Ternary Biology: Eight years of no new invention patent authorization Former financial director resume "playing through"

"Jin Zhengyan" Northern Capital Center Yi An/ Author Wu En Huansheng / Risk Control

"The shore of the Bohai Sea, the continent of the Yellow River", Binzhou City in Shandong Province got its name from this, and is known as "Sun Tzu's Hometown". Moreover, Binzhou, known as the "Qilu Important Town of the Nine Dynasties" and "The Ancient City of Thousand Years of Culture", is one of the birthplaces of the Yellow River culture and Qi culture. Shandong Sanyuan Biotechnology Co., Ltd. (hereinafter referred to as "Sanyuan Biological"), which has impacted the listing, is located here, and on December 29, 2021, the listing application of Sanyuan Biological took effect, which is "one step away" from the capital market.

In contrast, after his death, the R&D expense rate of Sanyuan Bio has been declining all the way during the reporting period, the number of patents or "bottom" in peers, and Sanyuan Bio has not authorized new invention patents for eight years, and its innovation ability is questionable. The problem does not stop there, Sanyuan Bio's former financial director resume "playing through", its initial appointment time is earlier than the establishment of the unit, and the letter is now in doubt. In addition, while the concentration of the top five suppliers of Ternary Biologics is higher than the average of its peers, 3 of them also have the vision of zero social security contributors, and the authenticity of transactions may be tortured.

First, the R&D expense rate is low, the number of invention patents authorized lags behind its peers and there is no new increase for eight years

The ability to innovate provides impetus for the development of enterprises. However, from 2017 to 2020, the R&D expense rate of Ternary Bio continued to decline.

According to the draft prospectus of Sanyuan Bio with the signing date of December 10, 2020 and the prospectus signed on January 14, 2022 (hereinafter referred to as the "Prospectus"), from 2017 to 2020 and from January to June 2021, the R&D expense ratio of Sanyuan Bio was 5.65%, 5.13%, 4.08%, 3.87% and 3.63%, respectively.

At the same time as the R& D expense rate declined, the number of invention patents of Ternary Bio may rank at the "bottom" of comparable companies in the same industry.

According to the prospectus, as of January 14, 2022, the date of signing of the prospectus, Sanyuan Bio has obtained 6 patents, of which 3 are invention patents.

According to the prospectus, the comparable companies of Sanyuan Bio are Anhui Jinhe Industrial Co., Ltd. (hereinafter referred to as "Jinhe Industry"), Baolingbao Biological Co., Ltd. (hereinafter referred to as "Baolingbao"), and Zhejiang Huakang Pharmaceutical Co., Ltd. (hereinafter referred to as "Zhejiang Huakang").

According to the public information of the State Intellectual Property Office, as of December 31, 2020, Bowling Bao (the parent company) has obtained a total of 61 authorized patents, of which 46 are invention patents.

According to the 2020 annual report of Jinhe Industry, as of December 31, 2020, Jinhe Industry has obtained a total of 147 authorized patents, of which 86 are invention patents.

According to Zhejiang Huakang's 2020 annual report, as of December 31, 2020, Zhejiang Huakang has obtained a total of 111 authorized patents, of which 23 are invention patents.

It can be seen that during the reporting period, the R&D expense rate of Tsnary Bio has decreased year by year, and the number of patents granted by it is much lower than that of comparable companies in the same industry.

In addition, in the past five years, Tsnary Biologics has only obtained one patent authorization, and it has been obtained for transfer. And in the past eight years, Ternary Biologics has not authorized new invention patents.

According to the prospectus, as of January 14, 2022, the date of signing of the prospectus, Sanyuan Bio has obtained a total of three authorized invention patents, of which the invention patent "Lipolytic Yaro yeast strain and its method for synthesizing erythritol" and "method for extracting erythritol from erythritose yeast liquid and its special yeast strain", all of which were applied for on July 5, 2013. Another invention patent, "A Method for Making Low Sugar and Low Calorific Value Golden Silk Honey Dates", was filed on June 16, 2008.

As of January 14, 2022, the date of signing of the prospectus, the utility model patents of Sanyuan Bio, "a fermentation tower dedicated to food fermentation" and "an automated equipment for food fermentation", were applied for on March 16, 2018, and another new patent, "a kind of conveying equipment for food production", was applied for on January 7, 2021. All three utility model patents were acquired by transfer.

That is, among the 6 authorized patents of Ternary Biologics, 1 invention patent was applied in 2008, 2 invention patents were applied in 2013, 2 utility model patents were applied in 2018, and 1 new type patent was applied in 2021.

That is to say, since 2013, Tsnary Biology has not been authorized for invention patents, and Ternary Biology's ability to innovate may be tortured.

In addition, one patent of Sanyuan Bio was terminated due to the non-payment of the annual fee.

According to the public information of the State Intellectual Property Office, Sanyuan Bio has a utility model patent entitled "a fermentation tank agitator based on biological engineering" and patent number of 2018207112942, and its application date is May 11, 2018, and the case status is unpaid annual fees and terminated. The date of the notice of termination of the patent right is December 17, 2019.

It is not difficult to see that in less than two years from the date of application for patent rights to the date of issuance of the notice of termination of patent rights, the above-mentioned utility model patent of Ternary Biology has led to the termination of the patent right due to the unpaid annual fee, which is regrettable. At the same time, the R&D expense rate of Ternary Biotech continues to decline, the number of patent authorizations lags behind that of its peers, and its innovation ability may be tortured.

Second, the resume of the former financial director "played through", and the letter was now in doubt

Listed companies release market confidence to investors through information disclosure. In order to protect the interests of investors, the CSRC requires listed companies to ensure that information disclosure is accurate, complete and true. However, the resume of the former financial director of Sanyuan Bio is now in doubt.

According to the prospectus, Li Guiqin, who was the financial director of Sanyuan Biotech, left in December 2019.

According to the Reply to the Inquiry Letter on the Review of the Application Documents for the Initial Public Offering of Shares and Listing on the Growth Enterprise Market of Shandong Sanyuan Biotechnology Co., Ltd. (hereinafter referred to as the "Reply to the Inquiry Letter"), from 1998 to 2001, Li Guiqin worked at Binzhou Donghui Accounting Firm.

The Northern Capital Center of "Jin Zhengyan" found that there was no query result of Binzhou Donghui Accounting Firm by consulting the Market Supervision administration, and the query showed that the name of an accounting firm was "Shandong Donghui Accounting Firm Co., Ltd. (hereinafter referred to as "Shandong Donghui Accounting Firm")," and the historical name of Shandong Donghui Accounting Firm was Shandong Binzhou Donghui Limited Liability Accounting Firm, similar to Binzhou Donghui Accounting Firm, and the establishment date of Shandong Donghui Accounting Firm was October 6, 1999.

According to the public information of the Management Information System of the Chinese Certified Public Accountants Industry, there is only one accounting firm with the name "Donghui", that is, Shandong Donghui Accounting Firm, and the approval of Shandong Donghui Accounting Firm was September 6, 1999.

Through the public information disclosed by the Market Supervision Administration and the Management Information System of the Chinese Certified Public Accountants Industry, it can be seen that the "Binzhou Donghui Accounting Firm" disclosed in the reply to the inquiry letter may actually be Shandong Donghui Accounting Firm. The prospectus discloses that the former financial director Li Guiqin joined Shandong Donghui Accounting Firm earlier than the establishment time of Shandong Donghui Accounting Firm, which is puzzling.

Third, "zero people" suppliers have appeared in groups, and the authenticity of more than 10 million yuan of procurement amounts has been tortured

The problem is not over. During the reporting period, Sanyuan Bio may have traded with "zero people" enterprises, and the authenticity of the transaction is doubtful.

According to the prospectus, from 2018 to 2020 and from January to June 2021, the concentration of the top five suppliers of Sanyuan Bio was 88.16%, 67.66%, 76.53% and 78.01% respectively.

From 2018 to 2020, the concentration of the top five suppliers of Baolingbao, a comparable listed company in the same industry of Sanyuan Bio, was 44.89%, 46.34% and 46.53%, the concentration of the top five suppliers of Jinhe Industry was 29.71%, 28.29% and 28.91%, and the concentration of the top five suppliers of Zhejiang Huakang was 50.23%, 50.59% and 43.59%, respectively.

According to the research of the Northern Capital Center of JinzhengYan, from 2018 to 2020, the average concentration of the top five suppliers of the above-mentioned comparable companies of Sanyuan Bio, Bowling Bao, Jinhe Industry and Zhejiang Huakang, was 41.61%, 41.74% and 39.68%, respectively.

It can be seen that from 2018 to 2020, the concentration of the top five suppliers of Ternary Biotech is about 46 percentage points, 25 percentage points and 36 percentage points higher than the average of its peers, respectively.

Not only that, among the top five suppliers of Tsnary Biotech, there may be "zero people" enterprises.

According to the prospectus, in 2018, Qingdao Jin'anqi Science and Trade Co., Ltd. (hereinafter referred to as "Jin'anqi Science and Trade") was the fifth largest supplier of Sanyuan Bio, and Sanyuan Bio purchased yeast products from it, with a purchase amount of 6.3529 million yuan, accounting for 3.76% of the total procurement amount of Sanyuan Bio in the current period.

According to the data of the Market Supervision Administration, from 2018 to 2020, the number of employees of Jinanqi Science and Trade is 0.

According to public information, as of January 19, 2022, Wu Hanbing held 100% of the shares of Jin Anqi Science and Trade, and there were no other controlling enterprises.

That is to say, Jin Anqi Science and Trade or other enterprises controlled by the actual controller Wu Hanbing do not pay social security on behalf of other enterprises.

In addition, among the top five suppliers of Tsnary Bio's construction projects, there may also be "zero people" enterprises.

According to the prospectus, from 2018 to 2020 and from January to June 2021, Zibo Jinchun Stainless Steel Sales Co., Ltd. (hereinafter referred to as "Zibo Jinchun") is one of the main suppliers of the construction project of Sanyuan Bio, and the purchase amount of Sanyuan Bio to it is 6.8625 million yuan, 10.9482 million yuan, 12.8233 million yuan and 3.1885 million yuan, respectively, totaling 33.8225 million yuan.

According to the data of the Market Supervision Administration, from 2018 to 2020, the number of employees in Zibo Jinchun was 0.

According to public information, as of January 19, 2022, Chen Jifa and Zhang Ruihong held 98% and 2% of Zibo Jinchun's shares respectively, of which Chen Jifa had no other controlled enterprises.

It can be seen that Zibo Jinchun may not have any situation in which other enterprises controlled by the actual controller Chen Jifa pay social security on their behalf.

The problem is not over.

According to the prospectus, from 2018 to 2019, Binzhou Shanshui Commerce and Trade Co., Ltd. (hereinafter referred to as "Shanshui Commerce") was one of the main suppliers of Sanyuan Bio's construction projects; in the same period, Sanyuan Bio purchased 3.4631 million yuan and 1.1 million yuan from it, respectively, with a total of 4.5631 million yuan.

According to the data of the Market Supervision administration, from 2018 to 2020, the number of employees of Shanshui Commerce and Trade was 1, 0 and 0 respectively.

According to public information, as of January 19, 2022, Niu Ruifang held 100% of the shares in Shanshui Commerce and Trade, and there were no other controlling enterprises.

Therefore, Shanshui Commerce and Trade may not have other enterprises controlled by the actual controller Niu Ruifang to pay social security on behalf of them.

That is to say, as the supplier of Tsnary Biology, Jin Anqi Science and Trade, Zibo Jinchun, Shanshui Commerce and Trade, these three enterprises, during the transaction with Tsanyuan Biology, there are now "zero people" vision, of which Zibo Jinchun will support the procurement amount of TsuiBio of more than 10 million yuan in 2020, and the authenticity of the transaction is doubtful.

Contradictions in letters, "zero people" suppliers have appeared in groups, and there has been no new invention patent authorization for eight years, etc., for Ternary Biology, it may be a problem that needs to be faced directly.