Biopharmaceutical investment in the "cool period" gradually turned to innovative research and development

There is nothing more figurative than the phrase "on the accelerator and on the brakes" as a metaphor for the current state of the biopharmaceutical industry.
"stepping on the accelerator" is that the biopharmaceutical industry is growing at full speed, thanks to the support of the policy system. And "stepping on the brakes" refers to the face of the national health insurance on drug price reduction requirements, the industry felt the "cool."
at the 2018 China Biologics Annual Meeting and the 18th National Biopharmaceuticals Symposium (CBioPC) Biopharmaceutical Investment and Financing Branch, many investors began to look at the pace of investment in the biopharmaceutical industry with a more rational perspective.Industry has driven on the "highway
pharmaceutical innovation can not be separated from the support of capital, although Jianxin Capital Partners Yuan Quanhong believes that the industry is now "one side to press the brakes, one side to step on the accelerator", but in the situation of opportunities and challenges coexist, Yuan Quanhong is more willing to believe that "who has a high driving level, who can make good value." Under
reform and improvement of a series of systems, such as domestic drug review and approval in recent years, new drug research and development ushered in a period of opportunity. In an interview with the Daily Economic News, Yuan Quanhong described the biopharmaceutical industry as "highway" from the "rural dirt road" of the past. Among them, the capital market's open and positive attitude towards new drug research and development enterprises is undoubtedly an accelerator, so that investors and enterprises active in the biopharmaceutical industry are encouraged.
, the HKEx made major changes to its main board listing rules to allow non-profitable or non-revenue biotech companies to list in Hong Kong. So far, four companies, Goli Pharmaceuticals, Baiji Shenzhou, Huali Pharmaceuticals and Xinda Bio, have been listed on the Hong Kong Stock Exchange. In addition, the Shanghai Stock Exchange will set up a branch board and pilot registration system of good news also boosted industry confidence.
have opportunities, but the challenges are not to be underestimated. In the capital market door to the biopharmaceutical enterprises open at the same time, Goli Pharmaceuticals, Baiji Shenzhou, Huali Pharmaceuticals have been "broken."
investors believe that this has both macro factors, but also the reasons for the previous high market valuation. "The market valuation today is not a little bit expensive, but a lot more expensive. Enterprises to Hong Kong listed investors also lost money, very simple, is the front of the investment expensive. So everyone has to adjust. Lu Dazhong, managing director of China Investment Innovation, said.
in Yuan Quanhong's view, this is the market constantly game and adjustment, and eventually to mature the normal phenomenon. Judging from the performance of NASDAQ-listed biopharmaceutical companies, the percentage of break-ups in the years after listing is also very high. Because biopharmaceutical companies are in the research and development stage at the time of listing, there is information asymmetry, so the volatility of stock prices will be more obvious. The current stock price ups and downs is the normal situation in the early stages of development, after the company pricing and market pricing of the continuous game adjustment, the mature market will be relatively stable.towards innovative research and development
in addition to considering return on investment, the direction of policy will also affect investors' expectations for the future.
recently, health insurance through negotiations, volume procurement and other measures to reduce drug prices, which also put forward higher price requirements for innovative drugs. For example, 17 anti-cancer drugs have recently been included in health insurance, with an average price reduction of 56.7 per cent.
research and development of new drugs due to long cycle, risk and other factors, the investment is often very large. Lu Dazhong said that corporate profits and health care fees how to balance is a long-standing problem.
Yang Wei, a partner at Songxuan Capital Health Fund, points out that health insurance is a "double-edged sword" that requires companies to do a good job of cost control while seeing the good, considering whether there is enough room to meet price reduction requirements. Moreover, it also challenges pharmaceutical companies to change from selling products to exporting the whole service system in pricing, bidding and market application.
Yu Lin, managing director of Tongtong and Cheng Cheng, also said that in the past to develop the first innovative drug, in the antibody, the yield of the cell strain is not very concerned, feel that it is good to be able to make it. But now is different, to carefully consider the production situation and whether the drug price can meet the requirements of collection.
In the past, imported drugs approved for market in China often lag 5 to 10 years behind foreign countries, domestic pharmaceutical companies more use of "metoo" and "me-better" strategy, choose has been listed or clinically verified, strong pharmaceutical, development risk less mature targets, so as to develop similar products, price advantage to occupy the market.
lu Dazhong told the conference that for companies and investors, if the product is mostly "me-too" or "me-better", then the profit margin will become smaller and smaller. Investors should pay more attention to the most innovative companies, because only such enterprises will be more profitable.
Lu Dazhong points out that a lot of things in the industry are changing. Last year, he said, China joined the International Coordinating Committee for the Registration of Human Medicines (ICH), a landmark event in which foreign medicines are entering the Chinese market at an accelerated rate. In the past, Chinese pharmaceutical companies could do generic drugs in a relatively "closed" environment, but now the market is open and foreign drugs can basically be listed simultaneously at home. "If you're just imitating, not having enough innovation, or even international innovation, it's going to be difficult to survive." He said. This also forces domestic pharmaceutical companies to pay more attention to innovative research and development.Zhang Han, managing director of
Yuanchenkun, said that traditionally, many pharmaceutical companies focus on marketing and light research and development, even if the research and development is more follow-up research and development, rather than innovative research and development. At present, such a model already has the opportunity to change, it can be said that "the spring of original medicine has arrived." investment in the pharmaceutical market is becoming more
, but in Yuan Quanhong's view, there is no need to worry about the issue of health care charges. Indeed, in all countries, drug price cuts and health-care charges are eternal themes that can be used as an opportunity to restructure the pharmaceutical industry.
Yuan Quanhong said that China's prescription drug market size of about 1 trillion yuan, of which the proportion of innovative drugs less than 20%, if calculated according to the innovative drug market 200 billion yuan, 75% of which are occupied by multinational pharmaceutical companies, the total domestic production will not exceed 50 billion yuan. Of the remaining 800 billion yuan in the market, Chinese medicine accounts for 300 billion yuan to 400 billion yuan.
Yuan Quanhong pointed out that if China's drug restructuring can be good, even if the cost of health insurance control is tightened, innovative drugs still have a lot of room for development. First of all, in accordance with the clinical efficacy of ineffective drugs, and through consistent evaluation to compress the space of generic drugs, reduce the price of generic drugs. Then, continuously improve the proportion of domestic innovative drugs.
in the face of the environment of opportunities and challenges, some investors are becoming more rational.
said that some time ago (pharmaceutical investment) is a trend of overheating, investors will enter a relatively calm phase, the professional requirements for investment will be higher and higher.
Zhanghan also believes that from the perspective of investment institutions, the short-term investment heat may appear to decline. "Over the past few years, the industry has been overheating, and with the introduction of market-adjusted policies, including the corresponding price formation mechanism in the capital market transmitted to the secondary market, market cooling is a good thing. In the future, the market will become more rational and more specialized. Zhang
pointed out that from a long-term perspective, the biopharmaceutical industry is still optimistic.
Lu Dazhong also said that the future of the biopharmaceutical industry and the determination to invest in the industry will never change. "I believe we will have more investments in the future, " he stressed. (Per network)