The soaring cost of raw materials for 61 life-saving drugs

2017-05-26

Tetanus antitoxin, glucose injection... The well-known drugs were labeled "emergency" in a list released by the Guangdong Drug Exchange Center on May 2. But the reason they are on this list is because companies are "cutting off payments".


Reporters from The National Business Daily noticed that a total of 61 drugs were listed on the "supply cut-off" list, while as many as 1,004 drugs were listed on the "supply cut-off" list.


Why the supply of lifesaving drugs was cut off? The cost of pharmaceutical raw materials has risen sharply


"Guangdong is a big pharmaceutical province. Who wants to lose their business if they win the bid? Companies are not unwilling to do it, they are afraid to do it." In the face of the reporter's interview, li Yun (pseudonym), who was chairman of an old brand pharmaceutical enterprise in Guangdong, said bluntly, not the enterprise does not want to do business, but the inverted situation of production cost and bid price makes the enterprise have no production power. Reporters from National Business Daily found that drug companies are reluctant to pay the bill and do not supply after winning the bid. In May 2016, Guangdong Pharmaceutical Exchange Center made public the 806 drugs that failed to be delivered according to the contract, and clearly pointed out that if the drugs were not delivered on time after the publicity period, they would be cancelled the market trading qualification of the drug in Guangdong province within two years. In addition, many places in China have also taken place in the bidding of pharmaceutical companies do not supply and was publicly named.


Huang Xiuxiang, secretary general of hunan Pharmaceutical Distribution Association, previously told reporters that Guangdong, as a big province of drug consumption, has a large procurement volume of medical institutions. If pharmaceutical companies can win this market and survive, their ability to make money in other provinces will not be too bad.


Hard in the standard, but now has become a "hot potato", so many pharmaceutical companies "off" and what is the secret? Reporters contacted nearly ten companies in the "cut off supply" list of enterprises, in addition to two that the "cut off supply" is due to distribution enterprises, the rest of the interviewed enterprises will focus on production costs.


Li Yun told reporters that pharmaceutical companies do not supply drugs in a timely manner or not to supply the main two reasons: first, production costs, especially raw material costs have risen too much; Second, the phenomenon of API monopoly is serious. , he said, drug procurement bidding price theory is scientific, reference standards have the average price of around the key provinces and cities, into the market, and negotiation, but due to the economic activity of the drug with lag, the bidding price reference data is often in the past four or five years, but the cost of production, especially the cost of raw materials is rising year by year, and even double. In addition, the new VERSION of GMP standard certification, consistency evaluation and other policy influence, enterprise workshop, product upgrade, also promoted the drug cost rise.


For the cost of raw materials climb, Li Yun has a deep experience. He gave the reporter an example, cold clear production enterprises need to use mopriguanidine as an excipient, but there are only one or two enterprises in the country to produce this API, the price soared from the original 20 thousand yuan per ton to about one million yuan, "very ridiculous."


In addition, stricter drug management standards have also led to a steep increase in pharmaceutical companies' production costs. Li yun said that in the past, the regulatory authorities only tested the ingredients of compound Danshen tablets, and about 5,000 units of panax notoginseng could be produced in 1 ton. Since 2012, the testing standard has been changed to strict content testing, requiring each tablet to contain 1 gram of panax notoginseng. As a result, only 1,000 units can be produced in 1 ton of panax notoginseng. In addition, the past few years of panax notoginseng raw materials fried badly, greatly improved the production cost. As a result of craft improvement, still have a few medicines to raise cause cost to increase, the cold spirit that 1 yuan can buy before, just as a result of craft adjustment, production cost and price hang upside down, the enterprise that does not wish to do loss-making business simply abandoned production.


The chairman of a pharmaceutical company in Zhanjiang, Guangdong told the National Business Daily that it was helpless to stop the supply, as the price of traditional Chinese medicine has risen sharply in recent years, greatly pushing up production costs. At present, the winning price of some drugs is not enough to buy the raw materials. If we deliver according to contract, we will not only lose profit, but also lose money.


Bulk drug monopoly is the underlying reason


A number of drug manufacturers interviewed by The National Business Daily mentioned that the bulk drug monopoly has become an important factor in the price rise of raw materials.


"When dopa was ordered to be manufactured exclusively, there were fewer manufacturers and distributors monopolized the raw material, and this is also the case with vitamin B1." Mr. Zhang, head of the bidding department of a pharmaceutical company in Guangdong, told reporters that dealers' monopoly led to the rising cost of API, but due to the relevant government regulations, the price of low-cost drugs cannot be increased, and the enterprise cannot produce normally.


During the NPC and CPPCC this year, vice chairman of Chinese medical materials, with good doctor pharmaceutical group chairman GengFu submitted "about the national related department to break monopoly, bring down the price proposal, part of the API production enterprise and business enterprise, using the method of the pharmaceutical administration law and relevant regulations" shall manage the approval number of active pharmaceutical ingredients, The production of its preparations must use the API with the approval number ", using the resources of the approval number in hand, to raise the price of the API, or do not take out the raw materials (only for their own production), resulting in high prices of the market preparations or people can not buy some life-saving drugs.


He also pointed out that some pharmaceutical companies and a few exclusive raw material manufacturers together to raise prices, resulting in API prices of nearly 840%; Some pharmaceutical companies have negotiated with foreign companies for higher prices, leading to a 677 percent increase in the price of apis and a 1566 percent increase in the price of apis in three years.


In fact, the National Development and Reform Commission has also moved to rectify the phenomenon of bulk drug monopoly. In 2016, the National Development and Reform Commission punished three companies including Huazhong Pharmaceutical Co., LTD., Shandong Xinyi Co., LTD., and Changzhou Fourth Pharmaceutical Co., LTD., for reaching and implementing the monopoly agreement on estazolam API and tablets, with a total fine of over 2.6 million yuan.


Although the state has shown a strong attitude towards the anti-monopoly law enforcement in the pharmaceutical industry, the price rise of some API is still fierce, and the surging price of API leads to an increasingly serious supply and demand tension in upstream enterprises. Public information shows that from October 2011 to May 2013, the price of thymolol, the main raw material of "Xinlong go water", rose from 275 yuan/kg to 8808 yuan/kg, rising 32 times; The API of digoxin tablet gradually increased from 75,000 yuan/kg in September 2014 to 400,000 yuan/kg in January 2015, increasing by 5 times in half a year. Take domperidone API produced by Indian enterprises as an example. There are only two exclusive import distributors in China, and the price has risen from 900 yuan/kg to 7000 yuan/kg in two years.


The "double squeeze" of API price rise and bidding price reduction on drug manufacturers makes the enterprises feel hurt and can only lead to the supply shortage of some drugs. According to the statistics of the list released by Guangdong Drug Exchange Center, 711 of the 1,004 drugs are urgent (snatch) rescue, clinical necessary drugs and cheap drugs, including 61 urgent (snatch) rescue drugs, 32 clinical necessary and difficult to purchase, 335 cheap drugs, and 283 other basic drugs.


On May 3 and 4, a reporter from National Business Daily repeatedly called the Guangdong Pharmaceutical Delivery Center, hoping to find out the number of delayed and undelivered drugs and the manufacturer's explanation of the reasons, but he still could not be reached as of press time. The guangdong Provincial Health and Family Planning Commission said it would consult relevant departments before replying to reporters about the drug delivery center, which had not been responded to by press time.


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