Mingdu Zhiyun Files IPO Prospectus After Raising Nearly RMB 200 Million in Two Years to Accelerate Pharma Digital Transformation

Amid the frequent occurrence of drug safety incidents, the government has continuously introduced policies in recent years to advance supply-side structural reforms in the pharmaceutical industry, aiming to elevate the overall standards of the sector and ensure drug safety.

From the National Medical Products Administration’s issuance of the “Guiding Opinions on the Construction of an Information-based Drug Traceability System” in November 2018, to the State Council’s promulgation of the “Vaccine Administration Law of the People’s Republic of China” in June 2019 and the passage of the revised “Drug Administration Law” in August of the same year, and further to the “Requirements for Drug Records and Data Management (Trial)” in July 2020… this series of policies issued by the state allRequire pharmaceutical companies to establish a full-process traceability system from R&D to production, logistics, and consumption.。

However, most domestic pharmaceutical companies in China still lag significantly behind international advanced standards in new drug R&D, IT investment, and overall management and manufacturing capabilities. There is substantial room for improvement in areas such as comprehensive compliance management and digital transformation.

Digital Transformation and Intelligent Manufacturing Upgrading in Pharmaceutical Companies Are Urgent.

In light of the practical application needs of domestic pharmaceutical companies,Mingdu Intelligence, grounded in digital R&D and digital factory operations, powered by big data and artificial intelligence technologies, and supported by an industrial IoT platform, aims to provide pharmaceutical enterprises with full lifecycle solutions spanning from research and development to production.

Since its establishment in May 2017, Mingdu has served clients includingLivzon Group, Shanghai Pharma Group, Tianjin Institute of Pharmaceutical Research, Huadong Medicine, China Resources Sanjiu, Zhejiang Medicine, Zhuhai Rundu Pharmaceutical, and more than 100 other leading domestic pharmaceutical enterprises, covering traditional Chinese medicine, active pharmaceutical ingredients (APIs), chemical preparations, vaccines, and other biological products,Widely recognized by customers.

Leveraging its own strengths, Mingdu Intelligence has also frequently garnered favor from investors.

Within just two years, Mingdu Wisdom successively completed three rounds of financing: Pre-A, A, and A+, with the total funding amountNearly 200 millionRMB.

Mingdu Intelligence's Historical Financing Details

Ge Yafei, Founder of Mingdu IntelligenceFormer Chairman and President of Dunan Environment, a publicly listed company, with extensive experience in business management and profound expertise in smart factories, robotics, and the pharmaceutical sector.

When discussing the original intention behind its founding, Ge Yafei stated, “In previous years, I worked in the discrete manufacturing industry, where I accumulated extensive experience and insights. In 2016, I began to reflect on the challenges society was facing and what development opportunities might emerge in the future. The internet industry had been developing for over a decade, but the Industrial Internet of Things (IIoT) was just getting started.”

Ge Yafei believes that Chinese-made low- and mid-end products have nearly reached their peak, with future growth trends lying in high-end products. In his view, the entire society will undergo comprehensive upgrading and transformation. “I consider the pharmaceutical industry to be one with promising development prospects, which is why I made the firm decision to establish Mingdu Intelligence,” said Ge Yafei.

In addition to the halo effect carried by the founders,The founding team of Mingdu Intelligence brings together senior technical talents from multiple fields, including industrial IoT, automation, industrial control, internet, and pharmaceuticals, with backgrounds at companies such as Dun’an Environment, Zhejiang Supcon, Siemens, AstraZeneca, H3C, and Alibaba.The team members possess in-depth knowledge of underlying equipment such as pharmaceutical machinery and instruments, as well as upper-level control software, digitalization software, and pharmaceutical GMP regulations.

Ge Yafei told VCBeat, “Our requirements for the overall team are threefold: first, a solid understanding of underlying automation; second, proficiency in digitalization; and third, familiarity with the production and quality systems, as well as laws and regulations, of the pharmaceutical industry.” Based on this, Mingdu Intelligent has built such a robust talent system.

According to the report “Quarterly Journal of Digital Healthcare Innovation: Framework for Digital Transformation in the Pharmaceutical Industry” released by VCBeat’s VBInsight this July, the pharmaceutical industry has maintained a high growth rate.The pharmaceutical industry’s compound annual growth rate (CAGR) has surpassed that of other sectors, including information and communications technology (ICT), retail, high-end manufacturing, and wholesale trade. While the market growth rate exceeds 10%, the overall level of digitalization remains low.

Driven by national policies, the pharmaceutical industry is undergoing transformative changes, shifting from paper-based to digital regulation, from a marketing-centric approach to a focus on drug quality and cost efficiency, and from generic drugs to innovative therapeutics. Against this backdrop, it is imperative for Chinese pharmaceutical enterprises to accelerate their digital transformation and upgrade toward intelligent manufacturing.

Ge Yafei stated, “With the continued advancement of policies such as centralized procurement and increasingly stringent national regulatory requirements, industry consolidation is an inevitable trend."The number of pharmaceutical companies in China, currently over 7,000, is expected to be consolidated to around 3,000, or even as few as 1,000. To achieve sustainable development, these companies must address compliance issues, enhance their R&D and manufacturing capabilities, invest in the application of new technologies, and embark on the path of 'dual transformation' (namely, informatization and digitalization)."

Currently, China’s pharmaceutical industry lags significantly behind international leaders such as the United States, the European Union, and Japan in areas including new drug research and development, informatization investment, and logistics capabilities.

“Why is pharmaceutical manufacturing more advanced abroad? Because as early as the 1980s and 1990s, companies like Siemens and Rockwell were already comprehensively helping large overseas pharmaceutical enterprises implement automated information systems,” Ge Yafei told VCBeat. He emphasized that for pharmaceutical companies to achieve genuine growth and expansion, they must complete their informatization and digital transformation. This upgrade is essential to enhance manufacturing capabilities, fully unleash productivity, and ensure drug quality—a requirement of the times and an inevitable development trend.

“Mingdu primarily addresses two issues: first, ensuring compliance in the pharmaceutical industry; and second, elevating the overall standards of pharmaceutical manufacturing by providing guarantees in productivity, efficiency, and safety for pharmaceutical companies.” With this concise statement, Ge Yafei articulated the mission of Mingdu Intelligence.

When discussing the pain points in China’s pharmaceutical industry, he regretfully stated, “The current state of China’s pharmaceutical sector is characterized by small scale, fragmentation, and low standards. There are more than 7,000 pharmaceutical companies in China; while numerous, they are generally small in size. A common problem among most domestic pharmaceutical enterprises is the difficulty in strictly ensuring manufacturing quality.”

Ge Yafei further explained that, since over 90% of pharmaceutical companies in China currently rely primarily on manual labor for workshop management and operations, issues such as process instability and batch-to-batch variability frequently arise, making it difficult for these enterprises to fully ensure their overall pharmaceutical manufacturing standards.

To address this market pain point, Mingdu Intelligence provides end-to-end digital solutions for pharmaceutical companies, aiming to bridge gaps in manufacturing workshop management and meet the current development needs of domestic pharmaceutical enterprises.

At the R&D end,Mingdu Intelligence provides SmartLab, a full-lifecycle solution for drug R&D, to help pharmaceutical companies manage R&D projects, scientific data, laboratory records, and drug registration and marketing applications. By leveraging digital empowerment, it aims to assist clients in scientifically managing their R&D pipelines and enhancing drug development productivity.

On the production side,By providing the MindownIn Pharma MES intelligent manufacturing solution, Mingdu Intelligence delivers a pharmaceutical manufacturing execution system centered on electronic batch records (EBR), production traceability, production execution, and quality control. This helps pharmaceutical enterprises enhance management compliance, consolidate process knowledge, and improve product quality, while enabling big data accumulation to ensure safety and support sustainable development.

In terms of logistics,Mingdu Intelligence leverages its WMS system to help pharmaceutical enterprises establish intelligent warehousing, integrate smart logistics between warehousing and production, achieve unmanned operations and intelligent control in warehouses, and enable refined management and traceability through multi-level coding for unique item identification.

"In Ge Yafei's words, the systems on the production and logistics ends have become clear."“The Digital Journey of a Pill”“From raw materials, formulation, and weighing to the actual production of each pill, followed by packaging, warehousing, and distribution, we can achieve full-process traceability,” said Ge Yafei with satisfaction.

Mingdu Intelligence’s system is designed to enhance human-machine coordination, freeing people to focus on more valuable tasks.

Mingdu provides pharmaceutical companies with a variety of flexible solutions tailored to different industry segments, based on their compliance requirements and practical needs.

To fully address the IT needs of domestic pharmaceutical companies,The Mingdu software system is compatible with multiple cloud deployment models (public cloud, private cloud, and on-premises deployment), facilitating data analysis and processing while ensuring data integrity and security.

“It’s not just about meeting the digital transformation demands of large pharmaceutical companies in production management,” Ge Yafei told VCBeat. “Currently, our company is designing version 2.0 software management systems, striving to make our products lightweight and modular to cater to innovative pharmaceutical enterprises of varying scales. Mingdu will strive to help these growing companies address their digital transformation challenges in production management.”

Digital transformation is not an overnight achievement; pharmaceutical companies will gradually implement comprehensive informatization reform and intelligent manufacturing upgrades based on their specific needs. To this end,Mingdu’s software offerings feature two pricing models. One is an annual subscription model; for R&D solutions such as eCTD, Mingdu charges an annual service fee based on the number of drug applications submitted by the client. Solutions for manufacturing and logistics are primarily implemented on a project basis.

Regarding the future development trends of Mingdu Intelligence, Ge Yafei expressed strong confidence. “We are currently competing primarily with foreign counterparts and striving to achieve domestic substitution for imported products. Through iterative development, Mingdu Intelligence will gradually establish advantages in technology and structure compared to traditional software service providers in the pharmaceutical industry. Our core competitiveness lies in our product architecture, application of AI technology, cost-effectiveness, and our ability to provide continuous customer service.”

Ge Yafei told VCBeat,Mingdu Intelligence will complete its shareholding reform in the near future, expects to close its Series B financing round before the first quarter of 2021, and plans to file for an IPO with the stock exchange based on its 2021 annual report.

Recently, Mingdu Intelligence participated in the Zhejiang Division of the 9th China Innovation and Entrepreneurship Competition and the 7th Zhejiang Province “Torch Cup” Innovation and Entrepreneurship Competition. In the final round, Ge Yafei, founder of Mingdu Intelligence, presented on the theme of “The Digital Journey of a Pill,” showcasing the company’s team strengths, core business, leading technologies, and financial and capital planning to attendees and judges, earning full recognition from both the judges and the audience.

Ultimately, Mingdu Intelligence emerged from the 21 finalist teams with the highest overall score of 92.6, claiming the championship in the Growth Category of the Zhejiang Division Finals.

Figure: Ge Yafei, Founder of Mingdu Intelligence

The competition was hosted by the Zhejiang Provincial Department of Science and Technology and the Torch High-Tech Industry Development Center of the Ministry of Science and Technology, with a total of 886 eligible enterprises registering to participate.

“The Digital Journey of a Pill” continues to unfold. Next, Mingdu Intelligence will continue to unlock endless possibilities.