The transfer of drugs produced overseas to domestic production ushered in favorable policies, and China's high-quality production capacity is expected to accelerate its entry into the supply chain of overseas pharmaceutical companies.
The Zhitong Finance App learned that Minsheng Securities released a research report saying that on January 24, the State Drug Administration publicly solicited the “Notice on Optimizing the Application for Marketing Registration of Overseas Produced Drugs Already Marketed in China (Draft for Comments)” to facilitate China's high-quality production capacity to enter the global supply chain. The bank believes that the policy side will continue to benefit the transfer of overseas drugs to domestic production. China has a large amount of high-quality production capacity with international standards to meet global supply needs. Overseas customers will accelerate cooperation with leading Chinese CDMOs. Local CDMOs are expected to undertake global commercial production projects, and they are optimistic about leading domestic CDMOs and overseas generic drug companies with international production capacity.
Recommended attention: Yao Ming Kang De (603259.SH), Pharmaceutical (02269), Gloria Ying (002821.SZ), Boteng (300363.SZ), Jiuzhou Pharmaceutical (603456.SH), Puli Pharmaceuticals (300630.SZ), Jianyou Co., Ltd. (603707.SH).
The analysis of Minsheng Securities is as follows:
The “Draft for Solicitation of Comments” optimizes the marketing registration application procedures for domestically listed and foreign-produced drugs transferred to domestic production.
(1) Where drugs produced overseas that have been marketed domestically are transferred to domestic production, the domestic applicant shall apply in accordance with the requirements and procedures of the drug marketing registration application. (2) Where drugs produced overseas that have been marketed domestically are transferred to domestic production, relevant pharmaceutical, non-clinical research, and clinical research data may be submitted in the original registration application data for drugs produced overseas, and relevant research data transferred to domestic production. (3) For applications for marketing registration of drugs transferred from original research chemicals and biological products to domestically produced drugs, the Drug Administration includes them in the scope of priority review and approval.
The Drug Administration continues to issue a number of documents to guide, optimize and support the transfer of marketed drugs produced overseas to domestic production.
Document No. 518 of 2009 stipulates that if drugs produced abroad are transferred to domestic production, they shall be declared in accordance with the procedures for supplementary applications for technology transfer. In 2021, the Drug Administration issued the “Administrative Measures on Changes after Drug Marketing (Trial)”, which clarifies that the transfer of drugs produced abroad that have already been marketed to domestic production can be declared in accordance with the generic drug marketing registration application, which can simplify the application data requirements, and also stipulate special regulations on certification of reference formulations, etc. The specific application data requirements will be separately formulated by the Drug Review Center. In March 2023, the Drug Administration further drafted the “Application Data Requirements for Drug Marketing Registration Transfer to Domestically Produced Drugs (Chemical Drugs) (Draft for Comments)”, which stipulates that chemicals marketed domestically or produced abroad are transferred to domestic production to submit marketing registration applications in accordance with the 4 types of chemicals, and formulates corresponding application data requirements, clarifying the relevant materials that can be simplified or exempted from provision compared to generic drug declaration data requirements. In December 2023, the Drug Administration drafted the “Application Data Requirements for Marketing Registration Applications for Drugs Already Marketed and Produced Overseas (Therapeutic Biological Products) (Draft for Comments)”, which stipulates that biological products marketed domestically or produced abroad are transferred to domestic production to submit marketing registration applications in accordance with 3.4 categories of therapeutic biological products.
The transfer of drugs produced overseas to domestic production ushered in favorable policies, and China's high-quality production capacity is expected to accelerate its entry into the supply chain of overseas pharmaceutical companies. The policy side continues to favor the transfer of overseas drugs to domestic production. China has a large amount of high-quality production capacity according to international standards, which can meet global supply needs. Overseas customers will accelerate cooperation with leading Chinese CDMOs, and local CDMOs are expected to undertake global commercial production projects.
Investment advice: This “Notice” will further optimize the foreign investment environment and improve the accessibility of drugs, and optimize the transfer of drugs produced overseas that have already been marketed to domestic production. Optimistic about leading domestic CDMO companies and overseas generic drug companies with international production capacity, it is recommended to focus on Pharmaceutical Kangde, Pharmaceutical Biotech, Gloria, Boteng shares, Jiuzhou Pharmaceutical, Puli Pharmaceuticals, and Jianyou shares.
Risk warning: health insurance fee control risk; market sales risk; market competition risk; R&D declaration risk, demand decline risk.