The performance fell short of expectations. The company's 2015 revenue was 1,366 million yuan, a decrease of 13.89%, net profit attributable to shareholders of listed companies was 282 million, a decrease of 19.97%, and an EPS of 0.34 yuan, lower than our expectations. The company plans to introduce a profit distribution plan of distributing cash dividends of 1 yuan (tax included) for every 10 shares. The development trend focuses on products that are heavily pressured by medical insurance fee control. Sales of the company's main product, Phlegm Fever Cleaning Injection, declined under the pressure of medical insurance fee control, and revenue is expected to drop by nearly 15% in 2015. At present, it has entered the basic drug catalogue of Guangdong, Xinjiang, Guangxi, Liaoning, Jilin, Shandong, Henan, Anhui, Zhejiang, etc., and the new product, phlegm fever-clearing capsules, has entered the supplementary medical insurance catalogue of Guangxi Zhuang Autonomous Region. The company has taken the initiative to change the sales model, speed up market development, and strive to shorten the market introduction cycle of phlegm fever-clearing capsules. Epitaxial expansion complements quality resources. The company is actively expanding its product range. In January 2015, the company successfully acquired the national class 1.1 traditional Chinese medicine “Youxindin Capsule”, which is used to treat a large variety of depression; in May, it successfully acquired Xinyi Pharmaceutical and its two exclusive varieties “thiopronin sodium” and “astragalus capsule”; and increased capital in Shanghai Yizhong Biotechnology Co., Ltd. in December to enter oncology drug research and development and lay out the modern biomedical pharmaceutical field. It is expected that the company will continue to actively expand product coverage areas and enhance its overall competitiveness through extension in the future. The profit forecast takes into account that the company's main products are under heavy pressure from medical insurance fees, and the 2016/2017 EPS forecast was lowered to 0.36/0.39 yuan (originally 0.58/0.64 yuan, a decrease of 38%/39%), giving an EPS forecast for 2018 of 0.41 yuan, an increase of 8%/7%/6% over the previous year. The valuation and recommended EPS corresponding to P/E from 2016 to 2017 are 27 times and 26 times, respectively. Maintaining the “recommended” rating, the target price was lowered to 12 yuan (40% reduction), corresponding to the 2016 P/E by 33 times. Risk The promotion of new products falls short of expectations, and the risk of price reduction of traditional Chinese medicines.