Antibiotics Price Limitation Decreases the Performance of Expanding Pharmaceutical Enterprises
According to the Plan, medical institutions are required to investigate the clinical application of antibiotics in hospitals and departments in 2011, including the varieties, dosage forms, specifications, dosage and amount of antibiotics used in the top 10, respectively. In addition, the special rectification also includes the establishment of the selection and periodic evaluation system of antimicrobial drugs, and strengthening the management of the purchase and use of antimicrobial drugs. In principle, there are no more than 50 kinds of antibiotics in tertiary general hospitals, no more than 35 kinds in secondary general hospitals, no more than 35 kinds in stomatological hospitals, no more than 35 kinds in cancer hospitals, no more than 50 kinds in children hospitals and no more than 10 kinds in psychiatric hospitals. In principle, there are no more than 40 kinds of antibiotics in maternity hospitals (including maternal and child health centers). There are no more than two kinds of injections and oral dosage forms under the same generic name. Antibiotics with similar or identical pharmacological characteristics may not be purchased repeatedly.
It is worth noting that before 2011, the abuse of antibiotics was serious, which was the highest category of drug use in China's medical market. The average annual growth rate in the past five years was 24.5%, accounting for 23% to 25% of the total drug use. According to the Statistical Yearbook published by the Ministry of Health, the total drug revenue of public medical institutions in 2009 was 313.605 billion yuan. It is estimated that the income of antibiotics is about 74 billion yuan per year. In order to curb the abuse of antibiotics, on August 3, 2011, the Ministry of Health consulted on the "Measures for the Administration of Clinical Application of Antibiotics" and planned to administer antibiotics at different levels.
The restriction order hit the antibiotics companies hard, with a slight loss in the third quarter of last year and a further expansion in the fourth quarter. As for raw materials, the price of 7-ACA, a cephalosporin intermediate, was 525 yuan/kg at the end of last year, almost half of the highest price in 2010; the price of GCLE, another intermediate, was also close to the historical low, about 74 yuan/kg; and the price of 6-APA, a penicillin intermediate, was 170 yuan/kg at present, which was lower than the historical low.
In the listed companies, the main products of the subsidiary company of Harbin Pharmaceutical Co., Ltd. are antibiotic raw materials and pharmaceuticals, accounting for about one third of the company's revenue and contributing about half of its profits. Recently, Harbin Pharmaceutical Co. announced its 2011 performance report, showing that the company realized revenue of 13.346 billion yuan in 2011, but its operating profit was only 689 million yuan, down 46.64% from the same period last year, and its net profit attributable to its parent company was 583 million yuan, down 48.42% from the same period last year. From the quarterly point of view, the net profit of Harbin Pharmaceutical Co. Ltd. in the first three quarters of 2011 was 310 million yuan, 340 million yuan and 213 million yuan, respectively. It can be seen that the company lost 280 million yuan in the fourth quarter.
In addition, Shandong Lukang Pharmaceutical, the leading antibiotic company, is expected to achieve net profit attributable to shareholders of Listed Companies in 2011, which is more than 60% lower than the same period last year. Jincheng Pharmaceutical's 2011 performance report, which is listed on the GEM under the halo of cephalosporin intermediates, also shows that its operating profit is 58.26% lower than that of the same period last year, and its net profit is 46.48% lower than that of the same period last year.