Price trend of major raw materials in the pharmaceutical and biological industry

The overall trend of vitamin varieties declined: In July 2020, the prices of VE, VC, VK3, D-calcium pantothenate, VA and VB1 all declined, among which calcium pantothenate declined by a larger margin. In the early stage, due to the continuous fermentation of the COVID-19 epidemic overseas, the demand for vitamins was strong. Although domestic manufacturers resumed normal production and operation, the short-term supply was still tight, which led to the rise of vitamin prices. With the normalization of epidemic prevention and control, the prices of vitamin varieties began to fall after a general increase.

The overall stability of antibiotic intermediates: In July 2020, the prices of antibiotic intermediates remained stable. In March 2019, the Xiangshui explosion accident caused the domestic 7-ADCA and 4-AA to stop quoting; some 4-AA manufacturers resumed their quotations in early July 2019. Due to tight supply, subsequent prices are expected to rise. With the inflection point of the epidemic situation in many overseas countries, the epidemic situation has eased slightly, and downstream demand has stabilized. At the same time, domestic work and production have resumed, and prices have stabilized. It is recommended to continue to pay attention to the follow-up foreign epidemic progress.

The price of hormone intermediates dropped slightly: Among the hormone intermediates, the price of saponin in July was 540 thousand CNY/ton, down 0.92% from the previous month, and the price of diene was 940 thousand CNY/ton, down 1.57% from the previous month. Affected by the epidemic, the prices of hormone intermediates fluctuated at higher prices.

The prices of specialty APIs stabilized overall: In July, the prices of Irbesartan, Telmisartan, Captopril, Enalapril Maleate, Lisinopril, Lovastatin and Simvastatin were all compared The prices of heparin, valsartan and atorvastatin were unchanged from the previous month. As the impact of the valsartan nitrosamine impurity incident is gradually eliminated, the overall supply of sartan and pristine is increasing, and short-term competition is intensified. However, with the advancement of consistency evaluation and related review, the product structure of preparation manufacturers The quality requirements of specialty APIs have increased, and the industry structure is generally better. Qualified upstream API manufacturers have strong bargaining power. As the Indian epidemic continues to ferment, domestic core suppliers are expected to increase the market share of some varieties.

Investment views: In July 2020, the price trend of vitamin varieties will decline as a whole; the prices of antibiotic intermediates have remained stable as a whole; the prices of hormones have dropped slightly; the prices of major chronic disease specialty APIs have stabilized as a whole. In addition to environmental factors, limited production capacity has broken the stable supply-demand relationship, natural growth in demand and the gradual digestion of production capacity and expectations of "supply-side reform" are all catalysts for the stock price of the API sector. The promotion of consistency evaluation and volume procurement will enable qualified upstream specialty API manufacturers to have stronger bargaining power. In the short-term, affected by the variable of the new crown epidemic, the prices of bulk commodities remained relatively high, and the prices of specialty products were relatively stable. Due to the gradual alleviation of nitrosamine impurities, the short-term prices of Sartan and Puri were reduced, but with the spread of the epidemic in India , Domestic core suppliers are expected to accept some overseas orders. We recommend that investors keep track of the API sector and pay attention to companies that can provide high-quality specialty APIs and API companies that are capable of upgrading to the field of preparations or CMO/CDMO.