Overall Performance Pharmaceutical Industry in 2006 - November 2007

Since the price was strictly cut and controlled by National Development and Reform Commission (NDRC) last year, and the coverage of pharmaceutical products affected by that had become much wider, a big question mark had been left on the industry profitability. Moreover, as rise of the anti-bribe action and the collapse of the old marketing pattern commonly adopted by most pharmaceutical enterprises, combined by the implementation of the rules to regulate the medicine market and protect the environment, and the increase of the price of raw material and energies as well, the cost and expense of production had been soaring continually. Therefore, the growth rate of both the sales revenue and profit in the pharmaceutical sector had stayed at the lowest point in history last year, stated by the National Statistics Bureau (NSB). The sales revenue of domestic pharmaceutical enterprises was 520bn yuan ($69.2bn) in 2006, increasing by 17.53% in the total amount but decreased 8% compared to the growth rate of the same period of the previous year; the overall profit was 41.3bn yuan ($5.5bn) in 2006, rising by 11.1% in terms of the total amount but fell by 12% compared to the growth rate of 23% in 2005. When the country had been enjoying a profit growth rate up to 31% among national industries, the pharmaceutical industry suffered a loss at 4.46bn yuan ($593m) that covered 1368 enterprises, taking up 22.62% of the whole market.