China Pharmaceutical Chain Industry Report, 2007-2008

Publication Date	July 2008
Publisher	Research in China
Product Type	Report
Pages	75
ISBN Number	not applicable
Product Code	RIC00461

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Summary

Pharmaceutical industry is called as "eternal sunrise industry", mainly because of its sustained growth in market demand. The main factors driving the growth in market demand of China's pharmaceutical industry include economic growth, improved people's awareness of self-health care, the process of aging population and urbanization and full start-up of health system reform, which has greatly promoted the ability and willingness of medical consumption. China's demand for medical industry in the future will maintain a rapid growth. According to the forecasts of IMS, China will become the seventh largest pharmaceutical market in the world in 2009 and will jump to the second largest one with a market capacity of US$220 billion after the U.S.A. in 2020

According to the latest statistics of the National Bureau of Statistics, the sales revenue of China's pharmaceutical industry in the first five months of this year revenue reached CNY271.78 billion, up 26.63% year on year. In 2007, the sales revenue reached CNY575.4 billion, rising 21.5% year on year. The average growth rate of sales revenue of China's pharmaceutical industry in the recent ten years exceeded 20%, far higher than GDP growth rate in the same period. Moreover, the profit growth rate of China's pharmaceutical industry in the past two year was much higher than the growth rate of sales revenue. The total profit of China's pharmaceutical industry in the first eleven months of 2007 reached CNY49.9 billion, jumping 51% year on year. In 2008, the industry continued maintaining the momentum of fast growth, and the total profit of the industry in the first five months of this year stood at CNY26 billion, 41.4% year on year, which is mainly attributed to government support and industry restructuring.

Due to impact of many factors including mainly price competition and market disorder, China's pharmaceutical chain industry was in the doldrums in the past four years in general. However, the industry had a turn for the better in 2007 after experiencing industry restructuring and gradually improved corporate operation in 2006. In 2007, net profit rate of China Top 100 pharmaceutical chain companies reached about 3%, higher than that in the previous year, and the growth rate of profit reached 56.2%, far higher than the growth rate of sales revenue.

Although we are optimistic about our forecast of potential of market development, too fast expansion of pharmaceutical chain industry in large cities like Beijing, Shanghai, Guangzhou and Shenzhen has made market in these large cities tending to be saturated. Rising cost, price competition, new medical reform and other factors have made medium- and small-sized drugstores more and more difficult to survive. It is increasingly clear that China should further restructure its pharmaceutical chain industry to raise industrial concentration degree, which is a very good opportunity for those powerful companies to further strengthen their presence in the industry.

The report is based on the authoritative statistics from the National Bureau of Statistics, the Ministry of Health, the State Food and Drug Administration, the China Association of Pharmaceutical Commerce and China Drugstore website as well as information from annual financial reports and websites of some key companies.

Content

1. Overview of China Pharmaceutical Chain Industry
- 1.1 Industrial Chain
- 1.2 China Medical System Reform
  - 1.2.1 Reform Course Review
  - 1.2.2 Basic Framework, Goals and Measures of the New Reform
- 1.3 Main Factors Driving China Pharmaceutical Industry Development
  - 1.3.1 Economic Growth
  - 1.3.2 Aging Population
  - 1.3.3 Urbanization Process
  - 1.3.4 Push from New Medical System Reform
  - 1.3.5 Improvement in People's Healthcare Awareness
  - 1.3.6 Technology Improvement
- 1.4 Forecast of Development Trend
2. Operating Status of China Pharmaceutical Industry
- 2.1 Market Demand
  - 2.1.1 General Size
  - 2.1.2 Main Sub-industries
- 2.2 Economic Efficiency
  - 2.2.1 Overall Economic Efficiencies
  - 2.2.2 Economic Efficiencies of Main Sub-industries
3. Operating Status of China Pharmaceutical Chain Industry
- 3.1 Main Industry Indices
  - 3.1.1 Market Size
  - 3.1.2 Profitability
  - 3.1.3 Other Indices
- 3.2 Consumption Structure
- 3.3 Price Trend
- 3.4 Industry Expansion
- 3.5 Business Mode
4. Competition Status of China Pharmaceutical Chain Industry
- 4.1 Market Concentration Degree
- 4.2 Competition Pattern
- 4.3 Key Enterprises
  - 4.3.1 Comparison of Overall Sizes
  - 4.3.2 Comparison of Economic Efficiencies
5. Key Regions of China Pharmaceutical Chain Industry
- 5.1 Beijing
- 5.2 Shanghai
- 5.3 Guangdong Province
- 5.4 Jiangsu Province
- 5.5 Hunan province
- 5.6 Liaoning Province
- 5.7 Other Regions
6. Development Trend of China Pharmaceutical Chain Industry
- 6.1 Market Trend
- 6.2 Development Trend of Consumption Structure
- 6.3 Price Trend
- 6.4 Competition Trend
- 6.5 Operation Trend
  - 6.5.1 Marketing Era of Drugstore Management
  - 6.5.2 Transformation of Traditional Drugstores
  - 6.5.3 Alliances of Medium- and Small-Sized Drugstores
  - 6.5.4 Return of Directly-Managed Drugstores
  - 6.5.5 Capital Operation:A Major Means of Industry Integration
- 6.6 Key Concerns
  - 6.6.1 OTC Drugs Market
  - 6.6.2 Medical Care Insurance Medicine
  - 6.6.3 Drug Store Cosmetics
7. Key Companies of China Pharmaceutical Chain Industry
- 7.1 Laobaixing Drugstore
  - 7.1.1 Company Profile
  - 7.1.2 Revenue Status
  - 7.1.3 Distribution of Chain Stores
- 7.2 Nepstar Drugstore
  - 7.2.1 Company Profile
  - 7.2.2 Revenue Status
  - 7.2.3 Distribution of Chain Stores
- 7.3 Hubei Tongjitang Drugstore
  - 7.3.1 Company Profile
  - 7.3.2 Revenue Status
  - 7.3.3 Distribution of Chain Stores
- 7.4 Chongqing Tongjunge Drugstore
  - 7.4.1 Company Profile
  - 7.4.2 Revenue Status
  - 7.4.3 Distribution of Chain Stores
- 7.5 Guoda Drugstore of Sinopharm Medicine Holding Co.
  - 7.5.1 Company Profile
  - 7.5.2 Revenue Status
  - 7.5.3 Distribution of Chain Stores
- 7.6 Liaoning Chengda Fangyuan Chain Drugstore
  - 7.6.1 Company Profile
  - 7.6.2 Revenue Status
  - 7.6.3 Distribution of Chain Stores
- 7.7 Chongqing Heping Drugstore
  - 7.7.1 Company Profile
  - 7.7.2 Revenue Status
  - 7.7.3 Distribution of Chain Stores
- 7.8 Jiangxi Kaixinren Drugstore
  - 7.8.1 Company Profile
  - 7.8.2 Revenue Status
  - 7.8.3 Distribution of Chain Stores
- 7.9 Guangdong Dashenlin Drugstore
  - 7.9.1 Company Profile
  - 7.9.2 Revenue Status
  - 7.9.3 Distribution of Chain Stores
- 7.10 Yunnan Hongxiang Pharmaceutical Co.(Yixintang Drugstore)
  - 7.10.1 Company Profile
  - 7.10.2 Revenue Status
  - 7.10.3 Distribution of Chain Stores
- 7.11 Shanghai Huashi Drugstore
  - 7.11.1 Company Profile
  - 7.11.2 Revenue Status
  - 7.11.3 Distribution of Chain Stores
- 7.12 Hunan Zhilin Drugstore
  - 7.12.1 Company Profile
  - 7.12.2 Revenue Status
  - 7.12.3 Distribution of Chain Stores
- 7.13 Shenzhen Zhonglian Drugstore
  - 7.13.1 Company Profile
  - 7.13.2 Revenue Status
  - 7.13.3 Distribution of Chain Stores
- 7.14 Shenyang Northeast Drugstore
  - 7.14.1 Company Profile
  - 7.14.2 Revenue Status
  - 7.14.3 Distribution of Chain Stores
- 7.15 Beijing Jinxiang Drugstore
  - 7.15.1 Company Profile
  - 7.15.2 Revenue Status
  - 7.15.3 Distribution of Chain Stores
- 7.16 Tongrentang Drugstore
- 7.17 Guizhou Yishu Drugstore
- 7.18 Medicine Shoppe