As the world’s manufacturing hub, China has boost its pharmaceutical market over the past decade to become one of the fastest growing and most competitive markets. In a report by IQVIA, the global pharmaceutical market is expected to exceed US$ 1.5 trillion by the year 2023 with a 3 to 6 percent compound annual growth rate over the next few years. In 2018, pharmaceutical expenditure in China reached US$ 137 billion and has been projected to increase to US$ 140 to 170 billion by 2023.
The pharmaceutical industry in China is largely made up of companies engaging in the production of generic medicines, therapeutic medicines, active pharmaceutical ingredients, and traditional Chinese medicine. Trends in China’s pharmaceutical market will definitely see changes through the coming years, especially with the Chinese government’s changes to pharmaceutical regulations. In 2019, a second draft of the Drug Administration Law of the People’s Republic of China was submitted and approved by the Standing Committee of the National People’s Congress of China for consideration and discussion. Most noteworthy in the amended draft were that innovation of pharmaceuticals should be based on clinical value, domestic and imported drugs will have the same MAH (Market Authorisation Holder) system applied and subject to approval by the National Medical Products Administration, and digital sales of non-prescription pharmaceuticals can be established through third party portals registered with local drug administrations.
Regulatory changes in the pharmaceutical industry in China has seen its benefits from faster approval process of innovative drugs. These statistics have been increasing since 2017 from six approvals in 2016 to 41 in 2017. In other aspects of the pharmaceutical industry in China, the revenue has been forecasted to increase over the past decade up till the year 2020. The forecast of revenue in manufacturing of pharmaceutical production equipment is predicted to be US$ 2.75 billion in the year 2020. Biopharmaceutical manufacture revenue would also see an increase in operating revenue to US$ 41 billion in 2020, together with Chinese medicine production revenue of US$ 101 billion in 2020. These forecasts of rise in operating revenue in China’s pharmaceutical industry is bolstered by the Chinese government’s commitment in switching from an industry follower to an innovator.
Traditional Chinese Medicine is another focus of the Chinese government in its pharmaceutical market. Since the implementation of the Outline of the Strategic Plan on the Development of Traditional Chinese Medicine, the Chinese government has set a roadmap to make development of traditional Chinese medicine as part of its national strategy, the Healthy China 2030 initiative. An example of such is the research of honeysuckle decoction as a potential treatment for the COVID-19 disease by the Nanjing University, Wuhan Institute of Virology and the Second Hospital of Nanjing.
The pharmaceutical retail market in China has also seen steady growth throughout the years. A report by Deloitte, highlighted that China’s pharmaceutical retail market had a compound annual growth of about 8 percent from 2015 to 2019. Which was much higher by comparison to the global pharmaceutical market of 6.1 percent annual growth. Key players in the increase in China’s pharmaceutical retail market were the accessibility of retail drugs, growth of total pharmacy visits, and an increase of expenditure per visit.
The report also shared how changes in policies by the Chinese government will help to boost the access to drugs in the pharmaceutical retail market. This was particularly necessary during the COVID-19 outbreak as traditional methods of obtaining drugs could not be carried out due to lockdown measures implemented. With changes in policies and the new adjustment by the recent global pandemic, the report by Deloitte remains optimistic in China’s pharmaceutical retail market. It is expected to have a high growth rate until 2023 as strategies and channels for access to drugs shift to more digital platforms.
The year 2020 has proven to be one of the most challenging across a number of industries. Particularly in the pharmaceutical, biomedical, and healthcare industries, as a result of the COVID-19 pandemic that was known to have started in late 2019. China was one of the early epicentres of the novel coronavirus disease which started from its first confir...
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