Lifeng Pharma Secures First-to-File Generic of 'Smart Drug' Concerta, Surges with Five Consecutive Daily Trading Limits Amid Market Shortage

Apr 21, 2025 18:46 CST Updated 18:46

Johnson & Johnson

Medical Device R&D and Manufacturer

On April 21, Hefei Lifeon Pharmaceutical Co., Ltd., a leading company in osmotic pump controlled-release formulations, had closed at 30.62 yuan per share after five consecutive trading days of hitting the upper limit. During this period of continuous limit-up, the stock had cumulatively increased by 60.99%. Notably, this wave of limit-up activity occurred after the recent approval of a new drug by Lifeon Pharmaceutical.

On April 15, Hefei Lifeon Pharmaceutical Co., Ltd. announced that its extended-release methylphenidate hydrochloride tablets, submitted as a Category 4 chemical drug, received approval from the National Medical Products Administration (NMPA) for marketing in China to treat Attention Deficit Hyperactivity Disorder (ADHD). Prior to this, there was only one approved imported drug with a registration number for extended-release methylphenidate hydrochloride tablets in China, held by the original developer Johnson & Johnson. This approval means that Hefei Lifeon Pharmaceutical's extended-release methylphenidate hydrochloride tablets will enter the ADHD medication market as the first generic drug.

Typically, the approval of the first generic drug does not cause much of a stir in the capital markets. However, the reason why Hefei Lifeon Pharmaceutical Co., Ltd. was able to achieve a "five-day limit up" with its approval of the extended-release methylphenidate hydrochloride tablets lies in the shortage of Johnson & Johnson's original drug "Concerta" in the Chinese market. Drugs for ADHD treatment are being sought after by the market as "smart drugs." With this move to fill the gap, can Lifeon Pharmaceutical meet investors' expectations?

China-Made "Smart Drugs" Breakthrough

Shortage wave is expected to ease

ADHD is a common neurodevelopmental disorder in school-age children, with 30% to 50% of patients experiencing symptoms that persist into adulthood. It is widely considered a disease that affects an individual throughout their entire life cycle. Data shows that the prevalence rate of ADHD among children in China is as high as 6.26% (approximately 23 million people), but the clinical visit rate is only about 10%. Additionally, around 65% of patients have at least one other comorbid condition.

Currently, based on clinical values such as good tolerability and efficacy, Methylphenidate Hydrochloride preparations have become the first-line standard treatment for ADHD patients over 6 years old. Methylphenidate Hydrochloride preparations can block monoamine neurotransmitters in pediatric patients, increasing the concentration of norepinephrine in the body and dopamine in the synaptic cleft, thereby enhancing the excitability of the arousal center. This helps relieve fatigue, invigorate the spirit, and improve the concentration of the pediatric patients.

Among them, the extended-release methylphenidate hydrochloride tablets were developed by ALZA Corporation, a pioneer in the field of drug delivery, and received FDA approval for marketing in 2000. In 2001, Johnson & Johnson acquired ALZA Corporation for $10.5 billion, gaining several innovative achievements in the field of drug delivery systems, including the extended-release methylphenidate hydrochloride tablets. In August 2005, the extended-release methylphenidate hydrochloride tablets, imported and packaged by Xi’an Janssen Pharmaceutical Ltd., a subsidiary of Johnson & Johnson, were approved for marketing in China under the brand name "Concerta," becoming a leading brand in China's ADHD medication market.

Data from MiNe Network shows that, after being included in the Class B National Medical Insurance Catalog, the sales of Methylphenidate Hydrochloride Extended-Release Tablets in China's public medical institutions have been increasing year by year, surpassing 400 million yuan in 2023. In the first half of 2024, it continued to grow at a rate of approximately 39%. However, in recent years, the supply of Concerta has been tight in China.

Xi'an Janssen once publicly responded to the shortage issue, stating that Concerta is a Class I psychotropic drug under national control, and the main raw materials for its production are globally regulated. Since 2023, due to various factors, the global demand for Concerta has continued to grow. To alleviate supply tensions, Xi'an Janssen planned at that time to transfer the packaging process of Concerta for the Chinese market from overseas factories to the Xi'an factory, in order to expedite the supply speed in the Chinese market.

Over the past 20 years, the main reason why Johnson & Johnson's Concerta has been able to dominate the market is that the drug adopts a complex osmotic pump technology structure and process, and for the first time achieved biphasic controlled release of the drug. In the field of drug delivery, osmotic pump technology is known as the "ceiling" of sustained and controlled release formulations, as it enables the drug to be continuously released in the body for up to 24 hours, significantly improving efficacy and reducing side effects.

As a leader in osmotic pump controlled-release formulations, Hefei Lifeon Pharmaceutical Co., Ltd. has been continuously developing an osmotic pump controlled-release technology platform in recent years, focusing on advanced slow and controlled-release formulations for psychiatric and anesthetic drugs. It is one of the few designated manufacturers in China authorized to produce Schedule I psychotropic substances and anesthetic drugs. In its announcement, Lifeon Pharmaceutical stated that the recently approved Methylphenidate Hydrochloride Extended-Release Tablets utilize an advanced three-layer osmotic pump controlled-release technology, ensuring precise control for rapid onset and effectively maintaining stable efficacy throughout the day.

It is worth mentioning that Lifeon Pharmaceutical also emphasized its independent production capacity of Methylphenidate Hydrochloride API, ranking among the few companies in China that master the key raw material production process. In the industry's view, the stable supply of high-quality raw materials will help Lifeon Pharmaceutical establish an integrated supply system of API and formulation, which means that the shortage of Methylphenidate Hydrochloride Sustained-Release Tablets in China may be alleviated.

Hefei Lifeon Pharmaceutical Co., Ltd.'s Five-Day Limit Up is Event-Driven, with the Core Logic Being First-to-Market Generic Drugs Filling Market Gaps, Technological Barriers, and High Industry Prosperity. However, as Hefei Lifeon Pharmaceutical Co., Ltd. Reminded in Its Stock Trading Abnormal Fluctuation Announcement, Due to the Possible Influence of Policies and Market Factors on Drug Production and Sales, the Specific Impact on Its Performance Still Carries Some Uncertainty. How Long Hefei Lifeon Pharmaceutical Co., Ltd.'s Limit-Up Stock Price Rally Will Last Remains to Be Seen.

Focus on Two Major Types of Drugs

ADHD Market Unfolds

By altering the way brain chemicals work, ADHD medications help improve children's attention, control impulses, and enhance thinking abilities, which are crucial for learning and social life. With increased awareness and ongoing research, the ADHD medication market is expected to grow steadily.

Data shows that the global ADHD drug market size will reach 14.71 billion US dollars in 2025 and is expected to achieve 21.14 billion US dollars by 2034 with a compound annual growth rate of 4.11%. Globally, multinational pharmaceutical companies such as Takeda, Eli Lilly, Novartis, and Johnson & Johnson occupy the major share of the ADHD drug market.

Currently, the commonly used medications for treating ADHD in China are mainly divided into two categories: central stimulants and non-stimulant drugs. Among them, methylphenidate hydrochloride is the primary central stimulant, while atomoxetine hydrochloride is the main non-stimulant drug.

In terms of methylphenidate hydrochloride preparations, although only Johnson & Johnson and Hefei Lifeon Pharmaceutical Co., Ltd. currently hold production licenses for extended-release tablets, other formulations have enabled multiple pharmaceutical companies to secure a "market entry ticket." Specifically, China Resources Double-Crane and Su Yi Pharmaceutical both possess production licenses for methylphenidate hydrochloride tablets, while the U.S.-based Tris Pharma has obtained import and sales qualifications for two major formulations: extended-release dry suspension and extended-release chewable tablets.

In addition to competing in dosage forms, some pharmaceutical companies have also attempted to break through with isomers of methylphenidate hydrochloride. In January 2025, Henan Zhongshuai Pharmaceutical's dexmethylphenidate hydrochloride sustained-release capsules were approved for marketing. Dexmethylphenidate hydrochloride is the dextrorotatory isomer of methylphenidate hydrochloride. The capsule utilizes oral pellet drug absorption technology, containing 50% immediate-release pellets and 50% delayed-release pellets. Through multi-unit release, it can effectively reduce individual differences and minimize fluctuations in peak and trough blood drug concentrations. For patients with swallowing difficulties, the medication can be administered by sprinkling.

When Johnson & Johnson's Concerta was out of stock in the market, many pediatric patients also chose atomoxetine hydrochloride as an alternative drug. Atomoxetine hydrochloride is a selective norepinephrine reuptake inhibitor originally developed by Eli Lilly and can be used as a first-line treatment for ADHD in children and adolescents. Unlike methylphenidate hydrochloride sustained-release tablets, atomoxetine hydrochloride has not yet been approved in China for adult ADHD indications.

Currently, there are dozens of domestic production enterprises for Atomoxetine Hydrochloride in China, including Huahai Pharmaceutical, Jichuan Pharmaceutical, and Shandong New Era, covering oral solutions, capsules, and tablets. In the ninth round of national procurement, Atomoxetine Hydrochloride (capsule and oral solution formulations) was included in the procurement list for the first time, with nearly 20 companies shortlisted, and only 9 companies eventually securing the bidding qualification.

Some argue that first-line medications for ADHD can be substituted, but switching drugs is not easy. Different drugs have significantly different onset times and mechanisms of action, and changing medications also involves dose adjustments. The market launch of Hefei Lifeon Pharmaceutical Co., Ltd.'s extended-release methylphenidate hydrochloride tablets is expected to stabilize supply to a certain extent, potentially reducing the need for medication switches.

Although no other companies have entered the clinical research or registration application stage for Methylphenidate Hydrochloride Sustained-Release Tablets so far, more companies may enter the ADHD drug market in the future due to market dynamics.

Editor: Fan Xiaoyan

Layout Editor: Yu Yuanze

Reviewed by: Ma Fei, Zhang Song

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