In the Twelfth Five-Year Development Opportunity, the Pharmaceutical Industry will Maintain a 24% Growth Rate

Wang Bo, vice president of the Chinese Pharmaceutical Enterprise Management Association, said at the interpretation and seminar of the biomedicine policy held on October 27 that optimistic about the development of the pharmaceutical industry during the “12th Five-Year Plan” period, it is expected that the pharmaceutical industry will maintain a growth rate of 24%. By the end of the "Twelfth Five-Year Plan" period, the total output value of the pharmaceutical industry is expected to approach 4 trillion yuan.

During the “Twelfth Five-Year Plan” period, the basic medical market will maintain rapid growth as the basic drug system is implemented in a wider range. Analysts said that pharmaceutical manufacturers and distributors with stronger scale will benefit, and the concentration of sub-sectors will further increase.

The pharmaceutical industry will grow at a rate of 24%

During the “Eleventh Five-Year Plan” period, Wang Bo thought that although China's pharmaceutical industry maintained rapid growth, it was “limited to rapid development rather than benign development”. The reason is that the pharmaceutical industry still has problems such as unreasonable industrial structure, insufficient overall investment, and unfavorable environment for fair competition in medicine. For example, in terms of product structure, with the exception of foreign-funded enterprises, China’s pharmaceutical industry’s product structure is still processing trade that lacks independent intellectual property rights as a whole. , resource-based and low value-added products.

Wang Bo expressed confidence in the development of the pharmaceutical industry during the 12th Five-Year Plan period. He said that several major factors have determined that the pharmaceutical industry will continue to maintain rapid growth. The first is the population. China’s urbanization population has soared recently and the elderly population has soared. It has determined that the rigid demand for pharmaceuticals has grown strongly, and that market factors and policy factors will maintain the market growth of the pharmaceutical industry.

However, for the unsolved problems in the pharmaceutical industry during the “Eleventh Five-Year Plan” period, such as the reform of public hospitals, Wang Bo believes that it is more difficult to make substantial progress during the “12th Five-Year Plan” period, but this problem must be obtained by the government. Pay enough attention.

Industry concentration is further enhanced. Liu Zhenning, a partner of the board of the company, said that from the perspectives of people, finances, and materials, it is expected that the basic drug system will take the lead in coastal developed provinces. It is understood that the current list of basic medicines is not nationally unified, and the provinces across the country supplement their basic medicines according to their own financial conditions, forming a basic provincial directory.

Experts said that the potential of the primary medical market in China is large. According to the policy, the basic drug system is currently being tested only in about 30% of the regions, and the growth rate of the primary medical market has exceeded 50%.

This year, the planned basic medicine system in China will be implemented in 60% of grass-roots medical and health institutions. With the implementation of the basic drug system in a wider region, the basic medical market will also expand substantially. The growth of the basic medical market will drive the upgrade of corresponding medical software and bring about the benefits of related listed companies.

Liu Zhenning said that for pharmaceutical manufacturers or distributors, it may wish to pay attention to the tendering dynamics of the above-mentioned core provinces, actively participate in and strive to obtain a high premium bid price, and withdraw from low-priced provinces.

Analysts said that the implementation of the basic drug system is a process of redistribution of benefits, which will lead to the impact of the interests of the three major parties: pharmaceutical companies, circulation companies, and primary medical institutions. But overall, it benefits the primary medical institutions. And it is beneficial to pharmaceutical manufacturers and distributors with stronger scale and strength, and the degree of concentration in the pharmaceutical industry will further increase.