Analysis of the Development Prospects of the Pharmaceutical Equipment Market

In recent years, with the acceleration of drug approval processes, the promotion of consistency evaluation for generic drugs, drug volume-based procurement, and adjustments to the medical insurance directory, a series of new medical policies have been continuously implemented in China, accelerating the transformation and upgrading of the pharmaceutical industry. At the same time, the biopharmaceutical industry represented by monoclonal antibodies, bispecific antibodies, and ADCs has been booming, bringing new opportunities and challenges to the upstream pharmaceutical equipment industry. Since 2020, domestic pharmaceutical equipment has seized the huge space for import substitution and gradually increased its market share. So, how will the pharmaceutical equipment market in China develop in the coming years? And what trends will there be?

Pharmaceutical equipment includes: granulation ovens, boiling dryers, wet processing machines, pulverizers, vibrating screens, slicing machines, roasting machines, decoction machines, tablet presses, pill-making machines, multi-functional extraction tanks, liquid storage tanks, liquid mixing tanks, vacuum drying ovens, tilting reaction vessels, capsule filling machines, blister packaging machines, granule packaging machines, powder packaging machines, V-shaped mixers, and lifting feeders, etc. The upstream industries of pharmaceutical equipment mainly include the steel industry, mechanical parts industry, and electrical parts industry. The steel industry provides various types of steel for the pharmaceutical equipment industry, which is used for the production of the supports, main structural components, and non-standard mechanical parts of the pharmaceutical equipment: mechanical and electrical parts provide various standard mechanical parts and electrical components such as electric motors, pneumatic components, and PLC modules for the pharmaceutical equipment industry; the downstream demand customers of the pharmaceutical equipment industry are mainly pharmaceutical enterprises, and the pharmaceutical equipment is one of the most fundamental facilities for pharmaceutical enterprises.

The downstream demand for pharmaceutical equipment mainly lies in the pharmaceutical industry, including the chemical raw drug industry, chemical formulation industry, Chinese herbal decoction pieces industry and biopharmaceutical industry. Currently, the demand for chemical drug formulations is the largest, and it also has the greatest demand for midstream pharmaceutical equipment; while the demand potential for Chinese herbal decoction pieces is the greatest.

The pharmaceutical industry is an important part of China's national economy. The Chinese pharmaceutical industry has maintained a rapid growth rate. Especially with the acceleration of the medical reform process, the increase in medical insurance investment, and the improvement of the public's medical and health awareness, the scale has continued to expand, and the economic operation quality and efficiency have been continuously improved. The "Analysis Report on Market Demand Forecast and Investment Strategy Planning of China's Pharmaceutical Equipment Industry" shows that the total industrial output value of the national pharmaceutical industry reached 1,443.799 billion yuan; the realized sales revenue was 1,452.205 billion yuan, with a year-on-year growth of 29.37%.

With the development of the pharmaceutical industry, the pharmaceutical equipment industry in our country has also maintained a rapid growth. The data shows that the sales revenue of the pharmaceutical equipment industry in our country has been increasing year by year, reaching 7.661 billion yuan, with a year-on-year growth of 9.79%.

According to the "Market Status Investigation and Development Prospects Analysis Report on Pharmaceutical Equipment from 2022 to 2026" released by Hangzhou Zhongjing Zhisheng Market Research Co., Ltd.: Firstly, in terms of pharmaceutical safety, the "12th Five-Year Plan for the National Pharmaceutical Industry" proposed to fully implement the new version of GMP and strictly enforce GMP, significantly improving the overall quality management level of drugs in our country. Encouraging enterprises with conditions to carry out GMP certification in line with developed countries or WHO standards, and promoting the alignment of our country's drug quality management with international standards; The European Union officially promulgated Directive 62/EU, raising the threshold for drug imports.

The European Union is the largest export market for our chemical pharmaceutical products. According to analysis, based on the data, our export of Western pharmaceutical products to the EU amounted to 6 billion US dollars, with a year-on-year growth of 18%, accounting for 25% of the global market. Although the latest GMP standards implemented in our country cover the basic requirements of the EU, the US FDA and WHO for GMP, with the hardware aspects referring to the EU standards and the software aspects referring to the US FDA standards, the degree of strictness is unprecedented in the history of Chinese pharmaceutical production, yet among Chinese pharmaceutical export enterprises, only a few large enterprises have received GMP recognition from both China and the EU. Therefore, the promulgation of the new standards will inevitably accelerate the production transformation and upgrading of export enterprises.

Under the circumstances of the introduction of the new EU GMP standards, the full implementation of the new GMP in China, and the increased environmental protection requirements for pharmaceuticals, the growth rate of the raw material drug equipment market capacity will be more outstanding in the future. On one hand, the proportion of raw materials in Western medicines exported to the EU market in China is approximately 50%, which is a relatively large share; on the other hand, raw materials are the most environmentally polluting module in pharmaceutical enterprises, so the demand for environmental protection investment for them is also greater.

From the perspective of the chemical pharmaceutical formulation market, the total output value of China's chemical pharmaceutical formulation industry has been increasing year by year. According to statistics, in 2019, the total main business income of the chemical pharmaceutical formulation industry was 857.6 billion yuan, with a year-on-year growth of 11.5%. The chemical pharmaceutical formulation industry achieved a main business income of 835.7 billion yuan.

In recent years, China has continuously introduced policies to support the development of the pharmaceutical equipment industry, encouraging the research and production of high-end pharmaceutical equipment, such as transdermal absorption, powder aerosol, and other new formulation production equipment, large-scale bioreactors and their associated systems, protein efficient separation and purification equipment, efficient extraction equipment for traditional Chinese medicine, and continuous production technologies and equipment for pharmaceuticals. It has continuously advanced the digitalization process of the pharmaceutical industry, leveraging new-generation information technologies to empower pharmaceutical manufacturing and enhancing the automation, digitalization, and intelligence levels of pharmaceutical equipment. Benefiting from favorable policies in the pharmaceutical industry and the pharmaceutical sector, the entire pharmaceutical equipment industry has also ushered in new development opportunities, with a bright future ahead.