Wang Muye was a 185cm tall, strong man. He laughed out loud when he heard this:
"Mr. Lin, you're being too modest. Old Zhou told me that Mr. Lin is an unfathomable boss, and that we pharmaceutical professionals can't compare to him.
Just the profit from selling one single piece of your Lingnantang wild ginseng would probably require us to painstakingly produce dozens of tons of API. So, our earnings are all hard-earned money.
At the beginning, I was also impulsive and thought that we had joined the WTO and were going to become the world's factory. With our country's efficiency, wouldn't we occupy the global pharmaceutical market?
So I invested all my family fortune and borrowed money from the bank and got into a lot of debt. In 2002, I spent a full 1 billion yuan to build this pharmaceutical factory.
1 billion in 2002, oh my god, I regret it so much now.
If I had used all that money to buy a house, a courtyard house in the capital, I would have been the richest man in the country by now."
After saying this, Wang Muye slapped his thigh in pain, then pointed at the row of instruments in front of him and said:
"This raw material factory is really a bottomless pit. Director Lin, although my pharmaceutical factory is so large, the output of cephalosporin is already the largest supplier in China, but the competition pressure is also great.
Now our company is actually completely focused on volume, small profits but quick turnover, and we try to make as much money as possible.
Otherwise, once the machine stops, the daily losses will be huge, and restarting it will cost a lot of cleaning costs, so it cannot be stopped.
Mr. Lin, take the reactors for example. There are many types, such as fiberglass reactors, stainless steel reactors, carbon steel reactors, etc.
Oh my god, the technical department is constantly requesting funding for technology upgrades and machine replacements, and it's driving me crazy."
Zhou Daxin also smiled bitterly and said:
"It's really a nightmare now. Those of us in the manufacturing industry are struggling to survive. We are lucky to avoid losses. The slightest market disturbance will lead to bankruptcy. It's very tragic.
Those who speculate in real estate, stocks, and finance all make a fortune.
Our old friends who came out to make a living from the same generation as us, Xu Baorun, Li Baoguo, Luo Xingyu and so on
Wow, these guys are doing very well now. Just a few clicks on the computer and money comes in like a flood. They appear on the Forbes wealth list every year.
People like me and Lao Wang are having a hard time. Even though we are surrounded by this chairman, that boss, and other high-ranking officials, if you ask us to come up with hundreds of millions, I can’t do it anyway.”
Before Lin Sanqi could speak, Wang Muye continued:
“In the past, people said that we should work hard to build a country, and we should all engage in industry, saying that only in this way can the country become prosperous and strong.
As a result, now anyone with connections and channels is willing to become a stock market maker, play P2P, or engage in micro-loans.
Money makes money, so naturally money comes quickly, but isn’t this just a capital game of passing the parcel?
If everyone stopped working in the real economy and closed their factories to speculate in stocks and futures, and the economy shifted away from the real economy and toward the virtual economy, then when would we be able to complete the four modernizations? When would our country truly become prosperous and strong?
This is all abnormal, and the government isn't doing anything about it."
Lin Sanqi thought, how can we control this? The market economy is all about freedom.
But excessive freedom means the full-scale invasion of capital.
When wealth is in the hands of a few people, it is definitely not a good thing, and the state should indeed take action.
The simplest one is that small and medium-sized enterprises cannot obtain loans and financial support, making it difficult for the real economy to develop.
A large amount of loans were invested in various large enterprises, or directly entered the stock market and real estate market, causing turmoil in the capital market.
The question is, what kind of people are capable of playing with finance and capital in China?
This group of people... ahem... the Celestial Dragons who even Jack Ma can't defeat, who can control them?
Lin Sanqi also deals in finance. He exchanged hundreds of billions of dollars into US stocks, but the people he reaped the benefits were Americans.
Unlike some domestic capitals, which are novices in foreign wars but experts in civil wars, they only know how to reap the money of domestic compatriots and then run out to pay tribute to foreigners.
Several people complained while visiting.
Lin Sanqi wanted to laugh after hearing this, thinking that these two old men were probably anxious because of the pressure of running the business, and they didn't look like big bosses at all.
So he changed the subject and said:
"Mr. Wang, you just said that Kenfu Pharmaceutical is one of the largest suppliers of cephalosporin raw materials in China. I have a question:
Why is there such a huge difference in efficacy between domestic and imported drugs for the same medicine? What is the problem?
When Wang Muye and Zhou Daxin heard this, they both laughed.
"This matter is complicated and simple at the same time. If you want to hear the truth, there will be a true explanation. If you want to hear a lie, there will be a lie.
Mr. Lin, you are Lao Zhou’s friend and also a colleague in our pharmaceutical industry. We can talk to each other honestly behind closed doors.
If other customers come to ask, I will definitely tell them that the drug ingredients are the same and there is no difference in the efficacy.
How could it be the same?
For example, the main raw material of Moutai liquor is sorghum rice, and ordinary rural liquor is also made from sorghum rice, and the ingredients are indeed the same.
But don’t the two wines taste the same? Then why does one cost thousands of yuan per jin (approximately 10000 yuan) and the other only a few yuan per jin (approximately 10000 yuan).
Drug prices are affected by many factors, including R&D costs, production processes, raw materials, patent protection, marketing, etc.
The efficacy of a drug depends on the level of its production technology, the quality of its raw materials, and whether its quality control is strict.
Let me give Mr. Lin another example. The raw materials of imported cephalosporins are extracted from Penicillium bacteria, while domestic cephalosporins are mainly obtained by hydrolysis of cephalosporin C.
The difference between these two processes is that the ingredients are very different, and the consequence is the difference in drug concentration and purity, which will directly affect the efficacy.
So in the pharmaceutical industry, you get what you pay for. The cephalosporin raw materials we export to European and American countries cost tens of millions per ton. Of course, we give them good products and the money is in place.
The medicine we export to India is cheap, we charge them a maximum of one million per ton. So what good medicine do India want? I will definitely give them the worst.
I will give you the medicine at whatever price you, the buyer, give me.
We are a business, not a charity. How could we possibly produce medicines at a loss without making any profit? What are we trying to achieve?
Even if I sell it to Ah San for 1 million per ton, I still have to make a profit. You can imagine the quality of the raw materials is bad. Mr. Lin, do you think I am right?"
Lin Sanqi gave a thumbs up and said, "Mr. Wang is a real man. I think you are right."
Wang Muye became even more excited when he heard Lin Sanqi agree with his point of view:
"If customers insist on low prices, don't care about efficacy, and don't care about the life and death of upstream API manufacturers, this will actually cause great damage to the normal market.
Because in the end, good money will drive out bad money, and pharmaceutical companies that make truly good drugs but sell them at higher prices will not be able to get orders, will not be able to survive, and will have to close down.
The final winners were those fourth- and fifth-rate pharmaceutical factories that were only interested in making dirty money, using the lowest-quality raw materials, the simplest processes, and even lacking sterile factories, and simply used low prices to capture the market.
In addition to directly affecting the efficacy of drugs and the number of side effects, another critical factor is that the investment in developing new drugs is huge, which requires pharmaceutical companies to have a lot of financial support.
If pharmaceutical companies don't make money and don't have the funds to develop new drugs, how can the medical industry progress? With so many diseases still unsolved, can we just sit back and relax? This is obviously irrational.
What is even more frightening is that if our domestic pharmaceutical companies have no money to invest in research and development, while foreign pharmaceutical companies are working hard on scientific research, in the end all patented drugs and special-effect drugs will be in the hands of foreign companies.
We will suffer a huge loss then, because foreign companies can take advantage of their monopoly and charge exorbitant prices. They can charge you tens or even hundreds of thousands of yuan for a box of medicine, but they are the only one with the product and no other stores. Will your patients buy it or not?
After hearing this, Lin Sanqi and Zhou Daxin both felt a little worried.
Zhou Daxin slapped his thigh and said unwillingly:
"Yes, this is like handing over the market for nothing. We've suffered a lot of losses in this regard, and they've been huge. Why haven't we learned our lesson yet?"
Lin Sanqi sighed heavily and said:
"It's mainly because of poverty. The people have no money, and the country has no money.
From a philosophical point of view, on the one hand, there is the people's growing demand for medical care, while on the other hand, there are backward drug production and economic constraints. What a contradiction.
So what Mr. Wang said makes sense, but each country has its own national conditions. Developed countries have the money to buy good medicine, but what about poor countries that can't keep up? First, solve the problem of whether or not there are drugs, then talk about efficacy."
The two Shandong men were stunned for a moment when they heard this, and then they could only continue to smile bitterly and nod:
"Boss Lin is right. Although we are complaining about being poor and tired, at least we are financially independent and have no worries about food and clothing. But we forget that there are still 600 million people in the country whose monthly income is less than 1,000 yuan.
This is ungrateful.
By the way, Mr. Lin, I'm wondering what kind of API you're planning to purchase this time? And how much?
Don't worry, if you are Lao Zhou's friend, you are also Lao Wang's friend. I promise not to make a penny, just consider it as making friends."
It’s useless to say this to southerners. For southern entrepreneurs, personal relationships are personal relationships, and business is business.
Negotiations must be negotiated, and bargaining must be done without hesitation. This is why Northerners find Southerners unresponsive. (End of this chapter)
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