[Fine Chemicals] China is the world's largest producer of active pharmaceutical ingredients, so why is ibuprofen still in short supply? What are the m
For one thing, this drug shortage is a sudden, unexpected situation, and ramping up production could lead to stockpiling of the drug.
On top of that, companies have to weigh whether upgraded equipment would end up sitting idle, and once they commit to expanding output, they also need to figure out how much extra to produce.
When a drugmaker starts raising output based on the demand numbers sales reports in, the only way to hedge the risk is to lay down rules for the sales companies. One industry insider who declined to be named told reporters that their company chose to make it clear to sales staff and sales companies that "products made with overtime work because of the pandemic are, in principle, not eligible for returns."
Speaking of expanding capacity, someone from Rundu Pharmaceutical, a maker of ibuprofen extended-release capsules, offered an analogy: "Drug production follows fairly strict procedures. It's not like food processing—you have to meet the environmental standards for making medicine before you can do it. It's not like people imagine, where you buy some pots and pans and just start."
Rundu Pharmaceutical hasn't disclosed its specific ibuprofen capacity. On December 8, it said on its investor platform that ibuprofen extended-release capsules are one of the company's main finished products. As of September 30, 2022, revenue from ibuprofen extended-release capsules accounted for about 7.74% of the company's total revenue (consolidated basis) for the year.
Beyond those concerns about expanding output, an industry insider also told The Paper that although there are plenty of approvals for fever-reducing drug products, profit margins on these generic drugs aren't high, and each company has different considerations when it comes to laying out its product pipeline. So not every drugmaker that holds an approval is actually producing all the time, and starting up production on short notice isn't easy.
Some API makers have orders booked into January
Upstream of the drugmakers are the API (active pharmaceutical ingredient) companies. Whether APIs are currently in sufficient supply is a question the whole supply chain, consumers included, cares about.
Antipyretic and analgesic drugs mainly include ibuprofen, aspirin, paracetamol (acetaminophen), naproxen sodium and similar varieties. Ibuprofen, paracetamol and aspirin are widely used and are listed in the Reference List of Common Medicines for Home Treatment of COVID-19 Infected Persons.
According to Securities Times, China is a major producer and exporter of ibuprofen API, accounting for one-third of global capacity, and there are many downstream finished-product manufacturers as well. Huajin Securities tallied in a research report that the big global producers of ibuprofen API are Xinhua Pharmaceutical, Hubei Biocause Pharmaceutical, and BASF, with annual capacities of 8,000 tons, 3,500 tons, and 3,000 tons respectively.
On paracetamol, Guolian Securities cited Zhiyan Consulting data showing that between 2009 and 2018, China's paracetamol output stayed basically stable at 80,000–100,000 tons. In 2016, China produced 87,400 tons of paracetamol, about 53% of the global total, corresponding to demand for roughly 75,000 tons of para-aminophenol.
So how many ibuprofen finished products can 1 ton of ibuprofen API make?
According to the "2022-2027 Government Strategic Management and Regional Development Strategy Research Consulting Report on the Chemical API Industry" compiled by Zhongyan Puhua Research Institute, someone from a company that makes ibuprofen finished products said the common strengths of ibuprofen products are 0.3g or 0.4g. At the 0.3g strength, 1 ton of ibuprofen API can make 3.3333 million ibuprofen doses.
With API output on that scale, why can't consumers get the medicine?
Comments
0