Export of medicines and health-care products increases constantly.

The export of medicines and healthcare products from China hit a new high in 2006 and became the major driving force for the development of the sector. The export value reached US$19.61 billion, an increase of 26.3% over 2006. The unfavorable balance in the foreign trade of medical apparatuses was reversed. Statistical data showed that the export of chemical medicines maintained a rapid growth in 2006 and the export value was US$11.65 billion, an increase of 24.3%. The export value of medical apparatuses was US$6.87 billion, an increase of 28.6%. The export value of traditional Chinese medicines was US$1.09 billion, exceeding US$1.0 billion for the first time in history. According to the projection made by experts, the import and export of medicines and healthcare products in China will hopefully continue to grow rapidly in 2007. The drive of the export to the production and sales in companies will become more prominent. With the participation of domestic medicines and health-care products in the international market competition, the foreign trade of the pharmaceutical sector will be faced with more and more difficulties and challenges.

Rapid growth in exports

The rapid growth in the export of medicines and health-care products in 2006 benefited mainly from the following advantages.

Chemical bulk medicines as the pillar for export maintained considerable competitive advantages. Antibiotics, vitamins, hormones and analgesic-antipyretics, in particular, held a considerable share in the international pharmaceutical market. Products in some companies, such as terramycin, griseofulvin and gentamycin sulfate earned FDA certification from the United States and COS certification from the European Union, and their export prices also increased steadily. What should be noted is that in the penicillin industrial salt sector, with unduly heated competition in the past, the consumption was increased as a result of rational and timely readjustments made by producers to their industrial chains. In addition, quite a few penicillin producers, both at home and abroad, suspended or restricted production. The export of penicillin grew and the average export price was also higher than the previous year.

The unfavorable balance in the foreign trade of medical apparatuses was reversed. In terms of product portfolio, medium and small products such as conventional equipment, surgical apparatuses and massage tools had price advantage and their function and reliability are equal to similar foreign products. The export of brand-name, patented high-tech medical equipment, such as ultrasonic diagnostic gauges and patient monitoring gauges increased remarkably. Medical apparatuses of some companies passed the CE certification and the ISO13485 certification.

Constraints needing attention

2007 is the sixth year of the WTO (World Trade Organization) accession for China. To enhance the international competitive edge of the medicine and health-care product sector, various ministries and commissions of the state will formulate a series of policies to promote technical progress in the pharmaceutical sector and encourage more pharmaceutical companies to get into the international market and seek new development space.

According to experts, further expanding the export of chemical bulk medicines will still be a logical strategy. China will maintain advantage in traditional large-volume chemical bulk medicines. Products such as antibiotics, vitamins, hormones, analgesic-antipyretics, amino acids and alkaloids will, in particular, continue to hold a considerable share of the world market. While maintaining comparative advantage and competitive edge in the export of medium and small medical apparatuses, the export of high-tech medical equipment with high added value will be further promoted. Moreover, the export of traditional Chinese medicines will sustain its rapid growth. The export of medicinal herbs, drink tablets, extracts and health-care products will have a rapid growth and the export of Chinese proprietary medicines will become a new growth point in the export of traditional Chinese medicines.

As 2006's export growth was quite high, it is harder for China's foreign trade in medicines and health-care products to maintain rapid growth in 2007. With the participation of domestic medicines and health-care products in the international market competition, the foreign trade of the pharmaceutical sector will be faced with more difficulties and challenges. Constraints on export growth should never be overlooked. The appreciation of Renminbi and the reduction of the export rebate rate will weaken the competitive edge of domestic medicines and health-care products in the international market. The increase of the labor cost and the sustained price rise of raw materials will affect the normal production and the performance capability. In addition, the issuance of acts such as REACH by the European Union will also add uncertainty to the export of medicines and health-care products from China.