Reporter 丨 Xiaomin Trainee 丨 Si Gaofeng
Produced by 丨aotou finance (theSankei)
As a well-established Chinese medicine enterprise, Jianmin Group (600976. SH) hit his own foot a bit.
On August 4, the administrative penalty decision published on the website of the Hubei Provincial Drug Administration showed that The Hubei Provincial Drug Administration confiscated the illegal gains of The Hubei Provincial Drug Administration for producing and selling inferior drugs and stomach digestion tablets.
Aotou Finance also found that drugs such as Small Gold Capsules of Jianmin Group were also fined for unqualified quality.
In recent years, the performance of Jianmin Group has grown rapidly, and the company's net profit from 2019 to 2021 has increased by 12.65%, 61.53% and 119.73% respectively.
However, in the 2022 restricted stock incentive plan (draft), Jianmin Group's goal is only to increase net profit by 10%. In the first half of the year, the company's net profit increased by 18.7%, and it was not difficult to achieve the target under this momentum.
And who is the beneficiary of equity incentives? He Qin, chairman of Jianmin Group, and Wang Jun, director and president of Jianmin Group, and 6 senior executives, including 92,400 shares, are incentive recipients, and these two also account for half of the shares.
Production of inferior drugs stomach digestion tablets
According to the data, Jianmin Group is a traditional Chinese medicine enterprise with a long history, with three major brands of "Jianmin", "Longmu" and "Ye Kaitai".
Among them, the brand "Ye Kaitai" of Jianmin Group has a history and culture of nearly 400 years, and adheres to the manufacturing philosophy of "following the past and the present, sincerely repairing, preferring to be lacking and indiscriminate, and not good to come again" and the business philosophy of "eclectic and inclusive, self-harming and non-deceptive".
However, the current Jianmin Group violates the ancestral precepts.
On August 4, the administrative penalty decision published on the website of the Hubei Provincial Drug Administration (E sui drug administration penalty [2022] No. 001) showed that Jianmin Group YeKai Thai Medicine (Suizhou) Co., Ltd. was confiscated by the Hubei Provincial Drug Administration for producing and selling inferior drugs and stomach digestion tablets.
Specifically, the "Stomach Digestion Tablets ( Production Unit: Jianmin Group Yekai Thai Medicine (Suizhou) Co., Ltd., batch number: 210415, specifications: each piece weighs 0.8g (film-coated tablets)) provided by the "Hubei Zhongxiang City Hospital of Traditional Chinese Medicine", of which the "weight difference" item test results are "20 pieces of 3 pieces exceed the weight difference limit (does not meet the regulations)", the conclusion is: "This product according to the "Chinese Pharmacopoeia 2020 edition of the first part of the inspection of the above items, the results do not meet the regulations".
Jianmin Group Ye Kai Thai Medicine (Suizhou) Co., Ltd. produced and sold the batch of unqualified stomach digestion tablets. According to the provisions of Article 98 of the Drug Administration Law, it was judged that Jianmin Group Ye Kai Thai Medicine (Suizhou) Co., Ltd. produced inferior medicine stomach digestion tablets.
Ye Kai Thai Medicine (Suizhou) Co., Ltd. (hereinafter referred to as "Ye Kai Thai Medicine") is a wholly-owned subsidiary of Jianmin Group, and its leading products are Dragon Mu Zhuang Bone Granules, Pediatric Lung Cough Granules, Pediatric Bao taikang Granules, Pediatric Anti-sensing Granules, Jian Spleen Blood Granules, Jian Spleen Blood Tablets, Xiao Jin Capsules, And Xiao Jin Pills. The company's main varieties also include stool capsules, Jianmin throat tablets, stomach digestion tablets, estradiol gel, toxin extraction muscle dispersion and so on.
Aotou Finance and Economics learned that Yekai Thai Medicine is the core company of Jianmin Group, and the products produced are the main products of listed companies, and in 2021, it also won the title of intelligent manufacturing demonstration unit in Hubei Province.
Microbial exceeding the standard was fined nearly one million
In fact, this is not the first time that Jianmin Group has been fined for product quality problems.
On July 20, 2018, the State Drug Administration issued the "Notice of the State Drug Administration on 14 Batches of Unqualified Drugs (No. 63 [2018])" to notify that the microbial limit of 1 batch of small gold capsules (batch number: 170661, specification: 0.35 grams per capsule) produced by Jianmin Group did not meet the regulations (mold and yeast counts did not meet the regulations).
On July 25, Jianmin Group defended in the announcement that after the company's self-inspection, no abnormalities were found in the inspection, production and testing process and storage of raw materials for the batch of products.
The reason for Jianmin Group's preliminary judgment was that part of the batch of products of a pharmaceutical company in Heilongjiang may have been contaminated with local products due to improper control of the transportation process (the batch of products was shipped to Heilongjiang during the hot and rainy season).
In January 2019, Jianmin Group issued another announcement, explaining that mold and yeast are non-pathogenic bacteria and do not affect the efficacy of the product.
However, unqualified is unqualified, and for the public, Jianmin Group cannot use "eating is okay" to prevaricate.
Finally, the Wuhan Food and Drug Administration believes that in view of the fact that Jianmin Group actively cooperated with the investigation and took the initiative to recall the drugs involved in the case, and no harmful consequences have occurred, it decided to give the company the following administrative penalties in accordance with relevant regulations: confiscation of 17015 boxes of small gold capsules; Confiscation of illegal gains of 40,370 yuan; The fine 947439 yuan. The total amount of the above-mentioned fines and forfeitures is 987809 yuan.
In June 2015, Jianmin Group announced that the company's holding subsidiary, former wuhan Jianmin Group Suizhou Pharmaceutical Co., Ltd. (hereinafter referred to as "Suizhou Pharmaceutical"), as a manufacturer of ginkgo biloba preparations, found that the product quality indicators of individual batches of preparations produced by individual suppliers of ginkgo biloba extracts supplied by Suizhou Pharmaceutical were abnormal according to the requirements of the State Administration of Drugs and Food. The company decided to recall the relevant drugs.
Stock incentive plan targets are accused of being too low
In the past three years, Jianmin Group has gradually got rid of the previous lack of growth.
According to the data, from 2019 to 2021, the operating income of Jianmin Group was 2.239 billion yuan, 2.456 billion yuan and 3.278 billion yuan respectively, an increase of 3.58%, 9.69% and 33.48% respectively; Net profit was RMB91.4903 million, RMB148 million and RMB325 million, up 12.65%, 61.53% and 119.73% year-on-year, respectively.
Under the soaring performance, Jianmin Group came up with a stock incentive plan.
On June 1, 2022, Jianmin Group released the 2022 Restricted Stock Incentive Plan (Draft), showing that the incentive plan involves a total of 6 incentive objects, including the company's chairman, president, vice president, board secretary and core technical personnel.
Specifically, the number of restricted shares granted by He Qin, chairman of Jianmin Group, reached 92,400 shares, accounting for 25% of the total number of restricted shares granted; Director and President Wang Jun received 92,400 shares, accounting for 25%; Vice President Pei Xuejun and Vice President Huang Zhijun both received 55,440 shares, accounting for 15%; Zhou Jie, secretary of the board of directors, and Li Lijuan, a core technical officer, received 36,960 shares, accounting for 10%.
As of the year 2021, the number of employees in Jianmin Group totaled 2,004, and the stock incentive plan can be described as more than 300 people to choose one, and all of them are senior executives of the company.
The announcement shows that the grant price of the restricted stock grant is 20.58 yuan per share, that is, after the grant conditions are met, the incentive object can purchase the company's restricted stock at a price of 20.58 yuan per share.
In the secondary market, Jianmin Group's current share price per share is around 43 yuan, while at the beginning of 2022, it was about 86 yuan per share, which was tragically cut. In this stock incentive plan, the price granted by Jianmin Group has been "discounted in half".
The year of the release of restricted shares granted by this incentive plan is the two fiscal years from 2022 to 2023.
Among them, the first release of the restriction period, that is, in 2022, will increase by no less than 10% on the basis of net profit in 2021; The second release period, that is, in 2023, will increase by no less than 21% on the basis of net profit in 2021.
In the first quarter and the first half of 2022, the net profit of Jianmin Group reached 88.7092 million yuan and 198 million yuan respectively, an increase of 25.95% and 18.7% respectively year-on-year.
According to this growth momentum, it is not difficult to complete the equity incentive performance appraisal target in 2022.
Interestingly, although the net profit has grown rapidly, the growth of Jianmin Group's operating income has slowed down, and its revenue in the first half of 2022 reached 1.827 billion yuan, an increase of only 1.93% year-on-year.
Some insiders said that if the executives of Jianmin Group can easily complete the performance goals, is its incentive significance so important?