Frequent Executive Turnover in China's Pharmaceutical Sector: Six Chairpersons and Numerous Senior Executives Resign Within a Month

Executive turnover in the pharmaceutical sector remains frequent, with chairpersons of six pharmaceutical companies resigning within just over a month.

01

Chairman Changes at 6 Leading Pharmaceutical Companies

Recently, executive turnover in the pharmaceutical industry has remained frequent. According to an incomplete tally by Sai Bailan, from July to the present, six pharmaceutical companies have undergone changes in their chairmanship.

Jiaying Pharmaceutical

On August 2, Guangdong Jiaying Pharmaceutical Co., Ltd. issued the "Announcement on the Election of the Chairman and Appointment of the General Manager" and the "Announcement on the Election of the Vice Chairman." The announcement stated that on August 2, 2021, the Company convened the First Meeting of the Sixth Board of Directors, which reviewed and approved the "Proposal on Electing Mr. Zhu Layi as Chairman of the Sixth Board of Directors" and the "Proposal on Appointing Mr. Zhu Layi as General Manager of the Company." All directors agreed to appoint Mr. Zhu Layi as Chairman of the Company, who will concurrently serve as General Manager.

Yunnan Lusheng Traditional Chinese Medicine Science & Technology Co., Ltd.

On July 28, Yunnan Lusheng Traditional Chinese Medicine Technology Co., Ltd. announced that its board of directors received a resignation letter from Chairman Xiong Shurong on July 26, with the resignation taking effect on July 26, 2021.

Zhongxin Pharmaceutical

On July 20, Zhongxin Pharmaceutical announced that the Board of Directors received a written resignation from Li Liqun on July 19, 2021. The announcement stated that due to changes in work arrangements, Li Liqun has applied to resign from his positions as Director and Chairman of the Board. Following his resignation from these roles, Li Liqun will continue to serve in other capacities within the company. In accordance with the relevant provisions of the Company Law and the Articles of Association, Li Liqun's resignation shall take effect on the date the written resignation is delivered to the Board of Directors.

Changchun BCHT Biotechnology Co., Ltd.

On July 13, BCHT Biotechnology announced that the Company's Board of Directors recently received a resignation application from Director An Jixiang. Due to reaching the statutory retirement age, Mr. An has applied to resign from his positions as Chairman of the Board, Director, and Convenor of the Strategic Decision-Making Committee of the Fourth Board of Directors.

`Hengrui Pharma`

On July 9, Hengrui Medicine announced that the Board of Directors had recently received a resignation letter from Zhou Yunshu, Chairman and General Manager of the Company. Due to health reasons, Mr. Zhou has applied to resign from his positions as Chairman and General Manager, as well as his corresponding roles on the Board's specialized committees. The resignation shall take effect upon its delivery to the Board of Directors. It is reported that on August 4, Hengrui officially announced Sun Piaoyang's appointment as Chairman.

Yan'an Bikang

On July 7, Yan'an Bikang issued the 《Announcement on the Resignation of Certain Directors and Senior Management and the By-election of Successors》. The announcement stated that the company recently received resignation letters from six senior executives, including the Chairman, Vice Chairman, Directors, and Deputy General Manager. On July 5, the company convened a board meeting to review and approve the appointment of a new management team.

According to the company's announcement, the senior executives resigning from Yan'an Bicon on this occasion include Chairman Gu Xiaojia, Vice Chairman Li Jingkun, Directors He Yudong, Deng Qing, and Wang Dong, and Vice President Yue Hongbo. Additionally, the company convened a board meeting, which approved the nomination of Han Wenxiong, Shao Xinjun, Wang Cheng, Quan Xinxue, and Cui Qingwei as candidates for non-independent directors of the Fifth Board of Directors. The board also reviewed and approved the appointment of Shao Xinjun as President of the company, and Wang Cheng, Quan Xinxue, Yin Dajie, Kang Xinchang, and Deng Siwei as Vice Presidents.

02

Management Changes at Over 10 Pharmaceutical Companies

In addition to the aforementioned six pharmaceutical companies that have undergone changes in chairmanship, according to a review by Sibailan, from July 2021 to the present, other departed pharmaceutical executives include:

Shu Wen of Huarong Pharmaceutical has applied to resign as Vice President; Wang Jianhua of Boji Pharmaceutical Biotechnology Co., Ltd. has applied to resign as Director, Deputy General Manager, and other positions; Chen Da of Luoxin Pharmaceutical has applied to resign as Chief Financial Officer and other positions; Chen Qiubo of Hainan Taosheng Pharmaceutical Co., Ltd. has applied to resign as Board Secretary of the Company; Han Tianyu of Wan'an Pharmaceutical has applied to resign as Deputy General Manager of the Company; Yang Feng of Renhe Pharmaceutical has applied to resign as Independent Director of the Company; Xu Zhijian of Dongya Pharmaceutical has applied to resign as Board Secretary; Ding Fujun of Ji'an Yisheng Pharmaceutical has applied to resign as Deputy General Manager and other positions; Yuan Min of Fukang Pharmaceutical has applied to resign as Deputy General Manager; Gao Meihua of Lifang Pharmaceutical has applied to resign as Director and Deputy General Manager; Guan Chengshan of Harbin Sanlian Pharmaceutical has applied to resign as Deputy General Manager of the Company.

According to incomplete statistics from Saibailan, nearly 11 pharmaceutical companies have experienced senior executive turnover within just over a month. Overall, the primary reasons for the departure of these executives are career transitions and personal reasons.

03

Industry Adjustment Drives Talent Mobility

In fact, management turnover in pharmaceutical companies has consistently been relatively high. Alongside the ongoing adjustments to the organizational structures of domestic pharmaceutical enterprises, multinational pharmaceutical companies are also continuously engaged in strategic planning.

For example: In August, according to the "Pharma Representative" Official Account, Peng Zhenke, founder and partner of medical consulting firm INNOVie, joined Pfizer as President of Pfizer Biopharmaceuticals Group China; in June, Qian Wei, former General Manager of Roche's First Business Unit and Acting Head of the General & Specialty Pharmaceuticals Division, joined Junshi Biosciences; in May, Wang Yizhe, former Global Head of R&D for Oncology Products at Eli Lilly, joined LianTuo Biosciences; in February, Ji Jing, former Vice President of R&D at AstraZeneca China, joined Abbisko Therapeutics.

The greater scope for career advancement and higher compensation packages have made domestic pharmaceutical companies highly attractive to many senior executives from multinational pharmaceutical firms. It is evident that the trend of top executives leaving multinational pharma companies to join China's domestic pharmaceutical sector has gradually become established.

With the normalized advancement of centralized volume-based procurement, the ongoing adjustment of the National Reimbursement Drug List, and the gradual implementation of national drug price negotiations, the profit margins of some pharmaceutical companies continue to be squeezed. To a certain extent, this has impacted their development strategies, compelling them to compress costs, reduce expenditures, and adjust their strategic structures. Against this backdrop, frequent turnover among pharmaceutical senior executives comes as no surprise.

According to the analysis in the 《2021 Market Outlook and Compensation Report》 published by Randstad Greater China, one of the world's largest HR service solutions providers, compensation and benefits, work pressure, and career development opportunities have become the primary reasons for healthcare professionals to change jobs.

It is foreseeable that, against the backdrop of the pharmaceutical industry's continuous transformation and upgrading, the requirements for talent are becoming increasingly stringent. Professionals in pharmaceutical enterprises should align with their companies' strategic realignments and proactively pursue career paths tailored to their own professional development.