If I say that the vaccine is useless, it may be that this "bottle" is not good. What is your first reaction?
This is not necessarily a false proposition.
In fact, packaging materials directly contact drugs and store drugs for a long time, which will directly affect drug quality and drug safety. Some components in the glass are precipitated by the contacted drugs, or the mutual migration of glass and drug components occurs, which is one of the important reasons for the decline of the efficacy of the injection and the incurable drugs.
In the research process of the new crown vaccine, we have proved that our medical research and development strength is very strong. At present, China has won vaccine orders from 16 countries and regions, and the total number is about 500 million doses.
On the contrary, due to the low starting point of the industry, the development process of China's pharmaceutical packaging materials industry is significantly behind the overall development level of my country's pharmaceutical industry.
For example, international standards require that glass containers containing vaccines must be "class 1 medium borosilicate glass bottles." The domestic rate of such glass bottles is less than 10%. China's seven new crown vaccine projects that were approved to enter the clinical stage in the early stage all used German Schott's medium borosilicate glass, and none of them used domestically made medicine glass.
In other words, we cannot make this kind of glass bottle ourselves. At least, it is unable to produce stable mass production of high-quality medium borosilicate glass bottles that can meet international standards.
In the 1960s, we had a factory in the trial production of this medicinal glass. However, after nearly 60 years of development, China's GDP has increased by 255 times (calculated according to IMF forecast data), and the domestic production rate of such glass bottles is still less than 10%.
This is a microcosm of many industries in China, starting from a low starting point, developing at a high speed, and then plunged into the sweatshop constructed by low-end manufacturing, falling into a painful inward roll, and no profit ever since.
Since Huawei, everyone likes to write about the areas where the neck is stuck, but there are still many areas that are not stuck to the neck. They are just a blood vessel of the national economy, but they constitute the healthy operation of the entire body and block it. It will also make people uncomfortable, too much blockage will cause tissue necrosis. Although these areas may not seem fatal, they will still indirectly affect the health of the entire national economic structure and are closely related to every ordinary citizen.
Pharmaceutical glass is such an industry. It affects the cost structure of major Chinese pharmaceutical companies and the results of the consistency evaluation of generic drugs. Perhaps Schrödinger also affects the efficacy of domestic drugs.
To get rid of the dilemma of inward scrolling, realize economic transformation, and allow more industries like pharmaceutical glass to upgrade the advanced productivity of foreign countries and realize domestic substitution is a very important solution, and even the only way.
Can't make medium borosilicate glass bottles, but can make substitutes
In April 2020, John Bell, a professor of medicine at the University of Oxford, expressed his concern about glass bottles containing medicines. The data he provided was that there are only 200 million medicine bottles left in the world.
In July, when vaccines were gradually put on the agenda, Dr. Zhang Wenhong said in an interview: The production of glass bottles containing vaccines is more difficult than vaccines. Vaccine manufacturers all over the world are rushing to buy vaccine glass vials. Johnson & Johnson alone has ordered 250 million vaccine vials as a reserve. When talking about this, some readers joked: If the output of something has been in a hurry for three months and has not been relieved, it is usually because China can't make it.
On the glass bottle for the vaccine, he was right.
Medical glass belongs to the packaging material industry. We can understand medicinal glass bottles in two dimensions: one is the manufacturing process and use, and the other is the type of material.
▲Two classification methods for medical glass
Let's talk about materials first.
In the field of medical glass, there is a very important parameter called water resistance. It refers to the amount of alkali precipitated per unit mass of glass under certain conditions (usually expressed by the volume of acid consumed or converted into the mass of sodium oxide). The less the amount of alkali precipitated in the glass, the higher the water resistance level. The impact of water-based drugs is also smaller.
This sounds a bit abstract. If you can generalize it, it means that the better the water resistance of the glass and the more stable the material, the less it will react with the solvent in the bottle, and the safer and more reliable the vaccine in the bottle will be. Among the four types of glass, the best water resistance is the medium borosilicate glass.
In the 1960s, China’s pharmaceutical industry had a period of rapid development. The Beijing Glass Instrument Factory in Nahui took the lead in the trial production of 5.0 neutral borosilicate glass tubes. In the 1980s, Baoji Pharmaceutical Glass introduced a complete set of Corning from the United States. production line.
What was the level of the craftsmanship at that time, there are very few existing data, but there is no doubt that whether it is Beijing Glass Instrument Factory or Baoji Pharmaceutical Glass, their initial goal is the most advanced manufacturing technology at that time.
But the Chinese economy was just in its infancy at that time, and one word can describe the situation of most Chinese industries at that time, that is, "poor".
The wisdom of the working people is very pragmatic. High quality and advanced technology require high costs and high consumption power to support it. We have none of these. In short: can't make it. Even if it is made, it cannot be used.
So China has created a replacement for medium borosilicate glass: low borosilicate glass.
The performance of this kind of glass is basically the full-shrinked version of medium borosilicate glass. The thermal expansion coefficient is larger, it is easier to break, and it is easier to produce cracks and glass chips. Although the water resistance is acceptable, the amount of alkali precipitation under the same conditions It is more than doubled than medium borosilicate glass.
▲ Performance comparison of medicinal glass bottle materials
The high amount of base precipitation will cause the glass to peel off and react with the drug, reducing the efficacy of the drug. This is one of the important reasons for the attenuation of the efficacy of injections and the incurable drugs. This kind of glass bottle is only suitable for storing some medicines that do not require high chemical stability, such as some common antibiotic powder injections and oral liquids.
Although low borosilicate glass is not good enough, it is enough. Its appearance greatly reduced the cost of domestic pharmaceutical glass companies and promoted the rapid development of the entire industry. In that era, we achieved the first wave of domestic substitution in the field of medical glass.
However, this kind of substitute later became the Achilles' heel of China's pharmaceutical glass industry, and cut off the source of technological breakthroughs for Chinese pharmaceutical glass companies for several years.
How does the inner scroll roll up
After talking about the materials, let's talk about the process.
There are two main production processes for medical glass bottles, one is molding and the other is control.
Molding is easy to understand. Usually, the molten glass is formed at one time through the mold, and can be packaged and stored in storage after cooling down. This process has fewer steps and is relatively less difficult, but the bottles made are generally thicker than the controlled process bottles. Some are usually used to make larger bottles, such as infusion bottles.
▲ Molded glass bottles for medicinal use; Source: Piramal Glass
However, there are more steps in the control process, and the difficulty is also higher. It has to undergo two moldings: first, the molten glass is drawn into a slender tube and molded once; then the glass tube is reprocessed and heated. The bottom-making, neck-making and other processes, and finally secondary molding, can produce a control bottle. However, the bottles produced by this process are relatively thinner, smaller in capacity, and more beautiful. Many biologics vials, including vaccines, are relatively inclined to use this process.
Medium borosilicate glass not only has a high melting point, but also has a very important property in its liquid state, which is its high viscosity. With such a material, whether it is a compression mold or a slender and thin glass tube, the molding difficulty is much higher than that of ordinary glass liquid.
At present, we can find relatively few molding technologies for borosilicate glass. However, in this regard, Shandong Pharmaceutical Glass, the leading domestic pharmaceutical glass company, has achieved technological breakthroughs and has completely independent property rights. What followed was a drop in the overall price of borosilicate molded bottles in China.
But generally speaking, the demand for controlled bottles is significantly higher than that of molded bottles.
Before the epidemic, the total annual demand for medical glass bottles in my country was about 80 billion, of which about 15 billion were molded bottles, accounting for about 18.8%. The demand for ordinary controlled bottles is also about 15 billion, and the demand for ampoules made with controlled processes is nearly 40 billion, and the two together account for 68.8% of the total demand. The demand for control bottles accounted for an overwhelming majority.
Regarding control bottles, the front-end furnace drawing technology of borosilicate glass is basically monopolized overseas.
There are nearly 100 domestic companies engaged in pharmaceutical glass packaging, and none of them can truly achieve stable mass production of high-quality borosilicate glass tubes under the condition of reasonable cost control. The front-end kiln drawing technology is concentrated in the hands of a few foreign companies such as Schott of Germany, Corning of the United States, and Nihon Electric Glass. The market share of the first three companies alone has reached 80%.
Many domestic companies say that they have achieved mass production of domestic borosilicate control bottles, but before August 18, most of them were already formed glass tubes bought from foreign companies, and they only needed to perform secondary molding after taking them back.
I don't have to ask you to buy my glass bottle, but if you want to make a glass bottle, you must buy my glass tube.
Does it sound familiar? Those engaged in glass tubes, those engaged in chips, and those engaged in mobile phone systems ended up in the same way.
The mobile apps are weird and the customized systems are so popular, but in the final analysis, it’s either Android or iOS. Chips are in full bloom in all walks of life. When you disassemble them, they are either Qualcomm or Samsung. They are all made by TSMC; just like medicinal glass bottles. , No matter what size is made and what kind of medicine is contained, the raw materials are always from Schott of Germany or Corning of the United States.
According to China Glass Information Network, the price of neutral borosilicate glass tube produced by German SCHOTT is about 27,000 yuan/ton, the price of neutral borosilicate glass produced by domestic manufacturers is about 15,000 yuan/ton, and the price of low borosilicate glass tube is about It is 6000~7000 yuan/ton.
According to the product revenue and sales data of domestic pharmaceutical glass leaders Shandong Pharmaceutical Glass and Zhengchuan Co., Ltd., the average price of low borosilicate glass bottles and soda lime glass bottles is less than 0.1 yuan. The price of neutral borosilicate glass is 4 to 5 times or more than low borosilicate and soda lime glass.
At the same time, according to the China Industry Information Network, the growth rate of China's pharmaceutical glass industry has fallen below 1%.
Data from: China Industry Information Network, China National Securities Research Institute
Even so, hundreds of products from nearly a hundred small and medium-sized enterprises in China compete fiercely on the low borosilicate and soda lime glass track.
According to the data in 2018, there are 45 domestic companies that can produce low borosilicate glass tubes, and 107 companies produce low borosilicate glass bottles (injection bottles & oral liquid bottles). Both low borosilicate glass tubes and glass bottles are not imported.
In contrast, in the United States, less than 10 companies have applied for DMF, all of them are Chinese companies, and all low-end products come from China.
High-end technology is in the hands of a few upstream giants, which means that the industry's right to speak and profits will be concentrated upwards. For those downstream companies in the pharmaceutical glass industry, they basically have no bargaining power, and the profit margin left is very small. At the same time, because they only master low-end technologies and do not have enough technical barriers, they will also face the influx of a large number of competitors, which will eventually lead to excessive competition.
This is the legendary scroll. The direct impact is that the structure of China's pharmaceutical glass industry basically remains at the level of the last century.
Take the 182 essential medicines recorded in the China Essential Medicines Catalogue in the 2018 edition as an example. There are 131 medicines that can be found on the UK Drug Registration website. These 131 medicines can correspond to a total of 613 injection products, of which 410 are products. Glass packaging is used, and the number of products using type I borosilicate glass is 284, accounting for 69.3% of the total.
This is just the part of essential medicines that are not mandatory. Various biological preparations and blood preparations, including vaccines, must use Class I medium borosilicate glass in the regulations of developed countries such as the United States and Europe.
In contrast to China, according to data from the China Medical Packaging Association, the total annual consumption of injections in my country before the epidemic was about 62 billion, of which the total annual consumption of water injections was about 40 billion, and the total annual consumption of freeze-dried preparations, blood preparations and biological vaccines was about For 2 billion. However, according to the data from the demand side, there is actually only about 1 billion medium borosilicate glass bottles in the Chinese market every year.
According to the regulations of developed countries such as the United States and Europe, even if it is a mandatory category, the demand should be at least nearly 2 billion, but in fact, the demand in the market is just half of this number.
This data is obviously unreasonable. why?
The answer is cost.
95% of glass-packaged injections in my country are still using low borosilicate glass or soda-lime glass, while 95% of clinical small-volume injections cost one to two cents per bottle, which may be as low as a few cents. For example, the bidding price of a bottle of vitamin B6 injection is about 0.06 yuan, if it is packaged in neutral borosilicate glass, the bare bottle will cost 0.15 yuan.
Then why is the bottle so expensive?
The answer goes back to the starting point: we can't make it ourselves.
This is an endless loop.
Can low borosilicate and soda lime glass be used?
good or not?
It is certainly not as good as medium borosilicate glass.
But can it be used?
So China's pharmaceutical companies and the pharmaceutical packaging industry continue to use it without looking back.
People like to ridicule the celebrities who are not guaranteed in the evening: "They give too much." For those downstream pharmaceutical companies in the pharmaceutical glass industry, this sentence can be replaced by: "They are so cheap!"
Excessive competition has led to the continuous reduction of product unit prices, striving to squeeze the profit space of the company, but this space releases the demand for low-end production capacity: the cheaper your bottle, the lower the cost for packaging, and the more I tend to choose you.
Overcapacity at the low end of the production side suppressed the growth of high-end demand; the demand side in turn told the production side: we don’t need medium borosilicate glass bottles, just use low borosilicate glass and soda lime glass, so the production side said: you don’t Need, what else can I do?
How is the inner scroll rolled up? That's how it is rolled up.
Chinese companies are struggling to compete excessively in the low-end market, and their willingness and ability to upgrade their industries have been eroded in the process. Companies and practitioners are trapped in this cycle of low-end manufacturing together, fighting against themselves. It's hard to deal with. Then through the industry chain, it is continuously transmitted to both ends, bringing more companies, more people, and more industries into this vortex.
Domestic substitution is the only way to solve the internal volume
In the past two years, the domestic media has always liked to say that the neck is stuck. In fact, most of the things we can't make are not necks, but blood vessels. It is not fatal if it is stuck, and it can live even if it is completely blocked, but a large piece of body tissue connected to that blood vessel will be necrotic.
If you don’t believe me, try to tighten your wrist with a rubber band. You will feel uncomfortable in ten minutes, pain in twenty minutes, and forty minutes this hand may not belong to you.
If you dare to leave it on your wrist for a day, you might have to amputate it.
Not being able to make a glass bottle is certainly not as deadly as not being able to make a chip, but the process of backward technology that brings pain to the industry and practitioners is the so-called "involution."
This term was introduced to China in the 1980s. It was originally used by Chinese-American professor Huang Zongzhi to describe China's agricultural society before the industrial revolution. Later, American historian Pomeranian Pomeranian wrote a book called "The Great Divergence", which studied and compared the economic levels of East Asia and Western Europe before and after industrialization, and extended the definition of involution to a broader meaning. But no matter how it is extended, there are actually two elements:
First, the technological structure of the existing industries has been relatively stable, and the market has begun to lack incremental growth;
The second is that the industry cannot enter the next technological/industrial upgrade due to various reasons.
Then the solution to the problem is about to emerge: industrial upgrading.
In the past two years, due to the tense international situation, when it comes to "domestic substitution", it seems that there is a bit of implicit "antagonism". But this is actually a misunderstanding.
Historical reasons have created a very low starting point for many industries in China. During the period of rapid development, they can only take care of fast enough, but not good enough. Just like China's pharmaceutical glass industry, in the 1960s, the market chose to use low borosilicate instead of medium borosilicate, but today, this has become an obvious backward production capacity.
The country is also guiding the industrial upgrading of this industry through policies.
In December 2017, the State Food and Drug Administration issued the "Technical Requirements for the Consistency Evaluation of Listed Chemical Generic Drugs (Injections) (Draft for Comment)", which clearly mentioned that "low borosilicate glass and soda lime glass are not recommended".
Although there are no hard and fast rules on the policy this time, the direction of the policy is very clear. Many companies such as Shandong Pharmaceutical Glass, Zhengchuan Co., Ltd., Four Star Glass, Kibing Group, etc. subsequently raised funds in the capital market for research and development and invested in the construction of borosilicate glass production lines.
In October 2019, the State Food and Drug Administration issued the "Technical Requirements for the Consistency Evaluation of the Quality and Efficacy of Generic Drugs for Chemical Injections (Draft for Comment)", in which the description became "The quality and performance of packaging materials and containers used for injections shall not be less than Reference preparations to ensure that the quality of the drugs is consistent with the reference preparations".
There are a large number of generic drugs in the Chinese pharmaceutical market, and the proportion of domestically produced original research drugs is relatively low. The way that the country directly connects the standards to international standards is a soft requirement. It starts directly from the needs of pharmaceutical companies and forces upstream pharmaceutical glass companies to carry out technological transformation and upgrades.
Image source: GF Securities Research Center
This is not the first time that the country has given similar guidance. Since 2015, multiple policies have been introduced. After 2015, domestic pharmaceutical glass companies such as Shandong Pharmaceutical Glass, Zhengchuan Co., Ltd., and Four Star Glass have also launched The capital market raises funds for the research and development of borosilicate glass drawing tube technology.
Because of its fragility, glass naturally has the advantage of being nearby. Once the domestic pharmaceutical glass achieves a technological breakthrough and can produce high-quality pharmaceutical glass, coupled with cost advantages, it is almost inevitable for Chinese pharmaceutical companies to switch from import to domestic use.
Domestic substitution is not a goal, but a result, a natural process, and it is a necessary way for China's industrial upgrading and economic transformation.
Our generation is fortunate, born and grown in an era of rapid economic growth, but rapid growth has also concealed many problems. Therefore, the country has been relentlessly emphasizing industrial upgrading for many years. To promote economic transformation, it must be fast and good, and even a part of the speed can be sacrificed for better.
The Chinese can't make not only glass bottles for vaccines, but also steel balls on ballpoint pens and gaskets on lighters. In fact, there are many such "small" things that China cannot make. According to this, some people criticized China's manufacturing is not good, but it is not.
Made in China just lacks enough time. We have walked the road that others have walked for hundreds of years in decades. We can't be demanding, and we must be as solid as others in every step. It is undeniable that rapid growth has concealed many problems in development.
Someone always asks the director, why do you care about domestic substitution?
In addition to not wanting to be stuck by others, perhaps more, because we always believe that realizing domestic substitution will lead us to a better future.
GF Securities "Building Materials Industry: Interpretation of the Pharmaceutical Glass Industry"
Everbright Securities "Shandong Pharmaceutical Glass Investment Value Analysis Report"
China Packaging News "my country's Pharmaceutical Glass Standards and Standardization System"