China and India rely on the high degree of dependence on raw material drug trade disputes in the short term

The raw material medicine trade between China and India has been constantly frayed in recent years and the game is moving ahead. The Chinese anti-dumping penicillin G potassium and 6-APA anti-dumping rulings, which were previously ruled by the anti-dumping office of the Indian Ministry of Commerce and Industry in late January of this year, were rejected by the Indian Ministry of Finance on the grounds of considering “public interest”.

"From a procedural point of view, the Anti-Dumping Authority of the Ministry of Commerce and Industry of India decided to submit an application for enforcement to the Indian Ministry of Finance after it has ruled anti-dumping. Usually this time is about three months." China Chamber of Commerce for the Import and Export of Medicines and Health Products (hereinafter referred to as "Medical Insurance Association") Ning Yun, director of the Department of Information Law, told the reporter of the "Medicine Economics" that this is the second time that the Ministry of Finance of India rejected the anti-dumping and anti-dumping measures proposed by the General Administration of Taxation. The objections of downstream users and their fear of adversely affecting the domestic pharmaceutical industry are The main reason for this result.

Low price competition leads to anti-dumping

It is reported that the Anti-Dumping Agency of India launched an anti-dumping investigation against penicillin G potassium and Chinese-made 6-APA produced by China and Mexico in July 2009. The investigation comprehensively considered the import quantity, market share, import price, production capacity, sales volume, and expenses. Factors such as profit margins, inventory, etc., determine that Chinese products cause substantial damage to domestic industries.

In January of this year, the Indian anti-dumping bureau made a final ruling that the prices of raw material medicines produced in China and Mexico were below normal value, causing substantial damage to Indian domestic industries and constituting dumping. According to the previous proposal of the Anti-Dumping and Joint Taxation Administration of the Ministry of Commerce and Industry of India, an anti-dumping tax of US$2.17 will be levied on every one billion Chinese penicillin G potassium and an anti-dumping tax of US$2.66 to US$9.28 per kilogram of Chinese-made 6-APA.

"India and China's raw material trade is an interdependent relationship. In fact, no one can do without. Anti-dumping duties are also very detrimental to India itself." Guan Ningyun said that because of India's local climate and geographical characteristics, penicillin industry Salt products cannot be relied on domestically-made solutions and have been imported from China and Mexico. Once the imported products are judged to be subject to anti-dumping duties, the resulting price increase will ultimately be borne by the Indian buyer’s market.

The reporter found that in the final announcement, the anti-dumping bureau still regards China as a non-market economy country. Among the Chinese export enterprises, Zhangjiakou Jiest-Brogkades Pharmaceutical Co., Ltd., Zhangjiakou DHA Pharmaceutical Co., Ltd. and Alabindu (Datong) Biopharmaceutical Co., Ltd. all received market economic treatment, and North China Pharmaceutical Group Beida Co., Ltd. The company did not accept verification and was identified as a non-cooperative company. In the end, the Indian anti-dumping bureau determined that the dumping margins of my penicillin G potassium exporting enterprises were: 11.52% of Jiest-Brog Cardes Pharmaceutical Co., Ltd. in Zhangjiakou, and 39.51% of other Chinese companies; the dumping margin for 6-APA export enterprises was They were identified as 13.58% of Zhangjiakou DHA Pharmaceutical Co., Ltd., 10.43% of Alabindu (Datong) Biological Pharmaceutical Co., Ltd., and 36.01% of other Chinese companies.

"Some of the anti-dumping cases despite the large amount of investigations, many of them are behaviors of multinational companies themselves. As long as the status of China and India's API countries remains unchanged, similar incidents will surely continue to occur." Some industry researchers believe that The competition of penicillin industrial salt has been gradually spread from the low-end upstream products to downstream intermediates and even high-end raw material medicines. It has repeatedly caused friction in international trade, and some of the low-price competition in the raw material and pharmaceutical industry is a major cause of anti-dumping. important reason.

Long-term game between China and India

India has always been China's major exporter of penicillin industrial salt and 6-APA. Since 2005, China's export of penicillin industrial salt to India has been maintained at more than 5,000 tons per year, which exceeds 80% of China's total exports of penicillin industrial salt.

Since 2006, the penicillin industry in India has applied a penalized policy on the import of penicillin industrial salt products in China, repeatedly filed anti-dumping lawsuits, and then withdrew its lawsuits. From a single penicillin industrial salt product to its entire product chain, it is continuously extending to downstream products, demonstrating that India’s determination to seek trade protection for the penicillin industrial salt industry has not diminished.

At the anti-dumping meeting of penicillin industrial salt organized by the Medical Insurance Chamber of Commerce in early March of this year, representatives of a number of manufacturing companies stated that if exports are not profitable, they may abandon direct exports and switch to self-digestion or extension to downstream products.

"Although India's indigenous pharmaceutical raw materials can solve 70% of its demand, in the long run, India's demand for raw material medicine in China is rigid, and China's export of raw material medicine to India will continue to maintain growth." Director of Western Medicine Department, Medicare Association Talked to reporters about Shengcai, China and India in the raw material medicine industry there is a certain degree of complementarity, penicillin industrial salt in India has a certain degree of market monopoly and price advantage; at the same time, in the variety of raw material drug exports, between the two countries There is a large number of cross-overs and a high degree of interdependence.

In fact, India has become China's best target market for the export of bulk drugs and intermediates. Some experts predict that as more product patents expire, the increase in the size of the generic pharmaceutical industry will further stimulate demand for APIs. The global API market will grow from US$86.8 billion in 2010 to US$108.9 billion in 2015. India, which is a big generic country, has a reputation in the global outsourcing market. The demand for APIs continues to rise. The demand for 40% of the global API market is derived from India, while the Indian market has more than 400 APIs and 57,000 formulation products. Prior to this, India's imports of penicillin industrial salt and 6-APA from China were mainly for deep processing and production of amoxicillin, and then exported to markets such as Europe and the United States. After the imposition of anti-dumping taxation, it will actually fluctuate India's own penicillin industrial salt industry chain and directly affect the export situation of amoxicillin.

“The penicillin industrial salt industry's gradual extension of competition to the downstream is only the tip of the iceberg of the bulk raw material medicine in China. There are not only historical reasons but also insurmountable gaps in economic development.” Guan Ningyun reminded, although the Indian Ministry of Finance rejected two items. Anti-dumping applications, but do not mean that the fundamental issues of the future industrial chain have been resolved, and the industry needs to be vigilant in preparations to prevent such trade protection measures from happening again.