Main points:
Introduction to protected varieties of traditional Chinese Medicine
Traditional Chinese medicine variety protection system is a graded protection system implemented by the state to encourage the development of clinically effective traditional Chinese medicine varieties. The protected varieties of traditional Chinese medicine are divided into grade I and grade II. The term of grade I protected varieties is 30 years, 20 years and 10 years respectively, and the term of grade II protected varieties is seven years. And six months before the expiration of the protection period approved by the drug regulatory department under the State Council, it may re apply for protection in accordance with the provisions of these regulations.
The scope of protection is the variety of traditional Chinese medicine approved for protection. During the protection period, it is limited to the production of enterprises that have obtained the certificate of protected variety of traditional Chinese medicine. Enterprises that have not obtained the protection of the same variety shall stop the production of this variety. The reply period after application is 6 months. After successful application, it will be publicized on the website of the State Drug Administration and the certificate of protected varieties of traditional Chinese medicine will be issued.
Sort out the current protected varieties of traditional Chinese Medicine
As of January 1, 2022, there are a total of 83 protected varieties of traditional Chinese medicine under protection, including 3 first-class protected varieties, including Yunnan Baiyao Group Co.Ltd(000538) capsules and Yunnan Baiyao Group Co.Ltd(000538) (powder) of Yunnan Baiyao Group Co.Ltd(000538) (Group) and Zhangzhou Pientzehuang Pharmaceutical Co.Ltd(600436) (lozenge) of Zhangzhou Pientzehuang Pharmaceutical Co.Ltd(600436) pharmaceutical industry in Zhangzhou. The rest are grade 2 protected varieties with a period of 7 years. There are 65 manufacturers involved, of which 15 have a variety of protected varieties of traditional Chinese medicine. In terms of renewal, a total of 35 varieties have applied for traditional Chinese medicine protection since 2020, involving 35 manufacturers. Among them, 16 are initial insurance and 12 are renewal insurance. According to the data of Intranet, the total annual sales of protected varieties of traditional Chinese medicine in the terminals of public medical institutions and physical pharmacies in Chinese cities exceed 20 billion yuan. At present, there are 26 protected varieties of traditional Chinese medicine with market sales of more than 100 million yuan.
The difference between patent protection and variety protection of traditional Chinese Medicine
Patent protection and variety protection of traditional Chinese medicine are protection systems formulated to maintain the normal development and market order of traditional Chinese medicine. However, there are differences in legal effect, nature of rights, protection cycle and so on. On the whole, although both of them are protective measures for the production of traditional Chinese medicine, there are differences in the way and duration of protection due to the different administrative subjects and objects of protection. For unlisted drugs, patent protection is the only protection path, only listed varieties, and variety protection is more efficient and confidential.
Investment advice
The regulations on the protected varieties of traditional Chinese medicine are important laws and regulations for the national protection of the inheritance and development of traditional Chinese medicine. There is a strong market moat for the protected varieties of traditional Chinese medicine within the protection period. It is suggested to pay attention to the protected varieties of traditional Chinese medicine and the relevant listed companies under application. Relevant listed companies (covered): Zhangzhou Pientzehuang Pharmaceutical Co.Ltd(600436) (buy rating), Yunnan Baiyao Group Co.Ltd(000538) (overweight rating), Beijing Tongrentang Co.Ltd(600085) (buy rating), Jianmin Pharmaceutical Group Co.Ltd(600976) (buy rating); Other relevant and related beneficiary targets: Chinese bio pharmaceuticals, Tasly Pharmaceutical Group Co.Ltd(600535) \\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\\, Henan Lingrui Pharmaceutical Co.Ltd(600285) , Shanghai Kaibao Pharmaceutical Co.Ltd(300039) , Jiangsu Kanion Pharmaceutical Co.Ltd(600557) , Shenwei pharmaceutical, Zhuzhou Qianjin Pharmaceutical Co.Ltd(600479) , Ginwa Enterprise (Group) Inc(600080) , Chengdu Huasun Technology Group Inc.Ltd(000790) , etc.
Risk tips
Policy uncertainty; Risk of expiration of protection period; Uncertainty of application cycle, etc.
