The year 2017, just past, was undoubtedly a pivotal year of significant transformation for the pharmaceutical industry. Under the guidance of government policies, profound adjustments across various sectors have been systematically carried out. The "Two Offices" have continuously encouraged innovation and their accompanying detailed implementation guidelines, steering the industry’s future development toward greater innovation. The ongoing and rapid advancement of bioequivalence evaluations for generic drugs has made quality a central focus for enterprises’ sustainable development. Meanwhile, the “two-invoice system” has been successively rolled out nationwide, reshaping the distribution landscape. The steady promotion of tiered diagnosis and treatment, the implementation of zero-markup policies, the introduction of new national medical insurance catalogs, and the outcomes of medical insurance negotiations—all these developments have kept cost-control efforts in the medical insurance system under intense pressure, leading to continuous changes in drug usage patterns within hospitals... With the implementation of this series of new pharmaceutical reform policies, the pharmaceutical industry is now entering a new stage of development driven by innovative technologies, marking the best era yet for China’s pharmaceutical sector.
In 2018, structural adjustments in the industry had already begun. For enterprises, opportunities and challenges coexist, and building strong R&D and innovation capabilities while enhancing product quality have become the dominant theme of development. Some industry observers commented that this marks a new era in which “only the survivors will prevail.” Extreme weather conditions have driven many small and medium-sized enterprises to flee, leaving only those companies—much like the poplar trees thriving in the desert—with unwavering perseverance, endurance, and resilience—to secure a place for survival. This is precisely the case with Shisi Pharmaceutical.
Shuffling accelerates; innovative layouts enter the harvest phase.
Relevant authorities have intensively introduced a series of pharmaceutical policies and regulations, including several landmark measures. While these policies raise the barriers to drug R&D and enhance drug quality, they also promote greater standardization and consolidation within the pharmaceutical R&D industry, thereby fostering a process of survival of the fittest in the sector.
Recently, the Drug Review Center of the National Medical Products Administration released a notice soliciting public comments on the “Technical Requirements for Consistency Evaluation of Already Marketed Generic Chemical Injectable Drugs.” This is another significant announcement—following the launch of consistency evaluations for oral solid dosage forms—that will profoundly impact the structure of the pharmaceutical industry. With the exception of a few specific products such as sodium chloride injection and glucose injection, nearly all generic chemical injectable drugs will be subject to consistency evaluation. This means that a large number of small- and medium-sized injectable drug manufacturers will face a reshuffling of the market.
According to the plan of the National Medical Products Administration, the consistency evaluation of injectable drugs will be completed within 5 to 10 years. This is seen by the industry as a major challenge facing large intravenous solution manufacturers. Industry insiders generally believe that, as the market becomes increasingly open and competition between domestic and foreign companies intensifies, it has become inevitable for China’s large intravenous solution enterprises to shift their development approach and focus on improving quality and fostering continuous innovation.
“Currently, the projects we’ve submitted are gradually entering the harvest phase. Soon, a raw pharmaceutical material for combating hepatitis B virus and AIDS will obtain its production approval. Meanwhile, four or five generic drugs that have already completed evaluations of quality and therapeutic equivalence as well as bioequivalence studies have been submitted to the National Medical Products Administration’s Center for Drug Evaluation,” said Yin Dianshu, Chief Engineer of Shisi Pharmaceutical and Director of the Institute of Pharmaceutical Research. At present, Shisi Pharmaceutical has over a hundred projects under development, covering areas such as cardiovascular diseases, antiviral therapies, respiratory disorders, and mental health conditions. The company is also collaborating with top domestic research institutions, including the Chinese Academy of Sciences, to develop innovative drugs.
Driven by relentless innovation, the pace of product approvals has accelerated. Recently, Shisi Pharmaceutical Group announced that it has obtained the drug production registration approval from the National Medical Products Administration for Sodium Acetate Ringer’s Injection (500 ml). Sodium Acetate Ringer’s Injection is primarily used to treat blood loss caused by trauma, surgery, burns, and other conditions. In addition, Shisi Pharmaceutical has two other major therapeutic infusion products expected to receive production approvals within 2018, which will serve as catalysts for future market growth.
To date, Shisi Pharmaceutical has obtained production approvals for several products, including the 2,000 ml glycine irrigation solution. The company has already filed applications for and is actively developing more than 100 product candidates, among which are several first-in-class chemical drugs. While maintaining its technological and product advantages in intravenous solutions, Shisi Pharmaceutical is steadily building a portfolio of distinctive surgical irrigation solutions, a series of products for emergency surgical care, a range of dialysis solutions (including peritoneal dialysis and hemodialysis), parenteral nutrition solutions (such as amino acid and fat emulsion formulations), and disinfectant products—all through innovative R&D efforts. This high R&D efficiency fully meets the company’s needs over the next five years. As its R&D team continues to mature, Shisi Pharmaceutical also plans to establish overseas R&D innovation platforms, truly achieving internationalization.
It’s worth noting that the infusion markets in both the U.S. and Japan are highly concentrated: for instance, Baxter in the U.S. holds an 80% market share, while Otsuka Pharmaceutical in Japan accounts for more than 50% of the market. Without exception, these companies have adopted the latest processes and technologies, thereby forcing smaller firms to either transform or exit the market. As a result, vacant market niches are filled with new products, giving the entire market a fresh and revitalized look.
According to a research report, future new products will focus on the therapeutic parenteral solutions segment, including anti-tumor injections, organ preservation solutions for multi-organ transplantation, surgical irrigation solutions, various dialysis solutions, and ready-to-use liquid-solid dual-chamber flexible bag infusions. In the nutritional parenteral solutions segment—such as fat emulsions, invert sugar injections, amino acids, and multi-chamber fat emulsion infusions—these areas represent key growth directions for parenteral solutions in the future.
Looking at the development blueprint of Shisi Pharmaceutical, the company will continue to enrich its product portfolio in the future. According to the plan laid out by Qu Jiguang, Chairman of Shisi Pharmaceutical, three major directions for future product structure optimization have already become clear: First, the intravenous infusion product line will include nearly 60 high-end products; second, oral formulations and small-volume injections; and third, strengthening capabilities in nine key therapeutic areas, including anti-infectives, drugs for the nervous system, respiratory system, digestive and metabolic systems, cardiovascular system, water-electrolyte and nutritional therapies, basic intravenous solutions (including dialysis and irrigation solutions), and anticoagulants.
Packaging Innovation: Leading the High-End Market
While further strengthening innovation and R&D on the products themselves, the industry is also increasing its investment in innovative packaging for large-volume infusions. In recent years, companies such as Shisi Pharmaceutical have been stepping up their research into packaging.
The “In-depth Research Report on China’s Intravenous Solution Market and Investment Prospects Forecast (2017 Edition)” shows that currently, there are a total of 236 intravenous solution manufacturers in China that have obtained certification under the new GMP standards. These companies have an annual production capacity of approximately 25 billion bottles and bags, with a capacity utilization rate of around 55%. Plastic-bottle IV solutions remain the mainstream packaging material in the market, though their market share is gradually declining; by contrast, the market shares of soft bags and direct-soft bags have been increasing year by year. Glass bottles, meanwhile, hold the smallest market share, and their sales volume has been decreasing steadily over the years.
Currently, in both Europe and the Americas, infusion products packaged in flexible bags and plastic containers dominate the market. According to statistics, in Europe today, flexible bags account for 60% of the market, plastic bottles for 20%, and glass bottles for another 20%. In the U.S., flexible bags make up as much as 90%, with the remaining 10% accounted for by glass bottles. Meanwhile, in China, plastic bottles still remain the dominant packaging type. Market experts predict that flexible bags are undoubtedly the trend of the future and will likely gradually replace both plastic bottles and glass bottles. There is still tremendous room for growth for flexible bags in the Chinese market.
In fact, over the past decade, the large-volume parenteral solutions industry has undergone a transition—from primarily glass bottles to plastic bottles, upright flexible bags, and standard flexible bags. Shisi Pharmaceutical has consistently been at the forefront of this transformation. Currently, the proportion of non-glass-bottle packaging has exceeded 90%, reaching an internationally advanced level. In particular, Shisi Pharmaceutical holds a 30% share of the high-end standard flexible bag infusion market, firmly establishing its dominance in the domestic standard flexible bag segment. Shisi Pharmaceutical began producing upright flexible bags in 2015, and these are now mainly used as a replacement for plastic bottle packaging. Moreover, the gross profit margin of upright flexible bags is significantly higher than that of plastic bottles and glass bottles, enabling Shisi Pharmaceutical to maintain a leading position in the industry’s gross profit margin.
“We currently maintain a pace of launching more than ten new products each year, and in recent years, we’ve even secured approval for the production of 14 new types of upright polypropylene infusion bags—making us one of the few domestic manufacturers capable of producing infusion products in all packaging formats,” said Su Xuejun, General Manager of Shisi Pharmaceutical. He added that these achievements are entirely attributable to the company’s continuous innovation throughout its development journey.
“From glass bottles to flexible bags, each new generation of Shisi Pharmaceutical’s intravenous solutions has opened up a whole new market space. Before we launched our flexible-bag products, the market had no idea what they were or even recognized their advantages. Through targeted guidance and extensive promotion, we quickly helped the market understand and embrace our innovative products,” said Su Xuejun. “Every innovative product we introduce is the result of thorough market research and analysis. We always stay ahead of the curve, guiding the industry toward products that are safer, more efficient, and more convenient. This is not only a necessity for our company’s growth—it’s also our mission.” (Originally published in Pharmaceutical Economic News) The year 2017, just past, was undoubtedly a pivotal year of significant transformation for the pharmaceutical industry. Under the guidance of government policies, profound adjustments across various sectors have been systematically carried out. The "Two Offices" have continuously encouraged innovation and their accompanying detailed implementation guidelines, steering the industry’s future development toward greater innovation. The ongoing and rapid advancement of bioequivalence evaluations for generic drugs has made quality a central focus for enterprises’ sustainable development. Meanwhile, the “two-invoice system” has been successively rolled out nationwide, reshaping the distribution landscape. The steady promotion of tiered diagnosis and treatment, the implementation of zero-markup policies, the introduction of new national medical insurance catalogs, and the outcomes of medical insurance negotiations—all these developments have kept cost-control efforts in the medical insurance system under intense pressure, leading to continuous changes in drug usage patterns within hospitals... With the implementation of this series of new pharmaceutical reform policies, the pharmaceutical industry is now entering a new stage of development driven by innovative technologies, marking the best era yet for China’s pharmaceutical sector.
In 2018, structural adjustments in the industry had already begun. For enterprises, opportunities and challenges coexist, and building strong R&D and innovation capabilities while enhancing product quality have become the dominant theme of development. Some industry observers commented that this marks a new era in which “only the survivors will prevail.” Extreme weather conditions have driven many small and medium-sized enterprises to flee, leaving only those companies—much like the poplar trees thriving in the desert—with unwavering perseverance, endurance, and resilience—to secure a place for survival. This is precisely the case with Shisi Pharmaceutical.
Shuffling accelerates; innovative layouts enter the harvest phase.
Relevant authorities have intensively introduced a series of pharmaceutical policies and regulations, including several landmark measures. While these policies raise the barriers to drug R&D and enhance drug quality, they also promote greater standardization and consolidation within the pharmaceutical R&D industry, thereby fostering a process of survival of the fittest in the sector.
Recently, the Drug Review Center of the National Medical Products Administration released a notice soliciting public comments on the “Technical Requirements for Consistency Evaluation of Already Marketed Generic Chemical Injectable Drugs.” This is another significant announcement—following the launch of consistency evaluations for oral solid dosage forms—that will profoundly impact the structure of the pharmaceutical industry. With the exception of a few specific products such as sodium chloride injection and glucose injection, nearly all generic chemical injectable drugs will be subject to consistency evaluation. This means that a large number of small- and medium-sized injectable drug manufacturers will face a reshuffling of the market.
According to the plan of the National Medical Products Administration, the consistency evaluation of injectable drugs will be completed within 5 to 10 years. This is seen by the industry as a major challenge facing large intravenous solution manufacturers. Industry insiders generally believe that, as the market becomes increasingly open and competition between domestic and foreign companies intensifies, it has become inevitable for China’s large intravenous solution enterprises to shift their development approach and focus on improving quality and fostering continuous innovation.
“Currently, the projects we’ve submitted are gradually entering the harvest phase. Soon, a raw pharmaceutical material for combating hepatitis B virus and AIDS will obtain its production approval. Meanwhile, four or five generic drugs that have already completed evaluations of quality and therapeutic equivalence as well as bioequivalence studies have been submitted to the National Medical Products Administration’s Center for Drug Evaluation,” said Yin Dianshu, Chief Engineer of Shisi Pharmaceutical and Director of the Institute of Pharmaceutical Research. At present, Shisi Pharmaceutical has over a hundred projects under development, covering areas such as cardiovascular diseases, antiviral therapies, respiratory disorders, and mental health conditions. The company is also collaborating with top domestic research institutions, including the Chinese Academy of Sciences, to develop innovative drugs.
Driven by relentless innovation, the pace of product approvals has accelerated. Recently, Shisi Pharmaceutical Group announced that it has obtained the drug production registration approval from the National Medical Products Administration for Sodium Acetate Ringer’s Injection (500 ml). Sodium Acetate Ringer’s Injection is primarily used to treat blood loss caused by trauma, surgery, burns, and other conditions. In addition, Shisi Pharmaceutical has two other major therapeutic infusion products expected to receive production approvals within 2018, which will serve as catalysts for future market growth.
To date, Shisi Pharmaceutical has obtained production approvals for several products, including the 2,000 ml glycine irrigation solution. The company has already filed applications for and is actively developing more than 100 product candidates, among which are several first-in-class chemical drugs. While maintaining its technological and product advantages in intravenous solutions, Shisi Pharmaceutical is steadily building a portfolio of distinctive surgical irrigation solutions, a series of products for emergency surgical care, a range of dialysis solutions (including peritoneal dialysis and hemodialysis), parenteral nutrition solutions (such as amino acid and fat emulsion formulations), and disinfectant products—all through innovative R&D efforts. This high R&D efficiency fully meets the company’s needs over the next five years. As its R&D team continues to mature, Shisi Pharmaceutical also plans to establish overseas R&D innovation platforms, truly achieving internationalization.
It’s worth noting that the infusion markets in both the U.S. and Japan are highly concentrated: for instance, Baxter in the U.S. holds an 80% market share, while Otsuka Pharmaceutical in Japan accounts for more than 50% of the market. Without exception, these companies have adopted the latest processes and technologies, thereby forcing smaller firms to either transform or exit the market. As a result, vacant market niches are filled with new products, giving the entire market a fresh and revitalized look.
According to a research report, future new products will focus on the therapeutic parenteral solutions segment, including anti-tumor injections, organ preservation solutions for multi-organ transplantation, surgical irrigation solutions, various dialysis solutions, and ready-to-use liquid-solid dual-chamber flexible bag infusions. In the nutritional parenteral solutions segment—such as fat emulsions, invert sugar injections, amino acids, and multi-chamber fat emulsion infusions—these areas represent key growth directions for parenteral solutions in the future.
Looking at the development blueprint of Shisi Pharmaceutical, the company will continue to enrich its product portfolio in the future. According to the plan laid out by Qu Jiguang, Chairman of Shisi Pharmaceutical, three major directions for future product structure optimization have already become clear: First, the intravenous infusion product line will include nearly 60 high-end products; second, oral formulations and small-volume injections; and third, strengthening capabilities in nine key therapeutic areas, including anti-infectives, drugs for the nervous system, respiratory system, digestive and metabolic systems, cardiovascular system, water-electrolyte and nutritional therapies, basic intravenous solutions (including dialysis and irrigation solutions), and anticoagulants.
Packaging Innovation: Leading the High-End Market
While further strengthening innovation and R&D on the products themselves, the industry is also increasing its investment in innovative packaging for large-volume infusions. In recent years, companies such as Shisi Pharmaceutical have been stepping up their research into packaging.
The “In-depth Research Report on China’s Intravenous Solution Market and Investment Prospects Forecast (2017 Edition)” shows that currently, there are a total of 236 intravenous solution manufacturers in China that have obtained certification under the new GMP standards. These companies have an annual production capacity of approximately 25 billion bottles and bags, with a capacity utilization rate of around 55%. Plastic-bottle IV solutions remain the mainstream packaging material in the market, though their market share is gradually declining; by contrast, the market shares of soft bags and direct-soft bags have been increasing year by year. Glass bottles, meanwhile, hold the smallest market share, and their sales volume has been decreasing steadily over the years.
Currently, in both Europe and the Americas, infusion products packaged in flexible bags and plastic containers dominate the market. According to statistics, in Europe today, flexible bags account for 60% of the market, plastic bottles for 20%, and glass bottles for another 20%. In the U.S., flexible bags make up as much as 90%, with the remaining 10% accounted for by glass bottles. Meanwhile, in China, plastic bottles still remain the dominant packaging type. Market experts predict that flexible bags are undoubtedly the trend of the future and will likely gradually replace both plastic bottles and glass bottles. There is still tremendous room for growth for flexible bags in the Chinese market.
In fact, over the past decade, the large-volume parenteral solutions industry has undergone a transition—from primarily glass bottles to plastic bottles, upright flexible bags, and standard flexible bags. Shisi Pharmaceutical has consistently been at the forefront of this transformation. Currently, the proportion of non-glass-bottle packaging has exceeded 90%, reaching an internationally advanced level. In particular, Shisi Pharmaceutical holds a 30% share of the high-end standard flexible bag infusion market, firmly establishing its dominance in the domestic standard flexible bag segment. Shisi Pharmaceutical began producing upright flexible bags in 2015, and these are now mainly used as a replacement for plastic bottle packaging. Moreover, the gross profit margin of upright flexible bags is significantly higher than that of plastic bottles and glass bottles, enabling Shisi Pharmaceutical to maintain a leading position in the industry’s gross profit margin.
“We currently maintain a pace of launching more than ten new products each year, and in recent years, we’ve even secured approval for the production of 14 new types of upright polypropylene infusion bags—making us one of the few domestic manufacturers capable of producing infusion products in all packaging formats,” said Su Xuejun, General Manager of Shisi Pharmaceutical. He added that these achievements are entirely attributable to the company’s continuous innovation throughout its development journey.
“From glass bottles to flexible bags, each new generation of Shisi Pharmaceutical’s intravenous solutions has opened up a whole new market space. Before we launched our flexible-bag products, the market had no idea what they were or even recognized their advantages. Through targeted guidance and extensive promotion, we quickly helped the market understand and embrace our innovative products,” said Su Xuejun. “Every innovative product we introduce is the result of thorough market research and analysis. We always stay ahead of the curve, guiding the industry toward products that are safer, more efficient, and more convenient. This is not only a necessity for our company’s growth—it’s also our mission.” (Originally published in Pharmaceutical Economic News)