Pharmaceutical Terminal Network Secures RMB 50 Million Series B Funding from Guohong Asset, Plans NEEQ Listing

Pharmaceutical E-commerceB2BDrug Terminal Network, a trading platform, announced the completion of a new round of financing worth RMB 50 million from Guohong Assets in December 2015. With this, the total amount of financing raised by Drug Terminal Network has exceeded RMB 100 million.

Three rounds of financing led by Matrix Partners, GGV Capital, and Guohong Capital, respectively

Guohong Asset was established in 2008 by a well-known domestic fund management team. Specializing in securities and equity investments, it ranks among the leading private hedge funds in China. Wang Qiang, Chairman of Guohong Asset, also stated that the firm would leverage its extensive experience and resources accumulated over years in the secondary capital markets to facilitate more effective capital operations following the company’s listing on the National Equities Exchange and Quotations (NEEQ), thereby jointly fulfilling the corporate mission of continuously optimizing China’s pharmaceutical supply chain.

YaoPinZhongDuan.com had previously secured two rounds of financing. In May 2015, YaoPinZhongDuan.com announced that it had raised RMB 27 million in Series A funding, led by Matrix Partners China and participated by Xianfeng Huaxing. In July of the same year, the company closed a RMB 37 million Series A+ round, led by GGV Capital and participated by Matrix Partners China.

YaoPin ZhongDuan Wang is a third-party B2B e-commerce trading platform specializing in the pharmaceutical distribution sector. In April 2014, it obtained the Internet Drug Trading License (No. Guo A20140002) issued by the China Food and Drug Administration. Starting with a transaction volume of only hundreds of thousands of yuan in early 2014, the platform achieved nearly RMB 100 million in monthly transactions by 2015. The number of partner pharmaceutical manufacturers, wholesalers, and active pharmacies on YaoPin ZhongDuan Wang has exceeded 30,000.

According to He Side, founder of Yaopin Zhongduan Wang (Drug Terminal Network), the company’s transaction volume was approximately RMB 30 million in 2014 and reached RMB 400 million in 2015, far exceeding its predefined target of RMB 300 million. For 2016, Yaopin Zhongduan Wang projects that its transaction volume will surpass RMB 2 billion. Meanwhile, the company has initiated shareholding reform and plans to list on the National Equities Exchange and Quotations (NEEQ) by July at the latest.

He Side, Founder of Yaopin Terminal Network

Securing Hundreds of Millions in Funding Within Just One Year: Why Do Investors Favor the Drug Terminal Network?

He Side stated that investors value the Drug Terminal Network for four main reasons.

FirstIn pharmaceutical distribution, end-point channels include retail pharmacies, hospitals, township health centers, community medical clinics, and chain drugstores. Yaopin Zhongduan Wang focuses on a niche segment within the industry, exclusively facilitating online procurement for small retail pharmacies, small clinics, and small chain stores. Its upstream suppliers primarily consist of pharmaceutical manufacturers and provincial-level general distributors acting as wholesalers, thereby eliminating intermediate links.

Many entrepreneurs have overlooked this niche segment of the pharmaceutical terminal market, primarily because small pharmacies are highly fragmented and often located in remote areas, leading to high procurement costs. Nevertheless, these small pharmacies play a crucial role in local pharmaceutical distribution. In essence, the Pharmaceutical Terminal Network handles the “dirty and tedious work” within the pharmaceutical distribution sector.

Second, within the concepts of broad health and comprehensive healthcare, pharmaceuticals constitute a critically important sector.



Third, the company’s team demonstrates strong execution capabilities and consists of individuals who are dedicated to getting the work done. Currently, China’s internet industry remains somewhat impetuous; ultimately, the enterprises that prevail will be those that are down-to-earth and capable of delivering results.

Fourth, the company demonstrates strong growth potential, a factor that investors highly value.

Regarding future plans, He Side stated that the primary proceeds from this financing round will be invested in market expansion to establish branches nationwide. Currently, the drug terminal network covers 10 provinces, with the aim of extending its reach to most provinces across China this year. The company will also increase investment in collaborations with pharmaceutical manufacturers, wholesalers, and pharmacies, while enhancing the user experience of its internet-based products.