Shanghai Pharma's Cloud Health Secures RMB 135 Million in Series A+ Funding

On the evening of March 19, Shanghai Pharmaceuticals Holdings Co., Ltd. (“Shanghai Pharma”) issued an announcement stating that its subsidiary, Shanghai Pharma Health Commerce Co., Ltd. (hereinafter referred to as “SPH Health Commerce”), received cash capital injections of RMB 67.5 million each from Shanghai Yuepu and Shengtai Investment, with each investor acquiring a 4.5467% equity stake in SPH Health Commerce. This marks the third round of financing for SPH Health Commerce within one year of its establishment.

It is reported that on March 9, 2015, Shanghai Pharma and its e-commerce management team invested cash to establish Shanghai Pharma Health Commerce Co., Ltd. The company is positioned as a trade-oriented e-commerce platform providing patients with O2O sales of prescription drugs and health management services.

The announcement shows that SPH Health Commerce was established on March 18, 2015, with Shanghai Pharma investing RMB 70 million in cash and co-investing with individual investor Ji Jun. On August 18, 2015, Shanghai Pharma’s subsidiary Shanghai Pharma Holdings, JD.com, and IDG Capital jointly increased their capital investment in SPH Health Commerce with amounts of RMB 900 million, RMB 151.5 million, and RMB 60.625 million, respectively.

On August 18, 2015, SPH Health Commerce secured a total investment of RMB 1.1175 billion from Shanghai Pharmaceuticals, JD.com, and IDG Capital. Specifically, Shanghai Pharmaceuticals contributed its wholly-owned pharmaceutical distribution subsidiary, “SPH Holdings,” valued at RMB 900 million, resulting in a cumulative shareholding of 80.02% for Shanghai Pharmaceuticals and its affiliates. JD.com invested RMB 100 million in cash and platform resources valued at RMB 51.5 million, acquiring a 12.5% stake. IDG Capital invested RMB 60.625 million in cash, acquiring a 5% stake.

Following this investment, Shanghai Pharma and its holding companies hold a 72.7478% stake in SPH Health Commerce; JD.com holds an 11.3622% stake; IDG Capital holds a 4.5467% stake; and SoftBank China and Shengtai Investment each hold a 4.5467% stake.

According to Shanghai Pharma’s 2015 announcement, as of December 31, 2015, the audited key financial data for SPH Health Commerce were as follows: total assets of RMB 11.263 billion; operating revenue of RMB 2.479 billion; and net profit of RMB 8.4707 million.

According to Shanghai Pharma’s 2015 annual report, the company’s total operating revenue for the year reached RMB 105.517 billion, representing a year-on-year increase of 14.2%. Its business operations are primarily divided into four segments: First, revenue from the pharmaceutical manufacturing segment amounted to RMB 11.824 billion in 2015, a year-on-year increase of 6.49%; second, revenue from the pharmaceutical distribution segment reached RMB 93.717 billion, up 15.47% year on year; third, revenue from the pharmaceutical retail segment totaled RMB 4.795 billion, reflecting a 13.68% year-on-year growth; and fourth, the pharmaceutical e-commerce segment, operated under SPH Health Commerce.

Regarding SPH Health Commerce’s Series A+ financing round, Shanghai Pharma stated that this capital injection will provide sufficient financial support for the future business development of SPH Health Commerce, helping it accelerate the development of its e-commerce platform and solidify its leading position in the industry.

It is understood that Shanghai Yuepu is an RMB-denominated fund managed by SoftBank China Capital, which has successfully invested in numerous well-known enterprises such as Alibaba, Focus Media, BGI Genomics, and Dian Diagnostics; while Shengtai Investment is an investment company wholly owned by the Shanghai Charity Foundation.