Development Trend of Going Green and Environmental Protection Strengthened, to Help the Development of High-end APIs Achieve Transformation and Upgrading

With the green development trend strengthened, how APIs could be transformed and upgraded to achieve better development has become one of the focuses of the Chinese pharmaceutical industry. According to the Suggestions for Further Improving Centralized Purchasing of Drugs for Public Hospitals, the environmental protection regulation can reversely force API enterprises to transform and upgrade and eliminate the backward enterprises, however, the "sweeping approach" shall not be used during the implementation, and construction of API parks that meet high standards shall be supported, to provide origins for the development of high-end APIs.

For the moment, the Chinese API industry is still in a "scattered, chaotic, and small-scale" pattern, and some small API manufacturers maliciously reduce the API prices to cause the vicious low price competition. Small manufacturers have backward equipment and low production input, with the produced APIs varying greatly in quality, and even those substandard circulated on the market.

Many pharmaceutical enterprises have "tumbled" due to inadequate efforts in environmental protection, as the law enforcement in environmental protection becomes increasingly strict. The living space of the Chinese API industry has been "suppressed" in recent years with the successive introduction of relevant environmental protection standards and policies. For example, the Discharge Standard of Water Pollutants for Pharmaceutical Industry was issued and comprehensively enforced by the Ministry of Environmental Protection of China in July 2010; the comprehensive investigation and rectification of the environmental pollution problems of the pharmaceutical industry was regarded as the third priority of the special environmental protection campaign by the Ministry of Environmental Protection of China in 2013; the environmentally illegal behaviors during pharmaceutical manufacturing were still the key object of rectification of relevant ministries and commissions of China in 2014, with the red line of the pharmaceutical environmental protection "tightened"; the Action Plan for Prevention and Control of Water Pollution followed in April 2015, listing API manufacturing as one of the top 10 industries to be focused on the rectification; the Environmental Protection Tax Law was introduced in in 2016, which changes the environmental protection costs to the environmental protection tax and imposes heavy tax on industries with high pollution such as the API industry. And the 13th Five-Year Plan for the Protection of Ecological Environment introduced in December 2016 requires the API manufacturing industry to promote the up-to-standard discharge transformation of the industry.

With the green and environmental protection policies increasingly tightened, the enterprises with backward and low-level redundant construction at the expense of environment and with pollution exceeding standards will be difficult to survive. The pollution control capacity and cost will become the core competitive elements of pharmaceutical enterprises in the future. In this process, some pharmaceutical enterprises will transform towards the downstream high-end preparations, and also pharmaceutical enterprises developing high-end APIs will also become one of the important aspects of enterprise transformation. Construction of the high-end API bases will help enterprises weather the storm.

According to information, currently, the global production of the APIs for clinical stages is mainly in the North America, EU, and India, while that of the patented commercial APIs is mainly in the North America, EU, Puerto Rico, and Singapore; the APIs of China are still in the generic API field. According to an insider, China should optimize product structure, achieve industry upgrading, and develop towards high-end APIs and preparations while guaranteeing the stable growth of bulk APIs. To promote the development of high-end APIs, China should strongly support the construction of the API parks that meet high standards to provide origins for the development of high-end APIs.

The environmental protection pressure will become increasingly high in 2018. For example, the Regulation on the Implementation of the Environmental Protection Tax Law of the People's Republic of China was formally implemented at the beginning of the new year, and industries with high pollution like API industry, etc. will be confronted with heavy taxes. Some enterprises have started to advance the progress, to promote the APIs to transform to high end. According to information, Kailihe Pharmaceutical that is committed to constructing a high-end API base in west China will achieve the annual output value of RMB 380 million and annual profit and tax of RMB 60 million after its project is fully put into production.

The refinement, serialization, and high-end development of bulk APIs will become the mainstream trend of the future development of APIs. China will encourage enterprises to carry out technological innovation, to reduce waste of energies and resources, promote high-end API development, increase product technical content and added value, and promote the better development of APIs.

EP & Clean Tech 2018 will promote the relevant environmental protection industry and environmental protection equipment manufacturing industry to expand and develop the market space, and help pharmaceutical companies find better green solutions in terms of environmental protection policies and regulations, environmental protection technology and equipment, waste treatment and recycling, and environment monitoring, by the display of applications of innovative and green environmental protection products and technologies in waste gas, waste water, and waste residues and monitoring, etc., as well as the information sharing and interaction in the China Pharma Environmental Forum and P-MEC China Summit, etc. concurrently with the exhibition.

See more: http://www.p-mec.cn/clean     

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