Pharmaceutical Network, April 8 News The rapid spread of the new crown pneumonia epidemic around the world has caused a great impact on the production and supply chain of medicines. Some countries have reported that the supply of raw materials is tight. The relevant person in charge of the Ministry of Industry and Information Technology said that since the beginning of this year, the export volume of China's APIs has decreased year-on-year, with most products down by 10% to 20%, but there are also a few varieties of export volume that have increased year-on-year. International transportation has become a bottleneck restricting the export of APIs.
Industry insiders believe that the rate of resumption of work and production of API companies has steadily increased, domestic demand has been basically met, and it is expected to meet overseas demand. The export of epidemic-related APIs may usher in a short outbreak period. However, it should be noted that due to the suspension of non-anti-epidemic medical needs, if the foreign pharmaceutical industry is suspended for a long time, it will have a negative impact on the overall export of Chinese APIs.
Poor international transportation has become a bottleneck
Xin Guobin, Vice Minister of the Ministry of Industry and Information Technology, said on March 30 that my country has more than 1,500 API manufacturers and is the largest API producer in the world. In normal years, the output of APIs is around 3 million tons. my country is also the world's largest exporter of APIs, exporting about 1 million tons in a normal year, which accounts for about 1/3 of the total output of APIs. In addition, my country is the world's largest producer and exporter of vitamins, antibiotics, antipyretic and analgesic drugs, anti-infective drugs, and sebum hormone drugs, accounting for more than 50% of the international market.
Xin Guobin said that at present, the new crown pneumonia epidemic is spreading rapidly around the world, which has also caused a great impact on the production and supply of drugs. Some countries are now reporting that the supply of raw materials is tight. In this regard, the Ministry of Industry and Information Technology found that there are mainly several factors: First, in January and February this year, due to the impact of the epidemic, some enterprises in my country stopped work and production, and there was a temporary shortage of supply. Since February, due to the spread of the international epidemic, international transportation, especially shipping and sea transportation, has been greatly restricted and affected, resulting in some logistics and transportation difficulties and transportation difficulties.
"Since this year, the export volume of APIs has declined compared with the same period last year. Most of the products have dropped by 10% to 20%, and some varieties have dropped by 30%. However, there are also a few varieties of export volume that have increased year-on-year. Xin Guobin said: "We have repeatedly communicated with enterprises, and everyone reported that the main constraints to the decline in exports are mainly the significant reduction in shipping and international shipping, and the increase in transportation costs. International transportation has become a bottleneck in the supply of our APIs."
The epidemic has caused concerns about the "cut-off" of global APIs
In recent years, with the continuous expansion of the generic drug market, and the improvement of domestic production enterprises' process technology, production quality and pharmaceutical market registration and certification capabilities, a large number of API production capacity has been transferred to my country. According to institutional statistics, there are currently more than 8,000 domestic API manufacturers, and the export volume of APIs has repeatedly hit new highs.
Since the beginning of this year, the impact of the "butterfly effect" of the new crown pneumonia epidemic has led to an increase in the demand for terminal drugs in the industry chain, and with the increase of overseas epidemics, the incremental demand is being transmitted up the industry chain. However, at the same time, the production stagnation, poor logistics and trade controls caused by the spread of the epidemic have directly led to the obstruction of the global API supply chain.
Since March 25, India has implemented a national blockade, which has triggered global concerns about the "cutoff" of medicines, especially antibiotics, and has exacerbated the tension in the global pharmaceutical supply chain. As the "world pharmacy", India is also an important destination for my country's API exports. Data from the China Medical Insurance Chamber of Commerce shows that in 2019, my country's API products exported to India accounted for nearly 17% of my country's total API exports.
At present, more and more API manufacturers in China have resumed work and production. Will this increase the export of APIs from related domestic enterprises and meet global demand, which has become the focus of the market?
In this regard, Xin Guobin said: "As a responsible major country, China attaches great importance to the safety of the global pharmaceutical industry supply chain. We will strive to maintain the production of API manufacturers and ensure the safety and stability of the global industrial chain supply."
Xin Guobin introduced that combing the national API industry chain shows that the current production resumption rate and the production rate of main products are over 80%, and the output of some varieties has also exceeded the level of the same period last year, especially the anti-epidemic drugs. The focus of guarantee. "We feel that we can meet the international anti-epidemic needs in this regard. For example, in the previous stage, we designated chloroquine phosphate as an effective drug for the treatment of new coronary pneumonia during the epidemic prevention process. The two major domestic API manufacturers, We have resumed work in a timely manner, and the supply level of preparations is relatively stable. At the same time, we also organize these companies to meet international demand. For example, the hydroxychloroquine produced by Chongqing Kangle Pharmaceuticals exported 4.9 tons of APIs within 5 days. Market demand, to further increase supply." Xin Guobin said.
The export of epidemic-related APIs may welcome a short outbreak period
Industry insiders generally believe that the current epidemic situation in my country continues to improve, and the resumption of production and production of API companies is progressing in an orderly manner. Domestic demand has been basically satisfied, and it is expected to meet overseas demand.
Zhu Renzong, deputy secretary general of the China Chamber of Commerce for Import and Export of Medicines and Health Products, said that the "New Coronavirus Pneumonia Diagnosis and Treatment Plan" will increase the international market demand for related drugs, including APIs, and the demand for other drugs directly related to the prevention and treatment of new coronary pneumonia will also increase. The export of related APIs in my country may usher in a short outbreak period.
As the overseas epidemic continues to ferment, will the tight global supply of APIs have an impact on the performance of related companies? Southwest Securities believes that in the medium and long term, the price increase of export-oriented APIs will be an inevitable trend. In addition, through the stress test of the epidemic, it highlights the position of domestic specialty APIs and intermediates certified by the FDA and the European Union in the global pharmaceutical industry, which were obviously underestimated by the market in the past.
Flush data shows that there are 29 pharmaceutical companies with API-based A-shares, among which Proton, Tonghe Pharmaceutical, Jinda, Fuxiang, and New Nova are expected to increase their performance in the first quarter. Among them, Proton is expected to increase its performance in the first quarter. Over 200%.
A person in the pharmaceutical industry said that with the development of the global epidemic and the rising demand for exports, in the future, under the trend of rising volume and price, it may have a positive impact on the second quarter performance of API companies. However, similar to the previous domestic situation, non-anti-epidemic medical needs may be suspended. If the foreign pharmaceutical industry is shut down for a long time, the overall impact on China's API exports will be negative.
At present, my country's API industry mainly focuses on bulk APIs including vitamins, antibiotics, hormones and other varieties. Analysts predict that the production of bulk APIs will become more and more concentrated, and the process will be further improved. At the same time, there is huge room for development in specialty APIs and patented APIs.
It is understood that in the next step, the Ministry of Industry and Information Technology will also organize and implement the monitoring and production scheduling of key products, coordinate and solve the problems of export and transportation difficulties encountered by enterprises, strengthen communication and docking with WHO, foreign business associations, and multinational pharmaceutical companies, and organize enterprises to have Provide targeted services to ensure domestic and international market supply, and make due contributions to the world's fight against the epidemic.