经销模式

In 2024, 2025 and the six months ended June 30, 2026, the revenue attributable to our distributors was RMB3.6 million, RMB1.9 million and RMB0.7 million, accounting for 69.7%, 57.3% and 31.4% of the revenue generated from sales of daily-care products in China, respectively.

In 2024, 2025 and the six months ended June 30, 2026, we terminated the relationship with 53, 57 and four distributors.

We conduct random purchases of products suspected of channel diversion or price violations and trace the distributors by tracking the special codes.

For the years ended December 31, 2023, 2024, 2025 and the six months ended June 30, 2025 and 2026, revenue attributable to the sales to our distributors represented approximately 4.6%, 4.1%, 3.8%, 3.8% and 3.3% of our total revenue, respectively.

Our distributors do not hold inventories and we do not allow product returns except for product defects.

These arrangements are in place principally to satisfy the procurement requirements of such end-customers, which led us to believe that the risk of channel stuff is minimal.

During the Track Record Period, revenue from direct sales accounted for 54.9%, 57.6%, 63.9%, 59.0% and 57.6% of our total revenue for 2023, 2024, 2025 and the four months ended April 30, 2025 and 2026, respectively, while the revenue from distributor sales accounted for 45.1%, 42.4%, 36.1%, 41.0% and 42.4% of our total revenue for the same periods.

In 2023, 2024, 2025 and four months ended April 30, 2026, we engaged 45, 25, 31 and 16 new distributors, respectively. During the same periods, we terminated or discontinued business with 6, 23, 8 and 12 distributors, respectively.

We believe that we were not subject to any material channel stuffing risk, given that: (i) we maintain a buy-out relationship with our distributors and are not responsible for unsold inventory held by them, which reduces their commercial incentive to overstock our products;

In FY2023, FY2024, FY2025 and 3M2026 revenue generated from sales to distributors amounted to RMB10.4 million, RMB17.2 million, RMB39.3 million and RMB12.8 million, respectively, accounting for 4.3%, 6.4%, 12.4% and 16.8% of our total revenue in each year/period during the Track Record Period, respectively.

In particular, the decrease from 23 distributors as at 31 December 2025 to 11 distributors as at 31 March 2026 was primarily attributable to our efforts to streamline the distributor network and focus on distributors with stronger sales performance and market coverage.

We mitigate the channel stuffing risks through measures such as determining each distributor's minimum purchase amount based on its historical sales volume, trade receivables status and inventory levels, and conduct regular reviews of the distributors' inventory levels and trade receivable collection status, order approval, sales-operation-finance collaboration, channel inventory and shipment limits, and regular monitoring.

Sales through distributors | 519,575 | 16.0 | 526,693 | 13.2 | 740,239 | 12.0 | 306,265 | 10.3 | 412,945 | 9.2

In FY2024 and FY2025, four and seven inactive distributors discontinued relationships with us, respectively, primarily due to their low sales volumes and limited profitability, and they elected not to continue the distribution arrangement with us.

Based on the foregoing, we believe there was no significant unsold inventory owned by distributors during the Track Record Period and as of the Latest Practicable Date, and the risk of channel stuffing is remote in our distribution network.

Our revenue attributable to distributorship accounted for 2.3%, 2.1%, 2.5%, 1.8% and 1.7% of our total revenue in 2023, 2024, 2025 and the five months ended May 31, 2025 and 2026, respectively.

In 2023, 2024, 2025 and the five months ended May 31, 2026, we terminated our business relationships with one, nil, nil and three distributor, respectively, primarily due to the optimization of the distribution network.

We believe our sales volumes reflect genuine market demand, thereby minimizing the risk of channel stuffing within our distribution network.

In particular, revenue generated from distributors as a percentage of our total revenue increased from 59.7% in 2024 to 71.3% in 2025, and increased from 62.8% in the six months ended June 30, 2025 to 65.6% in the six months ended June 30, 2026, primarily driven by the rapid expansion of market demand, during which distributor channels provided broader customer reach and faster market coverage.

We sell our solutions to distributors in accordance with our distribution agreements and the specific purchase orders placed by them, and we do not impose minimum purchase or sales targets.

During the Track Record Period and up to the Latest Practicable Date, to the best knowledge of our Directors, there was no material channel stuffing or cannibalization issue among our distributors.

In the year ended December 31, 2024 and 2025 and the six months ended June 30, 2025 and 2026, we derived 99.1%, 99.6%, 99.6% and 99.7% of our revenue through a distributorship model, respectively.

In 2024, 2025 and the six months ended June 30, 2025 and 2026, we terminated cooperation with nil, 24, five and 17 distributors, respectively, primarily taking into account their performances, specifically because they either failed to develop and gain admission to target hospitals according to the agreed-upon plans, or failed to meet their minimum sales targets.

To effectively mitigate channel stuffing risks, we have implemented distributor management policies, including: (i) requiring full payment before delivery; (ii) only allowing product returns in the event of product quality defects; (iii) periodically monitoring our distributors’ inventory levels to ensure they maintain a reasonable stock level commensurate with their sales capabilities; and (iv) requiring distributors to provide sales materials on a monthly basis, such as invoices and distribution records, enabling us to track their actual sell-through data and monitor the alignment between their sales and genuine market demand.

In 2024, 2025 and for the six months ended June 30, 2026, our sales to our distributors accounted for 91.7%, 95.0% and 99.5% of our revenue for the respective year/period.

The number of our tier-one distributors increased from 144 as of December 31, 2024 to 192 as of December 31, 2025 and to 212 as of June 30, 2026, as we expanded sales of our products, particularly NovaPulse IABP and iNOwill.

the Directors are of the view, and the Sponsor concurs, that we are not exposed to material channel stuffing risk.

During the Track Record Period, a substantial majority of our products were sold through distributors.

We had 2,538, 2,791, 2,773, 1,430 and 1,532 active domestic distributors, and 907, 903, 934, 469 and 497 active overseas distributors in 2023, 2024 and 2025 and the three months ended March 31, 2025 and 2026, respectively.

In 2023, 2024 and 2025 and the three months ended March 31, 2025 and 2026, which generated our global network included 3,445, 3,694, 3,707, 1,899 and 2,029 distributors, respectively, revenue of RMB1,151.8 million, RMB1,179.8 million, RMB1,345.0 million, RMB314.0 million and RMB371.6 million, respectively, accounting for 87.8%, 84.3%, 83.1%, 88.5% and 88.0% of our total revenue for the respective periods.

As of the Latest Practicable Date, we had approximately 170 distributors covering over 30 provinces, municipalities, and autonomous regions, and our distribution network covered over 6,400 hospitals in China.

We do not set minimum purchase amounts or minimum sales targets for our distributors.

We grant rebates to distributors under a two-part framework comprising a monthly KPI-based performance rebate and an early payment rebate.

Direct sales are our predominant sales channel and accounted for around 90% of our revenue in each of 2023, 2024, 2025, and the six months ended June 30, 2026, with sales to trading companies accounting for 10.6%, 13.4%, 9.8%, and 7.1% respectively.

The use of trading companies as a supplementary sales channel is consistent with industry practice among specialty chemicals manufacturers operating across multiple geographies and customer segments.

Our relationship with trading companies is a buyer-and-seller relationship: trading companies purchase our products outright and resell them to end customers on their own account, and we do not act as principal or agent in their onward sales.

During the Track Record Period, our customers were our distributors who purchase drug products from us, allocate within designated regions or resell to end-customers.

Notably, our distributors increased from 30 in 2024 to 40 in 2025 and further to 41 for the six months ended June 30, 2026, exemplifying our strengthened sales network.

Our trade receivables decreased from RMB48.0 million as of December 31, 2023 to RMB27.5 million as of December 31, 2024, primarily due to the one-off price difference compensation to our distributors for unsold inventory following the inclusion of ZEGFROVY^®^ and golidocitinib in the NRDL in 2024 (effective since January 1, 2025).

In 2024, 2025 and the six months ended June 30, 2025 and 2026, our revenue generated from sales of sebaloxavir marboxil tablets under the distribution model amounted to nil, RMB5.0 million, nil and RMB2.2 million, respectively.

As of June 30, 2026, we have engaged 30 distributors across China, among which one of them is an online distributor.

We have implemented the following measures to prevent cannibalization and channel stuffing:

In 2023, 2024, 2025, and for the six months ended June 30, 2026, total revenue generated from sales to offline distributors accounted for approximately 21.0%, 21.8%, 22.8%, and 26.3% of our total revenue for the same year/period, respectively.

We terminated or did not renew cooperation with 22, 26, 25, and 64 offline distributors in 2023, 2024, 2025, and for the six months ended June 30, 2026, respectively, primarily as part of our proactive channel optimization initiatives.

During the Track Record Period, revenue generated from our largest offline distributor was RMB62.6 million, RMB113.0 million, RMB183.1 million, and RMB148.2 million in 2023, 2024, 2025, and for the six months ended June 30, 2026, respectively, accounting for 1.3%, 1.8%, 1.9%, and 2.5% of our total revenue in the corresponding year/period.

In 2023, 2024 and 2025 and for the three months ended March 31, 2026, sales to system integrators accounted for 93.6%, 95.1%, 81.5% and 94.6% of our total revenue, respectively.

During the Track Record Period, the number of our cooperating system integrators continuously increased, reflecting the growing market demand, our expanding sales network and successful commercialization strategies.

We also maintain strict sales management protocols, including prohibiting inventory hoarding and requiring formal reporting of end-customer application scenarios in China under our internal policies.

In 2023, 2024, 2025 and the six months ended June 30, 2025 and 2026, revenue from sales to franchisees amounted to RMB11,091.6 million, RMB11,140.4 million, RMB10,812.6 million, RMB4,940.0 million and RMB4,840.3 million, respectively, accounting for 94.5%, 94.5%, 95.3%, 95.0% and 95.0% of our revenue for the same periods.

The number of franchisees decreased from 1,776 as of December 31, 2023 to 1,717 as of December 31, 2024, primarily due to the termination of certain underperforming franchisees.

In 2023, 2024, 2025 and the six months ended June 30, 2026, our franchisee retention rate, calculated as one minus the number of franchisees that exited during the relevant period (excluding franchisees that joined and exited within the same period) divided by the number of franchisees at the beginning of the period, was approximately 73.4%, 81.7%, 82.6% and 91.2%, respectively.

Our distributorship revenue was RMB232.0 million, RMB278.0 million, RMB299.6 million and RMB175.1 million, accounting for 6.4%, 6.0%, 5.7% and 6.6% of our total revenue in the same respective years.

The material turnover and movement relating to our distributor customers remained stable during the Track Record Period.

To reduce inventory pressure on distributors, we have adopted a small-batch, high-frequency delivery model that shifts away from bulk inventory pushing toward a demand-driven distribution approach based on actual customer orders.

Revenue generated through our channel partners accounted for 16.1%, 19.4%, 22.8% and 25.2% of our total revenue in 2023, 2024, 2025 and the six months ended June 30, 2026, respectively.

Our cooperation agreements with channel partners are generally non-exclusive. We do not require our channel partners to meet any minimum purchase commitments or minimum sales targets.

Accordingly, we do not consider our channel partners to be distributors, and we do not believe their involvement as our direct customers raises any concerns relating to inventory risk or the recoverability of accounts receivable.

Revenue from our distribution channels amounted to RMB13,053.6 million, RMB14,276.0 million, RMB13,736.3 million, RMB6,829.1 million and RMB7,022.3 million in 2023, 2024 and 2025, and for the six months ended June 30, 2025 and 2026, respectively, representing 74.4%, 72.0%, 67.4%, 68.6% and 66.2% of our total revenue for the same periods.

We maintain a buyer-seller relationship with our distributors under a buy-out model, and as confirmed by Frost & Sullivan, such distribution arrangement is in line with industry practice.

The higher number of terminations in 2024 was primarily attributable to our streamlining of the distributor network by discontinuing cooperation with smaller-volume distributors whose monthly sales fell below our expected standards.