General Biologic's  Instablog

General Biologic
Send Message
GBI ( is China’s leader in pharmaceutical and biotechnology information and consulting services. GBI provides in-depth analysis and insights that enable investors to stay ahead of China’s pharmaceutical, biotechnology and healthcare industries. Our information offerings... More
My company:
My blog:
Dr. Jonathan Zifferblatt's Pharma Exec column
  • Antibiotic abuse policies: Challenge or opportunity? 0 comments
    Jun 20, 2011 1:05 AM

    By Vincent Fan, GBI Analyst

    Since the appearance of the NDM-1 “super bug“ in the second of half of 2010, calls for reining in antibiotic abuse in China have increased. The recent furor should come as no surprise, as antibiotic overuse in Chinese hospitals, clinics and pharmacies is decades-old. The SFDA estimates that 2010 Chinese production of the top 26 antibiotics reached 44,000 tons, and China’s per capita level of antibiotic consumption is currently estimated at ten times greater than the global average.


    Various governments have recently announced initiatives seeking to tighten control of antibiotic use and hospital prescriptions overall. These included an NDRC retail pricing policy in November, 2010, mirrored at the provincial level in Shaanxi, Yunnan and Xinjiang, among others. In April, 2011, MOH announced a planned hospital inspection program - already implemented in Beijing, Hainan, Shanghai and Sichuan - to reduce antimicrobial usage rates to 30% from the current 80%. And in May, 2011, NDRC released an adjusted infrastructure policy, limiting production capacity for penicillin, cephalosporins and other traditional antibiotics.


    Regardless, this regulatory strategy may not have slowed the market. MOH hospital inspections focus only on cephalosporins (CEPs), quinolones (QNs) and carbapenems, which are currently more seriously abused because of compelling incentives for physicians. Moreover, the regulations do not target Level I (township) hospitals or grassroots clinics. As the EDL and NDRC policies take effect, the declining urban markets for those three categories may be offset by surging regional markets. A deeper structural change might be in the offing next year.


    Ironically, the anti-abuse policies could present manufacturers with greater opportunity as restrictions on mainstays such as CEPs and QNs open market space for proven, low-cost penicillins, aztreonams and macrolides. Classes considered effective against NDM-1, such as aminoglycosides and phosphonomycins, could also benefit. In the past year, domestic players such as North China Pharmaceutical, Sichuan Kelun Pharmaceutical, Tianyin Pharmaceutical, Jiangxi Dongfeng Pharmaceutical, Suzhou Erye Pharmaceutical (a subsidiary of NeoStem), Shangdong Lukang Pharmaceutical and Sinopharm have brought online facilities for each of these five categories.

Back To General Biologic's Instablog HomePage »

Instablogs are blogs which are instantly set up and networked within the Seeking Alpha community. Instablog posts are not selected, edited or screened by Seeking Alpha editors, in contrast to contributors' articles.

Comments (0)
Track new comments
Be the first to comment
Full index of posts »
Latest Followers
Instablogs are Seeking Alpha's free blogging platform customized for finance, with instant set up and exposure to millions of readers interested in the financial markets. Publish your own instablog in minutes.