Recently, Hubei took the lead in the bid opening of centralized procurement of 19 provincial alliance Chinese patent medicines. This is the first centralized procurement of Chinese patent medicine alliance in China.
Finally, 97 enterprises and 111 products were selected, with a selection rate of 62% and an average price drop of 42.27%. According to the calculation of the annual demand of the 19 provincial alliance, it is estimated that the annual drug cost can be saved by more than 2.6 billion yuan.
Or affected by the news of centralized purchase, the share prices of some traditional Chinese medicine enterprises have recently opened the accelerated rise mode, and the shares have risen by the limit 12 times in nearly 15 trading days, with a cumulative increase of nearly 200%.
the first centralized procurement of Chinese patent medicine alliance in China
“There is no way to collect Chinese patent medicine.” Once upon a time, this was a popular view in the industry. Since the reform of centralized drug procurement in 2018, no Chinese patent medicine has been included in large-scale centralized procurement. This is because Chinese patent medicine has its particularity, and it is difficult to carry out centralized collection.
First, the quality of Chinese patent medicine is difficult to evaluate. Secondly, there are many exclusive products of Chinese patent medicine.
However, the price of bitter medicine has been falsely high for a long time. Over the years, the problem of falsely high prices has existed not only in the chemical medicine, biological medicine and consumables industries, but also in the Chinese patent medicine industry, which has been strongly reflected by the people.
According to China Medical Insurance magazine, on December 21, 2021, just 10 days before the new year, the last big news in the medical insurance industry came from Hubei this year – Hubei took the lead in the centralized bid opening of 19 provincial alliance Chinese patent medicines, and 182 products from 157 enterprises participated in the price quotation, with a purchase scale of nearly 10 billion yuan; Finally, 97 enterprises and 111 products were selected, and the selection rate reached 62%. The average price of the selected products decreased by 42.27% and the maximum decreased by 82.63%. According to the calculation of the annual demand of the 19 provincial alliance, it is estimated that the annual drug cost can be saved by more than 2.6 billion yuan. This centralized procurement is also the first centralized procurement of Chinese patent medicine alliance in China.
On the late night of December 27, the office of the leading group for centralized procurement of inter provincial alliance of Chinese patent medicines issued the announcement on centralized procurement of inter provincial alliance of Chinese patent medicines (No. 4), and the selection results of centralized procurement of inter provincial alliance of Chinese patent medicines in Hubei Province were officially announced.
The relevant person in charge of Hubei Medical Insurance Bureau answered a reporter’s question about the centralized purchase of Chinese patent medicine alliance, saying that the price reduction effect of centralized purchase of Chinese patent medicine alliance will radiate to the whole country, the burden of patients\’ drug expenses will be further reduced, and the normalized epidemic prevention and control will also be guaranteed. While reducing the burden for patients, the centralized purchase of Chinese patent medicine also takes into account the reasonable profits of the enterprise. Through the centralized purchase, the marketing cost of the enterprise is reduced, which is conducive to squeeze out the unreasonable “water” in the drug circulation link and purify the market environment.
The published selection results show that the varieties involved in the centralized collection of Chinese patent medicines are those with large clinical dosage and high purchase amount, including many large varieties of Chinese patent medicines such as Xuesaitong, Xueshuantong and Ginkgo biloba.
According to the hospital and retail data of Intranet, the sales of Xuesaitong and Xueshuantong reached 6.683 billion yuan and 6.53 billion yuan respectively in 2019, accounting for more than 6% and 5% of the sales of cardiovascular and cerebrovascular Chinese patent medicine products in that year, respectively.
Ginkgo biloba product group has been selected by many pharmaceutical enterprises with different specifications, and some products have been reduced to less than 10 cents. Take Ginkgo biloba leaves of Hebei Tiancheng Pharmaceutical Co., Ltd. (0.20g (including 9.6mg total flavonol glycosides and 2.4mg terpenoid lipids)) as an example, 1.96 yuan / box, a total of 24 tablets, about 8 cents per tablet.
Chinese medicine sector rose strongly
Recently, a number of A-share listed companies announced the news of winning the bid for centralized purchase of Chinese patent medicines.
On December 23, 2021, Kunming Longjin Pharmaceutical Co.Ltd(002750) announced that the company’s main product breviscapine was planned to be selected for this round of centralized purchase, and the company’s injection of breviscapine 10mg (calculated by scutellarin) decreased from 11 yuan / bottle to 3.63 yuan / bottle, a decrease of 67%; Breviscapine 25mg for injection (calculated by scutellarin) decreased from 22.82 yuan / bottle to 7.53 yuan / bottle, and the price reduction range was 67%. According to the information disclosed by Kunming Longjin Pharmaceutical Co.Ltd(002750) , the product accounts for 87.74% of the company’s operating revenue in 2020. In addition, in the first three quarters of 2021, about 53.42% of the sales revenue of the product came from the areas covered by the inter provincial alliance.
On the same day, Guangxi Wuzhou Zhongheng Group Co.Ltd(600252) also announced that the proposed samples of Xueshuantong (freeze-dried) for injection, a core subsidiary of the company, were purchased intensively for the first time. The total sales of the product in 2020 is 1.098 billion yuan, accounting for 29.87% of the company’s operating revenue in 2020, including 526 million yuan in 19 provinces and regions, accounting for 14.32% of the company’s operating revenue in 2020.
On December 30, Tonghua Golden-Horse Pharmaceutical Industey Co.Ltd(000766) announced that the products of Chengdu Yongkang Pharmaceutical Co., Ltd., a wholly-owned subsidiary, were purchased centrally for the first time. Xiaojin pill is the leading variety of Yongkang pharmaceutical. The total sales of this variety in 2020 is 149 million yuan, accounting for 13.42% of the company’s operating revenue and 75.94% of Yongkang pharmaceutical’s operating revenue in 2020. The total sales in the first three quarters of 2021 was 154 million yuan, accounting for 14.22% of the company’s operating revenue in the first three quarters of 2021 and 83.75% of Yongkang pharmaceutical’s operating revenue in the first three quarters of 2021.
Tonghua Golden-Horse Pharmaceutical Industey Co.Ltd(000766) said that although the selected price of Yongkang pharmaceutical decreased to a certain extent compared with the original benchmark price, it had a positive impact on expanding market sales, increasing product sales and improving the market share of Xiaojin pill.
Or affected by the news of centralized purchase, the stock price of A-share traditional Chinese medicine enterprises has recently opened an accelerated rise mode. The data show that the index of traditional Chinese medicine has increased by 9.75% since December 22, 2021. In terms of individual stocks, Kunming Longjin Pharmaceutical Co.Ltd(002750) has raised the limit 12 times in 15 trading days since December 22, with a cumulative increase of 190.84%. Jinghua Pharmaceutical Group Co.Ltd(002349) the increase in the same period has also doubled, with a cumulative increase of 101.5%; Tianjin Chase Sun Pharmaceutical Co.Ltd(300026) increased by 94.58% in the same period, Tonghua Golden-Horse Pharmaceutical Industey Co.Ltd(000766) increased by more than 23% in the same period, and Guangxi Wuzhou Zhongheng Group Co.Ltd(600252) increased by 18.62% in the same period.
In fact, the rise of traditional Chinese medicine has lasted for some time. Since November 2021, the cumulative increase of traditional Chinese medicine index has reached 19.86%. In addition to the centralized purchase of Chinese patent medicines, what other news has promoted this round of rise in the traditional Chinese medicine section?
Some analysts believe that compared with the centralized collection of Western medicine, the centralized collection of traditional Chinese medicine is relatively mild and has a favorable impact.
In the past, most traditional Chinese medicine could not enter the hospital system for treatment and consumption. The drugs of traditional Chinese medicine companies are sold through pharmacies or self built stores with complete categories such as Beijing Tongrentang Co.Ltd(600085) . Now the national policy supports traditional Chinese medicine, so traditional Chinese medicine is expected to further seize the market of Western medicine.
Southwest Securities Co.Ltd(600369) pointed out that from the policy side, the national medical insurance bureau and the administration of traditional Chinese Medicine issued the guiding opinions on medical insurance supporting the inheritance, innovation and development of traditional Chinese medicine, gave full play to the institutional advantages of medical insurance, supported the inheritance, innovation and development of traditional Chinese Medicine, and highlighted the immune attribute of medical insurance of traditional Chinese medicine consumer goods.
Secondly, compared with western medicine, the cost of R & D investment in traditional Chinese medicine industry is relatively small.
Finally, according to the financial report of China Central Television, recently, a number of traditional Chinese medicine companies have issued the news of raising the price of their proprietary Chinese medicine products to customers, involving a variety of classic drugs such as Angong Niuhuang Pill and Huoxiang Zhengqi oral liquid.
It is worth noting that with the soaring share price, some pharmaceutical enterprises disclosed the shareholder reduction plan. On January 7, Kunming Longjin Pharmaceutical Co.Ltd(002750) announced that Kunming Qunxing Investment Co., Ltd., the controlling shareholder of the company, plans to reduce its shares by block trading not more than 4005000 shares (accounting for 1% of the total share capital of the company) from January 28, 2022 to July 27, 2022, and reduce its shares by centralized bidding not more than 8010000 shares (accounting for 2% of the total share capital of the company), The total reduction shall not exceed 12.02 million shares (accounting for 3% of the total share capital of the company).
In addition, fan xianrussia, the actual controller of Kunming Longjin Pharmaceutical Co.Ltd(002750) , plans to reduce his holdings of no more than 775000 shares obtained through centralized bidding transactions, accounting for 0.19% of the company’s total share capital.
On the evening of January 12, Kunming Longjin Pharmaceutical Co.Ltd(002750) made another announcement that the shareholder Lixing Industrial Co., Ltd. (accounting for 20.12% of the total share capital of the company) planned to reduce the company’s shares by centralized bidding, block trading or other legal means to no more than 24.03 million shares (accounting for 6% of the total share capital of the company).
