| By Cindy Wu, Asia Manufacturing Pharma |
| Wednesday, 29 July 2009 |
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Prices for penicillin industrial
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salt, a vital part of China’s API market, have been slumping since last year, exerting significant pressure on the country’s producers, according to Qiao Haili, an official of the China Chamber of Commerce for Import & Export of Medicines & Health Products. Prices for penicillin industrial salt may have reached bottom, said Ba Yanfeng, an industry analyst.
The excess capacity of penicillin industrial salt is the ultimate reason for the plummet in its prices, Ba added. China’s manufacturers of penicillin industrial salt currently have a combined capacity of approximately 100,000 tons a year, compared to demand of between |
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50,000 tons and 60,000 tons worldwide.
Nevertheless, a large number of pharmaceutical producers in the country, including Huaxing Pharmaceutical, China’s largest penicillin industrial salt maker based in Henan province, Shanxi Weiqida Pharmaceutical and Joincare Pharmaceutical, are expanding their output of penicillin industrial salt and related downstream products.
Today, a well established market for downstream products of penicillin industrial salt has taken shape in China. Such downstream products as 6-APA, amoxicillin and GCLE are expected to replace penicillin industrial salt to become a major driver for the country’s pharmaceutical export business. Producers of those downstream products, however, also face
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challenges from excess capacity and cutthroat competition.
The Chinese government needs to put in place measures to boost the domestic API sector, noted Qiao. “For example, tax rebates for downstream API products can be raised to promote their exports,” he added.
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