The industrial chain of the anesthetic drug industry is the upstream intermediate and raw material industries in turn, the midstream is the anesthetic drug manufacturer, and the downstream is the anesthetic drug sales organization.
Upstream of the Industrial Chain: Intermediate Industry and API Industry
Pharmaceutical intermediates are intermediate substances in the synthesis of raw materials. The industry is a subdivision of the entire industry. It does not require certification of drug quality management standards and is not protected by patents. Therefore, the entry barriers for intermediate industries are low, and the industry concentration is low. Product quality is uneven. Anesthesia intermediates are divided into extensive low-end intermediates and fine high-end intermediates. Low-end intermediate suppliers only provide simple intermediate products, which are greatly affected by the price of chemical raw materials, and their overall bargaining power is weak and competitive pressure is high. High-end intermediate suppliers participate in the entire process of new anesthetic research and development, and provide new anesthetic intermediates with higher technical content, which are less affected by the price of chemical materials, have strong overall strength and strong bargaining power. The intermediate industry has a close relationship with the midstream. High-quality intermediates can improve the bargaining power and profitability of pharmaceutical manufacturers. At the same time, the upgrading of narcotic drugs also promotes the development of the intermediate industry to the refined high-end intermediate industry. In the future, the intermediate industry will develop towards refined high-end intermediates.
The Upgrading of the API Industry Also Drives the Development of the Midstream
The quality and supply of upstream raw materials affect the production of midstream companies and the sales of downstream end markets. Therefore, the production quality and product supply of APIs have an impact on the production of midstream drugs and downstream end markets.
At present, more than 20 kinds of narcotic raw materials have passed the approval of the State Drug Administration. Among the many types of anesthetics, narcotic analgesics are the main objects of national supervision. Some general anesthetics and local anesthetics are psychotropic drugs, and psychotropic drugs have their own particularities, so some anesthetic raw materials must be in accordance with regulations Standard production. The production of other common anesthetic raw materials also has high technical requirements, and the industry has high barriers to entry, showing a situation of high density and concentration.
China's API production faces the problems of heavy pollution and high energy consumption. Public data shows that the total output value of the domestic pharmaceutical industry is less than 5% of the national GDP, but pollutant emissions account for 6%. Chemical raw material drug manufacturers with high energy consumption and serious pollution have become the focus of supervision by the environmental protection department. Under the ever-increasing environmental pressure, the anesthetic raw materials industry has continuously optimized its industrial upgrading and transformed into high-end drugs. The industrial upgrading of the anesthetic raw materials industry is conducive to driving the high-quality and high-end development of midstream companies and improving the bargaining power of midstream companies.
Midstream of the Industrial Chain: Anesthetic Drug Manufacturer
Midstream anesthetic drug manufacturers can be divided into anesthetic original research and production enterprises and imitation production enterprises. At this stage, the Chinese anesthetic drug market is dominated by generic drugs. China's anesthetic generic drugs are highly competitive, and a variety of generic drugs account for more than the original anesthetics.
Anesthetics are highly specialized and have extremely high safety requirements. The production and sales of anesthetics are strictly supervised by the state, and policy barriers are high. The production of anesthetics must be approved, the annual plan must be strictly followed, and government pricing must be implemented. Therefore, once the industry structure is formed, it is difficult to make major changes. At present, the domestic generic drug market is controlled by three major companies, namely Hengrui Pharmaceutical, Enhua Pharmaceutical, and Renfu Pharmaceutical. In the layout of key products, the three major companies have different priorities, and there is no direct competition. Dislocation competition avoids the harsh competition between homogeneous products and promotes the healthy development of the industry.
Downstream of the Industrial Chain: Medical Institutions Are the Main Consumer Places
The main types of anesthetics are general anesthetics, muscle relaxants, and narcotic analgesics. Data show that in 2018, the sales of general anesthetics accounted for 51% of total anesthetics sales, followed by muscle relaxants and narcotic analgesics, accounting for 29% and 18%, respectively.
The downstream of the anesthetic industry chain mainly includes distributors, medical institutions, and retail pharmacies. The government implements strict control over the circulation of anesthetics, so it has higher requirements for companies engaged in the sale of anesthetics. The market share of China National Pharmaceutical Group exceeds 80. %. Narcotics are distributed to various medical institutions and, retail pharmacies through distributors at all levels. Since anesthetics are prescription drugs, medical institutions are the main places of consumption. Data shows that more than 90% of China's prescription drug market is controlled by medical institutions. Under the influence of policy protection, increased operation volume, product upgrades and other factors, the anesthetics industry will develop rapidly, and the market structure of medical institutions as the most important place for terminal sales of anesthetics will remain unchanged.
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