Can you imagine that the price of a drug with a raw material and production cost of less than 15 yuan was sold for 2,918 yuan? There are two more exaggerated points.
First, there is only one pharmaceutical factory in China that can produce the drug. In other words, patients have no choice, and can only spend more than 2,000 yuan per injection.
Second, the drug is not self-developed but imported from abroad. It is said that there is no need to sell at a high price to recover the huge R&D costs in the early stage, and the money earned from selling at a high price is net profit after deducting the very low production costs.
It is the nature of capital to pursue profits, but this kind of black money is not something that everyone dares to earn, but the four companies have made money for several years with a monopoly position without conscience, which not only burdens patients with a heavy economic burden but also wastes valuable medical insurance resources. If it weren't for the Shanghai Market Supervision Bureau's recent administrative punishment of four companies for abusing their dominant market position to carry out monopolistic behavior, I am afraid that they would still be making a fortune in silence.
What is going on? The administrative penalty letter has uncovered this chain of interests for us.
The drug in question is "polymyxin B sulfate for injection", which is used to treat acute and chronic infections caused by carbapenem-resistant gram-negative bacteria. Medical matters are very complicated, we don't need to know too much, we just need to know that the raw materials of this drug are not available in China, and all of them have to be imported from abroad.
There are four companies involved in profit-making, including Shanghai Shanghai Pharmaceutical First Biochemical Pharmaceutical Co., Ltd. (hereinafter referred to as Shanghai Pharmaceutical Biochemical), a subsidiary of Shanghai Pharmaceutical, a subsidiary of Shanghai Pharmaceutical, Wuhan Huihai, Wuhan Kede and Minkang Pharmaceutical, of which the boss behind the latter three companies is the same, Li Meilin's mother and son. As for how Boss Li got on the subsidiary of a state-owned enterprise, it is not clear, but the important thing is that the latter has managed to get a foreign API supplier and become the only domestic supply channel.
Wuhan Huihai and Minkang Pharmaceutical signed a cooperation agreement with Denmark's Acerli to import APIs from Denmark and sell them downstream, and then Wuhan Kede arranged for the APIs to be sold to Shanghai Pharmaceutical Biochemical through 38 pharmaceutical companies, and the latter was responsible for processing the APIs into preparations that could be injected into patients.
The reason is very simple, every circulation is a transaction, and each transaction can be increased once, and the terminal price is "done" in this way.
It should be noted that mainland law does not prohibit the possession of a dominant position, and the three companies of Shanghai Pharmaceutical Biochemical and Wuhan (owned by the same actual controller) can become the exclusive domestic distributors of the drug, but the entity with a dominant market position cannot use the advantage to engage in monopoly.
Just like WeChat occupies the vast majority of the market share in the domestic instant messaging field, the state does not punish or prevent it from doing so, but once WeChat implements monopolistic behaviors, such as charging high fees for sending messages, then Tencent may be investigated and punished.
Therefore, the crux of the matter is whether the four enterprises have implemented monopolistic behavior. If you don't check it, you can't check it, and the ultra-high price is the best proof of monopolistic behavior.
According to the investigation of the Shanghai Market Supervision Bureau, the import price of the API is 73-94 yuan/gram, which is 4.8-6.2 yuan per preparation, and according to the financial data of Shanghai Pharmaceutical Biochemical, the production cost of the workshop is 3.8-8.4 yuan/piece, and the total production cost of polymyxin B sulfate for injection can be calculated to be about 8.6-14.6 yuan/piece, that is, no more than 15 yuan per piece.
In March 2017, the drug entered the Fujian Provincial Medical Insurance Listing Directory, with a price of 2,303 yuan/branch, and then in other provinces, the highest price reached 2,918 yuan/branch, which is hundreds of times the cost.
The reason why I dare to sell it so expensive is because it is the only one in China, and if you want to use medicine, you have to buy it, and there is no choice.
On the other hand, the average selling price of the drug in other countries and regions in 2022 is 65 yuan/piece, which is much lower than the domestic price, with the cheapest selling price in Bangladesh only selling at 23 yuan/piece (converted into RMB), and the most expensive Turkey selling at 96 yuan to 130 yuan/piece.
No matter from the point of view of the price-to-cost ratio or the comparison of the prices of similar drugs in the world, the prices of the drugs involved in this case can be described by the word sky-high. As mentioned above, this is a typical act of taking advantage of a dominant market position to sell drugs at unfairly high prices, which violates the Anti-Monopoly Law of the People's Republic of China.
According to the results of the investigation, the Shanghai Market Supervision Bureau punished four companies.
Shanghai Pharmaceutical Biochemical was fined 338 million yuan of illegal gains and 124 million yuan, with a total of 462 million yuan confiscated, and the total amount of fines and confiscations of the three Hubei enterprises was 757 million yuan, and the total amount of fines and confiscations in the whole case exceeded 1.2 billion yuan.
It is worth noting that this case was officially filed on July 31, 2023, probably because of the imminent punishment, and the price of the drug in Gansu, Shanxi, Guangxi, Jiangsu and other provinces dropped to 270 yuan per branch in July. Although it is still much higher than the cost and the average price of each country, it is significantly lower than the maximum price by 90%.
You see, the price of drugs can be lowered, and even if it does, there is still money to be made. How terrible is it to lose regulatory capital? In order to make money, there is no regard for the difficulties of patients.
I hope that the regulatory authorities can do a good job of investigating those drugs with abnormally high prices, especially the niche drugs that are not easy to attract people's attention, and the pharmaceutical field is related to the lives and health of the people of the whole country, and must not be rampant by capital.