Spring Pharmaceutical Group, Inc. ("CYIG" or "the Company"), headquartered in Shandong Province of China, is a diversified company engaged in developing, manufacturing and selling its own traditional Chinese medicines made primarily from panax ginseng leaves extract, developing the acer truncatum bunge planting bases, processing and selling acer truncatum bunge seed oils, and distributing health care supplement products manufactured by another company in the PRC. We operate through our 97% owned subsidiary, Shandong Spring Pharmaceutical, a corporation organized in the People's Republic of China. Shandong Spring Pharmaceutical is engaged in the business of developing, manufacturing and selling Huoliyuan capsules, a medicine made primarily from panax ginseng leaves extract; developing, manufacturing and selling seed oil products from acer truncatum bunge trees, a maple tree native to China, and distributing health care supplement products manufactured by another company in the PRC.
We generate revenue through the sales of diversified products, including prescription medicines, acer truncatum bunge seed oil products, and products purchased from a third-party supplier. We operate in the multi-level direct selling channel that the government of China licensed in May 2015, primarily utilizing person-to-person marketing to promote and sell our acer truncatum bunge seed oil products and products purchased from a third-party supplier. We believe that we are the largest producer of acer truncatum bunge seed oil in China, accounting for 47.4% of the market in China in 2017. Our products are distributed under the brand name “Bao Feng San Yi”. We believe that being the dominant producer will provide us with advantages in pricing and distribution of our products and that the brand recognition will spur further growth. We are the largest producer of Huoliyuan capsules and tablets in China and our Huoliyuan capsule is the only herbal medicine of its type made in the form of a capsule. We will be a vertically integrated acer truncatum bunge seed oil and blended edible oil producer once our own trees begin production, which is expected to occur in the fall of 2018. While to date we have produced acer truncatum bunge seed oil from raw materials purchased from third parties, we began to develop and cultivate our own trees in June 2013. We have leased 5,880 Mu (approximately 968.65 acres) of farmland for terms of 30 years and 14 years, respectively, and have planted 7,424,000 trees through March 31, 2018. Having our own tree base will significantly reduce the cost to produce the seed oils compared to competitors that purchase the acer truncatum bunge pods from third parties.
We are committed to developing and marketing innovative products. We have several products in development, including skin care products, nutritional supplements, and edible vegetable oil. Our goal is to utilize advanced biological technology to isolate and extract the beneficial compounds in plants that have traditionally been known to have medicinal benefits. We also focus our research on the seed selection and planting technologies for greater yield of leaves and seeds from the plants as well as the most efficient method to isolate and extract nervonic acid from seed oil. We maintain research and product development facilities in China. We have a staff of 29 employees engaged in research and development of new technologies and resulting products. We also maintain close ties to the research staffs at Tsinghua University, China Agriculture University, Shandong Herbal Medicine University, and the Shandong Herbal Medicine Research Institute.