Re-layout of channel strategy - new family members of Kehua

        January 4, 2018, upon approval of the board of directors, the company had formally signed relevant documents to acquire and control Guangzhou Kehua, Nanjing Yuanheng, and Jiangxi Kerong through acquisition, capital increase, joint venture and other means. In 2017, the company performed a capital increase to hold Xi'an Shenke and command the largest distributor resource of Shaanxi Province; now it proceeded the M&A transaction to continue expanding its layout of superior channels in the developed areas including East China and South China, by acquiring Guangdong Xinyou to obtain the general agency of Hitachi biochemical analyzer in the four provinces of South China. As KHB's channel strategy continued to be advanced, and based on the existing competitive strengths that each channel company had built in respective advantageous regions, as well as the stable customer base of secondary and tertiary hospitals and a considerable number of installed terminals and end customers, the company's "Instrument + reagent" business strategy could be better implemented.

        The three companies involved had been all maintaining long-term business cooperation with KHB. They were experienced in selling KHB products and could attend to comprehensive sales and after-sales of Kehua biochemical, immunological, molecular, and self-producing instruments. As such, they could be quickly and effectively integrated into KHB's existing sales team resources for mutual collaboration and support, so that the company can get closer to the end clients, providing comprehensive solutions for all types of medical institutions, and develop new business mode in advantageous areas, raise the market share of its own products, and further enhance its business scale and profitability.

        After 30 years of dedicated business development, the company has established and consolidated its full-line and brand advantages in the IVD field. It's been capable of producing MEIA reagents, LIA reagents, biochemical reagents, molecular diagnostics, and POCT, and been able to independently develop automatic biochemical analyzer, chemiluminescence instrument and serve for the end market at all levels. Now the company has established its "instruments + reagents" business development model and has built long-term partnerships with Sysmex, bioMerieux, DiaSorin, Hitachi, Biokit and other world-renowned enterprises, with sales resources spreading across all major provinces and cities. In the future, the company will give full play to the advantageous high-quality channels and the superior resources of current sales teams, attend to strong cooperation and collaborative support, exert its product and brand advantages to actively expand the market and raise the Kehua products' market share.