Editor's note: Panorama Network recently visited a number of star listed companies. As the leader of the capital market, they are exporting Chinese business voices based on the capital market and transmitting blood to the real economy in the capital market in the context of the historical transformation of the Chinese economy. The advancement of China needs change, and the era of the Chinese dream needs great responsibility, great deeds, and great charm. The Chinese nation stands on an unprecedented key node. The Chinese commercial forces represented by these outstanding listed companies are emerging and are changing the world. The Panorama Network series curated "China's commercial power - China's listed companies that change the world", and deeply understands the outstanding entrepreneurial character and craftsman spirit, which is intended to provide a meaningful perspective for the Chinese renaissance.

Panorama network series planning : "China's commercial power - China's listed companies changing the world"

Reporter: Chen Xiaoqiong Author: Chen Xiaoqiong

“Hengrui Medicine has three dreams: the first is the export of product preparations overseas; the second is the listing of innovative drugs in China; the third is the listing of genuine patented innovative drugs in the world.” Sun Feiyang, Chairman of Hengrui Medicine It does not hide its ambition and determination to expand its territory in the medical field, and Hengrui Medicine has indeed stepped forward on the road of innovation, R&D and internationalization as he expected, and gradually grew into a leader in the industrial upgrading of China's pharmaceutical industry.

Today, Hengrui Medicine has completed the first two dreams, and the innovative drugs independently researched and developed have entered the US clinical stage. The third dream of realizing the global sales of domestically produced innovative drugs is just around the corner.

Hengrui Pharmaceutical Lianyungang International Chemical Production Base

Hengrui Medicine has been the first in the history of the development of China's pharmaceutical industry: the first Chinese pharmaceutical company to sell injections to the United States and the European Union; the first company to transfer innovative biological drugs; the anti-tumor drugs and surgical drugs at home. Market share ranks first... and the most concerned by the capital market is the market value of the pharmaceutical industry in the two cities. The total market value of Hengrui Medicine rose from about 3 billion in 2006 to 180 billion in October 2017, an increase of nearly 60 times. Operating income increased from 480 million yuan in 2000 to 11 billion yuan in 2016. According to the third quarterly report of 2017, Hengrui Pharmaceutical achieved an operating income of 10.066 billion yuan, a year-on-year increase of 21.81%.

Advanced innovation

"China's medicine looks at Jiangsu, Jiangsu medicine looks at Lianyungang" is the consensus of the Chinese pharmaceutical industry. Today's Lianyungang Development Zone has developed into a life service industry public service platform integrating R&D, testing, incubation, display, trading and personnel training. In the 76 square kilometers development zone, there are more than 20 pharmaceutical manufacturers. Years of technical investment and research have enabled the major pharmaceutical companies to fully utilize their advantages and characteristics, and gradually developed into a leading company in the fields of domestic anti-tumor drugs, anti-hepatitis drugs, anesthesia analgesics and modern proprietary Chinese medicines. Hengrui Medicine is undoubtedly one of the most famous ones.

The predecessor of Hengrui Medicine was Lianyungang Pharmaceutical Factory. Thirty years ago, when Sun Feiyang took over the Lianyungang Pharmaceutical Factory, the company was on the verge of bankruptcy with a book value of less than 100,000 yuan.

“In the beginning, we didn’t have any competitive advantage. We did very simple products with no technical thresholds, such as purple syrup, simple paste, and liniment. Later, when the decision-making layer considers differentiation, it has to be done. Technical barrier products." Hengyue Pharmaceuticals Secretary Liu Xiaohan said in reviewing the company's development history.

Hengrui Pharmaceutical Workshop Production Line

Sun Feiyang’s drastic reform of the pharmaceutical factory quickly became effective. Shangma V16 capsule (anti-cancer drug), the first year of operating income increased by 34%; 1.2 million introduction of ifosfamide prescription for trial production and clinical, in 1995 approved domestically listed, and obtained the US FDA (US Food and Drug Administration ) Certification. In 1996, Lianyungang Pharmaceutical Factory broke revenue by 100 million.

At the time, domestic and foreign pharmaceutical companies were mainly engaged in the production of generic drugs, that is, innovative drugs whose patent protection expired. Lianyungang Pharmaceutical Factory is one of the first domestic enterprises to produce anti-cancer generic drugs, and its technology and management level are among the best. But Sun Feiyang is not satisfied with the status quo. In his view, pharmaceutical companies must have a core competitiveness and must trace back to the source to produce original drugs.

In 1997, Lianyungang Pharmaceutical Factory was renamed Hengrui Medicine. In 2000, Hengrui Medicine was listed on the Shanghai Stock Exchange. In the past two years, Hengrui Medicine has invested nearly 200 million yuan to set up two research centers in Lianyungang and Shanghai, and established a research strategy focusing on the development of oncology drugs, cardiovascular drugs, anesthesia analgesics and surgical drugs. Later, Hengrui Medicine set up R&D centers and clinical medicine departments in Chengdu and the United States to build six innovation platforms including drug targets and molecular screening, biomarkers and translational medicine.

Hengrui Medical Researcher

"Innovation at that time is a thankless thing. Because the investment is very big, but I don't know how to do it in the future. It will take at least 10 years or so to see the output. This requires a very determined determination at the decision-making level. Come down." Liu Xiaohan said.

Low-key research and development

In the era of low-end drugs in China, we were involved in generic drugs with technical barriers in advance; in the era of “imitation is king”, we also placed innovative drugs in advance. Sun’s strategic changes in every step can go before the industry, each The new decision has introduced Hengrui Medicine to a broader platform. Later facts also proved that Sun’s innovative strategy is indeed very forward-looking.

"Now, in the market in the United States, the development momentum of innovative pharmaceutical companies is better. The enterprises that are purely generic drugs, although they are very large and famous, but the growth rate may not be as fast as that of innovative pharmaceutical companies. We are now more determined to make innovative strategies." Liu Xiaohan said.

At present, the investment in R&D of domestic pharmaceutical companies is about 2% of total revenue, while the investment of Hengrui Medicine has remained above 8% for a long time. In recent years, it has exceeded 10%, which has earned the industry's “R&D brother”. title. In terms of scientific research team, the researchers of Hengrui Medicine have expanded from more than 50 people from the beginning to more than 2,000 now, including more than 1,000 doctors, masters and returnees, and 3 of them have been included in the “Thousand Talents Plan” by the state.

"We are not only making innovations in China, but also making innovations abroad, although foreign fees will be higher. In addition, with the adjustment of national policies, some research and development costs have also improved, such as doing consistency evaluation or clinical trials, costs. It’s a lot better than the original. But we still insist on making innovations and insisting on investing.”

In the modern workshop of Hengrui Medicine's 6000 square meters, the windows are clear and spotless. Most of the production processes are done by automated equipment with very few operators. In order to prevent the production of bacteria, all operators need to wear sterile clothes to reduce the range of motion and avoid unnecessary movement and movement.

According to the staff, the body's natural activities will emit a heat flow that is conducive to microbial transmission. Therefore, reducing the frequency of people entering the workshop and the movement of people is an effective way to reduce the density of bacteria.

Hengrui Pharmaceutical's sterile injection production line

Hengrui Medicine, which is serious about its own research and development, is very low-key and pragmatic.

"Our companies generally say that they are relatively small, they do it earlier, and they are better. They are really dry. Now it is often the institutions and investors who take the initiative to contact us to investigate, or invite us to participate in some roadshows." Liu Xiaohan Say.

Strive for the right to speak internationally

With years of concentration and investment, the research results of Hengrui Medicine have gradually been transformed. Especially in overseas markets, Hengrui's certification results are outstanding. On December 17, 2011, the anti-tumor drug irinotecan injection produced by Hengrui passed the US FDA certification inspection. This is the first time that the injections produced in China have been approved for sale to the most developed and high-quality US pharmaceutical market in the world, filling the gap in domestic injections. In August 2012, the injection of oxaliplatin produced by Hengrui was approved. The Netherlands is listed for sale. According to the EU mutual drug recognition regulations, after this approval, the injection oxaliplatin can be marketed in any other country in the European Union, which means that Hengrui has become the first pharmaceutical company in China to be approved for sale in the EU.

At present, Hengrui Medicine has listed two innovative drugs, apatinicin mesylate and ericoxib tablets, in China. At the same time, four varieties of innovative drugs have received clinical approvals from abroad, and two of them have started clinical trials abroad. If approved, domestically produced innovative drugs will truly be listed and sold on the international market.

Liu Xiaohan revealed that in the future, the pharmaceutical industry will gradually move toward a globalized industrial structure. Regardless of R&D innovation or market development, it will be a domestic and foreign chess game. Companies with international vision, innovative capabilities, and the ability to optimize the integration of global resources will be more likely to take the lead and win the market's right to speak. The core competitiveness of pharmaceutical companies will return to innovation and product quality.

Hengrui Medicine Japan R&D Center

At present, compared with multinational corporations, domestic pharmaceutical companies are generally in a disadvantaged position: weak independent innovation capability, low level of innovation, and a large gap in the transformation of cutting-edge scientific and technological achievements. Specifically, it is backward in the international level of antibody screening, expression culture technology, purification technology, quality control level and industrial scale; key equipment, raw materials and reagents such as bioreactor, purification system and scientific instruments also depend on imports. . To close this gap, domestic pharmaceutical companies face enormous challenges.

As a leading pharmaceutical company in China's innovation, Hengrui Medicine will strive to gain a foothold in the global bio-pharmaceutical competition. In order to realize the large-scale sales of generic drugs in the world, Hengrui will become China in the final realization of global sales of patented drugs. The multinational pharmaceutical group of people is making unremitting efforts.

“Hengrui Medicine will closely focus on the cutting-edge technology of international pharmaceutical innovation in the future development, and further increase investment in the fields of anti-tumor, diabetes, immunotherapy, etc., and develop more new drugs and good medicines to benefit patients and meet the growing domestic demand. At the same time, we will strengthen the global sales of domestically produced preparations, explore new growth space in overseas markets, accelerate the overseas certification and clinical practice of innovative drugs, continue to strengthen exchanges and cooperation with multinational pharmaceutical companies, and gradually establish their own sales teams overseas. Our ultimate goal is to achieve the globalization of patented drug innovation and to make a sound of 'China's wisdom.'