An astounding incident involving the direct dumping of 150 tons of untreated wastewater has occurred at a subsidiary of Jinghua Pharmaceutical Group (002349).
According to a disclosure by Jinghua Pharmaceutical on the evening of December 25, the company recently received a forwarded copy of the relevant "Criminal Judgment" from its controlling subsidiary, Jiangsu Senxuan Pharmaceutical Co., Ltd. (hereinafter referred to as "Senxuan Pharmaceutical").
The judgment reveals that the plaintiff, the Yinchuan Railway Transport Procuratorate, asserted that the defendant, Ningxia Senxuan Pharmaceutical Co., Ltd. (hereinafter "Ningxia Senxuan"), and the accused individual, Huang Xionghu, dumped 150 tons of toxic substances, causing public and private property losses amounting to 857,900 yuan. Huang Xionghu was identified as the responsible manager who organized and directed the actions leading to Ningxia Senxuan's environmental pollution crime, making him the directly responsible personnel for the corporate offense. The Yinchuan Railway Transport Procuratorate initiated a public prosecution based on Article 176 of the Criminal Procedure Law of the People's Republic of China.
It is noteworthy that Senxuan Pharmaceutical is a company listed on the Beijing Stock Exchange. Among the defendants, Ningxia Senxuan is a controlling subsidiary of Senxuan Pharmaceutical, primarily engaged in the R&D, production, and sales of fluorine-series and chlorine-series pharmaceutical intermediates; Huang Xionghu served as the head of the Safety and Environmental Protection Department at Ningxia Senxuan. Their prosecution is related to an environmental violation case they committed.
Around February 20 of last year, the sewage discharge pipeline in the park where Ningxia Senxuan is located froze and cracked, rendering it unable to process waste. Huang Xionghu, responsible for company safety and environmental protection, contacted an intermediary named He Moumou and Li Moumou from the park's environmental supervision department. They arranged for the untreated wastewater from the temporary storage pool at Ningxia Senxuan's wastewater treatment station to be transported by He Moumou to an off-site wastewater treatment plant for disposal at a price of 320 yuan per ton.
However, He Moumou organized the transportation of approximately 150 tons of wastewater in five tanker trucks, which were directly dumped on the grounds of a former abandoned school in Shitanjing, resulting in environmental pollution.
According to the verdict issued by the Yinchuan Railway Transport Court on December 23, Ningxia Senxuan was found guilty of environmental pollution and fined 500,000 yuan. Huang Xionghu was convicted of environmental pollution, sentenced to two years and six months in prison, suspended for three years, and fined 60,000 yuan.
In April of this year, Jinghua Pharmaceutical announced that Ningxia Senxuan had received a "County Government Decision Ordering Ningxia Senxuan Pharmaceutical Co., Ltd. to Suspend Operations" from the Pingluo County People's Government. Ningxia Senxuan was suspected of violating relevant provisions of Article 39 of the Water Pollution Prevention and Control Law of the People's Republic of China and was ordered to suspend operations for rectification.
In late July, Jinghua Pharmaceutical announced that Ningxia Senxuan had completed its rectification, passed a self-organized expert acceptance review, and subsequently passed an on-site verification by experts organized by various competent authorities regarding the shutdown remediation and rectification. Ningxia Senxuan has now resumed orderly production and operations. "Ningxia Senxuan prepaid a 2.5 million yuan environmental restoration bond. During the shutdown, the company formulated follow-up plans for production safety and market maintenance."
Jinghua Pharmaceutical stated that, based on the effective judgment result, the company will guide Senxuan Pharmaceutical and Ningxia Senxuan to actively advance relevant work to protect the legitimate rights and interests of the company and all its investors.
Jinghua Pharmaceutical's main business involves the R&D, production, and sales of traditional Chinese patent medicine preparations, chemical APIs and intermediates, chemical pharmaceutical intermediates, Chinese medicinal materials, and decoction pieces. The company and its subsidiaries are classified as key pollutant discharge units designated by the environmental protection authorities.
It is worth mentioning that in its 2024 annual report, Jinghua Pharmaceutical indicated that wastewater from Ningxia Senxuan undergoes pre-treatment at the company's own wastewater station and, after meeting standards, is indirectly discharged through a dedicated pipeline to the park's centralized wastewater treatment plant for further processing; waste gases from workshops and the wastewater treatment station are treated and discharged up to standard.
Issues related to wastewater treatment and discharge are not unprecedented within the Jinghua Pharmaceutical system.
In December 2019, a television report stated that the Bozhou Municipal Ecological Environment Bureau discovered environmental violations during an inspection of Baohetang Bozhou Pharmaceutical Co., Ltd. (hereinafter "Baohetang Pharmaceutical"), which had been placed under investigation by the Bozhou High-tech Zone Ecological Environment Branch. It was reported that Baohetang Pharmaceutical handled medicinal residue sludge improperly, and exposure to rain or snow on the openly piled medicinal residues and sludge would generate large amounts of sewage. Baohetang Pharmaceutical is a wholly-owned subsidiary of Jinghua Pharmaceutical.
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