On January 21, 688166.SH 20CM rose by the daily limit, while Shanghai Fosun Pharmaceutical opened the limit and opened the limit a few minutes later. By the end of the day, it was still up nearly 6 per cent. In addition, Hong Kong stocks$via creature (01873.HK) $At one point, it was up more than 30% at the start of trading, but by the close, it was still up more than 13%.
In the news, on the evening of January 20, the Drug Patent Pool Organization (MedicinesPatentPool, hereinafter referred to as: MPP) announced that it had signed agreements with 27 generic drug manufacturers to produce and supply high-quality, affordable Merck & Co Inc oral anti-novel coronavirus Molnupiravir generic drugs to 105 low-and middle-income countries or regions around the world, so as to promote the affordability and accessibility of such drugs in low-and middle-income countries and help prevent and control the local epidemic.
Among the 27 pharmaceutical companies, there are five Chinese pharmaceutical companies, namely Shanghai Fosun Pharmaceutical, Borey Pharmaceuticals, Vivia Biological subsidiary Longhua Pharmaceutical, Shijiazhuang Longze Pharmaceutical Co., Ltd. And Shanghai Diseno Biopharmaceutical Co., Ltd., of which, except Longhua Pharmaceuticals, the other four are authorized to produce APIs and preparations at the same time.
The profit of generic drugs has yet to be determined, and there is no need to pay patent fees.
In intraday trading on January 21, Bouri Pharmaceutical urgently warned of the risks and said that the impact of the above events on the company's future performance could not be predicted.
Based on the agreement with Merck & Co Inc, MPP granted Borex a non-exclusive license for the production, commercialization and related rights of oral drug Molnupiravir in 105 low-and middle-income countries, including India, Pakistan and C ô te d'Ivoire, as well as in the field of COVID-19 's treatment, using regional patents and Merck & Co Inc's proprietary technology, Borey said.
Under the agreement, Bhari will supply the goods at the actual cost of the goods (which can be verified by a third-party audit) plus a reasonable price increase (to be determined). Given that the cooperation aims to promote the global affordability of Molnupiravir and help 105low-and middle-income countries to use Molnupiravir, Brocade noted that the price of the product is expected to be lower than that of the original product or in other high-and middle-income countries. The specific price and production cost need to be submitted to MPP, which can not be determined for the time being.
In addition, depending on the nature of the buyer, Bouri Pharmaceutical shall pay Merck & Co Inc a patent license fee of 5% or 10% of the annual net sales of the product. "However, based on the agreement between Merck & Co Inc and MPP, the aforementioned patent license fees will be collected from the month after WHO announced that COVID-19 is no longer listed as a 'public health emergency of international concern'." Borey Medicine said.
In addition, Borey Pharmaceutical said, "as of the date of this announcement, the company has not yet ordered or carried out related production for cooperative drugs, and the performance of this contract has no significant impact on the company's current performance, and the impact on future performance cannot be predicted."
Some people in the industry believe that, subject to the public welfare attribute, the free production of generic drugs taken orally by Merck & Co Inc and COVID-19 does not bring too many profits for pharmaceutical companies.
Guosheng Securities briefly estimated the market size of Molnupiravir generic drugs in the research report. According to MPP, this time, 105 low-and middle-income countries will have access to Molnupiravir generic drugs, covering the basic population of 4.127 billion. Guosheng Securities assumes that the global actual average infection rate is the same as the statistical infection rate in Europe and the United States, and the treatment rate is 60% of that in Europe and the United States, then MPP authorized suppliers will receive a total of 373 million doses of COVID-19 in 2022. After referring to the cost of a single course of generic drugs in India, Guosheng Securities estimates that the market space for Molnupiravir in 2022 is US $1.225 billion.
Sales depend on sales network and supply chain
According to public data, MPP is a non-profit public health organization supported by the United Nations, with its main office in Geneva, Switzerland. Through innovative approaches to voluntary licensing and patent pools, MPP is committed to increasing access to medicines in low-and middle-income countries and promoting the development of such drugs.
According to the research report of Zheshang Securities, by the beginning of 2022, the authorized areas signed by MPP include 13 anti-HIV drugs, 1 anti-HIV technology platform, 3 anti-hepatitis C drugs, 1 tuberculosis therapy, 2 long-acting technologies, 2 anti-COVID-19 drugs and 1 COVID-19 antibody test. From January 2012 to December 2020, MPP has supplied 18.55 billion courses of drugs, saving US $920 million.
From the perspective of business model, MPP itself does not produce APIs or generics. WHO and MPP work together to screen drugs from the point of view of disease burden, effectiveness, accessibility and so on. After the patent holder cooperates and authorizes, the global API / generics suppliers fill in the letter of intent, and the original research manufacturers can choose whether or not to charge franchise fees. Authorized drug companies need to promote their own sales in authorized countries.
Zheshang Securities pointed out in the research report that obtaining MPP authorization is a manifestation of the applicant's global compliance production capacity, benefiting from the supporting advantages of Sinochem and the accelerated expansion of compliance capacity, it is expected that Chinese API and CDMO companies will have more influence in the global pharmaceutical supply chain. From the point of view of the internationalization of APIs and preparations, the company's sales after authorization depend on the ability of each company to build international sales network and supply chain management.
From the expansion of overseas commercialization, Shanghai Fosun Pharmaceutical is in the forefront. According to the company's semi-annual report of 2021, by the end of the reporting period, about 1000 overseas commercialization teams have been formed, mainly covering the United States, Africa, Europe and other regions. In Africa, the company has long-term business cooperation with public drug procurement centers in major countries, as well as international drug procurement agency groups, covering 35 English-speaking, French-speaking and Portuguese-speaking countries and regions south of the Sahara.
Will it crack down on the domestic COVID-19 special medicine?
In fact, in addition to Merck & Co Inc, Pfizer Inc, as one of the first two companies in the world to develop and market COVID-19 special small molecular oral drugs, may also have granted product patents to MMP. According to questions and answers from investors on the 002422.SZ platform, Coren submitted an application for a replica supply of Pfizer Inc's Paxlovid.
It is worth noting that at present, Pfizer Inc's COVID-19 specific drug market share is larger than Merck & Co Inc. According to the brokerage research report, of the 140 million courses of COVID-19 specific drugs to be sold to Europe and the United States, Merck & Co Inc is 20 million doses and Pfizer Inc is 120 million doses.
The two giants have granted patents for COVID-19 's specific drugs to MMP one after another. In the view of a person in the pharmaceutical industry, it is a "positive trick" for COVID-19 's specific drugs in China. The basic market pattern of COVID-19 's oral drugs in the world may be fixed: COVID-19 's oral drugs, which are being studied in the domestic market, face the impact of cheap generic drugs in the international middle and low-end markets, and have little competitiveness in Europe and the United States, while the domestic market space is very small.
Five Chinese pharmaceutical companies have received the license of Merck & Co Inc COVID-19 special effect drug imitation from MMP. What will be the impact on COVID-19 drugs independently developed in China? In this regard, pharmaceutical strategic marketing expert Shi Lichen told reporters: "Molnupiravir can reduce the risk of severe illness, there is no effect to put an end to transmission, reducing the risk of severe illness is only a very small part that is not taken seriously in the process of treatment." The treatment of novel coronavirus is a combination of drugs, which can not only reduce the risk of severe illness, but also treat the corresponding symptoms after being infected by novel coronavirus, thus ultimately helping the human body's immunity to make the virus disappear in the body. It can be seen that Molnupiravir is only a drug to reduce the risk of severe illness, and it will not have much impact on COVID-19 's treatment in China. "
"what needs to be clear is that the current COVID-19 treatment drug combination program in China is basically used only in China, and it has not been recognized by countries all over the world. in addition, the number of COVID-19 patients in China is very small, so the domestic COVID-19 treatment drug itself is not large, so the impact is even lower." Schlichen added.