The three international giants have cut prices and GLP-1 hypoglycemic drugs are strong. Can domestically produced insulin go overseas smoothly?
Under the general trend of domestic drugs going overseas, domestic insulin is also accelerating the pace of "going out".
On October 9, Ganli Pharmaceutical Co., Ltd. (Ganli Pharmaceutical, 603087.SH) officially announced new progress in the approval of two insulin products in Europe: its wholly-owned subsidiary Ganli Pharmaceutical Europe Co., Ltd. previously reported to the European Medicines Agency (EMA) ) submitted a marketing authorization application (MAA) for insulin aspart injection and insulin lispro injection, and recently received a formal acceptance notice from the European EMA and entered the review stage.
According to the IDF World Diabetes Map 2021, 537 million adults worldwide currently have diabetes. By 2030, the number of diabetic patients worldwide may reach 643 million. Insulin is an important means of treating diabetes, and going overseas will undoubtedly help domestic companies open up greater market space.
However, domestic insulin companies going overseas are also facing multiple challenges: on the one hand, the strong performance of GLP-1 hypoglycemic drugs has squeezed the insulin space to a certain extent; on the other hand, Eli Lilly, Sanofi, and Novo Global insulin giants such as Nordisk have also previously announced price cuts for some insulin products. The U.S. version of "medical insurance negotiations" also includes insulin products, and their prices may fall.
Domestic insulin is making continuous progress in exporting overseas and is expected to further expand the international market
Going overseas is an important path for a company to grow. For insulin companies, centralized procurement is a major factor in accelerating their overseas expansion.
In November 2021, the bidding for the sixth batch of national drug procurement (special centralized procurement of insulin) was opened in Shanghai. This is the first national drug procurement of insulin. In terms of reduction, compared with the highest effective quotation in the insulin centralized procurement documents, the average price reduction of the winning products was 48%, with the highest reduction being more than 70%.
The above-mentioned centralized purchasing will be implemented from May 2022, and the price reduction has put insulin companies under pressure. The 2022 annual report of Tonghua Dongbao (600867.SH) mentioned that 2022 is the implementation year of centralized procurement. Affected by the centralized procurement of insulin, the company's operating income has declined year-on-year: full-year operating income was 2.778 billion yuan, a year-on-year decrease of 1.498 billion yuan. %. The 2022 annual report of Ganli Pharmaceutical also mentioned that the operating income during the reporting period was 1.712 billion yuan, a decrease of 52.6% compared with the previous year. This was mainly due to the sharp drop in the price of the company's domestic bid-winning products during the reporting period, the one-time price difference of inventory products before the implementation of centralized procurement, and short-term The increase in sales volume cannot offset the impact of price decline for the time being.
A research report from CITIC Securities in February pointed out that due to the impact of centralized purchasing price cuts, the performance of related companies has been under periodic pressure. At present, the risks of centralized purchasing have been basically cleared, and insulin products have achieved rapid growth after centralized purchasing. The innovative research and development of leading insulin companies continues to accelerate, the clinical pipeline is progressing smoothly, and many milestone catalysts such as new product launches and overseas applications are worth looking forward to.
In fact, insulin companies’ plans to go overseas had already begun before centralized procurement.
In 2013, Tonghua Dongbao's human insulin API passed the EU GMP certification, and the EU registration process for human insulin injection was launched in 2013. The company reached a cooperation with Ruikang Company, and Tonghua Dongbao was responsible for providing the insulin API. Ruikang The company uses insulin APIs provided by Tonghua Dongbao to produce human insulin injections and carries out EU registration in accordance with EU biosimilar requirements.
In 2018, Gan & Lee Pharmaceuticals signed a supply agreement with Sandoz. The agreement stipulated that after Gan & Lee Pharmaceuticals' three insulins are approved, Sandoz will conduct commercial operations of the drugs in the United States, Europe and other specific regions, with Gan & Lee Pharmaceuticals being responsible. Drug development (including clinical research) and supply matters.
Since the beginning of this year, domestic insulin has made continuous progress in exporting overseas. For example, in June this year, Gan & Lee Pharmaceuticals announced that the biological products license application for insulin aspart injection was officially accepted by the FDA and entered the substantive review stage.
On October 10, Gan & Lee Pharmaceuticals introduced to reporters from The Paper that so far, the company’s important product applications in Europe and the United States have achieved initial success. The three core insulin products of glargine, lispro, and aspart have not only been approved for marketing in the United States. The applications were all accepted by the US FDA. At the same time, the marketing applications for the three insulin products were officially accepted by the European EMA and entered the scientific evaluation stage. If successfully approved, they will officially open up sales in European and American countries and further expand the international market.
As for Tonghua Dongbao, on September 17, the company announced that it held a signing ceremony with Nanjing Jianyou Biochemical Pharmaceutical Co., Ltd. for strategic cooperation in the U.S. market for three insulin injections: glargine, aspart, and lispro. According to the agreement, Tonghua Dongbao and Jianyou Co., Ltd. will jointly develop and produce the above three insulin cooperative products in accordance with the U.S. FDA drug registration requirements. At the same time, Jianyou Co., Ltd. will obtain exclusive commercialization rights in the U.S. market after the products are launched.
Previously, on February 1, Tonghua Dongbao and Swedish Ruikang Life Sciences Co., Ltd. announced that their application for marketing authorization for human insulin injection had recently been accepted by the EMA. Tonghua Dongbao said that in recent years, the company has steadily promoted the overseas registration of human insulin and insulin analogues. If the European marketing authorization application for human insulin injection is approved, it will become a milestone event for the company's insulin products to actively explore the markets in developed countries. At the same time, it will greatly accelerate the registration process of the company's human insulin products in many overseas countries, effectively promote the overseas sales of the company's human insulin products, and further expand the international market space.
Will changes in the overseas insulin market affect the pace of domestic insulin going overseas?
Eli Lilly, Novo Nordisk and Sanofi are recognized as the "three global insulin giants". At the beginning of this year, the three companies successively announced their insulin price reduction plans in the United States.
On March 1, Eli Lilly announced that it would cut the price of its insulin drugs by 70%, with patients paying no more than $35 per month. On March 14, Novo Nordisk announced that it would cut the price of insulin aspart by 75% in the U.S. market. The prices of insulin and insulin detemir were reduced by 65%; on March 16, Sanofi announced that it would reduce the price of insulin glargine injection 100U/mL in the United States by 78%, and the out-of-pocket limit for all patients would be US$35, regardless of whether they have commercial Insurance, the price of insulin glulisine injection 100U/mL will be reduced by 70%.
It is worth noting that the first batch of Medicare drug price negotiation lists previously announced by the U.S. Centers for Medicare and Medicaid Services (CMS) also includes an insulin product. This price negotiation is called the "American version of medical insurance negotiation." On October 3, CMS announced that the first batch of 10 drug-related companies will participate in this price negotiation.
In the above-mentioned negotiations, the extent of the decline in insulin products is still unknown, but changes in payment-end policies will inevitably have an impact on subdivisions. Previously, Zhao Heng, founder of Latitude Health, a medical strategy consulting company, pointed out to The Paper that overseas manufacturers that are benchmarking already-marketed drugs to make "Me too (generic drugs), Me better (similar and better drugs)" need to The investment and future sales estimates are re-calculated.
Regarding the price reduction of insulin abroad, Gan & Lee Pharmaceuticals told The Paper that the price reduction of insulin is an inevitable trend, both from a policy level and a social level. Secondly, the price of original drug products is usually affected by the expiration of patents and the gradual decline of competitors. Affected by factors such as entry into the market, the previous acceptance of BLA by the FDA is also part of the market competition. This is the development trend that companies hope to see when entering international competition.
Previously, Tonghua Dongbao has publicly stated that the price reductions of the three giants may have a greater impact on its overseas strategy and rhythm. Competition strategies, sales models, and partner selection may need to be adjusted.
In addition to the price reduction of insulin abroad, GLP-1 hypoglycemic drugs, which are also used to treat diabetes, have become popular since this year.
A research report from Great Wall Guorui Securities in March this year pointed out that the global diabetes drug market size in 2022 will be US$59.6 billion, of which there are two GLP-1 receptor agonists in the top four; The market size has surpassed insulin for the first time and has become one of the driving forces of the diabetes market.
Regarding the impact of GLP-1 drugs on the insulin market, Gan & Lee Pharmaceuticals told The Paper that the popularity of GLP-1 anti-diabetic products has indeed had a certain impact on the insulin market, but the impact is limited in the short term. Although GLP-1 drugs have outstanding hypoglycemic effects and have various clinical benefits such as weight loss, cardiovascular and renal protection, and are highly sought after by the market, insulin still has an irreplaceable position in the field of diabetes treatment and is the first choice for diabetes treatment. The ultimate choice. Especially in certain situations, such as the treatment of type 1 diabetes and acute hyperglycemia, insulin is an essential drug.
Ganli Pharmaceuticals believes that the competitive landscape of the insulin market is currently changing. It is gradually shifting from being dominated by original drug manufacturers to diversified competition. Domestic manufacturers and foreign companies are competing fiercely in terms of price, quality, R&D, etc., and innovation and R&D capabilities have become the key to enterprise development. 's top priority.
It is worth mentioning that Ganli Pharmaceuticals is also developing GLP-1 drugs. Ganli Pharmaceuticals said that at this stage, the company is actively conducting phase II clinical trials with indications for type 2 diabetes, obesity and overweight management. This product is China’s first GLP- 1 receptor agonist.
