2019 Pharmaceutical Industry Review Welcome to the 2020 of Power Supremacy

The earth has completed another revolution around the sun, and the human beings in the eight eastern regions have ushered in a new decade. The years have gone round and round, and the trajectory has returned to the origin. Where is the origin of China's pharmaceutical industry? Can we still go back? Do we need to go back?

At present, it seems that under the changing pattern of the industry, we no longer need to look back. At the beginning of 2019, the industry predicted that the whole 2019 will be the big year for the landing of China's pharmaceutical industry policy.

In the context of the continuous advancement of policies, various companies in the pharmaceutical industry will show different development momentum. Some companies grasp the development trend of the industry and gradually transfer their R & D energy to the research and development of innovative drugs; some companies have relied too much on a certain product before. Variety, deep losses, transformation difficulties.

Science and Technology Innovation Board officially opened in the summer of 2019. The stocks of companies listed in the early stage have been soaring all the way, and the players listed in the later stage have suffered a break. The capital market is full of drama. Even if we can grasp the normal state of capital pulse beating, no one can guarantee when the next black swan will come?

The 1920 s is a cold era that attaches great importance to strength. Although its signs have already appeared at the end of 2018 or 2019, whether it can do a good job in meeting more stormy attacks will test every pioneer in the pharmaceutical industry.

Policy, landing big year

2019 is a big year for the landing of the policy, which has been officially landed since the beginning of the year, including volume procurement, negotiated access to the new version of the health insurance catalogue and the key monitoring drug catalogue.

First of all, in the area of belt procurement, with the continuous promotion of "4 7" urban belt procurement, the implementation results are remarkable. On December 29, 2019, the State Organization Drug Centralized Procurement and Use Joint Procurement Office issued another announcement stating that the second round of national procurement with volume was officially launched. Currently, a total of 33 varieties are included and will be opened in Shanghai on January 17, 2020.

The official push is much faster than previously expected in the industry, and this shows that policy makers have had the desired effect on the effect of volume procurement.

For enterprises, the implementation of the policy of purchasing with quantity is like drinking water, cold and warm. Enterprises have spent a lot of energy to pass the consistency evaluation, but in the end only one to three winning bids, and even the price paid by the winning bidder has been cut in half. As a result, it is bound to directly affect the enthusiasm of enterprises to participate in the consistency evaluation. After all, in the process of drug consistency evaluation, enterprises have invested a lot. If the enterprise abandons the consistency evaluation in the future, it is believed that it is not in line with the original intention of the official policy formulation.

In fact, such voices have emerged one after another in the industry. At the "2019 China Pharmaceutical New Intelligence Forum" held in Beijing on December 28, 2019, Yu Mingde, honorary president of the China Pharmaceutical Industry Association, said that the government should fully take into account the opinions of enterprises and the market when formulating any policy, and all parties should fully study and discuss in order to jointly promote the progress of China's pharmaceutical industry.

In addition to the volume of procurement, health insurance negotiation access is also a concern, it is worth noting that, compared to the former, health insurance negotiation access, although the price is also constantly or even greater, but the industry's voice of questioning it is smaller.

The reason for this is that compared with centralized procurement, the negotiation access of medical insurance catalogue is more understood by the public. After all, after CCTV released the film of a negotiation expert's soul bargaining, the public's voice has already drowned out the discussion in the industry. In addition, the terminals of quantity procurement and medical insurance are also different. The payer of quantity procurement is the local centralized procurement platform, the payment terminal in the drug catalog is directly a front-line clinical hospital, which is more perceptible to patients and doctors.

Capital, still hot

For last year's pharmaceutical companies, the official opening of the board meant an additional financing channel, and as of December 24, 2019, the SSE disclosed that the number of companies listed on the Shanghai Stock Exchange's board had reached 68.

Previously, the industry's expectations for the board were quite high, and the board did rise all the way at the beginning of the board. In the first three months of the board's opening, the prices of all stocks rose. Among them, the biomedical company Heart Pulse Medical rose the highest, with an increase of 217.24 since its listing. This also confirms from the side that the pharmaceutical industry's expectation of high value for the board is not unreasonable.

Of course, Science and Technology Innovation Board, as another attempt in my country's securities market, will definitely appear in a different state from before. One of them is the break of listing. On November 6, 2019, the stock price of Science and Technology Innovation Board listed company Haohai Shengke opened 1.48 lower.%, reported to 88.53 yuan/share, fell below the issue price of 89.23 yuan/share, becoming the first break stock on the Science and Technology Innovation Board.

In fact, for the various uncertainties existing in the future science and technology innovation board, the market and investors need a certain amount of time to fully understand this market, and under the normal development law, be prepared to deal with the company's listing and break.

Compared with the mainland capital market, Hong Kong stocks in 2019 appears somewhat deserted, in 2019 Hong Kong stocks listed a total of 19 biopharmaceutical companies, of which a total of 9-B companies listed, of which a total increase of 26%, this figure is much higher than the Hang Seng Index's 7.83 percent increase.

Among the 19 companies, there are 9 biopharmaceuticals companies, 3 medical device companies, 4 healthcare companies, and 3 CXO companies. Both the traditional pharmaceutical giant Hausen Pharmaceuticals listed, there is no lack of relatively small biotech companies listed.

The positive attitude of mainland enterprises towards Hong Kong stocks has boosted the position of the Hong Kong stock exchange in the global capital market. On the evening of December 19, 2019, the Hong Kong stock exchange announced that it is expected to top the list of the world's first public fund-raising ranking, which is the sixth time in 10 years, and the number of new shares in the fourth quarter of this year is a record high in the same period.

The conclusion that can be drawn is that in 2019, whether it is the Science and Technology Innovation Board or the Hong Kong Stock Exchange, biomedical companies have expressed greater interest in it. If you think about the reason, it is not difficult to find that pharmaceutical companies have invested a lot in research and development in the early stage., In urgent need of financial support, once the capital market liberalizes the restrictions on listing, biopharmaceutical companies that are in urgent need of R & D funds will flock.

Innovation, breakthrough

Looking back on 2019, this year is definitely a year worth writing about in the research and development of innovative drugs by Chinese pharmaceutical companies. Starting from 2019, the main line of development of China's pharmaceutical industry will gradually transform from generic drugs to innovative drugs.

On November 15, the BTK inhibitor zebutinib (English trade name: BRUKINSA, English generic name zanubrutinib) independently developed by Baiji Shenzhou passed the FDA approval of the United States. This drug is the first new anti-cancer drug that is completely independently developed by a Chinese enterprise and approved to be listed on the FDA, achieving a "zero breakthrough".

On December 20, Shiyao Group announced that the innovative drug Levoamlodipine Maleate Tablets (English trade name: CONJUPRI) independently developed by the company passed the FDA New Drug Listing Application (NDA). This is the first Chinese pharmaceutical company to submit a new drug listing application to FDA and go through the normal FDA approval process. It is also the first Chinese local innovative drug to be fully approved by FDA and the first new hypertension drug to be listed in the United States in China.

In addition, in 2019, China's innovative drugs, represented by domestic PD-1, entered the new version of the national health insurance catalogue, which has become a new atmosphere after the introduction of a number of reform measures in China's pharmaceutical administration and health insurance system since 2015. Up to now, the domestic PD-1 varieties have been approved for listing have Junshi, Cinda, Hengrui, Baiji Shenzhou four local pharmaceutical companies.

Of course, as a number of domestic pharmaceutical companies have aimed at the world's advanced, the development of new drugs, research and development costs will rise. According to relevant statistics, in the-share market in 2018, there were 57 pharmaceutical companies with R & D expenses exceeding 0.1 billion yuan, 8 with R & D expenses exceeding 0.5 billion yuan, and two with R & D expenses exceeding 1 billion yuan, namely Hengrui Pharmaceutical and Fosun Pharmaceutical.

At present, China has become the world's second largest single market after the United States. China's innovative drug market will become the main driving force for the further expansion of China's pharmaceutical market in the future, and it will also become an important battlefield for global innovative drug companies to compete.

Conclusion, what are you thinking?

Standing at the fork of a new decade in history, what are you thinking about at this moment in the pharmaceutical industry? Is it the industry earthquake caused by volume procurement? Is it the soul of the negotiation of health insurance bargaining? Or is it the excitement of the first landing of Chinese innovative drugs in the US market?

No matter what you think of, the events in the pharmaceutical industry in 2019 will be dusty when people look back on the past in the future, after all, what we think of as major events in the industry may only be a small precursor to the arrival of a new era in the eyes of later generations, after all, one of the obvious shortcomings of human beings is the habit of magnifying the importance of things close to them infinitely.

In 2019, the pharmaceutical industry has not stopped changing, and you and I will not stop curious. We all hope to know as soon as possible what will happen in the world in the next decade. We are saying goodbye to the old year in response and reluctance, and we are also exploring and discovering. Welcome the updated world.