CCTV Script 10/08/18

— This is the script of CNBC's news report for China's CCTV on August 10, 2018, Friday.

When it comes to the development trend of global pharmacy, let us have a look over the general trend. From a report released by Life Sciences Market Consulting Company Evaluate, it is estimated that in 2022, pharmacy sales amount will reach 1.06 trillion US dollars. And that is a milestone, because that it marks the global prescription drug market will be over trillion dollars. Meanwhile, the growth rate is also very good. We can see that, during 2012 to 2016, this market was in downswing, but at current stage, from 2017 to 2022, the market will be buoyed, and its growth rate will reach 6.5%. Market share growth of drugs for rare diseases and globalization of drugs are part of main reasons for the increase in growth rate.

Among them, drugs for rare diseases are expected to be the area with the fastest growth in global pharmacy market.

The report pointed out that market share for rare diseases will be 20% to 262 billion US dollars by 2024. And one of the motivations is a series of new therapies, including gene therapy and cell therapy etc., those therapies will meet the demand that has not been fulfilled yet.

At the same time, another trend in the market is that more and more pharmacy companies are developing big data and predictive analysis. Some reports show that those new research and development techniques and means will enable the anti-tumor area be the fastest growing segment, and that is also one of the main drivers for promoting pharmaceutical growth.

It is estimated that the annual compound growth rate will reach 12.2%, and the sales amount will be 233 billion US dollars in 2024. Followed is anti-diabetic and anti-rheumatic areas, by 2024, Its sales are expected to reach $59.5 billion and $56.7 billion, respectively.

Meanwhile, the growth in global drug sales is also due to the increased availability of drugs worldwide.

That is what we call drug globalization. At current stage, 60% to 70% healthcare market is dominant by the north America, and some small biopharmaceutical companies also don't want to leave mature market including the US, Europe and Japan. However, with the increased price pressure in those areas, large pharmaceutical companies have to explore new market, especially those markets with a fast growing population and obvious aging trend. Those kinds of markets not only have sales opportunity, but also prompt the upgrade of medical infrastructure and more demand for innovative drugs.

Drug globalization faces many restrictions and challenges. For example, applying for authorization in different area means pharmaceutical companies have to launch clinical Trials in various countries. But a new trend currently is that because the clinical trials need more comprehensive and more transparent open data and different clinical trials disclosure websites are emerging, enabling market data integrity and accessible. Now, here is no uniform standard for cross-site data, being a tough challenge for pharmaceutical companies.

However, the general trend is that those websites will be an important tool for pharmaceutical companies to deliver the clinical trials results to participants. And in the capital market, the increased PE investment will also help the process of drugs globalization. For example, PE investment from China is growing in the global overseas market, and the capital flowing trend is from east to west. According to the data of Huaxing Capital, in 2016, there was 37 biotechnology and pharmaceutical transactions involving Chinese companies, with a total value of 6.8 billion US dollars, including the US and Europe biopharmaceutical companies acquired by Chinese companies.