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After the market closed on July 30, Laobaixing Pharmacy Chain Co., Ltd. (SH: 603883, hereinafter referred to as "Laobaixing") issued an announcement stating that on July 28, the company received a notice from the family of Xie Zilon, the actual controller and chairman of Laobaixing, that Xie Zilon's family received a notice issued by the Hunan Provincial Supervision Commission on July 28, 2024, stating that Xie Zilon was detained and under investigation.

Laobaixing stated in the announcement that the matters involved had nothing to do with the company. As of July 30, the company had not received any notification from the relevant authorities, nor had it been asked to assist in the investigation.

Laobaixing said that the company has a sound organizational structure and standardized governance system, and other directors, supervisors and senior management personnel are performing their duties normally. Xie Zilong's detention and investigation will not have a significant impact on the company's normal operations.

Xie Zilong's last public appearance was half a month ago. On July 15, Xie Zilong attended the 20th China Retail Pharmacy Annual Conference and the 5th China Professional Pharmacy Development Forum held in Kunming.

In the past two months, the share price of Laobaixing has continued to fall. From May 30 to July 30, the share price of Laobaixing fell from 25.43 yuan per share to 14.63 yuan per share, with a cumulative decline of 40%. Some people speculated that "the funds received the news three months in advance, and the stock price continued to fall in large volume, and it was cut in half." After the announcement of Xie Zilong's detention was issued, many investors questioned that Laobaixing's valuation was very low, the price-earnings ratio was only more than 8 times, and the dividend yield was only 3.5%. The stock price was cut in half in three months, and it has been falling almost every day recently, which is puzzling. It was not until July 30 that the answer was revealed, "This bad news must have been known in advance by the funds, and only 20,000 shareholders were kept in the dark."

It is worth noting that as early as July 29, before Laobaixing issued the announcement, someone seemed to have known in advance the news of Xie Zilon's detention, "it is said that he has been taken away", and reminded other investors online not to buy at the bottom.

"fromIsshindopay an overdue tax,DasanlinIt took only half a year from the actual controller being sentenced to prison, to the chairman of Laobaixing being detained, to the industry being hit hard by a series of bankruptcies, to the large-scale closures. "An investor who holds multiple drugstore retail concept stocks couldn't help but sigh, "It's really too difficult!"

On March 19, Yixintang (SZ: 002727) disclosed that the company received tax counseling from the competent tax bureau, involving deemed sales matters, and needed to pay 233 million yuan in taxes and 77 million yuan in late payment fees, totaling more than 300 million yuan. On May 24, the National Medical Insurance Administration interviewed relevant persons in charge of Yixintang. The interview pointed out that the medical insurance department found in the fund supervision work that some designated chain stores under Yixintang had problems such as swapping drugs, over-prescribing drugs, making medical insurance settlements on behalf of designated retail stores that had suspended medical insurance settlements, mismatching drug purchase and sales records, and irregular sales of prescription drugs, causing losses to medical insurance funds.

On the evening of April 12, an announcement released by Dasanlin (SH: 603233) showed that the company received a "Criminal Judgment" and its subsidiary Maoming Dasanlin Chain Drugstore Co., Ltd. (hereinafter referred to as "Maoming Subsidiary") was convicted of corporate bribery and sentenced to a fine of 4 million yuan; the company's actual controller Ke Jinlong was convicted of corporate bribery and sentenced to three years and six months in prison and a fine of 500,000 yuan.

Today, in the eyes of investors, listed companies in the pharmaceutical industry face compliance challenges. July 28Poinsettia(SZ:300723) issued an announcement that its wholly-owned subsidiary Guangzhou Yipinhong Pharmaceutical Co., Ltd. received a breach of contract notice from the National Joint Drug Procurement Office. Yipinhong Pharmaceutical engaged in bid rigging during the national centralized procurement process and was required to refund the purchaser for losses of 266 million yuan.

Reporter: Du Lin Editor: Zhou Quan Proofreader: Tang Qi