Health & Beauty

Innovative pharmaceutical companies represented by the development of PD-1 are accelerating the development of the international market. At the 2021 China International Service Trade Fair (Service Trade Fair) to be held in September 2021, many pharmaceutical companies participating in the exhibition released a positive attitude towards seeking overseas markets.

"China is a very good platform for the development of innovative drugs, and the ecosystem of innovation is becoming more and more perfect. However, it is the right choice to make products that are truly oriented to the global market." In an exclusive interview with a reporter from Securities Daily, he said that the gold standard for future biomedical innovation judgments is whether the product has a global market.

At present, the phenomenon of getting together in research and development is gradually appearing on the domestic innovative drug track, which also makes the market have many concerns about the valuation bubble of innovative drugs.

On July 2, the Center for Drug Evaluation (CDE) of the State Food and Drug Administration issued the "Guiding Principles for Clinical Research and Development of Anti-tumor Drugs Oriented by Clinical Value" for soliciting comments, aiming to curb micro-innovation and pseudo-innovation. After more than two months, this topic is still hotly discussed in the industry. In this regard, Wang Yinxiang said: “If you are still following hot spots in a crowded track, and the product does not have a global market, it will definitely become more and more difficult. The release of the above-mentioned consultation draft and the current enterprises are talking about going overseas, which shows that the industry has already Reach a consensus."

R & D get together and urgently need to break the game

PD-1, which was once a hot spot in the innovative drug market, has now become a "target" for criticizing research and development. On August 30, the sixth domestically produced PD-1-Yuheng Biological's Sepalimab was approved for listing. Previously, it included PD-1 from Cinda Biologicals, Junshi Biologicals, BeiGene, and Hengrui Pharmaceuticals. Has entered the national medical insurance through negotiation. At present, the annual treatment cost of PD-1 in overseas markets amounts to hundreds of thousands of yuan, while the minimum domestic cost has been as low as 20,000 yuan.

Fangyuan Capital partner Chen Hao introduced to a reporter from the Securities Daily: “Domestic medical insurance payments have ceilings. Therefore, with the increase in me too, best in class drugs, and biological antibody drugs, the competitive landscape has become increasingly fierce. Entering medical insurance will inevitably achieve price reduction through negotiation, and it will not be possible to give companies high profit margins."

The phenomenon of R&D getting together does not only occur on the PD-1 track. According to statistics, there will be 335 ongoing CAR-T clinical trials in China in 2020. In the selection of indications, CAR-T therapy focuses on hematological tumor indications, with targets clustered on CD19 and BCMA. When the leading companies Fosun Kate and WuXi Junuo's CAR-T products were approved for listing, it was unknown whether the market share allocated to the tail companies was sufficient to cover the R&D costs even if they obtained the marketing authorization.

Regarding the phenomenon of R&D clustering, Song Ruilin, the executive chairman of the China Pharmaceutical Innovation Promotion Association, said at the Service Trade Fair that in the future, it is hoped that companies will fully consider market demand when the project is established. "The first is to make innovative drugs because there is clinical demand. If there is no clinical demand, the so-called innovation will not necessarily create value even if it is made. The second is that investors must be rational. To drive the transformation to capital empowerment, capital needs to truly understand the industry and not blindly invest. Third, the price of innovative drugs should be tiered, that is, the first drug developed has the highest price, second and third place The price of the fourth and fifth place will have to be reduced to 50%, and the price may drop to 30% when the tenth place is reached. When no one is doing it, this kind of research and development will tend to balance and give full play to the market’s strengths. The role of regulation. In addition, the role of the government is also very important. For example, whether the medical insurance reimbursement system can be adjusted accordingly is the direction we need to study."

The world has become a new standard for innovation

As competition in the domestic innovative drug market is becoming increasingly fierce, the development of new drugs for the international market has become a trend.

Chen Hao introduced to a reporter from the Securities Daily that all companies have a life cycle. In the past 10 years of development, China’s pharmaceutical and biological industry has gone through the stages of generic drugs, me too drugs, and best in class. The next stage is Go abroad, do international level innovation, and compete with global pharmaceutical companies.

"The core of selecting investment targets is to see whether the development direction of enterprises at different stages meets the needs of the next stage of the market." Chen Hao told reporters: "As investors, we must look to the future instead of focusing on the present. In the next 3 to 5 years, the internationalization of innovative drugs is the way forward-looking Chinese companies must take. Walking at the forefront of international technology, to explore unmet clinical needs, whether it is cooperation or competition with international companies, Only companies have room to survive, and only such companies can be recognized by the capital market, and can they truly value innovative pharmaceutical companies."

At present, a number of innovative drugs developed by Chinese companies including Rongchang Bio, BeiGene, Jiaxi, CSPC and other Chinese companies have reached overseas authorization cooperation, which has become a way for companies to quickly recover costs, and it is also the current innovative pharmaceutical companies to go overseas and achieve internationalization. Important way.

Benefiting from the revenue from overseas authorized transactions with a total amount of more than US$855 million (over 5.5 billion yuan), GACOS has triggered a cumulative US$65 million (approximately 420 million yuan) milestone payment, which will be confirmed during the first half of 2021. Revenue 57.69 million yuan. In this regard, Wang Yinxiang told reporters: “At the current stage, Chinese biotechnology companies have almost no global market capabilities. They have authorized overseas rights and interests in innovative products to multinational pharmaceutical companies. Sales share, this is our strategy."

Before founding Jiaxian Pharmaceutical, Wang Yinxiang was the main inventor of the first targeted anticancer drug Icotinib Hydrochloride in China, and has more than 20 years of experience in new drug research and development. "Compared with more than 10 years ago, driven by capital, the cost of new drug research and development has risen sharply. This means that the cost of companies developing new drugs has also greatly increased. Except for PD-1, there are very few products in the country that have a market sales scale. Over 10 billion yuan." Wang Yinxiang told reporters that the intense R&D in the oncology field has led to fierce competition. Once only the Chinese market is targeted, it will be difficult for future sales to cover its R&D and development costs. Investing in innovative drugs must be from a farther perspective. Pay attention to financial indicators.

"Even multinational companies, from the perspective of the company's profit structure, the European and American markets have contributed the most. A very simple criterion for identifying the prospects of biomedical companies is whether the product has a global market." Wang Yinxiang told reporters that current trends require differences. Chemical and valuable products, that is, drugs, must have clinical value and market value on the basis of clinical value.