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Lou Dingbo Talks about Shanghai Pharma’s Innovation and Reform at the CBT 100 2015


Only by Looking Far Ahead Can You Expect to be Excellent and Only by Pioneering Can You Seek Sound Development

    On December 5, the CBT 100 2015 and the First Forum on Comprehensive Development of the Top 100 Chinese Cities were held at Shanghai International Convention Center. Lou Dingbo, Secretary of the Party Committee and Chairman of Shanghai Pharmaceuticals Holding Co., Ltd. (hereinafter referred to as “Shanghai Pharma”), gave a keynote speech titled “Innovative Shanghai Pharma for Healthy China” as a representative of the Top 100 listed companies, depicting Shanghai Pharma’s unusual road of reform and innovation as well as the gains, thoughts and expectations embedded therein.

Shanghai Pharma Won the Honorary Title of “Top 100 Enterprises”

    High-level keynote speeches and special forums were conducted at the conference. Focusing on the theme of “SOE reform”, Ji Xiaonan, Chairman of the Supervisory Board for Key Large State-Owned Enterprises under the State Council, offered guidance at the macro-level.

    As a State-controlled listed pharmaceutical company, Shanghai Pharma has gone through an unusual road of reform and innovation over the past three years. On that day, Shanghai Pharma won not only the honorary title of “Top 100 Chinese Enterprises” by virtue of its business scale and profitability but also the China Star Enterprise Award. Shen Bo, Finance Director and BOD Secretary of Shanghai Pharma, accepted the awards on behalf of the Company.

The Development Targets of the First Three-Year Plan to be Attained

    At the Forum, Lou Dingbo talked about Shanghai Pharma’s strategic development as well as the practice and comprehension of reform and innovation. Lou said that in the past five years, Shanghai Pharma has realized a compound growth rate of nearly 25% in business and a compound growth rate of 15% in profit, leading the industry. Thanks to the reform and innovation during the three years following 2012, in particular, Shanghai Pharma has realized the overall securitization of operating assets, diversified ownership structure, standard corporate governance framework and market-oriented management team. The Company has thereby been enjoying sound and rapid development.

    Under the BOD’s leadership, Shanghai Pharma has worked out the strategic development plan featuring “working 3 years, observing 3 years and thinking 3 years” and determined a large pharmaceutical enterprise control model with Shanghai Pharma’s characteristics with “the strategic control to play a dominant role and the operation control to play a supplementary role”, while systematically build a closed-loop management system covering “strategy – budget - performance”, split the strategy in a well-grounded way, and promote the implementation of the strategy step by step.

    State-owned enterprises are usually complicated organizations shaped by history. Shanghai Pharma has adopted a strategy-guided three-in-one systematic reform path. Namely the enterprise is operated by way of coordinated promotion of “strategic innovation, organizational restructuring and cultural renewal”.

    “This year, we will fully accomplish the development targets of first three-year plan. Shanghai Pharma will strive to become the first A-share listed pharmaceutical company to realize a sales volume of over RMB 100 billion and maintain its position as the most profitable company,” said Lou Dingbo.

Attitude is More Important than Plan

    “Only by looking far ahead can you expect to be excellent and only by pioneering can you raise up the sail of development. To step towards the higher end of the value chain by means of innovation in transforming business mode and adjusting business structure makes a course to leap forward in reform.” Lou Dingbo said that in the past three years, Shanghai Pharma has looked far ahead and been down-to-earth in order to carry out reform and innovation with a lot of painstaking efforts. “When recollecting this period of development, I am always deeply convinced that President Xi’s remarks ‘only the reformers can make progress, only the innovators can become strong and only those who seek reform and innovation can be successful’ are indeed valuable as the reform and innovation have already become an integral whole.”

    According to Lou, following a significant recapitalization campaign, a consolidation plan is, in general, most urgently needed. However, there’s something more important than plan. That’s attitude. The attitude should be “faithful” towards history, and be “willing” towards globalization and be “sustainable” towards future. Such attitudes determine Shanghai Pharma’s strategic vision, idealistic sentiment and operational persistence.

Deploy the “333+1” Rolling Plan

    Looking into the future, Lou Dingbo pointed out that Shanghai Pharma will continue to strengthen the board construction, intensify the management team’s executive ability, and perfect the corporate governance. The Company will promote the industrial concentration, strengthen the corporate integrity and synergy; explore and carry out the strong incentive and strong constraint mechanism, enhance corporate vitality and innovative capability, and work hard on the perfection of modern corporate systems and improvement of capital operating efficiency. Moreover, Shanghai Pharma will continue to deepen the mixed ownership reform subject to the orientation of seeking breakthroughs in key industries and innovating business model.

    The Fifth Plenary Session of the 18th Central Committee of the Communist Party of China has set “Healthy China” as a national strategy and thereby opened up broad space for development of healthcare industry, so that pharmaceutical enterprises will enjoy a brilliant future. Lou Dingbo said that Shanghai Pharma has made specific deployment in its decade-long “333+1” rolling plan. By closely integrating the national strategies such as healthy China, building a powerful country with network and opening up to the outside world, with the corporate strategies, and by following the main axle of “Internet + Healthcare Industry” and by focusing on the promotion of intelligent manufacturing and smart services, great importance shall be attached to the promotion of such significant development steps as internationalization, intelligent manufacturing and smart medical services, so as to achieve leapfrog development through synchronous progress in both endogenous and extensive growths.


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