China introduced cancer drugs much cheaper than the US

The way for Beijing to realize the dream of the world-class pharmaceutical industry: price competition.

Last year, Western companies began selling extremely hot cancer drugs called PD-1 inhibitors and aggressive advertising in China. However, instead of quickly conquering the mainland market, US drug makers Merck & Bristol-Myers Squibb face an unexpected challenge: local competitors. Chinese companies are introducing cancer therapy based on PD-1 inhibitors , using the body's immune system to fight tumors, in the domestic market. The solution of these companies has a much lower price, even only 1/3 of the price of products from US manufacturers. And their ambitions are far beyond the mainland, some companies plan to sell drugs in the US and around the world.

The development of PD-1 drugs marked the first breakthrough of the Chinese pharmaceutical industry with complex treatments. At the same time, it also received enthusiastic support from Beijing to speed up drug approval as well as financial support channels for the health care sector.

The development of a world-class pharmaceutical industry is a top priority for Chinese leaders. Beijing's Made in China 2025 Plan defines the pharmaceutical industry as one of 10 industries that will have technological breakthroughs, along with aviation, electric vehicles and advanced rail equipment.

The way Chinese companies expect to enter the market is price competition. Shanghai Junshi Bioscatics sold medicine called Tuoyi in China last December for 187,000 yuan (about 631 million VND) to treat melanoma skin cancer within a year. This price is only 1/3 of Merck's Keytruda products in China, with the same effect at the same time of treatment.

Chinese companies say their drugs are structurally different from those of American companies. " We are completely confident about our patent rights worldwide, " said Wu Xiaobin, president of BeiGene, which has approved the drug PD-1 in China. " We have been well prepared on this issue because we always have plans to go global ."

Innovent Biologics (based in Jiangsu) is licensed by US pharmaceutical giant Eli Lilly & Co, which also sells PD-1 in China at a cheaper price than 2 foreign brands.

Other biotech companies in China are also preparing to penetrate domestic and foreign markets. Jiangsu Hengrui Pharmaceutical Company, one of China's largest drug manufacturers, said on May 31, its drug PD-1 was approved. " PD-1 is the pinnacle of science and changing cancer treatment, " said Brad Loncar, a biotech investor and executive director at Loncar Investments in Lenexa, Kan. Therefore, the Chinese companies' focus on these drugs not only constitutes a change in cancer treatment in China but also has a global significance.

" Foreign companies are seeking to license Chinese medicines globally ," said Lin Lijun, Loyalty Valley Capital founder (based in Shanghai), also investing in Chinese biotechnology companies. including Junshi, said. The Chinese medical industry has been benefiting from increased funding as well as returning home scientists after gaining overseas experience. In addition, many new drugs produced by domestic and foreign companies are also approved.

China is still quite new in developing advanced drugs. Therefore, the safe and effective management of the drug is still a problem, analyst Zhang Jialin said. Chinese companies say tests show that their drugs are safe and some companies are pursuing larger studies.

Approved for the first time in the US in 2014, PD-1 has increased survival for many cancer patients. Although China estimates about 4 million new cancer patients each year, PD-1 is not really popular in this country. Such drugs will only bring in $ 170 million in Chinese sales by 2019, according to Frost & Sullivan estimates. Global sales for these therapies are expected to increase to $ 78.9 billion by 2030, of which China accounts for about a fifth.

Currently, there are no domestic or imported PD-1 drugs in China's public health insurance list, so cancer patients will pay for it by themselves. This is relatively difficult for a country with a per capita income of 28,228 yuan (about 95 million VND). Companies are willing to reduce product prices to be named in the government's support list, said Junshi Li Ning CEO.

The race also shows new challenges for foreign pharmaceutical companies in China, the world's second-largest pharmaceutical market. Bristol-Myers and Merck PD-1 drugs in China are much cheaper than in the US. Global Oncology Express (China) estimates that a Keytruda bottle is sold for 17,918 yuan in China, costing about 33,000 yuan in the US. And both US companies have said they have support programs for low-income patients in China.

Bristol-Myers said the joint efforts of domestic and foreign companies will help solve the need for medicines for patients in China. MSD said Keytruda - the only approved PD-1 therapy in China (treatment of melanoma and lung cancer) is well-positioned, in part by market participants, then faces a lot of problems. more barriers.

Ronald Ede, Creativeent's chief financial officer, said he had seen indigenous drug manufacturers win 85% of the market from global competitors for a drug or medical device in just a few years. This will also happen to the PD-1 market, and even faster, he predicts.