Luzhu Group Executive "Major Reshuffle": Helplessness and High Stakes Amid Growth Slowdown

Recently, a personnel change announcement has brought the established pharmaceutical company Lizhu Pharmaceutical into the spotlight. Four core executives resigned on the same day; three veteran leaders with over thirty years of service stepped down due to age, and 38-year-old post-85 Liu Daping took over as CEO. On the surface, it appears to be a routine leadership transition, but it actually reflects a pharmaceutical company caught in growth anxiety, desperately trying to break through the dilemma through a major personnel overhaul.

01 Performance “Warm Water Boiling Frogs”: Revenue Decline and Weak Growth

Behind any personnel upheaval, there is often the silent director of performance. Reviewing Lizhu Pharmaceutical’s recent financial reports reveals that the company is caught in a “boiling frog” style growth anxiety.

In 2024, Lizhu Pharmaceutical achieved a total revenue of 11.812 billion yuan, down 4.97% year-over-year; net profit attributable to shareholders was 2.061 billion yuan, up 5.5%. Revenue declining while profits slightly increase usually indicates the company is cutting costs or adjusting product structure, also hinting at sluggish core business growth.

Entering 2025, this fatigue persists. In the first three quarters, the company’s revenue was 9.116 billion yuan, a slight increase of only 0.38% year-over-year; net profit attributable to shareholders was 1.754 billion yuan, up 4.86%. Notably, net profit in the third quarter declined 5.73% year-over-year. Amid overall industry pressure and normalized centralized procurement, Lizhu has maintained its basic operations but has also lost its former high-growth elasticity.

02 R&D Investment “Cutting Back”: Hidden Concerns About Innovation Potential

More worrying than revenue data is the continuous reduction in R&D investment. The financial report shows that in 2024, Lizhu’s R&D expenses totaled 1.03 billion yuan, a decrease of over 20% from 1.33 billion yuan in 2023. In 2025, this trend not only continued but worsened.

In the first three quarters, R&D spending was only 683 million yuan, with the proportion of revenue dropping to 7.49%. How does this R&D ratio compare within the industry? HengRui Medicine’s R&D expenses in the first three quarters of 2025 reached 4.945 billion yuan, accounting for over 20% of revenue; Fosun Pharma also invested 2.73 billion yuan in R&D during the same period. In comparison, Lizhu’s absolute R&D investment is less than one-seventh of HengRui’s and less than a quarter of Fosun’s.

For a pharmaceutical company aiming for “innovation breakthroughs,” R&D pipelines are its lifeline. Shrinking investment in innovation drugs often means insufficient future momentum over the next three to five years. Lizhu is aware of this; the company has emphasized its “innovation pipeline layout” on multiple occasions and has made some progress in assisted reproduction, neuropsychiatry, and other fields.

However, limited R&D funds must be carefully allocated across multiple pipelines. While HengRui is making comprehensive advances in ADC, GLP-1, and international BD, and Fosun is heavily investing in CAR-T and nuclear medicine, Lizhu’s choices appear cautious or even conservative.

Conclusion

The rise of a younger team can undoubtedly inject innovation vitality and international perspective into the company, opening a breakthrough for its long-standing weak performance. But the new leadership team may also face a painful adjustment period. Under pressure from core product lines, any strategic wavering could be amplified. Although this leadership change is expected to “break the deadlock through change,” whether reforms can truly be implemented and new directions successfully established remains to be seen. For Lizhu Pharmaceutical, this is both an unavoidable self-revolution and a high-stakes gamble on the future.

This article was generated with AI tools.