77 Pharmaceutical Products Delisted in Shanxi Province, Involving 42 Domestic and International Companies Including CSK, Novartis, and Qilu

　　【Pharmaceutical Network Industry DynamicsOn April 1, the Shanxi Province Pharmaceutical and Medical Device Centralized Competitive Bidding Procurement Website released the "Notice on the Public Disclosure of Some Enterprises Revoking Their Platform Listing and Procurement Qualifications." The notice showed that a total of 77 products were delisted, involving 42 domestic and foreign pharmaceutical enterprises, including CSK, Novartis, and Qilu Pharmaceutical.
 

From the list, the 77 varieties applied for withdrawal this time include commonly used clinical drugs, as well as some important tumor drug varieties.
 

For example, Hul娃 Pharmaceutical's Omeprazole Enteric-Coated Capsules applied for withdrawal from the network in Shanxi Province. This product is a commonly used proton pump inhibitor for treating gastritis in clinical practice. It is a Class A variety in the National Medical Insurance Drug List (2021 Edition) and has been included in the National Essential Medicines List (2018 Edition). Data from the Mi内 Terminal shows that in 2020, the domestic terminal sales scale of Omeprazole oral preparations in China was 3.37 billion yuan, of which the terminal sales of Jinhua Kang恩贝 Omeprazole Enteric-Coated Capsules were 550 million yuan, accounting for 16.3% of the market share.
 

Applications for the withdrawal of cancer drugs in Shanxi Province, such as CSK's Lapatinib Tosylate Tablets (Tykerb), a product mainly used for treating breast cancer, entered the Chinese market in 2013 and once reached a global sales peak of 4 million US dollars. However, with the end of the patent period, the influx of generic drugs from numerous companies including Hengrui and Kelun has impacted the performance of the original product.
 

Another example is Qilu Pharmaceutical's four specifications of Tegafur-Gimeracil-Oteracil Potassium Tablets, an anti-gastric cancer drug. In March 2019, Qilu Pharmaceutical’s product became the first domestically-produced generic version to pass the quality and efficacy evaluation in China. Data from Menet shows that sales of Tegafur-Gimeracil-Oteracil Potassium in Chinese public medical institutions have been increasing year by year, with sales reaching 4.52 billion yuan in 2017, of which capsule formulations accounted for over 98% of the market share. In terms of competitive landscape, Shandong New Era Pharmaceutical holds more than half of the market share, followed by Qilu and Hengrui, occupying 11.72% and 17.14% of the market share respectively. In the second round of centralized procurement, Hengrui and Qilu were the winning bidders for Tegafur-Gimeracil-Oteracil Potassium products, with Hengrui offering a lower price at 67.95 yuan (20mg, 12 capsules) compared to Qilu. New Era Pharmaceutical was not eligible for the centralized procurement due to failing the quality and efficacy evaluation.
 

Under the normalization of centralized procurement, the trend of drug price reduction has become inevitable. Coupled with the continuous rise in raw materials and costs, both domestic and foreign pharmaceutical companies have been inevitably affected. Many enterprises have had to painfully give up bidding, withdraw from the network, or even halt production. In addition to Shanxi Province, many provinces have issued notices about the withdrawal of related products from the market since the beginning of this year.
 

On March 17, the Jiangsu Provincial Public Resources Trading Platform issued a notice to revoke the online listing of drugs that had no inspection records within one year or more on the platform as of March 15, 2022. A total of 6,076 drugs were delisted by drug serial numbers, involving several large domestic enterprises such as Kelun, Yangtze River, Shijiao, Lizhu, and Qilu. Earlier, on March 4, the Jiangsu Provincial Public Resources Trading Center also issued a notice regarding proposed revocation of online listings for certain drugs, which showed that 35 drugs, including Ligandan Granules and Shuanghuanglian Oral Liquid, were proposed for delisting, all of which were voluntarily applied for delisting by the companies.
 

In mid-February, the Shaanxi Provincial Public Resources Trading Center issued a notice on canceling the online listing qualifications of some products. This involved the delisting of nine products including Potassium Sodium Dehydroandrographolide Succinate for Injection, Alpha-Lipoic Acid Injection, Famotidine for Injection, and Nadroparin Calcium for Injection. The companies affected include Chongqing Pharma-Yupin Pharmaceutical, Sichuan Meidakang Huakang Pharmaceutical, Hainan Sanye Pharmaceutical, among eight pharmaceutical enterprises.
 

In the industry's view, as the withdrawal of drugs from the market becomes routine, market reshuffling is also intensifying. In order to gain more initiative in the market, pharmaceutical companies need to focus on the research and development of innovative drugs, create core competitive flagship products, strictly control drug quality, and actively carry out consistency evaluation.
 

Disclaimer: In no event shall the information or opinions expressed in this article constitute investment advice to any person.