In 2019, the retail market of drugstores exceeded 400 billion for the first time, and the growth rate dropped to 4.3%

Under the background of national industrial structure adjustment, a series of new medical reform policies focusing on the purpose of "vacating cages to replace birds, reducing costs and increasing efficiency", such as "4 + 7" volume procurement from pilot to expansion, variety expansion, medical insurance price negotiation, etc., have been implemented one after another, and obvious structural changes have taken place in the whole pharmaceutical industry; innovative enterprises have developed rapidly, and the growth of general medicine and Chinese patent medicine enterprises is generally weak The change of upstream industry also affects the retail market of drugstores In 2019, the total sales scale of national retail drugstores reached 400.8 billion yuan, with the year-on-year growth rate falling to a low level of 4.3% The scale of drug market basically maintained a normal growth level of 7.5%, but the scale of non drug market including health products, medical devices and daily necessities decreased by 5% compared with 2018, and the profitability of the industry was obviously challenged The two growth engines of the overall passenger flow and price in the retail industry are weak, small and medium-sized stores are eliminated quickly, and the top chain enterprises integrate the industry through M & A, franchising and other ways, and the industry concentration is significantly improved It is gratifying to note that under such a market background, there are still some excellent varieties in the market, such as enrotinib, vitamin D drops, oseltamivir, fiblasta and so on, which bring a ray of sunshine to the whole industry in winter According to the latest monitoring data of Zhongkang CMH, in 2019, the retail terminal sales scale of national drugstores was 400.8 billion yuan (calculated by retail price, the same below), with a year-on-year growth of 4.3%, further slowing down compared with 4.9% in 2018 (as shown in Figure 1) Under the iceberg of low growth, it is the differentiation of performance of various stores In 2019, 35.3% of retail drugstores' sales increased by more than 5%, while 44% of retail drugstores' sales decreased by more than 5% More than 60% of small stores with a monthly turnover of less than 50000 showed a significant negative growth, and the survival of the fittest intensified (as shown in Figure 2) From a regional perspective, the year-on-year growth rate of Guangdong, the largest market, is basically the same as that of the whole country; the growth rate of Jiangsu, Liaoning, Tianjin, Beijing, Shanghai and other provinces and cities is significantly slower than the national average (as shown in Figure 3) From the perspective of city level, in 2019, the growth rate of T1-T2 line cities has declined to less than 4%, while t4-t5 line cities have grown rapidly, 6.0% and 6.4% respectively, and the downward trend of market channels continues (as shown in Figure 4) According to CMH data monitored by Zhongkang, the number of orders of drugstores nationwide totaled 6.04 billion in 2019, down 0.5% compared with 2018 How to attract customers has become the core proposition of retail drugstores However, the growth rate of product unit price also slowed down significantly After three consecutive quarters of downward trend, the growth rate of 19q4 was only 2.3% year-on-year, compared with the growth rate of 14.5% of 18q4 vs 17q4 It can be seen that it is difficult to continue to rely on unit price driving (Fig 5) However, with the overall spread of volume purchase, the huge price difference between hospital pharmacies of bidding varieties drives some drug buyers to return to the hospital, especially the middle-aged and elderly people According to the data of Zhongkang CMH, the proportion of people over 56 years old in drug buyers has declined significantly (Figure 6) in terms of the unit price and frequency of drug purchase (only drugs), this group of middle-aged and old people are significantly higher than those of young people The flow of passenger flow of middle-aged and old people will have a huge impact on the operation of drugstores Most of the top 20 groups (including health products) in the retail market of drugstores maintain the growth momentum faster than the industry growth (Figure 7) The most outstanding performance is six enterprises, namely, Zhengda Tianqing, moshadong, Yangzi River, AstraZeneca, China Resources Sanjiu, and Thomson Beijian Dong'a Ejiao is the only one of the top 20 enterprises with a year-on-year decline in sales scale due to the impact of drugstore price reduction and inventory clearing This trend of concentration also means that in the competition of stock market, the living space of small and medium-sized enterprises in the retail market will be further compressed In 2019, the proportion of non drugs in national retail drugstores remained at 23% Compared with that in 18 years, the growth of drugstores still mainly depended on drugs, including 8.0% growth of chemical drugs, 6.8% growth of proprietary Chinese medicine, and only 0.8% growth of health care products The growth rate of medical devices also showed a low growth rate, while food / daily necessities also showed a significant decline (Fig 8) The structural adjustment of the pharmaceutical industry is also reflected in the drugstore market The anti-tumor and immunomodulators concentrated in the new special drugs maintain a high growth rate of nearly 30% in the retail drugstore channel The growth rate of cold medicine, cardio cerebrovascular medicine and gastrointestinal medicine in three categories of retail drugstores is faster than that of the market as a whole The growth rate of vitamin minerals and calcium preparations related to nutrition and dietary supplements for chronic diseases such as blood pressure and blood sugar reduction has been maintained at more than 5% this year (as shown in Figure 9) Among the top 20 OTC drugs, the growth rate of vitamin D drops and Lanqin oral liquid exceeded 30% in 2019 (as shown in Figure 10) due to the high incidence of influenza in South China in 2019, even huaqingwen maintained a high growth rate of more than 20% in 2019 Among RX drugs, the star varieties with an annual growth of more than 80% are antineoplastic drugs "androtinib" and anti hyperuricemia "non butasil"; some of them are not among the top 20, but they are the star varieties that attracted much attention in 2019 For example, oseltamivir, driven by the impact of influenza, grows very fast, among which the retail market of East Sunshine's kerasil increased by 645% in 2019 The price of entecavir dispersible tablets purchased with 4 + 7 volume decreased significantly at the hospital end, and the drugstore end also showed negative growth year on year (as shown in Figure 11) According to the monitoring of Zhongkang data, the downward trend of the hospital price in 4 + 7 cities will also be gradually transmitted to the drugstore end With the expansion of the volume purchase, the price of the centralized purchase varieties in the retail drugstore end is bound to decline nationwide Therefore, more and more local drug varieties in the drugstore business positioning from profitable products to drainage products, exploring "drainage + correlation" Purchase "and" drainage + pharmaceutical service "are the breakthrough points for drugstores In July 2019, the state issued the health China action (2019-2030), in which 64 times of "prevention" were mentioned, which clarified the strategic direction of the state to improve people's health level through disease prevention and "prevention of disease" In this context, although the health care products are impacted by the policy of cracking down on deception, the growth rate stagnates in the short term, and the flow of health care products purchased by drugstores is also lost in the short term, and the penetration rate declines (Figure 12) But in the long run, as an important category of "prevention and treatment", health care products still have a huge growth space It is not difficult to find out from the top 20 health care products The new varieties related to bone and joint health care, such as calcium glucochondroitin calcium tablets, calcium vitamin D vitamin K capsules, and children probiotic granules, all have good sales performance At the same time, vitamin E, VC, VB and other single vitamin products rank top (Table 1)