New Deals frequently come out, 6-picture analysis of the API market

The intensive release of heavy policies, what is the prospect of the API market?

Policy escort

In the past half month (November 3-19), the state has issued four documents specifically for APIs, which are rare, which shows that the country attaches great importance to the API industry
.

On the 9th of this month, the National Development and Reform Commission and the Ministry of Industry and Information Technology jointly issued the "Implementation Plan on Promoting the High-Quality Development of the API Industry", clarifying that through accelerating technological innovation and upgrading, promoting green and low-carbon development, promoting industrial layout adjustment, and promoting international development to a higher level In 2025, we will develop a batch of high-value-added and high-growth varieties, break through a batch of green and low-carbon technology and equipment, cultivate a batch of internationally competitive leading companies, and create a batch of industrial clusters with global influence.
Production base
.

On the 18th of this month, the day when the State Anti-Monopoly Bureau was officially listed, the Anti-Monopoly Committee of the State Council promulgated the "Guidelines for Anti-Monopoly in the Field of APIs".
The launch of the Monopoly Guidelines (Draft for Solicitation of Comments) is also the second anti-monopoly law enforcement document in the field of APIs after the National Development and Reform Commission issued the “Guidelines for the Price Behavior of Short Drugs and API Operators” in 2017
.

In fact, as early as the 3rd of this month, the Comprehensive Department of the State Food and Drug Administration also issued a document specifically for APIs, namely the "Notice on the Use of API Production and Supply Information Collection Module", which aims to strengthen the information infrastructure of APIs.
Previously (November 19), the CDE of the State Drug Administration issued the "Notice of the Center for Drug Evaluation on Improving the Review and Approval Progress of APIs" to improve the transparency of drug review and approval
.

The successive publication of the four consecutive documents has laid the foundation for ensuring the supply and price stability of shortage drugs, improving the transparency of the industry, and the development of anti-monopoly work.
The healthy and high-quality development of the API industry has a policy guarantee
.

Procurement promotion

The “Blue Book on the Progress and Effects of Medical Insurance Drug Management Reform” edited by the Science and Technology Development Center of the Chinese Pharmaceutical Association shows that the system design of volume procurement has achieved the effect of volume increase and price reduction.
The first quarter of 2021 compared with 2015, the first batch of national The amount of medicines collected has increased by 3.
5 times, and the amount of medicines has been reduced by 3.
6%
.

The expansion of the use of pharmaceutical preparations directly drove the increase in the use of raw materials
.

The "Implementation Opinions of the State Council Leading Group on Deepening the Reform of the Medical and Health System on Deepening the Promotion of the Experience of Sanming City, Fujian Province and Deepening the Reform of the Medical and Health System" issued on October 15 requires:

"Gradually expand the scope of procurement, and strive to purchase more than 300 generic names for drugs by the end of 2022.
By the end of the
"14th Five-Year Plan" period, the number of generic names for centralized procurement of drugs by each province’s national and provincial organizations will exceed 500.

Export pull

China's APIs have always occupied an important position in the world.

1.

Except for a decline of 1 to 2% in 2015 and 2016, all other years have achieved positive growth

According to preliminary statistics from the China Chamber of Commerce for Import and Export of Medicines and Health Products, in the first half of 2021, China’s export volume of APIs was US$19.

Since the second half of 2020, the unilateral increase in global bulk raw material prices and cross-border logistics costs is the main reason for the sharp increase in the average export price of APIs.

2.

Patent expiration market potential

The price of generic drugs is much cheaper than that of patented drugs, so generic drugs can greatly improve the accessibility of patients.

The next few years will usher in a wave of patent expiration.

According to Evaluate Pharma's estimates, from 2021 to 2024, patented drugs with a total sales of US$145 billion will expire, corresponding to approximately US$14.

Capital drive

In recent years, the number of new or expanded API projects has continued to increase
.

On May 8, 2020, Borui Pharmaceutical (Taixing) Biopharmaceuticals (Taixing) Biopharmaceuticals and Oral Preparations project with an investment of 500 million yuan held a groundbreaking ceremony in Taizhou.
The new project is expected to increase annual sales revenue of 4.
7 billion yuan
.

On July 20, 2020, Aoxiang Pharmaceutical issued an announcement stating that the total amount of funds raised by the proposed non-public issuance of shares will not exceed 420 million yuan (including the number), after deducting the issuance cost, it will be used for the production base of specialty APIs and key pharmaceutical intermediates Construction project
.

On August 1, 2020, Fuxiang Pharmaceutical issued an announcement stating that the planned investment amount was 1.
05382 billion yuan to build a high-efficiency penem antibiotic construction project of Jingdezhen Fuxiang Life Technology Co.
, Ltd.
After the completion of the project, an annual output of 600 tons of 4AA and 200 Production capacity of ton of meropenem
.

Continuous reaction technology helps

Continuous production technology refers to the transformation of the traditional batch production process into an automated continuous process.
According to the data of Roots Analysis, through the application of continuous reaction, the overall equipment efficiency of the reactor batch reaction can be increased from the traditional 30% to 75%.
More than %, it can also save 70% of the equipment area and manpower, and reduce the production cost and quality time by about half
.

According to Frost & Sullivan's data, Calais is one of the first companies in the world to apply continuous production technology to pharmaceutical production
.

With the support of policies and the continuous improvement of supervision, the continuous expansion of the scope of procurement with volume, the advent of the tide of patent expiration, and the promotion of new technologies such as continuous production technology, China's API industry will enter a stage of high-quality rapid development, transformation and upgrading Speed ​​up and industry concentration will also continue to increase
.