Research and analysis on development trend of China pharmaceutical industry in 2012
Since the beginning of reform and opening up, pharmaceutical industry attracts more and more public and government attention in China with the improvement of people's living standards and the growing demand for healthcare, occupies an increasingly important place in the national economy. In recent years, pharmaceutical production in China has been in a sustained, stable and rapid development stage. China's pharmaceutical industry growth rate has been higher than the gross domestic product (GDP) growth rate.
Pharmaceutical industrial output value increased from 7.9 billion in 1978 to 667.9 billion in 2007, it is increased by 84.5 times in 30 years; proportion of pharmaceutical industry in GDP increased from 2% in 1978 to 3% in 2007. It is the first ten years since the reform and opening up (1978-1987), medicine industrial annual growth is 14.4%, higher than GDP annual growth 9.7% of the same period; second ten years (1988-1997), GDP annual growth improved to 9.9%, and medicine industrial annual growth up to 21.4%; third ten years (1998-2007), although there is little slow down of medicine industrial growth, it still one time higher than GDP annual growth level, the average annual growth rate is18.8%.
Secondly, national industrial policy is to promote, and it has huge growth potential
Although pharmaceutical industry in China has developed rapidly, there is still a large gap on pharmaceutical market size compared with the developed countries at the present stage with the impact of China's per capita income and a lower level of health care. In 2008, for example, China's pharmaceutical market size was reached 70 billion US dollars, taking 9% of global market 773.1 billion US dollar. But per capita medical spending is still at a very low level, it was only about 18 US dollar, lagging far behind the developed countries not only US $ 300 per capita level, but also had a gap with developing countries representing a per capita level of 30~40 US dollar each person. Lower consumption levels indicate huge market growth potential.
In March 2009, State Council announced <recent key implementation planning of medicine and health reform (2009-2011)> it said:, town staff basic medical insurance, and town residents basic medical insurance and new rural cooperation medical will cover urban and rural residents in three years, parameter insurance rate are improved to over 90%; improve basic medical protection level, and appropriate improve personal payment standard; specify basic medical protection funding management; perfect urban and rural medical rescue system; improve basic medical protection management and service level.
In 2010, financial grants to new rural cooperative standards at all levels will be up to 120 Yuan per person per year; expense reimbursement ratio within the scope in the new agricultural policy will be gradually increased; gradually expand and improve outpatient reimbursement scope and scale; increase the maximum payment limit more than 6 times of net income from local farmers. …… After preliminary estimates, government at all levels of need to invest 850 billion Yuan from 2009 to 2011, in which the Central Government invested 331.8 billion Yuan. ”
Specifically, increased government investment will further promote the development of urban health, urban medical market capacity will continue to expand; at the same time, the policy can effectively improve the present weak construction of primary health care, given the medicine market base of current township and rural area is still weak, future growth speed of the market is expected to over the city pharmaceutical market growth speed.
Thirdly, industry production quality standards is improved and the industry will be suffered with consolidation
On March 1st, 2011, China <medicine production quality management specification (2010 Amendment)> (Good Manufacturing Practice, new GMP) was officially implemented, the management specification is the basic guidelines of medicine production quality management, made a detailed specification for production enterprises on its institutions, personnel, workshop and facilities, devices, materials, hygiene, medicine production validation, production management, quality management, products sales and recovery, as well as self-check, and it was the first time to propose the following items: personnel qualification, operation for different production process, confirmation system of equipment design, processing rules of operation deviation, supplying system and recall system of all kinds of raw materials manufacturers.
In implementation requirements, new GMP is directly referred to EU standard with more strict requirements, existing medicine production enterprises will has five years transition period to reach the specification requirements, this means medicine enterprises must increased input within five years, many small scale enterprises will exit off pharmaceutical production market with the failure of reaching specification requirements, and market status of advantage enterprises in the industry will be further consolidated, and preempt free market, further to improve market share. Therefore, pharmaceutical industry will face a huge Integration opportunity.
Fourthly, there has significant market growth in pharmaceutical consuming market, competitiveness of domestic pharmaceutical production in the first terminal market is increasing, while third terminal market will maintain its high growth:
① first terminal is still pharmaceutical market with stable growth, competitiveness of domestic medicine is growing
② second terminal market has slowing speed, and part of market will shift to the third terminal
③ third terminal is pushed by policies, market growth can be expected with high growth
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