China's pharmaceutical industry is navigating a pivotal phase of national healthcare reform. The implementation of the 4+7 policy, national centralized drug tendering and procurement, and the formal enforcement of the Medical Representative Registration Management Measures have significantly compressed industry profits while triggering sweeping transformations. Against the backdrop of the nation's vigorous promotion of the dual circulation strategy, how can enterprises innovate, transform, and elevate themselves amidst the waves of healthcare reform?
On November 26, the "E-A-Tong Pharmaceutical Industry New Distribution Development Forum" (hereinafter referred to as the "Forum") was held in Guiyang City. This forum is expected to significantly promote digital innovation in the distribution of Guizhou's healthcare industry.
In the post-pandemic era, is the pharmaceutical industry facing a harsh winter or soaring on a tailwind?
Official records indicate that on December 7, 2018, the National Healthcare Security Administration launched the "4+7" volume-based procurement pilot program. By September 24, 2019, joint procurement expanded to 25 provinces and regions, intensifying price competition.
Furthermore, the nationwide implementation of the "two-invoice system" in 2017 accelerated consolidation within the pharmaceutical distribution sector.Compounded by the proliferation of small and medium-sized domestic pharmaceutical agents, drugs undergo multiple distribution stages from manufacturer to end consumer. This results in high costs, intense competition, and severely impacts profit margins and sales growth across the industry chain. The dominant theme for the pharmaceutical sector over the next decade is now crystal clear—the urgent need for pharmaceutical companies to embrace digitalization, flattening, sharing, and decentralization in their transformation journey.
Eatone Keeps Pace with Industry Trends, Strategically Positioning for New Distribution Models in Pharmaceuticals
As early as 2017, Eatone entered the healthcare sector, establishing over ten controlled pharmaceutical distribution enterprises covering drugs, medical devices, and healthcare-related product lines. The company is committed to driving the industry's new distribution transformation toward "flattening, sharing, and decentralization."
Zhou Guohui, Chairman and CEO of YITONG, stated that the company's mission is to reduce intermediary links, control distribution costs, and enhance brand sales volume and profit margins during the healthcare industry's era of slim margins. YITONG aims to fully share the benefits of the "supply chain platform + internet" era with manufacturers and distributors.
In response, Ma Lei, Director of the Guizhou Provincial Investment Promotion Bureau, remarked during his address that digitally integrating the pharmaceutical distribution supply chain represents a bold new endeavor. YITONG's pursuit of breakthroughs in new business models from this strategic vantage point aligns with the new development stage, new development philosophy, and new development paradigm proposed at the Fifth Plenary Session of the 19th CPC Central Committee. "This goes far beyond the pharmaceutical sector—digitalized new distribution will bring disruptive changes to many other industries as well."
Undoubtedly, YITONG's vision for new distribution aligns closely with national healthcare reform objectives: leveraging digital tools to cover all supply chain segments—from marketing to operations—thereby deeply empowering brand owners, distributors, retail outlets, and end-users across the industrial chain.
Supply Chain Transformation Accelerates as YIT Helps Enterprises Amplify Core Competitiveness
By establishing a shared economy platform connecting upstream and downstream players in the pharmaceutical industry, YIT achieves flattened, shared, and decentralized operations. This enables direct supply from upstream brands to retail outlets and end-users, while allowing retailers to centralize direct procurement from brands. By reducing intermediary layers, the model achieves overall cost leadership.Its recently launched YATON Pharmaceutical Procurement App aims to create a streamlined distribution channel, flexibly and efficiently allocate resources, continuously reduce costs and improve efficiency, effectively alleviating the prisoner's dilemma commonly faced by pharmaceutical companies.
On one hand, the YITONG Pharma Purchase APP serves as a bridge for transactions among pharmaceutical brands, distributors, retail pharmacies, and hospital pharmacies. On the other hand, it leverages market-driven pricing advantages and service strengths to attract more users, such as hospital prescriptions, thereby cultivating a loyal consumer base.
Policy Regulation Drives Industry Growth; YITONG Supply Chain Matures with Strong Momentum
Policy has consistently served as a key "catalyst" for China's pharmaceutical industry development, accelerating transformation across the entire pharmaceutical supply chain. As supply chains mature, they will enable innovative industry development and become critical to the future survival of pharmaceutical enterprises.As an innovator in pharmaceutical supply chain solutions, YITONG Healthcare Platform possesses inherent advantages by tightly integrating major stakeholders including brand owners, manufacturers, logistics providers, channel distributors, and financial institutions.
Moreover, YITONG is strategically transforming its organizational management model. It is recruiting healthcare industry partners nationwide, sharing access to millions of retail outlets with agents and marketing partners to expand sales reach. This shifts away from the traditional sales-team-driven model, establishing a flat "platform + marketing partners" structure that fosters win-win development across the pharmaceutical supply chain.
It is reported that by year-end, YITONG expects to complete its medical platform deployment across 16 provinces, with nationwide network coverage finalized in the first half of next year, thereby refining the pharmaceutical distribution industry's new ecosystem.