Lunan Pharmaceutical Surges with 2035% Sales Growth and Major Wins in China's 9th National Drug Procurement

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On November 6, the ninth batch of national procurement arrived as scheduled. According to the official announcement, Lunan Pharmaceutical Group Corporation has three products expected to be awarded bids, which are likely to achieve significant sales growth with the help of national procurement. This year, Lunan Pharmaceutical Group Corporation has achieved substantial progress: the first generic approval of the rare disease drug Sapropterin Hydrochloride Tablets, the clinical trial applications for four Class 1 new biologics and two improved new chemical drugs, continuously enriching the group’s product pipeline. It is reported that from January to September 2023, the R&D investment ratio of Lunan Pharmaceutical Group Corporation continued to rise, accelerating innovation transformation. Currently, the group has 39 new products nearing market launch, with nine new drugs already in Phase I or higher clinical stages, indicating a promising future.

First Biologic Drug Surges 2035%, Secures First Generic for Rare Disease This Year

Lunan Pharmaceutical Group Corporation's pharmaceutical enterprises include Lunan Houpu Pharmaceutical, Lunan Better Pharmaceutical, and Shandong New Era Pharmaceutical, among others. Each company leverages its strengths to help the group continuously enhance its competitive capabilities. Data from Menet shows that from 2021 to present, Lunan Pharmaceutical Group Corporation has had 23 new products approved for marketing, including 21 chemical drugs and 2 biologics.

Table 1: Products Submitted for Market Approval by Lunan Pharmaceutical Group Corporation from 2021 to Present

Source: MiNeiNet China Application Progress (MED) Database

In April 2021, Lunan Pharmaceutical Group's first therapeutic biologic product, Pegylated Human Granulocyte Stimulating Factor Injection, was approved, helping the group unlock the biopharmaceutical market. In 2022, within China’s urban public hospitals, county-level public hospitals, urban community health centers, and township health clinics (referred to as Chinese public medical institutions), the sales revenue of the group's Pegylated Human Granulocyte Stimulating Factor Injection increased by 2035.61%, marking an impressive start. In May 2022, the group's second therapeutic biologic product, Insulin Glargine Injection, was approved, further expanding the group’s biopharmaceutical product portfolio.

Since 2021, the group has had first generic drugs approved every year, including Axitinib Tablets, Vonoprazan Fumarate Tablets, and Sapropterin Hydrochloride Tablets. The group's capability to quickly develop generics continues to improve. In June this year, Lunan Pharmaceutical Group Corporation obtained the first China-produced generic approval and was the first to pass the quality evaluation for Sapropterin Hydrochloride Tablets. This product is used to treat the rare disease phenylketonuria (PKU), which is a hereditary metabolic disorder. Data from the MiNe Network’s bidding database shows that the average winning bid price for the original Sapropterin Hydrochloride Tablets in 2022 was approximately 249 yuan per tablet/100mg, with a bottle of 30 tablets costing around 7,000 yuan. Chinese-produced generic drugs have a price advantage, helping to reduce patients' financial burden.

Since 2023, Lunan Pharmaceutical Group has received approvals for several blockbuster new products: Fulvestrant Injection, the group's first endocrine therapy drug, generated sales exceeding 900 million yuan in Chinese public medical institutions in 2022; Temozolomide Capsules, the group’s first alkylating agent class anti-tumor drug, achieved sales surpassing 1 billion yuan in Chinese public medical institutions in 2022.

39 High-End Generic Drugs Rush to Market, Ripples in a 30 Billion USD Market

Table 2: Status of Products Submitted for Marketing Approval by Lunan Pharmaceutical Group from 2022 to Present

Source: MiNeiNet China Application Progress (MED) Database

Currently, Lunan Pharmaceutical Group Corporation has 39 high-end generic drugs under review and approval for market application. The combined sales scale of these products in China's public medical institutions in 2022 exceeded 30 billion yuan. Products with sales over 1 billion yuan include Capecitabine Tablets, Lenvatinib Mesylate Capsules, Rocuronium Bromide Injection, Sacubitril Valsartan Sodium Tablets, Sitagliptin Phosphate Tablets, Ezetimibe Tablets, Sevoflurane for Inhalation, Nifedipine Controlled-Release Tablets, Nicorandil for Injection, and Valsartan and Amlodipine Tablets (I).

In June this year, Italian Menarini announced that its second-generation non-sedating long-acting antihistamine drug Bilastine Tablets had officially received NMPA approval for marketing in China. It is suitable for the symptomatic treatment of urticaria in adolescents aged 12 years and above and adults. Subsequently, in July, Jiangsu Huayang Pharmaceutical and Shandong New Time Pharmaceutical successively submitted a Category 4 generic drug marketing application. To date, four pharmaceutical companies in China have applications under review, and the competition for the first generic drug has gradually heated up.

In addition, Lunan Pharmaceutical Group has launched the traditional Chinese medicine Shouhui Tongbian Capsules for the treatment of constipation. If Prucalopride Succinate Tablets are approved successfully, it will become a new breakthrough for the group in the chemical drug market. In 2022, the market size of chemical drugs for treating constipation in China's public medical institutions rose to 4.7 billion yuan, maintaining a positive growth trend in recent years, showing considerable potential.

53 Products Have Passed the Evaluation, A Great Harvest for the Ninth Batch of National Collection

Table 3: Lunan Pharmaceutical Group Corporation's Products that Have Passed or Are Deemed to Have Passed Evaluation

Source: MiNeiNet China Application Progress (MED) Database

As of November 6, 2023, Lunan Pharmaceutical Group Corporation has a total of 53 products that have passed/been deemed to pass the consistency evaluation. Among them, Isosorbide Mononitrate Tablets, Omeprazole Enteric-Coated Tablets, Axitinib Tablets, Ketorolac Tromethamine Tablets, Epirubicin Hydrochloride Injection, Tirofiban Hydrochloride Concentrated Solution for Injection, Etodolac Capsules, Vonoprazan Fumarate Tablets, Sotalol Hydrochloride Tablets, Cetylpyridinium Chloride Lozenges, and Sapropterin Hydrochloride Tablets are the first to pass the evaluation.

On November 6, the much-anticipated ninth batch of national procurement in China arrived as scheduled. According to the proposed winning results published on the Shanghai Sunshine Pharmaceutical Procurement Network, three products from Lunan Pharmaceutical Group Corporation were successfully awarded, including Omeprazole and Sodium Bicarbonate Capsules, Fulvestrant Injection, and Ivabradine Hydrochloride Tablets.

Table 4: Status of Products from Lunan Pharmaceutical Group Corporation for the Ninth Batch of National Procurement in China

Source: Shanghai Sunshine Pharmaceutical Procurement Network

Figure 1: Lunan Pharmaceutical Group Corporation's National Centralized Procurement Bids Won (Including the Ninth Batch Tentative Wins)

Note: Quantity is counted by product name.

From the third batch to the ninth batch (excluding the sixth batch of insulin special projects) of national procurement in China, Lunan Pharmaceutical Group has won bids for 16 products (including proposed bids), achieving excellent results. Among the group's products that have passed evaluation but are not yet included in national procurement, the competitive landscape for inhalation sevoflurane involves five or more companies. Whether this product will become a target for the next round of national procurement is worth continued observation.

R&D Investment Hits New High, 16 New Drugs Rapidly Advance

Lunan Pharmaceutical Group Corporation Places High Importance on Technological Innovation, with R&D Investment Ratio Increasing Year by Year. According to media reports, in 2022, the group's R&D investment ratio reached 14.55%, and from January to September 2023, the R&D investment ratio rose to 16%.

Figure 2: New drug applications by Lunan Pharmaceutical Group Corporation since the beginning of this year

Source: MiNeiNet China Application Progress (MED) Database

On November 2, the clinical trial application for F008 was accepted by the CDE, adding a new member to Lunan Pharmaceutical Group's biologic drug pipeline. So far this year, the group has submitted clinical trial applications for four novel biologics and two improved chemical drugs. Currently, the liposomal injection of epirubicin hydrochloride has been approved for clinical trials.

Table 5: Overview of Some Major New Drugs Under Development by Lunan Pharmaceutical Group from 2018 to Present

Note: Terminated projects are no longer included in the statistics.

Source: MiNeiNet China Clinical Trial Database

From the current situation, Lunan Pharmaceutical Group Corporation is making continuous efforts in the biopharmaceutical field. The biosimilar of Rituximab Injection is in Phase III clinical trials, just one step away from production submission; in terms of Class 1 new drugs, Lonilimab Injection is the fastest progressing, and two popular bispecific antibodies have also entered Phase I clinical trials.

The product matrix of improved chemical drugs is rich, covering popular fields such as the digestive system and anti-tumor. The injectable Vonoprazan Fumarate and Mosapride Citrate Injection are the first to be declared and have entered clinical trials, highlighting the obvious competitive advantage of Lunan Pharmaceutical Group.

In terms of new traditional Chinese medicine, Jingfang Mixture is currently in Phase II clinical trials, and Icariin Capsules obtained clinical approval in March this year.

Source: MNI Database, Shanghai Sunshine Pharmaceutical Procurement Network, etc.

Note: The data is from the "Competitive Landscape of Drug Terminals in China's Public Medical Institutions" by Menet, covering China's urban public hospitals, county-level public hospitals, urban community health centers, and township health centers, excluding private hospitals, private clinics, and village health stations. The sales figures are calculated based on the products' average retail prices at the terminals. Data statistics are as of November 6th. If there are any omissions, corrections are welcome!