On June 13th, the "Science and Technology Innovation Board Daily" (Reporter: Zheng Bingxun) announced the adjustment of the price of two adult formulation four-valent influenza virus split vaccines under its ownership. The specifications of "pre-filled 0.5ml / support" have been adjusted to 88 yuan/support, and the specifications of "vial 0.5ml/bottle" have been adjusted to 85 yuan/bottle due to pressure from peers and market promotion.

Excluding companies with small market share and those not listed, including three major subsidiaries (Changchun, Wuhan, Shanghai) under China National Pharmaceutical Group Corp., Hualan Biological Engineering Co. (002007.SZ) and Sinovac Biotech, all four major domestic manufacturers of quadrivalent flu vaccines have completed price reductions.

Zhao Heng, founder of healthcare strategy consulting firm Latitude Health, told Science and Technology Innovation Board Daily that, "After an increase in production, there will inevitably be a price war, which is mainly due to the fact that demand growth is not high and Chinese users are not very aware of the flu vaccine."

The vaccination rate of the four-valent flu vaccine in China has always been low. Industry insiders believe that after this price war, a new change might occur in the industry's competitive landscape. Vaccine expert Tao Linana believes that lowering prices is difficult to expand the market share, but if it can eliminate some companies that lack competitiveness, it is also a good thing.

It greatly shortens the price gap with trivalent vaccines.

In fact, both Kingmed Diagnostics and Hualan Biological noted in their announcements that the price adjustment will have an adverse effect on the sales revenue of their quadrivalent flu vaccines. Kingmed owns only the production of four-valent flu vaccines, and price cuts will further affect the company's overall revenue and profit, but they have to follow the cut-price trend.

"Actually, it is because of market competition." A Science and Technology Innovation Board reporter learned from Kingmed Diagnostics and Hualan Bio that the price cut of the two companies’ vaccine products is because they saw other companies cut prices first. The opening of the price cut trend was first launched by China National Pharmaceutical Group in May this year.

On May 20, in response to the adjustment of the supply price of some vaccines in Jiangsu Province, China National Pharmaceutical Group lowered its winning bid price for its four-valent flu virus split vaccine from 128 yuan / support to 88 yuan/support, breaking the 100-yuan barrier for the first time and officially entering the era of two-digit pricing of quadrivalent flu vaccines.

Half a month later, Sinovac Biotech followed suit and adjusted the price of its 'pre-loaded 0.5ml / support' specification to 88 yuan / support, and the price of its 'vial 0.5ml/bottle' was adjusted to 78 yuan / bottle. On the evening of June 4th, Hualan Biological also announced that it would adjust the price of these two specifications of quadrivalent flu virus split vaccines to 88 yuan/support and 85 yuan/bottle, respectively, and will also adjust the children's dosage pre-filled 0.25ml / support to 128 yuan / support.

A reporter from the Science and Technology Innovation Board Daily learned from the securities department of Hualan Bio that prior to the price adjustment, the prices of vaccines for the 88 yuan/support and 85 yuan/bottle specifications previously were 128 yuan/support and 125 yuan/bottle, respectively. The original price of the children's dosage was 166 yuan/piece. An employee of Kingmed Diagnostics also revealed that the price of the vaccines of 88 yuan/support and 85 yuan/bottle specifications before the price adjustment were also 128 yuan/support and 125 yuan/bottle respectively.

Taking Hualan Biological as an example, it can be calculated that the price reduction of the children's dosage of the quadrivalent flu vaccine is 23%, the price reduction of the pre-filled adult dosage is 31%, and the price reduction of the vial is 32%, which can be said to be quite large.

Kingmed Diagnostics personnel revealed that currently, the factory price of the 0.5ml specification of trivalent flu vaccine on the market is generally between 60-70 yuan, and the original price of the four-valent flu vaccine was not competitive compared to it. With the current price reduction, it may have a certain driving effect on the sales of four-valent vaccines, but the actual outcome depends on whether the market buys into it.

It is noteworthy that the trivalent flu vaccine can cover Type A HIN1, Type A H3N2, and one type of influenza B virus subtype. The quadrivalent flu vaccine adds coverage of another subtype of influenza B virus on the basis of the trivalent vaccine.

"After an increase in production, there will inevitably be a price war, which is mainly due to the fact that demand growth is not high and Chinese users are not very aware of the flu vaccine," Zhao Heng, founder of healthcare strategy consulting firm Latitude Health, told Science and Technology Innovation Board Daily.

A senior pharmaceutical researcher believes, "Second-class vaccines have always been a high-profit industry, driven by this, the industry's competitive landscape has been getting worse in recent years, and this is the most direct motivation for this price reduction. Of course, the deeper reason is related to the previous vaccine anti-corruption campaign. Now that the price of the four-valent vaccine has dropped, other similar companies will likely follow suit and reduce prices."

It is likely to eliminate companies with insufficient competitiveness.

In the opinion of vaccine expert Tao Lina, the supply price of trivalent split influenza vaccine is usually around 60 yuan, with high transparency, which is equivalent to a unit price of 20 yuan. The quadrivalent split influenza vaccine only has one more price in production than the trivalent vaccine, so the supply price is normal at 80-90 yuan.

However, he also said that the domestic influenza vaccine market has already shifted to quadrivalent split influenza vaccine and the competition is very fierce, so price reductions are reasonable. However, the vaccination rate of influenza vaccine in China has never been able to exceed 4% throughout the year. It is difficult to expand the market by lowering prices, and can only be a "pyrrhic victory".

As early as 2020, the market share of quadrivalent influenza vaccine in China has surpassed that of trivalent influenza vaccine. In that year, the total batch issuance of influenza vaccine nationwide was 57.6525 million doses, of which the combined batch issuance of trivalent influenza vaccine was 24.0703 million doses, accounting for 41.8%, and the approved and batch-signed quadrivalent influenza vaccine was 33.5823 million doses, accounting for 58.2%.

However, compared with foreign countries, the vaccination rate of quadrivalent influenza vaccine in China has been hovering at a low level for a long time. The quadrivalent influenza vaccine in the United States was launched for sale in 2013, and the vaccination rate increased to 81% six years later, while China's vaccination rate during the same period was less than 4%. According to the data of the National Center for Disease Control and Prevention, the vaccination rate of influenza vaccine during the flu season in China is only 3.84% from 2022 to 2023.

The above-mentioned researchers believe that "actually the vaccine can also be centralized in the future. Technically, although medical insurance cannot include preventive vaccines, it is not ruled out that the country will invest more funds to pay for the people's vaccination and turn category two vaccines into category one vaccines. This also means that a suitable price will become particularly important."

Application for listing of quadrivalent influenza vaccine

Tao Lina believes that "it is not a good idea for domestic quadrivalent influenza vaccine to lower prices one after another, but I am not opposed to it. If some less competitive vaccine companies can be eliminated, it is also a good thing."

According to data from the Wind Pharmaceutical Database, in addition to the above four companies, other enterprises such as Sanofi Pasteur and National Vaccine&Biological Company also obtained the approval to market quadrivalent influenza vaccines in China, and the competition pattern is becoming increasingly fierce.

According to statistics from Everbright Securities, as of the end of December 2023, the total number of batches of quadrivalent influenza vaccines signed in China for the whole year was 260, among which Hualan Biological Engineering Inc., and the three institutions both topped the list with 88 batches of signed quantity. Sinovac Biotech and Sanofi Pasteur ranked second and third respectively, with 41 and 25 batches of signed quantity.

According to the Center for Drug Evaluation of the National Medical Products Administration, since 2024, China has added three new entities to declare new drugs for listing of quadrivalent influenza vaccines, namely Chengdu XinNuoming/Olin BioPharmaceutical/Lanzhou BaiLing, Jiangsu Kangrun Bio and Shenzhen Kangtai Biological Products. Prior to 2023 and earlier, many companies including Zhejiang Tianyuan Bio, Chengda Biotech, Zhifeilong Kema and Fosun Yalifeng have declared new drugs for listing of the quadrivalent influenza vaccine.

In the face of the current competitive situation, Tao Lina expressed the hope that China's influenza vaccine would try various technological routes, develop new markets, and improve China's influenza vaccine level and variety while achieving commercial success.