of the few countries in the world that can industrially produce insulin analogues. The company’s main products include insulin glargine injection (Chang Xiulin), insulin lispro injection (Su Xiulin), refined protein zinc recombinant insulin lispro mixed injection (25R) (Su Xiulin 25), insulin aspart injection (Rui Xiulin), insulin aspart 30 injection (Rui Xiulin 30) and insulin protamine mixed injection (30R) (Pu Xiulin 30). At the same time, the company’s products cover related medical devices, including reusable pen insulin syringes, non-reusable pen syringes, disposable injection pen needles and disposable insulin pen needles, which are convenient for patients to use.

　　In the future, the company expects to achieve comprehensive coverage of the product line in the field of diabetes diagnosis and treatment. At the same time, the company will also actively invest in the research fields of chemical drugs, eukaryotic and prokaryotic protein engineering, tumor, cardiovascular and metabolic diseases, and strive to provide more high-quality drug treatment programs for patients.

　　(2) The company’s business model

　　1. Purchasing mode

　　According to the requirements of the company’s procurement system, the purchasing department is responsible for the external procurement, organizes the formulation of the company’s annual procurement plan, and guides the completion of procurement tasks according to the monthly demand; And carry out access, evaluation and maintenance management of suppliers, dig deep into high-quality suppliers and continuously optimize the supplier system; At the same time, in order to ensure production safety and stable supply of raw materials, the quality management department will audit and manage the qualifications of raw materials suppliers, and the quality management department will conduct strict quality warehousing inspection when raw materials are put into storage. For engineering and equipment goods, according to the company’s procurement management system and national regulations, the final supplier is determined by bargaining or bidding.

　　2. Production mode

　　The company’s commercial production plan, process management, production scheduling and organization are managed by the production management department. According to the production and marketing plan formulated by the supply chain management department, combined with the procurement of raw materials and product inventory, the production management department formulates the rolling production plan of the production workshop, and adopts the production mode combining Make-to-Order and Make-to-Stock to meet the needs of many customers, and at the same time strictly manages the whole production process of products. In the production process, the quality management department conducts quality supervision over the whole production process, and carries out whole-process inspection and monitoring on the quality of raw and auxiliary materials, intermediate products, products to be packaged and finished products.

　　3. Sales model

　　(1) Domestic sales model

　　The company mainly adopts the sales mode of combining commercial companies with specialized academic promotion. The company’s domestic product sales mainly adopt the distribution mode, that is, the drug is sold and distributed to hospitals through pharmaceutical commercial companies. Commercial companies do not undertake market development and promotion functions, but only issue demand orders to the company according to the drug demand of hospitals or pharmacies in their distribution areas. The company sells drugs to cooperative pharmaceutical commercial companies according to the annual Distribution Agreement and specific orders, and the regional commercial companies complete the drug sales and logistics distribution to hospitals and retail terminals.

　　According to the high technical barriers of insulin analogues, the domestic market is mainly promoted and publicized by the marketing system through independent professional academic promotion mode, in which the promotion information includes: product-related information (drug indications, use methods, safety and related academic theories and latest clinical research results), company brand information, etc.

　　(2) overseas sales model

　　According to the policies and market characteristics of overseas countries, the company’s international sales products include insulin raw materials, insulin preparations, pen components and other medical devices. The sales model is divided into authorized distribution of insulin preparations and cooperation with local enterprises in importing countries in filling raw material drugs. Under the authorized distribution mode, the company’s preparation products are sold to overseas markets by international distributors authorized by the company. Under the cooperative sales mode of filling, the company mostly cooperates with local enterprises with strong filling capacity, complete assembly line and biopharmaceutical production qualification. The company exports raw materials and pen components, and the importing partners carry out local preparation filling production, pre-filled injection pen assembly and sales.

　　(III) Main performance drivers

　　In the domestic market, with the in-depth implementation of the first round of centralized insulin purchase policy, the process of replacing the third generation with the second generation of insulin in China and replacing the import with domestic products is accelerating. The company continued to carry out intensive cultivation of the market, accelerated the sinking of the grass-roots market, and maximized the ability of the company’s professional academic promotion team. The sales volume of the company’s products increased rapidly. In the international market, customers now pay more attention to the stability of product supply and the safety of product quality. With the stable product supply, excellent product quality and years of brand influence, the company has rapidly improved customer trust and further strengthened its willingness to cooperate. The order volume of its products in overseas emerging markets has increased, and its international sales revenue has doubled compared with the same period of last year. Under the strategic guidance of cost leadership, the company deepened the management of increasing efficiency and reducing costs, dug deep into the work potential and improved work efficiency.

　　In the future, the company will continue to implement the development strategy, actively participate in national procurement, and better and more comprehensively serve domestic insulin patients. Adhere to the international development strategy, continue to explore overseas markets, closely follow the national "Belt and Road" policy, and bring high-quality and stable products of Ganli to more emerging countries. Continue to carry out the management of increasing efficiency and reducing costs within the company, and thoroughly practice the cost leadership strategy. Continue to adhere to the R&D innovation strategy, accelerate the work of R&D projects, continuously enrich the R&D pipeline, optimize the product structure, broaden the cooperation mode, carry out investment and commercial development business, and promote the sustainable and high-quality development of the company.

　　Iv. analysis of core competitiveness during the reporting period

　　(A) technological innovation and R&D advantages

　　As the first company in China to master the technology of industrialized production of insulin analogues, Ganli Pharmaceutical has been adhering to the business philosophy of "quality first and innovation forever" since its establishment, and has successfully developed a number of third-generation insulin analogues, covering three functional market segments of insulin: long-acting, quick-acting and premixed. While constantly impacting the ceiling of diabetes treatment, the company shoulders the mission of "providing higher quality drugs and services for human beings" and actively participates in the research and development of drugs for endocrine and metabolic diseases related to diabetes, such as obesity/overweight and lipid lowering, aiming at bringing more and better treatment options to diabetic patients. The company adheres to the principle of combining imitation with wound, and not only continues to deepen the research and development of new drugs for diabetes and related indications, but also carries out drug research and development for other indications. At the same time, the R&D process of innovative drugs and generic drugs was rapidly promoted, and the R&D pipelines of chemical drugs, eukaryotic and prokaryotic protein projects, tumors and cardiovascular and metabolic diseases were continuously expanded, which injected new vitality into the company’s sustained and long-term development. Moreover, by integrating diverse resources, we actively carry out exchanges and cooperation at home and abroad, further improve the company’s R&D strength, and inject more vitality into the company’s long-term sustainable development.

　　The company regards R&D as the "lifeline of sustainable development", and continuously strengthens the R&D investment and capacity building of the drug research and development team. By setting up Post-Doctoral Research Center, the company will jointly train postdoctoral researchers with postdoctoral mobile stations in national key universities such as Peking University and Tsinghua University, so as to enhance the academic level of the company in the field of drug research. At the same time, creative R&D incubation platforms have been established, such as insulin platform, antibody platform, pharmacological toxicology platform and analysis platform. After years of development, the company has established a perfect R&D management system, covering the whole process of drug development from target research, preclinical research, translational medicine research, clinical trials and so on, so as to ensure the project to achieve the expected goals.

　　The company’s clinical team has led and supported a number of R&D projects from clinical trial design, operation, registration, pharmacovigilance and other dimensions, and successfully promoted a number of projects to the clinical stage at home and abroad. Taking GZR18 injection, a research drug with indications for type 2 diabetes and obesity/overweight, as an example, the project successfully entered the Ib/IIa clinical trial stage and the II clinical trial stage in only 8 months and 12 months respectively. The company promotes the remarkable progress of the project with high efficiency. As of the disclosure date of the report, GZR101, GZR4, GZR18 injection and GZR18 tablets are all in the clinical trial stage, and are progressing normally and orderly; GLR1023 injection project has received the Notice of Approval for Drug Clinical Trials approved and issued by National Medical Products Administration (NMPA), and is accelerating the phase I clinical trials.

　　In the first half of 2023, the application for listing of insulin glargine injection, insulin lispro injection and insulin aspart injection independently developed by the company was formally accepted by the US FDA. In the second half of 2023, the company welcomed the pre-approval inspection of the US Food and Drug Administration (FDA) for three bio-similar drugs: Glargine, Laifu and Insulin Aspartate Injection. At present, the company has received the initial feedback from the FDA, and the company still needs to improve related matters. The company will complete the rectification as soon as possible according to the opinions of the FDA. Previously, the results of clinical comparative studies completed by the company in Europe and America showed that these three biologically similar drugs showed comparable pharmacokinetic and pharmacodynamic (PK/PD) characteristics with their original reference drugs, and their safety was comparable. Through this declaration in the United States, the company will further bring the gospel to more diabetic patients around the world and improve the accessibility of drugs. In addition, the marketing license applications of insulin glargine injection, insulin lispro injection and insulin aspart injection submitted by the company to EMA in Europe have also been formally accepted by EMA. In the first quarter of 2024, the company welcomed the pre-approval inspection by the European Food and Drug Administration (EMA) for three bio-similar drugs, namely glargine, lispro and insulin aspart injection. At present, the company has received the initial feedback from EMA, and is in the process of preparing for the reply. The company will actively reply to these technical questions and meet the requirements of EMA.

　　With the professional R&D team and strong independent innovation R&D capability, since 2011, the Company has successively obtained the Certificate of High-tech Enterprise. Since the establishment of the company, it has continuously improved its innovation ability and been widely recognized by many authoritative organizations and experts, among which many honorary certifications were obtained during the reporting period: In January 2023, the company won the China Pharmaceutical Bio-industry Track Award for its outstanding performance in market share and R&D investment in vertical tracks; In February 2023, it won the honor of "National Intellectual Property Demonstration Enterprise"; In March 2023, it was awarded the title of "the sixth governing unit of Beijing Pharmaceutical Industry Association"; In April 2023, it won the title of "Tongzhou District Medical and Industrial Collaborative Innovation Base"; In April 2023, the company was listed on the list of "2022 Zhongguancun listed company Kechuang 100"; In June, 2023, with continuous and dedicated investment and persistence in the field of pharmaceutical R&D, the company won the ranking of "Top 50 Biopharmaceutical R&D Strength in China in 2023" and "Top 100 Comprehensive Pharmaceutical R&D Strength in China in 2023"; In August 2023, the company won the "2023 China Pharmaceutical Industry Comprehensive Competitiveness Index"; In August 2023, the company won the title of "Best Innovative Practice Employer of 2023 Forbes China"; In October 2023, the company was selected into the list of "Top 100 Scientific and Technological Innovations of Private Enterprises in Beijing" and "Top 100 Social Responsibility of Private Enterprises in Beijing" in 2023; In December 2023, the company won again.The qualification of "national high-tech enterprise" marks one of the best practical proofs of the "scientific extreme" culture that the company adheres to; In December, 2023, the company won the title of "the most valuable investment enterprise of the year" for its pioneering activities in the international market with unshakable faith. In December 2023, the company won four consecutive "Pharmaceutical Industry Award".

　　(B) the advantages of the whole product line layout

　　As a leading China enterprise mastering recombinant insulin technology, our company has a complete insulin R&D pipeline, five insulin analogue products and one human insulin product, covering three functional insulin market segments: long-acting, quick-acting and premixed, and is the most comprehensive company in the third-generation insulin market at present.

　　The company’s main hypoglycemic product line is fully and steadily developed. In addition to the second and third generations of insulin that have been listed and mature in the market, it is actively deploying and promoting the fourth generation of insulin and more cutting-edge drugs and therapies related to diabetes treatment. At present, the research and development projects in clinical stage include GZR18 injection, GZR4 injection and GZR101 injection.

　　In addition to the above-mentioned main insulin products, the company also arranges oral hypoglycemic drugs, such as DPP-4i, SGLT-2i, oral GLP-1RA, etc. The company’s DPP-4i sitagliptin phosphate tablet is the first oral hypoglycemic drug independently developed by the company, which was approved for listing in China in June 2022. As of the disclosure date of the report, oral GLP-1RA product GZR18 tablets have completed the first administration to subjects in phase I clinical trials.

　　The company has a rich pipeline of insulin-supporting instruments and products, including reusable pen insulin syringes, non-reusable pen syringes, disposable injection pen needles and disposable insulin pen needles, which not only effectively guarantees the company’s insulin preparation product supply and service, but also provides a new profit growth point for the company.

　　In order to face the growing market demand, the company is also actively promoting capacity building. At present, the company’s capacity expansion project is progressing synchronously and orderly. It is expected that after all the projects are put into production, it will provide a strong guarantee for the commercial production of the company’s products and help the company’s entire product line layout in the field of diabetes treatment.

　　(C) Cost leadership

　　The company has experienced R&D and industrialization team, which is conducive to the rapid industrialization of laboratory results. With many years of R&D and production experience, the company has built a production factory with advanced technology and scientific process, and continuously optimized the process to ensure the quality and safety of the company’s products and control the product cost, and constantly practiced the company’s cost leadership strategy. While providing more affordable drugs for diabetic patients around the world, the company constantly promotes the process of domestic industry and technology substitution, so as to improve the quality and competitiveness of domestic products, replace imported products, achieve the goal of localization development, ensure the drug demand of domestic diabetic patients at reasonable prices, and reduce the drug burden.

　　The company adopts the strategy of whole process control, and integrates cost control into all aspects of the company’s business activities, and has carried out comprehensive and effective cost control from product research and development, material procurement, product manufacturing to product sales and after-sales service. At the same time, continuously improve the lean management and control system of the whole chain, enhance the stickiness between the chains, and help the company achieve the purpose of reducing costs and increasing efficiency.

　　After the implementation of quantity procurement, the company continuously increased product sales by virtue of the advantages of this quantity procurement, thereby enhancing the capacity utilization rate, exerting the scale effect, diluting the production cost, and further maintaining and enhancing the cost leading edge. At the same time, the company has taken effective measures such as expanding production scale, strengthening production management and optimizing resource allocation to further ensure drug quality, improve production efficiency, and ensure the supply of centralized production in many ways. In addition, with the increase of output, the fixed cost of the company’s unit product will decrease, and the scale effect will be further highlighted. The company will support the company’s continuous investment in the market and research and development by virtue of its cost advantage and scale advantage, so as to better guarantee the company’s sustainable development.

　　(D) International strategic advantages

　　During the reporting period, while maintaining stable business cooperation with many international pharmaceutical companies, the company actively expanded international team building, conducted market investment and local distribution in different regions and countries, explored international diversified markets, and actively promoted the localization process. At present, the company’s overseas approved products include all kinds of insulin raw materials, cassette injection, pre-filled injection, reusable insulin injection pen and disposable injection pen needle. In the future, the company will continue to deploy a full range of products for diabetes treatment on a global scale, and it is expected to bring more high-quality products and services to patients around the world through diversified cooperation.

　　Internationalization strategy is an important focus for the company to realize its vision of "laying out the global market". Since 2005, the Company has promoted the layout of internationalization strategy. At this stage, the Company’s internationalization strategy is:

　　1. Occupy the highland of registration standards

　　Based on the advantages of research and development of biological agents, the company has accelerated the progress of research and development projects. The company is committed to promoting domestic high-quality drugs to the global market, aiming at improving the global accessibility and affordability of insulin products, so as to stand out from the international competition and further consolidate and enhance the company’s market position.

　　In December, 2021, the company’s long-acting (GLP-1RA)GZR18 injection, which is expected to be injected once a week, was approved to carry out a phase I clinical trial in the United States with the indication of type 2 diabetes, and the first dose was completed in March, 2022.

　　As of the end of the reporting period, only two insulin glargine bio-similar drugs with interchangeability certification have been approved by the US FDA, but at present, no bio-similar drugs of insulin lispro or insulin aspart have obtained interchangeability certification in the United States. Our company, as the first biomedical enterprise in China to submit an application for the listing of insulin biological similar drugs to Europe and America, has demonstrated its potential and strength as an industry leader. The company is committed to promoting domestic high-quality drugs to the global market, aiming at improving the global accessibility and affordability of insulin products, so as to occupy a place in international competition and further consolidate and enhance the company’s market position.

　　With the advantages of local enterprises in emerging markets, the company continues to promote the registration of drugs and medical devices in emerging markets, and emerging markets have gradually become an important stage for the globalization of the company’s layout. By the end of the reporting period, the company’s insulin products have been approved in 20 overseas countries and formally sold in 18 countries. In addition, the company continues to speed up the registration of medical devices, and the disposable insulin pen needle (Xiulin needle) is the first product registered and approved by the US FDA.

　　2. Simultaneous development of the global market

　　(1) Developed markets such as Europe and America: The company signed a commercial and supply agreement with Sandoz in 2018. According to the agreement, after the approval of three biologically similar drugs, Sandoz will carry out the commercial operation of drugs in the United States, Europe and other specific regions, and the company will be responsible for drug development (including clinical research) and supply. In the future, the company is expected to seize the European and American markets through excellent product quality and cost advantages with years of experience in research, development, production and sales in the domestic diabetes drug field.

　　(2) Emerging markets: Through the two strategies of localization of preparation production and localization of operation, the company actively introduces superior resources into emerging markets, promotes the rapid development of international business, and realizes the expansion of international business territory. In view of the current international market situation, the company’s advantage of stable production capacity supply is favored by the market and recognized by customers. More customers actively seek cooperation with the company, and the company’s international sales orders are increasing, and sales revenue is accelerating.

　　V. Main operations during the reporting period

　　In 2023, the company’s operating income was 2,608,037,000 yuan, an increase of 52.31% over the same period of last year; The net profit attributable to shareholders of listed companies was 340,068,600 yuan, which turned losses into profits compared with the same period of last year.

　　VI. The Company’s Discussion and Analysis on the Company’s Future Development

　　(A) the industry pattern and trends

　　(II) Company development strategy

　　The company always takes the mission of "providing higher quality drugs and services for human beings" and focuses on human health; Adhering to the enterprise tenet of "quality first and innovation forever", we strive to explore the most urgent needs of patients and clinicians; Taking "the ultimate in science" as the core of corporate culture, we constantly innovate in academic and clinical practice, and take the vision of "laying out the global market and becoming the world’s top pharmaceutical enterprise" to provide high-quality diagnosis and treatment products and medical services for patients all over the world.

　　Based on this, the company closely revolves around the four strategies of R&D-driven, cost-leading, internationalization and talent highland to promote the sustainable and healthy development of the company.

　　R&D-driven strategy: The company always adheres to the corporate purpose of "quality first and innovation forever" and attaches great importance to independent R&D and innovation. Adhering to endogenous independent innovation as the core, we will continue to increase investment in research and development, achieve comprehensive coverage of product lines in the field of diabetes diagnosis and treatment, and further enhance the company’s market competitiveness in the field of diabetes treatment. The company will also actively invest in the research fields of chemical medicine, eukaryotic and prokaryotic protein engineering, tumor, cardiovascular and metabolic diseases, etc., and constantly provide kinetic energy for the company’s performance growth, and strive to build a world-class pharmaceutical company.

　　Cost lead strategy: that cost leading strategy is the key to keep the company’s performance grow continuously for a long time. from product research and development to product listing, from product production to product sales, the whole chain always considers the cost lead strategy, and establishes a scientific cost-benefit assessment mechanism to ensure the company’s cost advantage.

　　Internationalization strategy: At present, there are significant opportunities in the international market, and the pace of internationalization of the company in the industry continues to accelerate. By continuously developing the international market, the company will promote the scale benefits and consolidate its leading position in cost. Guided by the internationalization strategy, the company develops a long-term global layout of R&D, manufacturing and commercialization, and promotes the enterprise to become a first-class multinational pharmaceutical company.

　　Talent strategy: Talent is the basis for the company to achieve all strategic goals, and introducing, cultivating and accumulating talents is an important part of the company’s long-term planning. The company always insists on "self-worth and company vision advancing synchronously" as the cornerstone of cooperation, "scientific perfection" as the core of corporate culture, and advocates the values of talents full of resilience and result-oriented. Over the years, the company has recruited talents and built a multi-dimensional talent training system, constantly stimulating employees’ potential and innovation, and is committed to cultivating compound talents and teams with international strategic thinking. The company will continue to implement the people-oriented human resources strategy, so that all kinds of talents can show their talents in the company, so that they can apply what they have learned and grow. In order to achieve this goal, the company will constantly improve the internal incentive mechanism, assessment mechanism and post rotation mechanism to maximize the enthusiasm and creativity of employees.

　　(3) Business plan

　　In 2024, the company will consistently adhere to the enterprise development vision, implement the development strategy, and achieve the business objectives for the new year around the core business philosophy of "stable growth, innovation drive and cohesion improvement".

　　Steady growth: In 2024, the company will continue to pay equal attention to both the domestic market and the international market, comprehensively increase the market share of its products in the domestic insulin market, and at the same time accelerate the development of the international market to help double growth of the domestic and international markets. In 2024, the contract renewal of insulin purchase will be ushered in. The company will focus on the needs of patients and take the market demand as the guide to accelerate the upgrading iteration of insulin products in the domestic market. In the international market, the company will make every effort to promote the listing declaration process of existing product lines in key markets, continue to deepen sales cooperation with new and old customers, and further strengthen the overseas sales coverage of the company’s products.

　　Innovation-driven: relying on the existing mature R&D pipeline, broaden the R&D technology platform. In 2024, the company will adhere to independent innovation and research and development, focus on promoting research pipelines in the diabetes field such as GZR18 and GZR4, and strive to provide better treatment options for diabetic patients. In addition to continuing to deepen cultivation in the field of diabetes treatment, the company will gradually explore other fields, promote clinical application of multiple categories, further broaden the R&D technology platform and product pipeline layout, and seek opportunities for clinical and commercial licensing cooperation to provide endogenous growth momentum for sustainable development.

　　Enhancing cohesion: strengthening strategic management, optimizing management mechanism and improving efficiency and effectiveness are the keys to the company’s long-term development. In 2024, the company will focus on management institutionalization, system process and process informatization to realize efficient operation and value enhancement of the company. At the same time, in 2024, the company will continue to promote a scientific, extreme, pragmatic and economical corporate culture, and all departments will work together to promote the high-quality and sustainable development of the company.

　　(4) Possible risks

　　1. Industry policy risks

　　The pharmaceutical industry is one of the key industries in China, and it is also strongly supervised by the state. With the deepening of the reform of the national medical and health system and the gradual improvement of the social medical security system, China has successively issued a number of heavy policies in the pharmaceutical industry, such as: consistency evaluation of generic drugs, centralized procurement of drugs and medical consumables, and dynamic adjustment of the medical insurance drug list.

　　The company actively responded to the call of the state to reduce fees for the people, and won the bid for six products in the whole line in the centralized procurement. The company finally obtained the first year’s agreed purchase volume of 35,337,700 pieces (the first report was 16,641,800 pieces, and the weight was 18,695,900 pieces). As of May 2023, the procurement of insulin with special quantity organized by the state has been implemented in all provinces (autonomous regions and municipalities directly under the Central Government) for about one year. In the second half of 2023, according to the guidance of the state, various regions have successively formulated and issued renewal policies for their own provinces (autonomous regions and municipalities directly under the Central Government).

　　Countermeasures: pay close attention to the policy development trend of the pharmaceutical industry, adjust the business strategy of enterprises in time, and actively respond to changes in industry policies. Specific measures are as follows: (1) In addition to independent research and development of new drugs, actively seek external high-quality standards for introduction and expand product lines. (2) Refine the management of cost and quality, and reduce costs and increase efficiency to cope with the downward trend of product prices brought about by the special centralized purchase of insulin. (3) Accelerate the coverage of newly admitted medical institutions in the procurement of insulin quantity, strengthen the publicity of relevant policy requirements for the implementation of national insulin centralized procurement, actively promote medical institutions and doctors to understand the company’s product knowledge, and assist medical institutions to complete the agreed procurement quantity of centralized procurement as scheduled. (4) Accelerate the product certification in Europe and America, and open up new profit growth points for the company.

　　2. Supply risk of selected products in centralized purchasing

　　According to the requirements of the National Centralized Drug Procurement Document (Special Insulin Project), if the selected enterprise fails to fulfill its supply commitment, which affects the clinical use or causes serious quality problems of the selected product, the relevant enterprise will be listed in the "violation list", and its declaration qualification or selection qualification may be cancelled. At the same time, the enterprise or insulin products involved will be disqualified from participating in centralized drug procurement activities in various places within 2 years from the date of listing in the "violation list" according to the seriousness.

　　The company obtains a relatively high agreed purchase quantity in the procurement of insulin. If the company is affected by changes in the international political situation and large fluctuations in the exchange rate, there will be problems in the supply of raw materials and consumables, insufficient capacity arrangement or major quality problems in the supplied products, which may cause the supply risk of the selected products in centralized procurement. If the company has the above problems, it may face the risk of entering the illegal list, which will lead to the company’s loss of relevant market share and significant fluctuations in operating performance.

　　Countermeasures: (1) The company further promotes the localization process of raw materials and consumables to cope with the instability of international supply. (2) The company continuously strengthens the promotion of production capacity upgrading and supply guarantee, and makes reasonable inventory reserves. (3) Carry out lean production activities, improve the toughness of the supply chain, and take centralized procurement of the winning products as the first priority to ensure efficient production, quality first and stable supply. (4) At the same time, accelerate the construction of incremental capacity projects and enhance the company’s capacity scale.

　　3. Single income structure and risk of technical iteration

　　Relying on its own core technology and research and development strength, the company focuses on the field of diabetes treatment. The company’s operating income mainly comes from the sales of insulin preparations and insulin dry powder. Focusing on the field of diabetes treatment makes the company have significant product technology advantages, but it also makes the company face the risk of single income structure.

　　If subversive innovative technology appears in the field of basic research and application transformation, it may promote the research and development of innovative drugs with higher safety and effectiveness, which will have a potential impact on the existing listed products, greatly reduce the demand for insulin preparations, and then have a relatively adverse impact on the company’s operating performance. In addition, the scale of the overseas market for diabetes should not be underestimated, and the company’s current operating income mainly comes from domestic sales income, and international sales income accounts for a small proportion of operating income, which is not conducive to the enterprise becoming bigger and stronger.

　　Coping measures: (1) The company strengthened its R&D and innovation ability, and made continuous efforts in studying the formation mechanism and drug action mechanism of diabetes, exploring new targets, drug design, clinical trials and other aspects to promote the rapid transformation of new hypoglycemic drugs. (2) The company actively expands overseas business, strengthens cooperation with overseas customers, and increases the proportion of international business income to operating income. (3) The company strengthens cooperation with Industry-University-Research of universities and research institutes, distributes therapeutic drugs in many fields such as tumors and autoimmune diseases, enriches the company’s product pipeline, optimizes the company’s income structure, and ensures the sustainability and stability of the company’s profitability.

　　4. Innovative drug research and development faces the risk of uncertainty.

　　New drug research and development has the characteristics of long research and development cycle, high research and development investment and low success rate. From the early research and development of innovative drugs, clinical trials to production and listing, every link may face the risk of failure. In addition, considering that the development cycle of new drugs is too long, the future product listing may face the uncertainty of market competition. If the new drugs developed by the company cannot meet the changing market demand or face a more intense market competition environment after the new drugs are listed, it will adversely affect the growth of the company’s operating performance and the sustainability of profitability.

　　Countermeasures: (1) On the one hand, based on the current domestic clinical needs, the company develops new MeToo drugs with similar efficacy and safety or better MeBetter drugs on the basis of international new drug products; On the one hand, taking advantage of the company’s R&D platform, we gradually try to develop Class I new drugs. (2) Establish a scientific decision-making system. The company gives full play to its experience in new drug research and development, grasps the cutting-edge technology of science and technology in time, and ensures the scientific decision-making process of the project so as to make correct decisions. (3) The company conducts technical evaluation and risk control on the early stage of R&D projects (such as track selection, R&D cycle, cost and other inputs and economic benefit output evaluation, the influence of industry policy trends on the income of new drugs, and the iteration of new drug use technology, etc.) and key nodes, and tracks them in time during the R&D projects, so as to grasp the major nodes in the R&D process and reduce the R&D risks. (4) The company actively seeks high-quality resources suitable for the future development strategy, and cooperates with complementary biopharmaceutical R&D and innovation enterprises with cutting-edge technological advantages, thereby enhancing the R&D capabilities of enterprises, expanding product pipelines and continuously improving the core competitiveness of enterprises. (5) The company evaluates the input-output ratio of each link of R&D, outsources the R&D links with low added value, and makes corresponding organizational structure adjustment to speed up the process of listing new drugs.

"This is Daxing" WeChat in WeChat official account. From 15: 00 on November 23rd to 15: 00 on November 24th, there were 83 new COVID-19 virus-infected people in Daxing District, including 62 quarantine control personnel and 21 social screening personnel, all of whom have been transferred to designated hospitals for treatment. The main activity tracks in Beijing are as follows:

November 19th

00:00-00:15 Night fire roast bar in the north area of Nanting Xinyuan, Fengtai District;

09:05-09:20 Tiantangyuan Snack Public Welfare Xiqiao Store in Fengtai District;

10:00-19:00 3+ hair salon on the third floor of Chongwen Store, New World Department Store, Dongcheng District;

20:20-22:00 Talk about a small entertainment 24-hour billiards hall near Tongxing Garden, Xihongmen Town, Daxing District.

November 20 th

00:00-24:00 Middle Gate of Xindian, Haizijiao, Tiangongyuan Street, Daxing District;

08:40-19:00 Mujiushi counter of New World Department Store (Chongwenmen Store) in Dongcheng District;

09:50-18:00 Chaoyang District Yaojiayuan City Legend Vitality Oriental Outlets Factory Store Training Institution;

10:00-19:00 3+ hair salon on the third floor of Chongwen Store, New World Department Store, Dongcheng District;

10:45-11:50 Badoutong International Education Plaza, Qingyuan Street, Daxing District;

13:00-13:40 Dining Hall of Dahongmen Store in Jimei Furniture City, Fengtai District;

13:50-14:00 Billy Restaurant in Haidian District (F1 Floor, Jin ‘ao Building, No.19 Madian East Road);

14:10-16:00 Floor 3, Hyde Hot Spring Hotel, Chaoyang District;

15:00-16:10 wu mart Jianxing Store, Linxiao North Road, Linxiao Road Street, Daxing District;

15:45-16:00 Jiaguole Fresh Supermarket in Xihongmen Town, Daxing District (Xinghai Yueyuan Community, Huangliang Road)

16:30-16:40 Haizijiao Erwei Barbecue Shop and Tobacco Hotel in Tiangongyuan Street, Daxing District;

17:00-18:00 Huilongguan Store of Yonghui Supermarket in Changping District;

18:00-19:10 Fengtai District Beicai Convenience Market is equipped with optical shops and Tujia dregs cake shops;

18:50-19:10 Guankelong Supermarket in Shuanghe South Lane, Huangcun Town, Daxing District;

19:40-19:50 jiugong town Shouhang Supermarket Runxing Home Store in Daxing District;

20:20-21:50 Yonghui Supermarket, Dongpo, Meizhou, Hongkun Shopping Mall, Xihongmen Town, Daxing District;

23:30-24:00 Beijing Jiayuan Tangquan (No.38 Qingyuan Road), Qingyuan Street, Daxing District.

November 21st.

00:00-07:30 Xixiang Store, No.3 Middle School, Bowen Net City, Linxiao Road Street, Daxing District (Floor 2, Building 8, No.27, middle section of Xinghua Street);

00:00-24:00 Middle Gate of Xindian, Haizijiao, Tiangongyuan Street, Daxing District;

07:30-08:25 Waiting room and bathroom on the second floor of Chaopeng Xingkang Physical Examination Center in Sanzhong West Lane, Linxiao Road Street, Daxing District;

08:30-08:40 China Lanzhou Beef Lamian Noodles, the bottom of Building 8, Sanhe Nanli Community, Xingfeng Street, Daxing District;

09:00-09:15 Huaxia Bank (Building 1, No.5 Courtyard of Jinxing West Road), Block D, Greenland Central Plaza, Panggezhuang Town, Daxing District;

09:00-10:00 Land Department of Yangzhen Town, Shunyi District;

10:30-12:00 The nearest men’s bathroom of Lingshuai Company on the third floor of Meibo Building, Flower of the World Holiday Plaza, jiugong town, Daxing District;

10:40-11:00 Luogulou Steamed Bread Shop, Qingyuan Street, Daxing District;

11:55-19:00 Colorful Yunnan Store on the first floor of the second phase of New World Department Store in Dongcheng District, and the women’s bathroom on the B1 floor;

12:05-12:30: Sheng Ziyue, the bottom merchant of Rainbow New Town, Qingyuan Street, Daxing District, has a skin care styling haircut;

13:35-14:20 Floor 1, Building 7, City Mingyuan Beauty Salon, Chaoyang District;

13:45-13:55 Water station of the bottom shopping supermarket in Weierli Apartment, Xihongmen Town, Daxing District;

14:00-14:30 Naixue tea shop on the first floor of Longhu Tianjie, Yizhuang Town, Daxing District;

14:40-14:55 Female toilet on the first floor of Yinghai Brigade of Daxing District Environmental Monitoring Detachment, Yinghai Town, Daxing District;

17:00-24:00 jiugong town Nanjiao Hotel, Daxing District;

17:20-17:30 No.80 Pharmacy, Beijing Dongsheng Tianbaotang Chain Pharmacy, Shuanghe Nanli, Kannonji Street, Daxing District;

18:00-18:15 Ideal City Store of Shoulian Youxian Supermarket in Xihongmen Town, Daxing District;

18:10-20:00: Spicy boiled beef shop, POP MART shop, famous boutique shop and original Maishanqiu shop in Longhu Tianjie, Yizhuang Town, Daxing District;

20:10-20:20 Gufangyuan Mushroom Chicken Shop, Jiuzhong Road, Ma Chunguang, jiugong town, Daxing District;

20:25-20:35 jiugong town Yungou Fresh Supermarket in Daxing District and Beijing Linxingtang Good Pharmacist Pharmacy (the bottom business of Yulong Jiayuan in Jiuzhong Road);

20:35-21:00 Shopping at Green Fresh Supermarket in Huangcun Town, Daxing District;

20:40-21:00 Shanshan IOT Supermarket and Boyikang Pharmaceutical Co., Ltd. in Beizang Village, Daxing District;

November 22nd.

00:00-05:00 Middle Gate of Xindian, Haizijiao, Tiangongyuan Street, Daxing District;

07:10-07:40 Hongxing Erguotou Hualian Lifestyle Supermarket in Shaduiying Village, Qingyundian Town, Daxing District;

09:25-09:35 Oriental Kangsheng Pharmacy and KFC on the 1st floor of Vitality Oriental Shopping Plaza, Yaojiayuan Road, Chaoyang District;

10:00-10:35 Meilianfu Supermarket in Dazhang Village, Beizang Village, Daxing District;

10:25-10:40 Hongkun Plaza Store of Yonghui Supermarket in Xihongmen Town, Daxing District;

10:45-10:55 Babi Xianbao Dongxi Street Store in Jiugong Town, Daxing District;

11:15-11:45 Shopping at Xinfeng Ruilian Comprehensive Supermarket in Huangcun Town, Daxing District;

13:30-19:00 Flagship Store of Xinyang International Beauty Salon in Fengtai District;

13:50-14:20 Ouqianna Beauty Salon in Fengtai District, 2-6 new generations of GOGO in Fanggu Garden;

14:55-15:25 Wanfucheng Convenience Store in Xizhihe, Chaoyang District;

15:00-15:20 Le Jing Lifestyle Supermarket in Xihongmen Town, Daxing District and Gaoji Baikang Pharmacy near Xingduyuan Community;

16:15-16:35 Xuji Beef Noodles in unit9 Apartment, Xihongmen Town, Daxing District;

20:30-20:50 Shopping in Forand Supermarket, Qingyundian Town, Daxing District;

20:40-20:50 jiugong town Jiugong Hongyun Tobacco and Liquor Hotel, Daxing District.

Please report to the community (village), work unit and hotel where you live, and cooperate with the implementation of various control measures.

Here, I would like to remind the general public and friends to raise their awareness of protection, reduce unnecessary going out, advocate not leaving Beijing unless necessary, and abide by various epidemic prevention regulations. Home isolation and people living together should obey the unified management of the community (village), strictly stay at home, do not go out or visit, and cooperate with various prevention and control measures such as nucleic acid detection, antigen self-test and health monitoring; Open the window for ventilation every day, do a good job in ventilation and disinfection of shared areas such as toilets and bathrooms, reduce contact with people living together, do not share daily necessities, and keep a safe distance when contacting, wear masks and do personal protection. When you have to go out, you should take personal protective measures such as wearing a mask and keeping a safe social distance, and actively vaccinate. If you feel unwell, especially with respiratory symptoms such as fever and cough, you should seek medical treatment in time according to regulations.

Reporter Cha Rui

The "6 18" shopping festival has just come to an end, and express delivery is about to reach its peak. In Whale Warehouse-1 Logistics Warehouse, 42 containers "Spider-Man" shuttled through the 9-meter-high shelf gap. AI was their brains, and their task was to "get the boxes". Once the order is received, these "Spidermen" will accurately locate the box where the goods are stored in milliseconds, and quickly transfer it to the goods picking platform. The whole process takes only two minutes.

Different from previous years, these "Spidermen" have achieved "winding" for the first time in the industry, and all operational data are encrypted and circulated on the blockchain network, laying the foundation for the large-scale development and credible cooperation of the warehousing and logistics industry.

Seize the opportunity of the digital transformation of the real economy, while opening up its own "isolated island" of technology, domestic blockchain has found an industrialization road in the fields of finance, logistics and carbon reduction.

Break the "island"

Recently, the national standard "Blockchain and Distributed Accounting Technology Reference Architecture" was officially released and will be implemented on December 1 this year. This is also the first national standard in the blockchain technology field approved for release in China. According to the national standard, blockchain is a new database software integrating distributed network, encryption technology, smart contract and other technologies. At present, this national standard has been applied in hundreds of typical blockchain enterprises.

In the early days of the industry, different blockchain systems have different technical routes in communication protocols and identity management, and most of them are independent of each other, forming numerous "islands", which are not conducive to interconnection objectively and affect the efficient cooperation among institutions. At present, the demand for cross-chain interoperability is becoming more and more urgent. The key of blockchain from "local area network" to "Internet" lies in the need for "language communication" between different blockchain systems. After cross-chain, each chain becomes an interconnected and open ecosystem from an "island". Cross-chain technology can realize safe and credible information interaction between different blockchain systems, realize data exchange and value flow, and open up the boundary of "language", which is the technical basis of blockchain ecological prosperity.

"The introduction of national standards is only the first step. With national standards, enterprises can cross the chain more effectively." Li Ming, Chairman of the Standardization Committee of Blockchain and Distributed Accounting of IEEE (Institute of Electrical and Electronics Engineers) Computer Association, said that the cross-chain standard agreed on a unified communication protocol, just like letting people who used different dialects start speaking Mandarin in the past, which will greatly reduce the cost of interoperability.

"From now on, there have been three major trends in the development of domestic blockchain: platformization, componentization and integration." Li Ming told reporters that at present, all localities have their own blockchain services, such as Chang ‘an Chain, Shuxin Chain and Haihe Chain. These blockchains have formed platforms, and related enterprises can develop applications on existing platforms without building the underlying system, reducing development costs. At the same time, the key technologies of blockchain can be packaged separately, such as smart contracts and digital signatures, which can form independent products. With the further subdivision of blockchain industry, independently packaged components can improve system flexibility.

He also said that like a new generation of information technology such as artificial intelligence, blockchain is also a data-oriented technology, and integration with other technologies is an inevitable trend. For example, privacy computing and the Internet of Things are deeply related to blockchain. In addition, the demand for data interaction between different blockchain systems such as energy chain, financial chain and copyright chain requires not only cross-chain capability, but also the integration and coexistence of distributed and traditional centralized systems of blockchain.

Tamp the base

While the blockchain is constantly iterating, the application scenarios are also expanding. The new national standard recognizes blockchain as an important part of the new generation of information technology and an important technical support for the development of digital economy.

The intelligent three-dimensional storage system of the whale warehouse "Spider Man" is one of the examples of the blockchain empowerment industry. Li Linzi, the founder of Whale Warehouse, introduced that there are more than 2.5 million items of more than 40 brands stored in the 6,000-square-meter warehouse, the storage capacity is six times that of the traditional warehouse, the space utilization rate of the warehouse has increased from 10% to 85%, and the efficiency has also increased by three times. For better and more efficient cooperation, Whale Warehouse adopts blockchain and Internet of Things technology, and realizes the encryption of the operation information, order and fund transaction information of the picking system, so that many parties can look at a trusted account book together. Because these data are authentic and rich, Whale Warehouse can lease warehouses and equipment from industrial capital at lower cost to realize asset-light strategy.

In the capital market, the involvement of blockchain can also reduce credit risk and provide financing guarantee for innovative enterprises. Huidian Yunlian, an energy service provider, has participated in the construction of several energy storage power station projects at home and abroad. However, the pain points faced by the development of the global energy storage industry, such as security risk, quality assurance cycle risk, performance uncertainty and income uncertainty, have led to large risk exposure and financing difficulties between the demand of power station owners and the service system of equipment suppliers. To this end, Huidian Yunlian cooperated with Ant Chain to establish a full-cycle data, algorithm and digital technology service system based on materials, components, systems, scenarios and residual values, so that the data of energy storage projects can be trusted, the risks can be quantified, and the value can be evaluated. The energy storage system and the data sources such as asset evaluation, asset management and asset operation in the whole life cycle of the project are "wound up", which finally attracted Yicun Capital to provide financial solutions and financial support.

Blockchain has long been practiced in preventing people’s livelihood such as telecommunication network fraud. Ant Chain, the first anti-fraud alliance chain based on blockchain technology in China, solved the problem of risk information sharing through the cooperation of data on the chain with public security, people’s bank of China and operators, handled more than 2.4 million pieces of early warning data in one year, protected the victims’ fund accounts 1380 times, intercepted 13.4 million yuan of cheated funds, and safely shared 10 million pieces of black and gray data. This practice has also been included in the "Typical Application Case of Blockchain in 2022" of the Ministry of Industry and Information Technology.

Shanghai opportunity

According to IDC, a well-known research organization, it is estimated that the global blockchain market will reach US$ 18.95 billion in 2024, and the market size of China is expected to exceed US$ 2.5 billion, and the market size is expected to remain the second in the world. Faced with this billion-dollar market, Shanghai has already taken the lead in layout. According to the Report on Comprehensive Index of Urban Blockchain in China in 2021, Shanghai’s comprehensive index of blockchain ranks second in China, and there are nearly 1,400 blockchain enterprises with input and output in China, with Shanghai accounting for about a quarter. Among the units involved in drafting the national standards for blockchain, there are also Shanghai figures such as Ant Blockchain, Chain Intelligent Technology, Fudan University and Shanghai Computer Software Technology Development Center.

At present, speculation in virtual currencies such as Bitcoin is explicitly prohibited in China, but transactions such as NFT digital collections are already in the exploration stage. As early as July last year, Shanghai explicitly supported the exploration of NFT trading platform construction, and studied and promoted the digitalization of NFT and other assets, the global circulation of digital IP, and the protection of digital rights in Shanghai.

At the level of blockchain and digital assets, Shanghai has clearly defined the direction of industrialization and marketization. The "Three-year Action Plan for Promoting High-quality Development of Manufacturing Industry in Shanghai (2023-2025)" points out that in the implementation of the action plan of "four new tracks" and "five future industries", it is necessary to develop new digital economies such as blockchain and Web3.0, and promote major applications of the Meta-universe. In August last year, Shanghai Data Exchange set up the first digital asset section in China, and this year, it linked major domestic blockchain enterprises to strive to achieve cross-chain interconnection of blockchain. According to reports, in order to realize the interconnection of assets on the chain, the Shanghai Data Exchange has formed a "three-step" plan, which will build a credible hub for blockchain interconnection, formulate relevant standards for digital cultural and creative blockchain applications, and activate multi-scenario applications of cultural and creative resources.

At the end of last year, "Shanghai Carbon Bank", a carbon inclusive platform settled in digital RMB, was launched. Shanghai residents can take the subway or ride a bike to calculate carbon emission reduction according to their mileage, and users’ daily low-carbon behavior income can be converted into digital RMB in real time. In order to make carbon assets visible, available and measurable, blockchain deposit certificate and smart contract are adopted, and the data of carbon assets can be realized by code without human intervention.

"Shanghai’s blockchain application scenarios are particularly rich, and the financial industry, shipping industry and logistics industry are highly developed. Most of the blockchain businesses can find landing scenarios in Shanghai." Li Ming said that Shanghai’s policy support for blockchain is very strong, and its talent advantage is second to none in China. "Blockchain requires compound technical talents, integrating cryptography, programming languages, computer networks and other majors, and usually requires talents with higher professional skills. Shanghai is just a gathering place for relevant talents." He also believes that Shanghai has hatched many blockchain companies, and "killer" applications may appear in the future in commercial operations.

In the cross-river tunnel between popularization of science park station and danshuichi station of Wuhan Metro Line 12, the construction workers are working nervously on multiple faces. Photo courtesy of the correspondent.

　　At the depth of more than 30 meters at the bottom of the Yangtze River, the giant "earth tiger" is fully excavating; In Huashan, Wuhan, the subway line 19 tunnel has quietly crossed Yanxi Lake; In Wuchang South Area, the starting point adjustment project of Line 5 (Phase II of Line 5) is undergoing joint debugging and testing … … In the past few days, hundreds of work sites in Wuhan Metro have set off a great upsurge and made every effort to sprint the annual construction target. Jimu journalist learned from Wuhan Urban Construction Bureau that this year, the city plans to implement 13 subway projects with a total mileage of 182.8 kilometers, and build the second phase of Line 5 and Line 19.

　　Shield machine successfully crossed the Yangtze River levee.

　　At 9: 00 a.m. on June 3, the ring line of the subway in Asia’s largest city, Wuhan Metro Line 12, sent another good news — — In the river-crossing section from Popular Science Park Station to Danshuichi Station, the "Jiangcheng hms illustrious" shield machine successfully advanced to the 540th ring road, successfully breaking through 1080m, and safely realized two first-class risk sources, such as the shield machine originating and crossing the Yangtze River levee.

　　At the entrance of the construction site of the Popular Science Park Station, a row of cutters replaced by the shield machine are displayed, with an average diameter of about 45 cm and various shapes, which are like the "teeth" of the shield machine. When the shield machine digs underground, it relies on these teeth to "chew" obstacles such as rocks, mud and gravel to ensure the smooth progress of the shield machine.

　　"Don’t underestimate these knives, they are so small and worth 20,000 to 30,000 yuan." Ren Ruhua, project manager of China Railway 14th Bureau, the construction party, introduced that these cutters are divided into hobs, scrapers, tearing knives, etc. according to their different functions. They are installed on the cutter head of the shield machine in an orderly manner, and they cooperate with each other during construction to "gnaw" hard bones.

　　The shield machine has a diameter of 12.55 meters and a height of about 4 floors. There are 206 cutters installed on the cutter head at one time. "Because of the complicated geology, the cutters wear quickly. At present, we have replaced 350 cutters, which is equivalent to spending nearly 10 million yuan to replace 350 teeth for the shield machine." Ren Ruhua joked.

　　Jimu journalists enter the underground tunnel through the construction stairs. The tunnel that has been formed is very spectacular, and the tunnel segments are assembled neatly and seamlessly.

　　Zhou Xun, the owner’s representative of Wuhan Metro Group, said that segment construction is a very key link in subway construction, and its quality directly determines the safety of subway tunnels, and there should be no carelessness.

　　A segment weighs 13.5 tons. In the tunnel, a journalist saw a double-headed flatbed truck specially for transporting segments, which has a cockpit at both ends and can move forward and backward freely, which can solve the problem of vehicles turning around in the tunnel.

　　The section from Science Park Station to Danshuichi Station is about 4 kilometers long, which is the longest subway tunnel under construction in China. Line 12 is the first subway loop in Wuhan and the largest subway loop in Asia, with a total length of 59.9 kilometers and 37 stations. The line crosses the Yangtze River twice and the Han River once.

　　The "fastest" subway is scheduled to open to traffic this year.

　　"Now our interval tunneling task has been completed 98%, and victory is in sight!" On the morning of June 4th, Yin Huabin, project secretary of China Communications First Bureau, the construction party, said excitedly at Gujiashan Station, Bid 8 of Wuhan Metro Line 19.

　　The shield construction of this bid section is from Gujiashan Station to Wudong Station, with a total length of 3.2 kilometers, of which 1.1 kilometers goes under Yanxihu Section. In order to ensure the smooth crossing of Yanxi Lake, the most suitable shield machine was selected by repeated comparison before construction, and industry experts were invited to repeatedly demonstrate the construction plan and make detailed disclosure to the construction supervisors. During the shield machine crossing the lake, the builders used the remote monitoring system of the shield machine to carry out 24-hour uninterrupted monitoring. At the same time, they also used drones, telescopes and ships to patrol the water surface of Yanxi Lake every day. "We rented a small fishing boat to patrol the lake with drones, and found problems in time by checking whether the water body is bubbling or not, so as to start emergency plans and ensure that emergency rescue work can be carried out in time and effectively." Yin Huabin said.

　　In a clean and tidy tunnel, Zhou Hao, the second-level project manager of Wuhan Metro Group, said: "The tunnel segment damage, dislocation and water seepage have always been common quality problems in the process of shield tunneling. In order to effectively improve the engineering quality and create excellent projects, we strictly control the segment production from the source, and strive to create a pollution-free, dislocation-free, leakage-free and overrun-free ‘ Five tunnels ’ 。”

　　According to reports, Wuhan Metro Line 19 is designed to operate at a speed of 120 kilometers per hour, with a long-term operating condition of 140 kilometers, which is called the "fastest" subway line in Wuhan. It is expected to be opened for operation within this year, when residents in Guanggu area can go directly to Wuhan Railway Station through Line 19.

　　Steadily enter a world-class subway city

　　On the afternoon of June 4th, on the track of the starting point adjustment project of Wuhan Metro Line 5, the test train runs every 5 minutes and "gallops" back and forth between Hongxiacun Station and University of Traditional Chinese Medicine Station.

　　"This is an unmanned line, and it has to be docked with the first-phase site, so the debugging period of each system is several times that of ordinary lines." Yin Lei, the second-level project manager of Wuhan Metro Group, said that the joint debugging test is currently being carried out, and a systematic "physical examination" is carried out around the signal system, vehicle system, integrated monitoring system and communication system. During the joint debugging and test, the project team focused on the key parts, focusing on stations, yards, substations and other places, doing a good job in the investigation of potential safety hazards, maintenance and equipment operation, and strictly implementing various safety precautions.

　　In the joint debugging test, the smooth track has been affirmed by all parties. Zhou You, director of the Engineering Department of China Railway Shanghai Engineering Bureau, told the reporter that the starting point adjustment project of Line 5 benefited from the fact that they "grafted" the high-speed rail technology into the subway track laying, and controlled the track laying accuracy within 1 mm, which was much higher than the industry standard of 3 mm. "This will provide passengers with a more comfortable ride experience."

　　It is reported that since the opening of the first rail transit line in Wuhan in 2000, Wuhan rail transit has realized the historical transformation of "from scratch, from single line to network". At present, 11 lines have been opened and operated, with a total of 291 stations, steadily ranking among the top ten "metro cities" in the world. According to the relevant approval of the National Development and Reform Commission, by 2026, Wuhan will form a rail transit network with 14 subway lines and a total length of about 660 kilometers, and fully realize the "main city network and new city line".

　　Focus on cutting-edge scientific and technological innovation and upgrading of traditional industries

　　With the popularity of the Internet, sensors and various digital terminal devices, an interconnected world is taking shape. At the same time, with the explosive exponential growth of data, digitalization has become the basic force to build a modern society, and it has pushed us towards an era of deep change.

　　So, how much data can our world produce every day in this new era of surging digital torrent?

　　In order to have a general idea of the data units in the following content, we can learn about each data unit first.

　　1B (Byte byte) =8b (bit bit)

　　1KB (Kilobyte kilobyte) =1024B.

　　1MB (Megabyte "megabyte" for short) =1024KB.

　　1GB (Gigabyte is also called "gigabit") =1024MB.

　　1TB (Trillionbyte terabyte) =1024GB

　　1PB(Petabyte petabyte) =1024TB.

　　1EB(Exabyte billion bytes) =1024PB.

　　1ZB (Zettabyte ten trillion bytes) =1024EB.

　　1YB (Yottabyte billion bytes Yao bytes) =1024ZB.

　　Whether it is email sending, video uploading, daily online search, or even daily data collection of self-driving cars, we will find that the amount of data formed in the Internet age is incredible.

　　In 2025, the amount of data generated worldwide will reach 491EB every day.

　　According to the report "Data Age 2025" released by IDC, the annual data generated in the world will increase from 33ZB in 2018 to 175ZB, which is equivalent to 491EB of data generated every day.

　　So how big is the data of 175ZB? 1ZB is equivalent to 1.1 trillion GB. If all 175ZB are stored in DVD, the height of DVD stack will be 23 times that of the Earth and distance to the moon (the nearest distance between the Moon and the Earth is about 393,000 kilometers), or it will circle the Earth 222 times (one circle is about 40,000 kilometers). At present, the average Internet speed in the United States is 25Mb/ s, and it will take 1.8 billion years for a person to download the 175ZB data.

　　With the popularity of Internet of Things infrastructure, smart phones and wearable devices, each of us is generating a lot of data all the time. We have also completely become digital individuals.

　　According to IDC’s forecast, in 2025, every connected person in the world will have an average of 4,909 data interactions every day, more than eight times that of 2015, which is equivalent to generating one data interaction every 18 seconds.

　　In 2019, the world sent and received 293.6 billion emails every day.

　　E-mail is one of the important channels for users to obtain information daily, especially for enterprise users.

　　According to the statistics of Radicati Group, the number of global e-mail users reached 3.8 billion in 2018, that is, more than half of the global population used e-mail.

　　In 2018, the total number of commercial and consumer e-mails sent and received worldwide exceeded 281.1 billion. It is estimated that the number of e-mails per day will reach 293.6 billion in 2019 and 333.2 billion by the end of 2022.

　　Interestingly, even though the total number of e-mails has been increasing, the growth rate has been decreasing year by year. There is obviously the influence of social media and more convenient mobile communication.

　　A connected car will generate 4TB of data every day.

　　According to Intel’s prediction, in 2020, a networked self-driving car will generate 4TB of data every 8 hours. This mainly comes from the hundreds of on-board sensors that self-driving cars will have. Intel said that only the camera can generate 20-40Mb of data per second, while the lidar will generate 10-70MB of data per second.

　　Brian Krzanich, CEO of Intel Corporation, said that in 2020, Internet users will generate 1.5GB of data every day. Based on this calculation, each connected car driving on the road will generate about 3,000 people’s data. And 1 million self-driving cars will generate 3 billion people’s data.

　　In 2025, the global Internet of Things connected devices will reach 75.44 billion.

　　The ubiquitous Internet of Things devices are turning the world into a "digital earth". According to HIS data, by 2025, the total installed capacity of Internet of Things (IoT) connected devices in the world is expected to reach 75.44 billion, about five times that of 2015.

　　Wearable devices are an important part of all kinds of networked devices. It is predicted that by 2020, global wearable devices will generate 28PB of data.

　　There are 5 billion online searches every day in the world.

　　In the Internet age, search engines have become an important channel for people to find daily solutions. It has become the normal state of work and life to search if you have something to do. Especially with the popularity of smart phones, we are generating search data anytime and anywhere.

　　According to Smart insight, there are currently 5 billion searches every day in the world, of which 3.5 billion are from Google, accounting for 70% of the global search volume, which is equivalent to processing more than 40,000 searches per second. Back in 2000, at that time, Google searched only 14 billion times a year.

　　Ubiquitous social data

　　Smartphones make people’s social life completely digital, spend more and more time on social networks every day, and the amount of data generated is correspondingly increasing.

　　According to Facebook statistics, Facebook generates 4PB of data every day, including 10 billion messages, 350 million photos and 100 million hours of video browsing. In addition, on Instagram, users share 95 million photos and videos every day; Twitter users send 500 million messages every day.

This article first appeared on WeChat WeChat official account: Capital Lab. The content of the article belongs to the author’s personal opinion and does not represent Hexun.com’s position. Investors should operate accordingly, at their own risk.

[ITBEAR] The plug-in hybrid SUV with long battery life was launched on the evening of November 18th. This new car has attracted wide attention with its excellent pure battery life and luxurious configuration. As a upstart in the plug-in hybrid SUV market, Fengyun T9 Long Life Edition only launched one model, but offered a variety of car purchase discounts, including the manufacturer’s subsidy replacement price of 168,900 yuan and the limited-time national compensation price of 148,900 yuan, and the market guidance price of 183,900 yuan.

Fengyun T9 Long Life Edition shows a strong visual impact on the design. The body lines are smooth and elegant, and the overall shape is full and round, showing the temperament of a luxury SUV. The closed middle net design highlights the new energy attribute, while the shape of diversion grooves on both sides of the front gives the new car a sense of movement. In terms of body size, the length, width and height of the new car are 4795/1930/1738(1741)mm and the wheelbase is 2770mm, which ensures a spacious interior space.

Viewed from the side, Fengyun T9 Super Long Endurance Edition has slender body lines, and the third row of side windows has a large area, providing passengers with a good view and a comfortable space experience. In the rear part, the penetrating taillights become the biggest bright spot, which has high recognition and excellent visual effect after lighting. The exhaust layout of two sides further enhances the sports properties of the new car.

In terms of interior, Fengyun T9 Long Life Edition adopts the popular smart cockpit design, which is simple and full of science and technology. There are almost no physical buttons in the center console, and it is replaced by a 15.6-inch central control panel with built-in Qualcomm Snapdragon 8155 chip and 5G Gigabit Ethernet, which provides a smooth operation experience. The new car is also equipped with a 50W wireless charging panel with heat dissipation function and a knob-type function button, which is convenient and practical. The interior has added amber brown color matching, which enhances the overall luxury.

In terms of power, Fengyun T9 Long Life Edition is equipped with Kunpeng Super Hybrid C-DM system consisting of 1.5T engine and motor. The maximum power of the engine is 115 kW, the maximum power of the motor is 165 kW, and the maximum power of the system is as high as 280 kW. The transmission system was upgraded from single-speed DHT to a three-speed DHT hybrid special gearbox, and equipped with a 34.46 kWh lithium iron phosphate battery pack, which improved the pure electric endurance to 210 kilometers. The new car also supports super fast charge and 6.6 kW high-power external discharge function, which can charge the power from 30% to 80% in just 20 minutes. The new car is also equipped with CDC "magnetic levitation" suspension system, which further improves the driving stability and comfort of the vehicle.

　　[Global Network Reporter Fu Jiajun] According to a report in Seoul News of South Korea and Daily News of Japan on the 9th, a famous Japanese artist, Hiroshi Ono, made insulting remarks about Chinese in the early activities of the local large-scale international street performing arts festival "2022 Avenue Art World Cup" last month. After its related remarks caused controversy, it was also fiercely denounced and criticized. In the end, Okuno was resigned from his post in the organizing committee of the festival, and a press conference was held on the 7th of this month to make a public apology.

　　On the 7th of this month, Japanese artist Hiroshi Ono held a press conference to publicly apologize for his earlier insulting remarks. Source: Daily News

　　According to the report, from November 4 th to 6 th, the "2022 Avenue Art World Cup" cultural activity will be held in Shizuoka, Japan. The event is the largest international street performance art festival in Asia, when street performers from all over the world will gather together to compete.

　　According to the report, Japanese artist Hiroshi Ono worked as a producer in the organizing committee of this festival. However, in a pre-competition activity on the 17th of last month, Mr. Okuno made insulting remarks that belittled Chinese, which caused great controversy. During the speech, he praised Japanese descent, claiming that "Japanese and Koreans are fundamentally different from Chinese". He also distributed publicity materials to the audience, which were printed with such insulting remarks as "One Chinese is a dragon, but two Chinese get together to be worms", which belittled Chinese.

　　According to "Seoul News", some participants present at that day expressed their dissatisfaction at that time. Since then, the controversy caused by this has continued to ferment, and his remarks have been fiercely denounced and criticized on social networks.

　　As the controversy continued to expand, Okuno held a press conference on the 7 th of this month and made a public apology. He claimed that he made an inappropriate speech based on a wrong historical understanding. According to the report, at present, Mr. Okuno has been resigned from his post in the organizing committee of the festival, and the executive chairman of the event has also resigned. In addition, in view of the controversy over racial discrimination in international cultural activities, the organizing committee of the festival will finally decide whether to hold the festival as originally planned at the end of this month.

　　() The Record Form of Investor Relations Activities was released on August 29th, and the company was investigated by 27 institutions on August 25th, 2023. The types of institutions are fund companies and securities companies. Introduction to the main contents of investor relations activities: 1. Ms. Jiang Min, Secretary of the Board of Directors and Chief Financial Officer, introduced the company’s situation. In 2023, the company accelerated the process of globalization and started a new journey of "global manufacturing, global service and global cooperation". According to the established strategic plan, the company gradually released high-quality production capacity, and the shipment scale of power and energy storage battery business grew rapidly, and the market share was improved rapidly. During the reporting period, the company achieved a total operating income of 22.976 billion yuan, an increase of 53.93% compared with the same period of last year, of which the operating income of power battery was 12.119 billion yuan, an increase of 71.92% compared with the same period of last year; The operating income of energy storage batteries was 7.072 billion yuan, an increase of 120.17% compared with the same period of last year. The net profit attributable to shareholders of listed companies was 2.151 billion yuan, an increase of 58.27% compared with the same period of last year, of which the net profit attributable to shareholders of the parent company was 1.927 billion yuan, an increase of 109.28% compared with the same period of last year. In terms of shipments, the company’s power storage battery shipments in the first half of the year totaled 21.63GWh, of which the power battery shipments were 12.65GWh, an increase of 79.46% compared with the same period of last year; The shipment of energy storage batteries was 8.98GWh, an increase of 102.30% compared with the same period of last year. II. Dr. Liu Jincheng, Chairman of the Board of Directors, introduced the company’s business strategy in the first half of the year and its future prospects. This year, as the year of intensive lithium energy, the company continued to improve its strategic capacity building and made important progress in three aspects. The first is technological innovation. (1)46 series large cylindrical battery system has made great progress. In the first half of this year, through in-depth research, the company reached an important conclusion that the large cylindrical battery system can achieve NTP, which laid the technical foundation for the large cylindrical battery and its system to become one of the mainstream directions of power batteries. (2) The research progress of 18650 and 21700 all-pole ear batteries is leading. Thanks to the company’s breakthrough in C-cylinder and large-cylinder battery technology, the company is expected to be ahead of the same industry and complete the research and development of 18650 and 21700 full-scale ear batteries to open up high-end markets. (3) Research and development of large iron lithium battery and its system. According to the company’s design principle, the cost of the pack part of the 5MWh energy storage system can be reduced by 30% to less than 10 cents. This kind of progress is very important for the company’s products to remain competitive. The second is the construction of power battery quality management system. In the first half of the year, the company completed the concept construction of quality management upgrade and the improvement of the basic system, and the quality concept and management methods have undergone fundamental changes. The company constructs a digital quality system and upgrades the traditional quality management to quality research. From paying attention to the quality of delivery to paying attention to the perceived quality of customers, it is expected that the perception of power and energy storage battery clients will be significantly improved. The third is the digital upgrade of the manufacturing system. In the past year,The company has built a large number of single factories, and it is expected to complete the construction of digital manufacturing system this year. On the basis of large-scale factory construction, through digital upgrading, production and management efficiency will be improved and management and operation costs will be reduced. In the future, the company will provide customers with products and quality data packets representing the whole process of products to help customers make clear judgments on the quality of batteries. Looking forward to the second half of the year, the company will continue to improve its comprehensive capabilities. First, complete the construction of strategic supply chain. The company’s investment projects in lithium, separator, electrolyte and anode and cathode materials have been gradually completed and put into production, which is expected to have a positive impact on the company’s operating results. Second, continue to develop head customers. The company actively communicates with major automobile industry companies in Europe, the United States and Asia, and constantly develops incremental customers and obtains orders. Iii. Management answers questions from investors.

　　Q: The company’s semi-annual report in 2023 revealed that 1 million large cylindrical batteries had been rolled off the assembly line. Please ask Liu Gong to introduce some key index data of the current large cylindrical production line, as well as the verification progress of car companies and the most concerned issues of car companies under the background of promoting large cylindrical products at present.

　　A: The company’s first large cylindrical production line was completed at the end of last year. In the first half of this year, the millionth battery was rolled off the assembly line. Through the production of 1 million batteries, the company solved the productivity problem of large cylindrical batteries, and the products successfully entered the C-sample stage. One of the customers has completed PPAP audit and entered the mass production stage. In the third quarter of this year, batch production delivery began in September, which is a very good start. According to our communication with customers, on the one hand, car companies pay attention to the good performance of large cylindrical batteries, such as high-rate charging, which can be charged to 80% in 15 minutes at present; Good low temperature performance, still showing good output ability under the condition of MINUS 20 degrees. On the other hand, car companies are concerned about the decline in manufacturing costs brought about by mass production. Our evaluation shows that the manufacturing cost of large cylindrical battery is lower than that of ternary square battery, which is its advantage. At present, the market needs to further verify the substantial results and usage of NTP(Never Thermal Propagation). Different manufacturers have different requirements and cognition of batteries. We carefully choose the cooperative customers, so that the early application process will be as smooth as possible, and the commercialization of large cylindrical batteries and systems will be promoted smoothly. It is our current strategy to carry out wider promotion after more comprehensive verification.

　　Q: Just now, it was mentioned that the large cylindrical battery has the advantage of manufacturing cost compared with the square ternary battery. Can it be understood that in the future customer expansion, the profitability of the large cylindrical battery will be better than the power battery products launched by the company in the past?

　　A: We certainly hope so. In theory, products with new technologies should have better profits. But now, from the market point of view, downstream OEMs have higher requirements for prices. We hope to find a balance point: in cooperation with some customers, we pursue better prices; Another part of customers, the pursuit of good use of products. However, from the perspective of the whole life cycle of power batteries, the cost advantage of large cylindrical batteries exists.

　　Q: What do you think of the future development expectation of large cylindrical batteries at the quantitative level?

　　A: We insist on the large cylindrical battery because the company thinks it represents the future development direction. Judging from the existing exchanges with car companies, mainstream car manufacturers around the world are highly concerned about large cylindrical batteries, and the consensus that large cylindrical batteries will be one of the mainstream power batteries in the future has basically formed. But the real large-scale application still needs time. For example, in the definition of European models, it should be in the fifth or even sixth generation before it will be widely popularized. From the perspective of technology foresight, the company has seized the future growth point and has got a lot of project fixed points at present. It is estimated that it will take two to three years to gradually increase the commercial delivery from now on to the delivery of dozens and hundreds of GWh every year in the future. During this period, the company will continue to increase the delivery of the system among the cooperative customers, so that the market will continue to form an understanding of its outstanding characteristics such as fast charging ability, economy, low temperature performance, and especially structural stability. After a consensus is gradually formed in the industry, our leading edge in technological innovation can be more effectively brought into play.

　　Q: Does the company have any related measures to improve the management and control ability of the industrial chain to consolidate the cost advantage?

　　A: The company has done a lot of work in the industrial chain layout in the early stage, and established a joint venture company with the head enterprises in the industry in the main materials of lithium batteries. At present, the focus of work is to operate these joint ventures well and establish strategic cooperative relations with smoother processes. We hope to push forward the above work in a solid way this year, so that in 2024 and beyond, the strategic supply chain can continue to play a role in the delivery quality and cost competitiveness of products. This work is of great significance to the company, especially in the case of local overcapacity in the industry, which has a cost advantage and can ensure the stable development of the company at a relatively good profit level.

　　Q: A new battery bill has been issued in Europe, which imposes long-term and proportional restrictions on the whole material and the recycling of lithium batteries. What kind of response mechanism does the company have in this regard?

　　A: Before the company invested in building a battery factory in Europe, it had repeatedly communicated and demonstrated with BMW and other customers for a long time. We have fully interpreted and analyzed the contents involved in the European battery bill, and have taken countermeasures in advance. For example, the bill involves the requirement of localization of supply chain in Europe. At first, customers asked for 70% of the supply chain, and now some customers have further proposed to raise the proportion to 90%. The company has communicated with its partners in the upstream of the industrial chain, and the results are gratifying. All partners are willing to build factories in Europe. One person walks fast and a group of people walk far, so it is certain that the whole supply chain will invest in Europe. Battery recycling, especially ternary battery recycling, is valuable in itself. At present, the company is still communicating with customers to demonstrate that the value of products recovered from batteries should be realized by consumers, or by car factories or battery factories. At present, this problem is still being studied and discussed with customers. In recent years, the company has been preparing and promoting the related work on carbon index, battery passport and other issues involved in the European bill, and it is well prepared. At present, the whole industrial chain of lithium battery goes to Europe to build factories and serve customers in Europe, and the conditions and environment are relatively mature.

　　Q: What is the proportion and performance of fast-charging batteries in the company’s existing product system?

　　A: The fast charging ability of the battery is always concerned by the company. The company’s large cylindrical battery can be charged from 20% to 80% in almost 15 minutes, and even reach a higher level. 800V fast charging technology has been applied to G9 cars in Tucki, which can reach 400 kilometers in 10 minutes or 200 kilometers in 5 minutes. The company regards fast charging technology as one of the core competitiveness of its products. In the field of super fast charging technology, we have cooperated with Israel’s StoreDot for nearly 7 years. The company’s soft-packed ternary batteries, lithium iron phosphate batteries and ternary square batteries all have good fast charging ability. The quick charging ability of products is the company’s unique technical feature. The company will continue to strengthen this technology and is confident to do better in the future.

　　Q: What do you think of 4C fast charging technology of iron and lithium introduced by friends?

　　A: Ferrous lithium phosphate 4C fast charging technology introduced by Youshang has certain influence on the market. The company thinks this is a very good thing, and it also supports such a technical development direction. It represents the competitive mode in the industry that constantly relies on technological progress to achieve development, rather than just adopting price competition strategy, which is also the fundamental reason for the differentiation between the leading enterprises and other participants in the industry.

　　Q: Fast charging technology takes 15 minutes to correspond to 4C’s charging capacity. Will there be any price difference between products with 1C, 2C and 3C’s charging capacity?

　　A: Fast charging technology is an improvement in battery characteristics. Customers will discuss it in the company’s product technology roadmap, and put forward what level of charging capacity needs to be raised at different time nodes. If it fails to meet the requirements of customers, it may not be selected by customers. There is not necessarily a special discount on the price. For example, the fast charging ability is strong, and it is unlikely that the battery will be sold more expensive. Fast charging technology only highlights the technical ability. The OEM will choose the supplier according to whether it has the technical ability. If it fails to meet the requirements, it will not be selected. Therefore, technical ability determines your market opportunities, which will not help the price too much.

　　Q: The company’s traditional consumer battery business will be under some pressure in the first half of the year, and the gross profit margin will drop by 4 points. What is the expected annual revenue target and profitability of the consumer battery business?

　　A: In the consumer battery business, the company’s lithium primary batteries and consumer lithium-ion batteries have maintained steady development; The growth of consumer lithium-ion batteries is relatively better this year, especially the primary e-cigarette batteries, which are expected to double, and according to the forecast of the future market, it is not excluded that there will be greater growth potential. The decline in gross profit margin is mainly affected by the decline in demand for small cylindrical batteries. The market of power tools changed greatly last year. Before last year, the power tool market was booming, and manufacturers prepared more stocks. However, after the epidemic ended, the sales of power tools declined precipitously. Therefore, the power tool market has accumulated a large amount of inventory, resulting in a significant decline in battery demand. The market originally expected to complete destocking in the first half of this year. At present, it seems that the time to go to the warehouse will continue for about one quarter. For the company, because the customers it serves are the heads of the industry, it has gradually stepped out of the difficult market period. The sales volume of small cylindrical batteries is also increasing month by month. By the fourth quarter of this year, it is expected that the gross profit margin of products will gradually pick up and return to the previous profit level.

　　Q: Is the second quarter of the energy storage and power battery industry the worst time? Will there be an inflection point at the industry level from the third quarter? Or is it still weak in the third quarter?

　　A: At present, some people are pessimistic about the industry, but the company will take a longer view and think that the overall situation is not so bad. Compared with the same period last year, the company’s sales revenue in the first half of the year increased by more than 50%. The three business segments of consumption, energy storage and power battery supported each other and achieved stable development. The company believes that the fourth quarter of this year will be better than the third quarter, and next year will be better than the fourth quarter of this year. This is our judgment. However, judging from the changes in the market, the second quarter of this year is indeed difficult. There are differences in the perception of cold and warm in different enterprises, and the pressure on new entrants will be greater;

　　Details of participating institutions are as follows:

　　A group of pictures of "Tang Dynasty ladies" eating glutinous rice balls became popular on the Internet. In the picture, a woman in the Tang Dynasty refused to welcome a bowl of glutinous rice balls in front of her, which made people laugh. It is understood that Ao Luojia (pseudonym), the main creator of the picture, is a Hanfu designer. This group of photos is inspired by the shape of Tang figurines. The original intention of shooting is to help everyone understand traditional culture while "being happy".

　　"Ladies of the Tang Dynasty" eat dumplings to bless the Lantern Festival.

　　On March 2nd, it was the traditional Lantern Festival. A group of pictures of "ladies of the Tang Dynasty" eating glutinous rice balls suddenly became popular on the Internet, and tens of thousands of netizens liked and commented. The official Weibo of Shaanxi History Museum and Xi ‘an Museum also forwarded them.

　　The protagonist in the picture is a plump and bright woman in the Tang Dynasty. She wears a tall bun and is dressed in gorgeous Hanfu. She wants to refuse a bowl of glutinous rice balls.

　　The caption of this group of pictures says, "No, no, no, I’m too fat to eat! Why don’t you eat one? It’s delicious. Have two more! Delicious, one more! My God! I accidentally finished eating! " These pictures are connected together to form a set of dynamic pictures.

　　At first, the plump woman faced the temptation of food, closed her eyes and tried to refuse. Then she held out a finger and smiled to indicate "only eat one dumpling", and then she indicated "only eat two" with two fingers … … In the end, the woman grabbed the bowl and ate all the dumplings. Facing the empty bowl, the woman frowned with her chin cupped and seemed to be remorseful.

　　The plump woman’s attitude of "resisting delicious food" quickly attracted a large number of netizens. Some netizens said that this group of pictures "resurrected" the ladies of the Tang Dynasty, "it is simply a walking expression pack"; Some netizens said that the woman in the picture is embarrassing and is the "Top Ten Miss Datang Players"; Some netizens said that they want to send this group of pictures in a circle of friends as a blessing for the Lantern Festival.

　　The creator consulted a large number of documents.

　　The model in the picture is Aoluojia, a Chongqing native, and also an "old cat" in the mouth of friends. On the afternoon of March 2, the reporter of Beiqing Daily contacted Ao Luo. Ao Luojia was surprised by the sudden popularity of the "Lady Tangyuan Map". Before creating this group of pictures, she also photographed the "red envelope picture of ladies" to celebrate the Spring Festival. "I didn’t expect this group of pictures to be popular at all."

　　The 38-year-old Ao Luojia is a mother and a designer of a Hanfu store. After giving birth to the baby, her weight rose. When she reached 180 Jin, Aoluojia felt that her weight had reached its peak and she never weighed again. "It’s almost the festival. I want to be a model myself and take a group of Hanfu photos for my clients." Aoluojia has her own ideas. "There are very few fat people who wear Hanfu, and I want to have inferiority complex. But I am a fat man with the spirit of Ah Q. When I shoot, I think about it. When I shoot, I shoot it. Anyway, it is also a true color. After shooting, it is nothing. It is good for people who look at pictures to be happy. "

　　Ao Luojia said that she wants to use this group of photos to help everyone understand traditional culture. "Many traditional festivals are familiar to everyone, but some traditional festivals are unknown to everyone, such as the Flower Festival, which symbolizes the growth of all things and is a very important festival."

　　In order to restore the Hanfu dress of the ladies in the Tang Dynasty, Ao Luojia referred to a large number of documents and materials, taking Tang figurines as the source of inspiration. Aoluojia said: "At first, like many people, I didn’t understand why the women painted in the Tang Dynasty were so big and small that they didn’t fit the human body. After I took this group of photos, I understood the paintings of the ancients. The women in the Tang Dynasty were very fat, and they were photographed with big heads and small bodies, like spindles. "

　　Hanfu’s pioneering work was once bumpy.

　　I told the reporter of Beiqing Daily that the Hanfu in the picture was designed by her personally. Since high school, she began to paint, and later studied fashion design. She has been engaged in painting since graduation because she loves antique illustrations and animation.

　　At that time, Ao Luojia hadn’t thought that he would set foot in the fashion design industry. In 2013, Aoluo started to make handicrafts, and his business was soon at a loss. Once, a friend who loves Hanfu asked Ao Luojia to help design the inner sling of Hanfu, and Ao Luojia agreed. Finally, because there were some stocks, Aoluojia put them on the e-commerce platform and sold them at the cost price. Slowly, Aoluojia simply put the antique hobby into it and designed Hanfu.

　　After getting fat, Ao Luojia came up with the idea of large-size Hanfu. Ao Luojia believes that girls love beauty, and fat girls should also have suitable large-size Hanfu. Soon, she designed several sets of Tang Dynasty Fu skirts and began to sell them on the shelves. However, to Ao Luojia’s disappointment, there are very few customers who buy large-size Hanfu.

　　What to do with those ready-made sample clothes made Ao Luojia puzzled. She thought, it is better to put on a sample dress and take some festive photos. Now, Aoluojia’s pictures have been widely praised by netizens, and she is encouraged. She plans to continue to create a series of "Pictures of Ladies in the Tang Dynasty" in the next traditional festivals.

　　Text/reporter Zhang Xi

　　In recent years, more and more parks have undergone new changes: fewer fences and more entrances. The park is more open and integrated with high-rise buildings and busy traffic, which gives citizens a broader view and leisure space and makes the city look more transparent and beautiful.

　　— — Editor

　　Spring is getting stronger, the blue sky is warm and the sun is warm. Walking on the road in Qingdao, Shandong Province, facing the humid sea breeze, I unconsciously set foot on a brand-new wooden plank road and broke into a green world: on both sides of the plank road, Metasequoia glyptostroboides is tall and straight, snowflakes and hydrangeas are pleasing to the eye, and citizens who do morning exercises are weaving.

　　This attractive garden is Zhongshan Park in Qingdao. Last year, Qingdao launched the urban renewal campaign, and Zhongshan Park implemented the project of tearing down the wall and penetrating the green. Previously, Zhongshan Park only opened three doors; By February this year, more than 760 meters of external walls and guardrails had been demolished in the southwest area alone, plank roads and green belts had been laid, and a number of entrances and exits had been added to facilitate citizens to visit the park freely.

　　Not only in Qingdao, but also in Beijing, Shanghai, Chengdu and other places, many parks have removed fences and merged with urban blocks without boundaries, so that people can embrace green when they see green and collide with natural scenery.

　　Tear down the wall and make it green

　　Natural scenery is within reach.

　　Zhongshan Park, with a history of over 100 years, is the largest comprehensive park in Qingdao, and its surrounding areas are mainly residential areas. Because the width of the road green belt in the old city is not enough, it is difficult to meet the public’s demand for green space, and the park was not open enough before, bypassing the park has become a problem for many nearby residents.

　　"In the past, the park had a wall, and there was a clear sense of distance from the park when walking on the road." Li Jianguo, a citizen of Qingdao, said, "Now, the fence has been demolished, and there is no need to detour into the park. There are more scenery. Walking on the road is like entering the park."

　　By the Tonghui River in Chaoyang District, Beijing, there is a Qingfeng Park built by the water, which opened 24 hours after the fence was removed, attracting a large number of surrounding residents to enjoy outdoor activities, dancing, playing the piano, walking and playing ball. Last year, Chaoyang District tried to build an unbounded park, and now there are 43 parks that realize open management like this.

　　Why build an unbounded park?

　　"Some parks are relatively large. If there are fences, few entrances or unreasonable settings, nearby residents need to go around to enter the park, which is very inconvenient." Peng Qiang, director of the Park Management Office of the Beijing Municipal Bureau of Landscaping and Greening, said, "This is not conducive to the connection of green spaces. If small animals such as hedgehogs migrate, they will be blocked by fences. Demolition of the fence can better extend the park green space and forest atmosphere to the block, provide a more open and shared space for citizens and tourists, and integrate the beautiful scenery into the city. "

　　"There is a railing, unless you go in specially, the scenery inside feels nothing to do with us. It is open, even if it is far away from a green space, it can be appreciated. " Ms. Song, a citizen of Beijing, believes that apart from the convenience of being open all day and easy to walk through, dismantling fences can also help to remove people’s psychological boundary.

　　Bounded becomes unbounded, which narrows the distance between the park and the citizens. Demolition of the fence will not only turn the park into a green living room open 24 hours a day, but also deeply embed the natural atmosphere, humanistic atmosphere and artistic style in the park into the residents’ life circle. In this sense, the unbounded park demolished the physical partition and connected the modern life with the natural scenery.

　　From the perspective of urban development, the construction of unbounded parks is also the epitome of practicing the concept of park urban development. From the city park to the park city, it is not a simple adjustment of the word order, but a profound change of the development concept. "If city parks are urban oases, then a park city is to turn the city into a big park and let roads and buildings from the park ‘ Long ’ Come out. " Peng Qiang said that the park city is not to build more parks in the city, but the whole system of ecology, life and production should be full of vitality, and more people should participate and share, and accompany the city to grow together.

　　Upgrade service

　　City life is more charming.

　　The disappearance of a blocked wall and the addition of a series of access channels have made the life and ecological space of the city transparent, and also opened up more possibilities for a better life for the citizens.

　　"The first batch of Yuandadu City Wall Ruins Park and Qingfeng Park in Beijing, which have been demolished with green walls, are strip-shaped waterfront parks with long length and large number of tourists, and the park gates are far apart. According to the actual situation, we solicited the opinions of the surrounding residents many times and designed the unbounded park. " According to the relevant person in charge of Chaoyang District Landscaping Bureau, the renovation of beijing dadu city wall relics park not only dismantled the fence and the gate, but also designed various entrance forms such as artistic landscape, plant groups and flower boxes in the park gate area, and opened up leisure spaces for people to rest, read and communicate, such as foliage verandah, pleasant small building and tree verandah.

　　Standing on Shudu Avenue, Qingyang District, Chengdu, Sichuan, looking southwest, the fence originally made of green wire disappeared, and the pavilions and flowing water in the park intertwined with the bustling street view outside the park, as if they were in the same exquisite meticulous painting. "The construction of unbounded parks is not a simple demolition. After the people’s park removed the fence, we added a green area near the street, cut the slope, paved the garden road, optimized the plant landscape, and organically integrated the park landscape with the street landscape. " Qiu Xiaobing, full-time deputy secretary of the Party branch of Chengdu People’s Park, said.

　　The beauty of the park lies not only in ecology, but also in humanity. The park that opened its doors welcomed more tourists, which also put forward higher requirements for the activities and services provided by the park. People’s Park integrates strong teahouse culture and chrysanthemum culture into park activities, so that the local traditional culture familiar to citizens can shine in their daily lives. "In March, we held ‘ Spring Tea Festival ’ Carry out a series of interactive activities, such as immersive performances and long pot tea art. " Qiu Xiaobing said that the taste of Sichuan tea is engraved in the memory of Chengdu people, and the fragrance of tea accompanied by floral fragrance can make the park more attractive and lasting appeal.

　　Optimal Management

　　Good order and multi-party construction

　　On the one hand, it is necessary to consider whether the park has the conditions to build an unbounded park, and on the other hand, after the wall is demolished, the park should change its management mode in a timely manner and adopt management methods that are more in line with the open form.

　　Peng Qiang said that this year, Beijing will build and renovate no less than 20 unbounded parks, and strive to cover 16 districts. The specific choice of parks is mainly based on the principle of adapting to local conditions. "We will conduct screening. If there is a need for management safety protection, the fence will be retained; Those that are unsightly and have no practical function and bring inconvenience to everyone will be demolished first. For example, some parks are beside the railway, so such parks are not suitable for removing fences. In addition, historical gardens and parks that need to protect cultural relics need to retain fence settings. " Peng Qiang said.

　　The relevant person in charge of the Chaoyang District Bureau of Landscaping and Greening said that after the park is opened, citizens can visit the park 24 hours a day. The park will strengthen coordination and linkage with the local urban management and public security departments, organize joint law enforcement, and maintain a good garden order and environment. At the same time, with the help of volunteers, please ask "civilized guides" and other park managers to guide citizens to visit the park in a civilized way and maintain a safe, comfortable, clean, beautiful and pleasant environment.

　　According to reports, many parks in Chengdu have opened a "24-hour business model" after the wall was demolished. In order to ensure the safety at night, the People’s Park has also added cameras, increased night patrol personnel, and upgraded the functional lighting facilities at night in the park.

　　Some protective measures are actually hidden in the design and construction. During the renovation and upgrading of Zhongshan Park in Qingdao, the functional layout and tourists’ needs in the park were analyzed, in order to meet the needs and habits of tourists to the greatest extent and reduce the behavior of trampling on green space. Wu Haili, a second-level researcher at the Garden and Forestry Construction Department of Qingdao Garden and Forestry Bureau, said: "The removal of fences is a test of park design and management. The plank road should be convenient, barrier-free passages should be built, and auxiliary facilities such as lighting and monitoring should be indispensable. After the completion, we will also guide and divert tourists by strengthening the daily management of the park, strengthening the public’s persuasion and designing hedges on the periphery, so as to raise tourists’ awareness of civilized garden. "

　　At present, the smart park project in Qingdao Zhongshan Park is stepping up construction, accessing new generation information technologies such as 5G, big data and artificial intelligence, which is expected to be opened in September. By then, Zhongshan Park will become a smart park with active safety prevention and control and convenient tourist service.

　　■ Extended reading

　　Opening a park doesn’t mean doing whatever you want.

　　The openness of the park has increased, giving citizens more trust and putting forward higher requirements for citizens’ literacy. It is understood that there are uncivilized phenomena such as littering, riding a bicycle to roll the lawn and bringing pets into the park in some unbounded parks.

　　Boundless parks do not mean no rules, and openness does not mean arbitrary. When people enter the park, they should consciously: maintain environmental sanitation, do not spit everywhere, and do not litter; Obey public order, don’t make noise, and don’t cut in line; Protect the ecological environment, don’t pick flowers, trees and fruits, don’t chase and catch, and feed animals indiscriminately; Cherish public facilities, do not trample on seats, do not smear or carve park facilities; Do not bring pets that are forbidden to enter the park; Wait a minute.

　　Park is an important window to show the image of urban temperament, and also an important platform to reflect the civilized quality of citizens. Civilized garden, let’s start from ourselves, improve the quality of civilization and jointly safeguard the beautiful environment.