Policy plus code!

On November 9, the National Development and Reform Commission and the Ministry of Industry and Information Technology issued the "Notice on the Implementation Plan for Promoting the High-Quality Development of the API Industry".

Featured APIs

API refers to any substance or mixture of substances used in the manufacture of pharmaceuticals, and becomes an active ingredient of pharmaceuticals when used in pharmaceuticals

Most of the specialty API companies use total synthesis, fermentation and chiral compounds as their main technology platforms, and a few such as nucleosides, peptides and PEG-based specialty APIs belong to emerging technology platforms.

Market Positioning of Domestic Featured APIs

As a major producer of chemical raw materials, China's overall industrial chain layout is suitable for the development of the pharmaceutical intermediates-API industry

At present, China is the world's largest producer and exporter of APIs, but from the perspective of a more cost-effective regulated market, specialty APIs face competition from mature suppliers in India and China

With the outbreak of the global epidemic, China's API industry has ushered in an opportunity for development, and the development of the specialty API industry has accelerated

Domestic development trend

In the early days of China, the characteristic API manufacturers represented by Huahai Pharmaceutical and Hisun Pharmaceuticals mainly focused on characteristic APIs such as statins and sartans.

Driven by the continuous improvement of the production process of domestic characteristic APIs and the price advantage of domestically produced APIs, the substitution effect of domestic characteristic APIs on imported characteristic APIs will also gradually increase in the future, and the domestic characteristic API industry as a whole is already in a rapid development period

From the perspective of the medium and short-term time dimension, under the combined influence of upstream costs and downstream inventory digestion and other factors, a new round of price increase cycle for domestic characteristic APIs is expected to start; Tantan, irbesartan, calcium pantothenate, caffeine and other varieties have gradually begun to increase prices

In addition, in early November, NMPA issued a notice on the activation of the information collection module for the production and supply of APIs, requiring companies to collect production, supply and inventory information of APIs through related review and approval on a quarterly basis, and to provide query functions for supervision.

The transparency of API production information has further standardized the industry and accelerated the clearance of small and medium-sized enterprises.

At the same time, in the short term, the US dollar interest rate hike is expected to lead to a depreciation trend of the RMB, which will lead to a significant benefit in the exchange rate of export-oriented API companies, which is conducive to the increase in apparent income growth

From the perspective of the medium and long-term time dimension, with the continuous landing of major customer orders, characteristic API companies are expected to realize the transformation of CDMO business

In the past three years, domestic specialty API companies, especially leading companies, have generally experienced large-scale expansion, and Chinese API companies are already preparing for the outbreak of the generic drug market