Industry research report | Biopharma upstream topic (7): Production instruments and equipment industry
A visual inspection machine is equipment that checks for impurities after liquid filling to ensure drug quality. It consists of an inspection box, an inspection table, inspection lights, and a computer display. By function, it can be divided into manual, semi-automatic, and fully automatic inspection machines. By product type tested, it can be divided into ampoule inspection machines, vial inspection machines, lyophilized product inspection machines, and so on. Since the development of drug inspection equipment, the instability of traditional manual inspection machines has become prominent, while automatic inspection machines not only improve inspection efficiency but also enhance inspection accuracy and stability. Currently, the market for inspection machines is dominated by foreign companies, and there is still a certain gap between domestic products and imported products. Major foreign manufacturers include Korber, ACG, Cognex, and Omron, while major domestic manufacturers include Truking Technology, Zhengzhong Pharmaceutical, and Qianshan Pharmaceutical.
III. Market demand analysis
Biopharma is booming, and upstream equipment has great potential. According to Frost & Sullivan forecasts, the global biopharmaceutical market was $286.4 billion in 2019 and is expected to grow to $768 billion by 2030. China's biopharmaceutical market was 312 billion yuan in 2019, accounting for 19% of total drug sales, and is expected to grow to 1,302.9 billion yuan by 2030, accounting for 41% of total drug sales. According to Research and Markets, the overall global market for biopharmaceutical equipment and consumables is around $20 billion, of which equipment accounts for about 46%, or about $9.2 billion. According to CITIC Securities forecasts, the domestic biopharmaceutical equipment and consumables market was about $12.7 billion in 2021 and will reach about $26.5 billion by 2025.
The main sub-markets of biopharmaceutical equipment include five major categories: bioreactors, liquid preparation systems, chromatography and ultrafiltration systems, DP equipment, and filtration components. The size of this sub-market reached 17.9 billion yuan in 2021 and is expected to reach 36.2 billion yuan by 2025 and 63.9 billion yuan by 2030. The compound annual growth rate from 2021 to 2025 is 19.2%, and from 2026 to 2030 it is 11.3%. This broad market space provides the driving force for the development of biopharmaceutical equipment.
China is currently the world's second-largest pharmaceutical equipment market, but compared with the booming trend in pharmaceutical equipment, the domestic localization rate of core process equipment for biopharma is relatively low, and key equipment is still bottlenecked by foreign supply chains.
Take bioreactors as an example. According to Huajing Industry Research Institute data, China's single-use bioreactor market was $210 million in 2020 and is expected to reach $790 million by 2027, with a compound annual growth rate of 21.1% from 2020 to 2027, faster than the global growth rate.
However, 80%-90% of this equipment is supplied by foreign companies, and the localization rate is very low.
The difficulty with single-use bioreactors lies in: first, how to more precisely match the requirements of cell culture processes with mechanical control, for which there is a lack of systematic experience; second, the membrane materials, production processes, sterility assurance, and quality consistency of single-use bioreactor bags have high requirements; third, single-use electrodes and sensors, among other things, depend on imports.
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