India's macrolide API: 90% imported from China

Macrolide raw materials, as a member of antibiotics, play an important role in the raging global new coronavirus. China is the world's largest producer and exporter of macrolides, and India is the largest importer of this product. Ninety percent of India's imports of macrolide raw materials come from China.

Since March this year, the Indian government has repeatedly restricted the export of various raw materials and preparations. Obviously, under the influence of low output and lagging international logistics under the epidemic, its raw materials and medicine production capacity is insufficient and cannot be self-sufficient. Data show that in 2019, my country's export volume of APIs was 10.118 million tons, a year-on-year increase of 8.83%. Among them, API products exported to India accounted for nearly 17% of China's total API exports.

According to statistics from Health.com, China’s total exports of macrolide raw materials in 2019 were 4,047 tons, of which more than 50% were exported to India, with a value of 165 million US dollars; in the first half of 2020, the total export volume was about 2,079 tons, and exports to India also exceeded half. Therefore, the overall export volume has not changed much from last year, and the product is not greatly affected by the epidemic and the international environment. The main export products include erythromycin thiocyanate, azithromycin, clarithromycin, erythromycin base and roxithromycin.

Conversely, from the perspective of India's import situation, the total import of macrolide raw materials in the first half of 2020 is 1,238 tons, of which 1,101 tons are imported from China, followed by about 107 tons from the United States. The quantity and value of raw materials from Chinese sources (including Hong Kong) accounted for 83% and 90% respectively.

This shows the degree of dependence of India's macrolide raw materials on China and the trend of China's main export markets. In addition, India is a big country of generic drugs, and the global macrolide preparations depend on India. For example, 40% of the generic drugs in the United States come from India. Therefore, in the future, China will not only be limited to raw materials, but also develop downstream products, and the industrial chain will extend to the world.

Among the erythromycin raw materials imported by India, the import volume of erythromycin thiocyanate and azithromycin both exceeded 500 tons. In recent years, the share of azithromycin has gradually increased, including the import of clarithromycin, which is a sign of the extension of the industrial chain. In the first half of this year, India's imports of azithromycin ranked first, accounting for more than half of the total.

There are about 105 buyers of macrolide raw materials in India, of which the top 15 companies account for 64% of their imports. Import companies are relatively concentrated. Compared with Chinese suppliers, there are less than 30 companies, including trading companies. In recent years, Indian pharmaceutical companies are optimistic about the Chinese market and have established joint ventures in China.

Anuh Pharma Ltd. is one of the largest manufacturers of macrolides and anti-tuberculosis drugs in India, as well as a major supplier of antibacterial, antimalarial and corticosteroids. As the largest importer of macrolide raw materials, Alembic Pharma established a Chinese joint venture with Shanghai Shangyao Xinyi Pharmaceutical Co., Ltd. and Adia (Shanghai) Pharma in May 2019. Shanghai Pharmaceutical Xinyi will hold 51% of the joint venture, Alembic will hold 44%, and Adia will hold 5%.

In summary, in the first half of 2020, India's imports of China's macrolide APIs have remained stable. The current domestic market price has stabilized compared with the first quarter. The global new crown epidemic has not yet passed, and antibiotic raw materials have become an indispensable part. As an important export region of our country, the Indian market must not only rely on each other, but also compete and develop.