Sheng Ye Information Technology Service (Shenzhen) Co., Ltd. (“SYIT”), a subsidiary of Sheng Ye Capital Limited (HKEx: 6069), has been strengthening its strategic presence in industrial SaaS and medical smart pharmaceutical supply, processing and distribution ("SPD") services, and its strength in the industrial IoT and supply chain fintech space has been recognized by companies such as Tencent Cloud and the First Company of China Construction Eighth Engineering Division Corp. Ltd.. Looking ahead, SYIT will continue to deepen its expansion into the supply chains of the infrastructure industry and speed up the development of a smart construction ecosystem while strengthening its digital service capabilities and quality comprehensively.
Meanwhile, leveraging its long track record in medical supply chain management, SYIT is accelerating the research and development of SaaS systems for the sector. SYIT has signed strategic cooperation agreements with the provincial platform companies of several large state-owned pharmaceutical enterprises. By harnessing IoT and artificial intelligence technologies, SYIT will provide tailored, integrated and more efficient medical SPD solutions to hospitals covered by these medical enterprises.
Medical SPD management, a model of supply chain management highly favored by the modern healthcare institutions, refers to the supply, processing and distribution management of medical supplies. Its end-to-end digital tracking feature makes it possible for inventory alerts and automatic restocking, ensuring the accurate use of medical consumables. Medical SPD management integrates automatic data collection, digital data processing and sensing-to-match (感应符合技术) technologies, which effectively streamline the sorting and acceptance inspection operations, significantly reduce the time needed for medical consumables counting and greatly improve warehouse efficiency. The approach also allows for end-to-end visualization of orders, which accurately monitors and controls temperature and humidity, thereby minimizing medical risks. Medical SPD management can help hospitals reduce labor costs for medical supplies management, improve efficiency and accuracy, and minimize errors, hence becoming increasingly popular among hospitals. In addition, with the introduction of new healthcare reforms such as two-invoice policy, zero-markup drug policy and separation of prescriptions and dispensary, medical SPD management will see substantial demand as the highly efficient supply chain management model integrates leading digital and intelligent technologies with the complex operations of hospitals, to significantly enhance accuracy of medical supplies management and cut down operational costs.
Enticed by the tremendous growth opportunity, traditional medical logistics businesses and SPD software suppliers have started to enter the medical SPD space. According to public data, in 2020, over 100 hospitals in China have introduced medical SPD systems, and large pharmaceutical groups including Sinopharm Group, CR Pharma, Shanghai Pharma, Thalys and Guangxi Liuzhou Pharmaceutical all accelerated their medical SPD investment. Currently, leveraging its medical device business model which integrates SPD, IVD, CSSD and MWD solutions, Sinopharm Group has established business and logistics network across 31 provinces, all of which are GSP certified. Thalys is also solidifying medical SPD as its core business, forging competitive barriers through co-building regional test centers with government.
Currently, end-to-end medical SPD management is still a blue ocean market in China, with huge market demand to be unlocked from hospitals in the next three to five years. Currently medical consumables take up a significant share of total hospital revenues, around 23-25% on average for hospitals with revenues of RMB1 billion, and 33-34% for hospitals with revenues of RMB2 billion and above. Similar to medicine procurement, medical consumables are shifting from a profit center to a cost center for hospitals, whose profits will rely on cost savings through refined management and cost control going forward.
Along with the booming development of SPD industry, technology-enabled end-to-end supply chain solutions have become a must for medical institutions. As a leading supply chain fintech platform, SY Capital has accumulated massive volume of real-time transaction data over the past 8 years and deeply penetrated the medical supply chain ecosystem. SY Capital caters effectively to the financing needs of medical circulation businesses while minimizing risk exposures with digitalized risk control measures. Meanwhile, SY Capital continues to expand its technology offerings, to cover areas such as medical SPD and SaaS, and strives to build an intelligent supply chain service ecosystem.
Powered by the integration and innovation of supply chain fintech and industrial digitalization, SY Capital will continue to provide sophisticated and intelligent supply chain solutions including smart construction sites, IoT data analytics, digital finance and medical SPD management services, to accelerate value delivery to all stakeholders.
