Sihuan Pharmaceutical has a sales model which has proven to be highly successful and cost-efficient, and has enabled us to rapidly achieve deep market penetration in an effective manner. Our marketing strategy and extensive sales and distribution network are difficult to replicate and represent a significant competitive advantage.
Sihuan Pharmaceutical has an extensive nationwide sales and distribution network of over 2,000 distributors covering all 31 provinces, autonomous regions and cities throughout the PRC. So far, our distribution network has penetrated into close to 10,000 hospitals, including 890 or approximately 70% of all Class III hospitals, 3,600 or approximately 55% of all Class II hospitals and 5,400 Class I and other hospitals and medical institutions in the PRC. Our distribution network has penetrated into county-level markets in certain densely populated provinces, such as Zhejiang, Guangdong and Henan.
Our distributors are supported by our sales representatives, while our sales representatives are responsible for promoting the sale of or soliciting customers for our products. Our distribution network is managed and supported by an in-house team of 278 dedicated sales and product managers, the majority of whom hold professional qualifications in medicine and pharmacy. Our distributors and third-party sales representatives have a deep understanding of their local markets and have established sales channels with local hospitals and physicians, and therefore can effectively promote our products.
Our distribution network is the culmination of a process of over a decade of searching for, identifying, negotiating with and selecting qualified distributors and third-party sales representatives in different regions across the country. Our sales model also requires a highly effective internal management system to control and support a distribution network of such large scale. Over the years, we have also developed pricing strategies, which ensure that the profit margins of our products remain attractive to our distributors. In addition, the market leading positions of several of our products and our strong product pipeline help retain our distributors. In view of this, our distribution network is not easily replicable.
To further the Group's business development, we will continue to extend our sales and distribution network, with a view to further increasing our market share and deepening our market penetration. We will continue working closely with our distributors and third-party sales representatives throughout the PRC to expand sales and marketing of our products to those regions and cities in which our network currently has limited or no presence. We also intend to recruit additional sales and marketing personnel. We aim to increase the coverage of Class III, Class II and Class I and other hospitals in the coming years.
