Health & Beauty

On January 15th, Greenleaf Pharmaceuticals announced that its self-developed new drug Rykindo (Risperidone sustained-release microsphere injection formulation) had officially obtained market approval from the US Food and Drug Administration (FDA). This is China's first independently researched and developed Class 1 innovative chemical drug with independent intellectual property rights for the treatment of depression, and also the first domestically produced CNS (central nervous system) innovative product approved overseas.

On January 31st, Baike Biotechnology announced that it had recently received the "Drug Registration Certificate" for the attenuated live herpes zoster vaccine issued by the National Drug Administration. This is the first domestically produced herpes zoster vaccine to be launched. Previously, China had only launched one shingles vaccine, which was imported through international trade and produced by GlaxoSmithKline.

While the number of new drug applications in China is steadily increasing, some innovative drugs are constantly achieving "zero" breakthroughs in their respective fields, which is a strong evidence of the continuous improvement of China's innovative drug research and development capabilities.

In response to the international trade situation of Western medicine products this year, Cao Gang, Director of the Western Medicine Department of the China International Chamber of Commerce for Import and Export of Medical and Health Products, pointed out that although the external environment remains severe in 2023, driven by favorable factors such as optimization and adjustment of domestic epidemic prevention and control policies, global economic recovery, and R&D innovation recovery, China's innovative medicine industry will welcome new opportunities and promote high-quality "going global" of Chinese Western medicine products to take new steps.

There are still bumpy and dangerous beaches

In 2022, the COVID-19 and many uncertainties in the international situation will have a certain impact on the operation of foreign trade of Chinese western medicine products. From customs data, China's international trade in raw materials has maintained good growth in import and export; The export of Western medicine preparations is relatively stable, with a slight decrease in imports; Biochemical drugs are showing a trend of decreasing export demand and increasing import, while exports of drugs related to epidemic prevention continue to decline.

Cao Gang stated that entering 2023, whether it is observing the internal and external environment or the "microclimate" of the industry, there are still many risks and challenges faced by China's foreign trade of Western medicine products.

Currently, the risk of global economic recession is increasing, the growth of external demand is significantly slowing down, and the international supply chain pattern is also accelerating reconstruction. The environment for foreign trade development is extremely severe. The prices of basic production factors such as oil, coal, metals, and grains have continued to rise, and the raw materials required for production in the pharmaceutical industry, as well as the transportation costs for international trade exports, have also skyrocketed, especially for the export of bulk raw materials that rely on price advantages to compete for overseas markets. In terms of the international market environment, Chinese pharmaceutical companies often face problems such as weak local infrastructure support, difficulty in implementing preferential policies, and disorderly market competition when expanding into emerging markets such as Latin America, Africa, and the Middle East. In addition, some countries have difficulty obtaining visas and low issuance rates, which affect their business expansion.

From the analysis of the industry's own development, the pace of enterprise transformation and upgrading still needs to be further accelerated. According to Cao Gang, while relying on regulatory norms and market guidance to promote the transformation and upgrading of pharmaceutical enterprises, the phenomenon of low gross profit and overcapacity of traditional bulk raw materials still exists. And with the decline in international demand for anti epidemic drugs and the gradual deepening of policies supporting the localization of the pharmaceutical industry chain in multiple countries, China's export model mainly based on bulk raw materials is unlikely to continue healthy growth and urgently needs to be transformed. At the same time, "although the innovation and development of China's preparation industry has made great progress, there is still a gap between China and the world's first echelon." Take vaccines as an example. In addition to the soaring export of COVID-19 vaccine in 2021, China's import and export of human vaccines have maintained a trade deficit for many years, and there is still some import dependence in high-end vaccine fields such as four price and nine price human papillomavirus. The vaccine trade deficit in 2022 was $2.942 billion, an increase of $1.437 billion compared to 2019.

In addition, the regulatory pressure faced by pharmaceutical companies at home and abroad will continue to become stricter and tighter. The pharmaceutical industry is a highly regulated industry. Overall, even in 2022, when epidemic prevention and control are tight, the pharmaceutical industry still maintains a trend of stricter policy supervision. In 2023, the frequency of the introduction of pharmaceutical policies may accelerate, and the implementation time will be more compact. Internationally, the European Commission has updated a series of regulatory documents such as the GMP appendix for imported drugs and clinical trial regulations, which have stricter requirements for product quality assurance and data transparency for enterprises. In March 2022, the US Congress requested the FDA to carry out a pilot program to increase on-site inspections of overseas drug production. In 2023, the FDA may resume some overseas on-site inspections. This is both an opportunity and a challenge for China to expand its exports of raw materials and preparations to the United States.

Stable in quality improvement and expected

Faced with the complex economic and trade situation, the Chinese government is continuously increasing its reform efforts, and pharmaceutical enterprises are actively seeking new development in the changing situation.

Enterprises actively seek change, diversify and diversify their international market layout in multiple forms. Cao Gang observed that while many leading innovative and traditional pharmaceutical companies in China are entering developed markets such as Europe and America, they are also engaging in international cooperation through various forms such as equity investment, mergers and acquisitions, license out (overseas licensing), and commercial authorization, actively expanding into emerging markets such as Southeast Asia, the Middle East, and Latin America. Chinese pharmaceutical companies are increasingly establishing research and development centers overseas, deeply participating in global research and development networks, and further expanding the breadth and depth of simultaneous registration and application at home and abroad.

Policies continue to exert efforts to promote industrial development. Since 2022, a series of policies and measures have been introduced to stabilize foreign trade and foreign investment, promoting the stable development of pharmaceutical foreign trade in various aspects such as assisting enterprises in relief, financing support, credit insurance, and trade facilitation; The "14th Five Year Plan" biobased economy Development Plan, the "14th Five Year Plan" Pharmaceutical Industry Development Plan and other guiding documents have been released successively, pointing out the upgrading development path for China's pharmaceutical industry; The National Drug Administration has repeatedly taken new measures to explore the establishment of a scientific regulatory system, providing regulatory policy support for improving drug regulatory capabilities and promoting high-quality industrial development

China's pharmaceutical industry is in the transitional period of implementing new regulations and the adaptation period after power adjustment. Policy support and guidance, as well as a solid and complete industrial foundation, are the 'stabilizers' for the high-quality development of pharmaceutical foreign trade. Cao Gang believes that this year, whether it is the transformation and upgrading of traditional raw materials and preparations, or the development of innovative drugs and biological products, will make steady progress, improve quality, and achieve new development.