Chinese herbal medicine prices soaring are not harmful to leading companies

According to data from the Center for Medicinal Materials of the Chinese Medicine Association, from November 2009 to October this year, 28% of Chinese herbal medicines rose between 51% and 100%, an increase of 21% to 50%. Between 101% and 180% accounted for 22% of the total, or between 161% and 300% for medicinal herbs, and 6% or 300% for 2%.

Guo Fanli, a research fellow in the pharmaceutical industry at China Investment Advisors, pointed out that in comparison with the prices in the same period of last year, a total of 459 varieties of Chinese herbal medicines rose in price in October this year, accounting for about 86% of the total. However, unlike the trend of price increase of traditional Chinese medicines in the past, the increase in the price of Chinese herbal medicines exceeded the expectations of many people. For example, the price of Taizishen (Xuanzhou) was up by 612% in the same period of last year in October this year.

Guo Fanli pointed out that in addition to heterophylla, Acanthopanax, Psoralea, Hawthorn fruit, North Adenophora, Campanulaceae, Red Ginseng, Codonopsis, Angelica, etc. also have a 200%-536% increase, the price of Cordyceps It is more than gold. In this huge increase, some manufacturers of pharmaceuticals are miserable because they can't arbitrarily increase the prices of drugs when the prices of raw materials soar. Therefore, the increase in the price of Chinese herbal medicines leads to the gross margin of some pharmaceutical manufacturers. Lowered, its production and operation were impacted.

Zhang Yanlin, director of the China Investment Advisory Research Institute, pointed out that this round of price hikes in Chinese herbal medicines has had little effect on leading companies, and they even have a favorable effect. On the one hand, leading companies that use Chinese herbal medicines as raw materials generally have self-built production bases in the main producing areas of herbal medicines, so they can reduce their dependence on other sources of Chinese herbal medicines and reduce the cost of raw materials; on the other hand, these leading companies generally There are more than one year of inventory, at least six months of inventory, so the short-term increase in prices of medicinal herbs is not very significant.

The “Investment Analysis and Forecast Report of China's Pharmaceutical Industry 2010-2015” issued by China Investment Advisors pointed out that the reason why the price increase of Chinese herbal medicines is beneficial to some companies is mainly because these companies have strong bargaining power. Varieties are exclusively priced products; on the other hand, some companies have made large purchases of Chinese herbal medicines when prices of Chinese herbal medicines are low, and prices of Chinese herbal medicines have soared. These companies have not only been threatened by the rise in prices of Chinese herbal medicines, but have also received huge profits.

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