| By Daisy Zhang, Asia Manufacturing Pharma |
| Friday, 16 May 2008 |
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China’s market for active pharmaceutical ingredients (APIs) and intermediates-related products experienced a series of significant changes in 2007. Traditional APIs were particularly affected, as they witnessed both a reverse from the downward price trend and simultaneous increases in production, sales and exports.
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According to statistics from China Customs, the country recorded imports and exports of chemical APIs-related products of US$2.65 billion and US$8.9 billion in 2007, representing a year-over-year growth of 22.6 per cent and 35.7 per cent, respectively.
Chemical APIs intermediates still took the lion's share of China’s foreign trade in medical products.
However, a majority of the exports were low-value items such as antibiotics, vitamins, amino acids and organic acids, indicating that the country is incapable of improving its export product mix in the short term. China’s APIs products are mainly |
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exported to active pharmaceutical markets worldwide, with the European Union, Asia and North America as the three main destinations.
Despite the strong performance of China’s APIs and intermediates-related products market in 2007, Chinese APIs suppliers still face a variety of uncertainties in future, such as wide price fluctuations in the global market. Only those market players with a top to bottom industry chain will have a high risk tolerance.
Four uncertainties will affect China’s exported medical products in 2008: hikes in the average export price for APIs as a result of rising costs for raw materials and labor; implementation of industry policies and environment-friendly regulations; the appreciation of yuan; and stricter national and international standards for the quality of China’s exported products.
Development of the medical products market subject to traditional APIs
China’s leading APIs providers with comprehensive competitiveness will |
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see further business expansion, while those without expertise and core products will have to struggle for survival.
Enhanced efforts in implementation of eco-friendly policies and environmental oversight
Regulatory controls put in place by the Chinese government will help boost the development of the country’s APIs industry. The government’s implementation of eco-friendly initiatives has efficiently curbed excessive production of certain highly-polluting products. In addition, Chinese drug makers’ manufacturing competencies will be improved in the long term.
Intensifying market competition at home
An increasing number of domestic pharmaceutical companies have sought overseas expansion, in light of stiffer market competition at home. As a result, these companies have increased investment in new product research and development, contributing significantly to globalization of China’s APIs and intermediates sector. |
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