Pharmaceutical retail chain development space is huge pharmacy assets accelerated securitization.


Release time:

2017-06-15

The chain rate of drugstores in China has increased from 34.61 percent in 2011 to 49.37 percent in 2016, approaching 50 percent, while the chain rate of retail drugstores in the United States is around 75 percent. Comparatively speaking, the concentration level and chain rate of China's pharmaceutical retail industry are low, and the future industry integration and drugstore chain will be the development trend, which is conducive to the emergence of large chain drugstores.

Recently, the official website of the State Food and Drug Administration released the "2016 Annual Food and Drug Regulatory Statistics Report": In 2016, the total number of pharmacies in my country was 448057, a decrease of 1023 from 2015. Among them, the number of monomer pharmacies has decreased significantly, with a decrease of more than 16000 in the past year. According to the data of the State General Administration in 2011, the number of single pharmacies in the country is 277085, and the number of single pharmacies in 2016 is about 22000. In the past six years, more than 50000 single pharmacies have disappeared in China, and the chain rate of retail pharmacies has been increasing. The chain rate of drugstores in China has increased from 34.61 percent in 2011 to 49.37 percent in 2016, approaching 50 percent, while the chain rate of retail drugstores in the United States is around 75 percent. Comparatively speaking, the concentration level and chain rate of China's pharmaceutical retail industry are low, and the future industry integration and drugstore chain will be the development trend, which is conducive to the emergence of large chain drugstores.

Retail terminals will become an important sales channel

For a long time, the drug addition of public hospitals in China has formed a situation of "relying on medicine to support doctors", and at the same time, it has partly caused problems such as "difficult to see a doctor" and "expensive to see a doctor. In December 2016, the State Council issued the "Thirteenth Five-Year Plan for Deepening the Reform of the Medical and Health System", proposing to "promote the separation of medicines and take comprehensive measures to cut off the chain of interests between hospitals and medical staff and medicines and consumables. Medical institutions shall issue prescriptions in accordance with the generic names of drugs and provide them to patients on their own initiative, and shall not restrict the outflow of prescriptions. Explore the multi-channel drug purchase model for hospital outpatients, and patients can purchase drugs from retail pharmacies with prescriptions, so that retail pharmacies will gradually become an important channel for selling drugs to patients and providing pharmaceutical services".
According to IMS data, China's pharmaceutical market reached more than 1100 billion billion yuan in 2015, with prescription drugs as the main structure. Hospitals, as the main sales channel of prescription drugs, accounted for 77% of the total sales, while retail pharmacies and grass-roots terminal channels accounted for 10% and 13% respectively. From this, it can be seen that the hospital prescription drug market is more than 800 billion yuan, and retail pharmacies are expected to undertake a 100 billion-level market in the future. In 2016, hospital channels in the pharmaceutical market accounted for about 69%, retail pharmacies accounted for about 17%, and grassroots terminals accounted for 14%. With the further advancement of the policy, the channel share of retail pharmacies will increase significantly.
At the same time, in October 2015, the State Council issued the decision of the State Council on the first batch of cancellation of 62 items of administrative examination and approval items designated by the central government (Guo Fa [2015] No. 57), and decided to cancel the first batch of 62 items of administrative examination and approval items designated by the central government, including the cancellation of the qualification examination of designated retail pharmacies of basic medical insurance. The industry believes that although the administrative examination and approval has been canceled, the handling department will strengthen the supervision and review of retail pharmacies. Management procedures for retail pharmacies ledger, purchase invoice management is more stringent, single pharmacies are facing greater cost pressure, good for the development of large chain pharmacies.

Capital market help is obvious

2014 is the "first year of listing" of chain pharmacies in China ". In July 2014, Yunnan Hongxiang Yixintang was successfully listed on the Shenzhen Stock Exchange, becoming my country's first A- share listed directly-operated chain pharmacy, filling the gap in the-share segment of large chain pharmacies. In February 2015, Yifeng Pharmacy Chain Co., Ltd. was officially listed on the Shanghai Stock Exchange and became the second listed stock of chain pharmacies. In April of the same year, the common people's pharmacy chain Co., Ltd. was listed on the Shanghai Stock Exchange, and the chain drugstore sector began to take shape. In September 2016, the restructuring plan of China Pharmaceutical Group landed, and the National Pharmacy was merged into the National Pharmaceutical Group Tongyi Pharmaceutical Co., Ltd. and officially landed in the-share market. According to the Ministry of Commerce's "2015 Statistical Analysis Report on the Operation of the Pharmaceutical Circulation Industry", the top ten retail companies have basically landed in the capital market.
Securities market analysis believes that the asset securitization of chain pharmacies is conducive to enhancing capital strength, enhancing brand influence, and laying the foundation for subsequent mergers and acquisitions and expansion. With the development of the pharmaceutical retail industry, a number of enterprises are expected to log on to the capital market in the future. Dasenlin Pharmaceutical Group Co., Ltd. ("Dasenlin"), which is a leader in South China, announced its prospectus in April 2017. Shandong Shuyu Civilian Pharmacy Chain Co., Ltd. has announced its prospectus in December 2016.
According to market observation, Yixiantang, Yifeng pharmacy and ordinary people have accelerated expansion after the listing, running horse circle, which triggered the demand for funds. Yifeng Pharmacy received approval from the China Securities Regulatory Commission at the end of June 2016. The company raised a net amount of 1.325 billion yuan through private placement for the acquisition of 100 percent of Suzhou Yuehai's equity project, O2O health cloud service platform construction and operation promotion project and chain pharmacy construction project. People issued 0.8 billion yuan of bonds in 2016 to supplement working capital. Yixintang has issued bonds totaling 1.2 billion yuan to supplement working capital and repay interest-bearing debts. At present, one heart, the people are in the fixed increase audit, the follow-up progress is worthy of attention. (The writer is an analyst at GF Pharma)