Global pharmaceutical industry faces reforms

Business Club May 20th Multinational pharmaceutical companies adjusted their business models and gradually closed their pharmaceutical research centers in the United Kingdom. Chinese pharmaceutical companies took the opportunity to focus on finding more opportunities in emerging markets to ease the decline in profits due to the expiration of pharmaceutical patents. The transnational pharmaceutical companies are currently carrying out a series of actions such as streamlining their business structure and increasing efforts to develop emerging markets in order to achieve revenue and expenditure reduction, and China has become their priority destination for industrial transfer.

The reporter recently learned from the Joint Working Group of Chinese and British Medicines that because Pfizer will soon close down its R&D center in Sandwich, Kent, UK, the UK Trade and Investment Agency is currently actively seeking new 2,500 UK drug development experts affected by the incident. Way out. In addition, AstraZeneca has adjusted its business, and its project at Chatswood R&D in Leicestershire, UK will also stop. Nearly 800 R&D personnel will soon face unemployment. The United Kingdom may consider the way out of this group of people.

"On July 1 this year, the cooperation agreement of the 2,500 experts will expire, and the British government hopes that they can cooperate with Chinese companies. At present, the British are proceeding to formulate a preliminary cooperation plan, and we are also waiting for the plan to come out. Further discussion will be conducted on the direction of cooperation.” Xu Ming, director of the China-China-Brazil Joint Pharmaceutical Working Group and head of the comprehensive department of the China Chamber of Commerce for the Import and Export of Chinese Medical and Health Products (hereinafter referred to as Medicare Merchants Association), told reporters that the Medical Insurance Association had previously organized 11 The member companies approached the British side to jointly discuss the issue of these pharmaceutical research experts. Now there are more companies joining the camp and show a keen interest in cooperation.

In the wave of multinational pharmaceutical companies shutting down overseas R&D centers, it revealed that a large number of branded drug patents are due to expire. While promoting the rise of the generic pharmaceutical industry, it also actively promotes the irreversible change of the pharmaceutical industry itself.

New hope for emerging markets

According to incomplete statistics, about 77 billion US dollars of pharmaceutical patents will expire from 2011 to 2015. Among them, patents for Pfizer's "bomb bomb" drug Lipitor (atorvastatin) will expire in November this year, which has directly caused Pfizer to be forced to reduce its investment in R&D, and thus shut down the decision to develop the R&D center in Sandwich.

In fact, Pfizer invests more than 550 million pounds in R&D in the UK R&D center every year. The Sangwaki R&D center is the largest R&D base in the world outside of the United States. The base has a history of 56 years and the famous drug Viagra is This was born. However, the peak value of Lipitor's sales in recent years has reached 12 billion U.S. dollars, making a large number of generic pharmaceutical factories ready for Lipitor. With Lipitor's patent expiring, the intensity of its killing with generic drugs can be imagined.

In addition, the uncertainties caused by the financial crisis in the United States and Europe, as well as the continuous deterioration of the economic environment and other factors, coupled with more and more proprietary drugs expired, the lack of new drug market, so that multinational pharmaceutical company sales growth slowed. In order to maintain profits, they have chosen to adopt measures such as streamlining the organization and personnel and transferring R&D and manufacturing to the developing countries in order to reduce operating costs.

In fact, in recent years, with the increasingly fierce competition in the world pharmaceutical industry, the cost of drug development and production in developed countries is too high, and the competitiveness of large pharmaceutical companies in Europe and America has declined. At the same time, the rapid development of the pharmaceutical industry in developing countries, especially in India and China, has given hope to large-scale pharmaceutical companies in Europe and the United States out of the predicament. Drug R&D and production are increasingly moving from developed countries to Asia.

The high growth rate of the emerging pharmaceutical market has created huge temptations for multinational drug companies, and they have increased their investment in these high-growth markets. In March 2010, IMS released a research report titled "Reshaping the New Order in the World Pharmaceutical Market: A Reclassified World." The report proposes that in 2011 China's pharmaceutical sales will exceed France and Germany, becoming the world's third largest pharmaceutical market after the United States and Japan; in 2013, nearly half of the sales growth came from emerging markets.

In global pharmaceutical cooperation and strategic alliances, emerging countries are playing a more important role with their various resource advantages. In 2010, the total drug sales in emerging markets reached US$123 billion, accounting for approximately 16% of the global pharmaceutical sales of more than US$770 billion, which contributed 37% of the global pharmaceutical industry's growth. IMS estimates that the global pharmaceutical market will reach 880 billion U.S. dollars in 2011, and the growth of the Chinese market will make a greater contribution to this.

“The global pharmaceutical industry has entered an era of transition and reform. The expiration of patents for pillar brands and the difficulty in the development of new drugs have caused serious problems in the product lines of multinational pharmaceutical companies. The business model is facing changes. At the same time, the economies of emerging markets Sustained development has become the main driving factor for the hospital market in the future.” Huang Donglin, chief consultant of the medical department of Frost & Sullivan, believes that medical demand remains high, and governments in various countries have adopted medical reforms to improve the efficiency and capability of medical services in the country and to control medical care. Excessive growth in costs. This, to a certain extent, has prompted the global pharmaceutical industry to develop into a new era of change. Now is the golden opportunity for China to capture the development opportunities in the global pharmaceutical market.

China’s top monopoly

IMS predicts that China's pharmaceutical sales, which is currently the third largest market in the world, will grow by more than 25% in 2011, exceeding US$50 billion. At the same time, drug sales in 17 emerging market countries are expected to increase by 15% to 17% in 2011, reaching 170 billion to 180 billion US dollars. The report divides these countries into three levels in accordance with the decreasing order of market value growth. China alone occupies the top floor.

Huang Donglin believes that in the past a long time, large multinational companies have been using a "blockbuster" model to maintain the company's profitability and high returns. However, when they are faced with a large number of “bombshell” products that expire their patents, new development strategies need to be redesigned to ensure sustainable development in the future. “By 2015, China will be located in the third place in the global prescription drug sales market, with approximately US$85 billion.” Huang Donglin believes that the continuous aging of the product line has forced multinational pharmaceutical companies to adjust their business strategies, thus giving birth to a large number of new cooperation opportunities in China.

China, which is itself one of the most important pharmaceutical markets in the world, has become a global raw material supply center. With the continuous improvement of GMP production capacity, the competitiveness of R&D outsourcing services is also increasing day by day. At the same time, as a large country with a population of several hundred million people, China and India have a more complete medical industry chain, rely on a large number of human resources and clinical resources, and a sound domestic industrial base, and they are expected to become leaders of emerging countries and enter the global market. The extensive cooperation and development.

“China itself is an important emerging market, which can strengthen cooperation with foreign companies and provide good commercial channels and sales outsourcing services for some foreign brand products.” Huang Donglin pointed out that from the standpoint of generic drugs, branded medicines It will further promote the entry of Chinese domestic companies, which are mainly generic drugs, into the international market. The further improvement of China's GMP standards will strengthen the possibility of cooperation with other overseas companies to provide relevant generic pharmaceutical products; from the perspective of biopharmaceuticals and specialty drugs, China The rapid development of biopharmaceutical technology is expected to participate in the outsourcing research of biometric appraisal and development. China has a wide range of patient resources and an outstanding team of doctors and is an ideal clinical base for biopharmaceutical development. In terms of biosimilars, China also has Certainly leading.

The specialization of medical R&D, production, and sales demands are constantly increasing. While promoting industrial cooperation, it also increases the demand for pharmaceutical outsourcing.

The cost-effectiveness of organizing clinics in emerging market countries is even higher, which has triggered more clinical outsourcing and has led to a gradual decline in the proportion of clinical studies conducted in North America and Europe. Frost & Sullivan data shows that in the future, the compound growth rate of China's CRO market will reach 23%, which is higher than the global average of 17%. The Chinese government has adopted a positive incentive policy for domestic pharmaceutical outsourcing, and multinational pharmaceutical companies have established R&D centers in China to further stimulate the growth of China's CRO market.

“China’s corporate R&D foundation is weak, and the task of separating production, learning, trade and trade from each other, and the upgrading of the pharmaceutical industry structure are becoming increasingly urgent.” Xu Ming believes that in the long run, the continuous increase in the strength of China's pharmaceutical industry will promote the emergence of more cooperative research and development, and the international medical division of labor. The transfer is expected to give China more advantages in its latecomer.

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