1988: Back to the human world for a few years

Chapter 636: Raising the price from the ground up
"Congratulations, Mr. Miyazawa has increased your country's medical expenditure budget to 22 trillion yen since taking office."

"Given that your country has in fact entered the early stages of an aging society..."

Miss Mu, who was in charge of the reception, smiled as she glanced at the dozen familiar faces in the box. She paused for a moment and smiled meaningfully, "After years of hard preparation, we have finally ushered in a new spring... From now on, the Ministry of Health, Labor and Welfare will truly be our biggest sponsor!"

Just a few opening remarks not only ignited the atmosphere, but also made old foxes like Suzuki Jiken couldn't help but smile bitterly in their hearts.

It is no secret that the island country has significantly increased its national medical expenditure budget this time.

In fact, ever since Miyazawa took office last November, countless pharmaceutical companies have been waiting for this day.

But the problem is that the Ministry of Health, Labor and Welfare suddenly throwing out such a big piece of new cake does not mean that all pharmaceutical companies are qualified to pounce on it and take a bite.

Very similar to a certain country in later generations, the reason why the medical expenditure budget was successfully raised this time was mainly because the island country could no longer avoid the objective reality that it was beginning to enter an aging society.

The economic boom of the island nation is inseparable from the prosperity of Shenwu and the hard work of the oxen and horses who have contributed all their sweat since the defeat. So when these people begin to grow old, the island nation must naturally pay attention to their medical insurance issues.

What's more, among the aging group of people are not just cattle and horses, there are also a large number of backbones and former pillars of society, and even celebrities... Being convenient to others is being convenient to yourself, this simple truth is also deeply understood by the Japanese people.

In other words, a considerable portion of the budget, which has suddenly increased to 22 trillion yen, is prepared for the aging population.

Since the budget is increased to accommodate the gradually growing aging population, the sudden increase in pie will naturally be closely related to aging diseases.

So apart from the spending on medical facilities and professional personnel, just talking about medicines and medical equipment is enough to make a large number of domestic pharmaceutical companies sigh in despair.

An objective fact is that although the current medical system of the island country is very developed, most of the technical patents for the latest generation of targeted drugs, special-effect drugs and even special instruments for common chronic diseases among the elderly, such as cancer, coronary heart disease, hypertension, heart bypass/transplant surgery, Alzheimer's disease, stroke and hemiplegia, are in the hands of Europe and the United States.

Although the book "Islanders Can Say No" is very popular nowadays, and the island nation in the Showa era even wanted to wave money to buy America, it still could not change a reality that they could not accept emotionally...America is always the father of the island nation.

Therefore, after nearly two years of economic fluctuations, everyone can see clearly that a large and painful portion of the extra medical spending will eventually flow into the pockets of American consortiums... In the past two years, European and American capital has acquired a lot of shares in island pharmaceutical and medical device companies.

Well, this is also in line with Mr. Miyamoto's style.

Like Kaifu Toshiki, Mr. Miyamoto is also a dove and also holds the idea of ​​balancing the relationship between the island nation and the United States and Asia. However, it is obvious that his courage and prestige are still somewhat inferior to Kaifu. Therefore, facing the aggressive pressure from European and American capital, it is not surprising that he finally made a large-scale concession.

but……

Even though a considerable portion of the newly added pie falls into the pockets of European and American capital, it would be wrong to say that the pharmaceutical companies of the island country cannot get a share of it - when it comes to the word "balance", the people of the island country may not be much worse than the Chinese. If they only know how to please American daddy and ignore the interests of their own financial tycoons, then Mr. Miyamoto will not have a good life either.

Therefore, the strategy to revitalize traditional Chinese medicine, which has been promoted for more than 20 years, finally reached a critical turning point this year. This is also a crucial part of the "balance" policy in the medical field.

It is undeniable that although Western clinical medicine is much more effective in emergencies and surgeries, when it comes to the prevention, conditioning and maintenance of chronic diseases, especially chronic diseases in the elderly, traditional Chinese medicine, which excels in conditioning, has a clear advantage over Western medicine.

Fortunately, after more than 20 years of tireless propaganda, people on the island really believe this.

Therefore, starting from this year, hundreds of Chinese herbal medicines and raw materials for chronic diseases and geriatric diseases have been included in the island country's medical insurance reimbursement list. With their more cost-effective characteristics, it is not difficult to imagine that the major hospitals in the island country will definitely strongly recommend these Chinese herbal medicines... Although the island country has not yet shouted the slogan of "medical insurance will lead to the country's destruction", the sudden increase in the medical expenditure budget to 22 trillion yen has still brought great financial pressure to the country. This is a huge sum of money that exceeds 10% of the country's GDP (it was already more than 98% in 15, which is rare in the world). The Ministry of Health, Labor and Welfare, which is under great pressure, naturally has to find ways to control costs.

As for why old foxes like Suzuki Cijian would smile bitterly after hearing what Miss Mu said...

the reason is simple.

The general public's perception of information has a lag, and this lag period is often between 5 and 10 years.

Therefore, even though the island country suddenly increased its medical support budget this year, in fact, even if it had not encountered the sudden situation of the bursting of the economic bubble, the budget would still increase when the island country officially entered the process of social aging...it's just that the groups that share the pie will be different.

Do you understand? Whether it was Tsumura's efforts in the field of Kampo medicine in the past few years, or Sankyo Co., Ltd. seeking to merge with Daiichi Pharmaceutical Co., Ltd., they were all preparations for this strategic turning point and were the foreshadowing of having a bigger bite of the cake.

Even the year before last, we joined hands with Momo Baitou in Shandong to promote the GAP planting base for Chinese medicinal materials. We even spared no effort to help Yang Mo to financialize the property rights of the artificial Coriolus versicolor planting base he had developed. All of this was to increase the bargaining chips for this day... Don't forget that medicinal materials grown according to the GAP standard mean higher and more stable quality standards, which is a big plus. In addition to anti-cancer, artificial Coriolus versicolor has the effect of significantly enhancing human immunity. For the elderly people on the island who are not short of money and even the vocal groups, it is an irresistible temptation. Even including it in the scope of self-funded drugs cannot stop their enthusiasm for buying.

However, it is obvious that the foreshadowing laid by Sankyo Corporation a few years ago has become a very important bargaining chip for Dahua Company today. Based on their understanding of Miss Mu, they are afraid that they will not get what they want without spending some money.

There is no way. Due to various objective reasons, Dezhou and Lanling are now the only two regions in China with large-scale GAP medicinal material planting bases.

As for artificial Coriolus versicolor, there is no other branch except this one (because of the flood in East China last year, otherwise it would be hard to say whether there would be an artificial mulberry Coriolus versicolor planting base).

........................

"I hope that this cooperation between the two sides can go a step further on the basis of Yuan Yuan's original foundation!"

"Taking advantage of the country's liberalization of foreign investment access policies and the fact that European and American pharmaceutical companies have not yet contacted the provincial and municipal governments, we will take the lead in putting both sides in place at one time, through the form of joint venture factory construction + technical exchange + gradual transfer of orders, and work with Momo Baiyao to create the largest CXO industry cluster in Qilu and even China!"

Miss Mu's tone was as excited as that of a pyramid scheme leader, and her face was full of confidence: "Believe me, after more than a year of rapid development, the number of grassroots radiation terminals of Momo Baiyao has now exceeded 1600... This is only limited to Dezhou and Lanling. As the Shandong-Henan-Hebei industrial manufacturing cooperation framework gradually gets on track, this number will only grow faster starting this year."

After a slight pause, Miss Mu showed a strange smile: "So, our Dahua Company believes that since we can build enough terminal outlets and sufficient market capacity in a short period of time;"

“So we think it is necessary to adjust the original idea and build a full-system XCO industry cluster. We are no longer limited to [following the development of original drug projects] or [following the development of original drug molecules]. Instead, we learn from the advanced experience of Europe and the United States and begin to try to provide you with [integrated, end-to-end] full-system R&D services by developing CRDMO and CTDMO businesses.”

At this point, Mu Liya's smile was as warm as the spring sunshine in March, but her tone was full of an indescribable strength: "My old friends...what do you think?"

CRDMO! ?
CTDMO! ?
Hearing these two terms that have only appeared in the past two years, Suzuki Jiken and others took a deep breath and their faces began to look unnatural.

As mentioned earlier, CXO is the abbreviation of "pharmaceutical outsourcing", but in fact, it is a general name for the track.

Therefore, the X in the middle can actually be replaced by any word, such as CRO (contract research outsourcing), CMO (contract manufacturing outsourcing), CDMO (contract development and production), etc. In a word, the abbreviation method depends on what kind of business model or cooperation model you adopt.

CRDMO (drug discovery + process development + production) and CTDMO (testing + process development + production) are new pharmaceutical outsourcing models that have emerged in Europe and the United States in the past two years. They are truly in-depth cooperation models. Therefore, once this "end-to-end" pharmaceutical outsourcing cooperation model is adopted, it will be impossible for companies such as Sankyo Co., Ltd. and Tsumura Pharmaceutical to get rid of the influence of Dahua in the future. Hearing this, many readers may be confused.

Isn’t it just outsourcing?

The word "outsourcing" sounds very low-level and has no technical content at all. Why do old foxes like Suzuki Jiken turn pale at the mention of it?

Ok……

Let me put it this way. Although the word "outsourcing" does sound very low-brow, in the pharmaceutical field, this outsourcing of R&D and production services is not only an inevitable choice for globalization, scale, and cost minimization, but also a business with extremely high technical content... Especially the CRDMO (drug discovery + process development + production) and CTDMO (testing + process development + production) cooperation models that almost cover 80% of the work content of original drugs.

Since some readers may not be very familiar with the pharmaceutical industry, I will briefly explain it here.

The process of a new drug from research and development to market is generally divided into five steps:
1. Drug discovery.

Including target confirmation, high-throughput screening, lead compounds and other work, it usually takes more than three years.

2. Preclinical research
Including animal experiments and toxicity tests, it usually takes 1 to 2 years.

3. Clinical research

包括临床1期（20~30受试）、临床2期（100~300人受试），临床3期（1000~3000人受试）、剂量确定、安全性测试等，一般耗时4~7年。

4. Registration and approval

It includes safety and effectiveness assessment, production qualification approval, post-market monitoring, etc., which usually takes 1 to 2 years.

5. Production and sales (depending on the specific situation)

Just by having a general understanding, you can know how time-consuming it is to develop a new drug, and each step requires a huge investment of money. A new drug requires hundreds of millions of dollars, which is not just talk.

But the astronomical amount of money invested is not the most fatal thing, the most fatal thing is...

The patent protection period for a new drug internationally is only 20 years!
These 20 years do not start from the time you put the product on the market, but from the time you start applying for it (generally, it starts from the time the original drug company confirms the drug discovery).

This is really a life-threatening thing. According to the previous introduction, it takes at least nearly ten years for a new drug to be developed from the start of the project. If you are unlucky, it is possible that the patent protection period is about to expire and it has not passed the safety and effectiveness evaluation.

You should know that during the patent protection period, as long as you can sell it, no one can restrict you no matter how much you sell it for. It is the critical period to recover the R&D costs. Once the patent protection period is over, others can imitate you openly.

It can be seen from this that, apart from the first stage of "drug discovery", the efficiency of the subsequent four stages even determines to a large extent whether the new drug can recover its costs.

The CRDMO (drug discovery + process development + production) and CTDMO (testing + process development + production) models are exactly the kind that cover all the work in the subsequent stages except for the first stage of drug discovery...CRDMO will even intervene in the supporting work of the drug discovery stage.

Faced with R&D costs ranging from tens of millions to hundreds of millions or even billions of dollars, how could Japanese pharmaceutical companies such as Sankyo Co., Ltd. not be cautious?
Just like the film and television industry where losing all the money from sponsoring a few movies could very likely lead to the bankruptcy of a company, no matter how strong the foundation of Japanese pharmaceutical companies is, they cannot withstand the failure of a few relatively important new drugs.

………………

Suzuki Cijian swallowed his saliva and, forced to stand up by the looks from others, smiled the most gentle smile: "Mrs. Yang..."

Before he finished speaking, Miss Mu corrected him: "Director Suzuki, although we are old friends, please call me Minister Mu in formal occasions."

Suzuki Jiken choked, but still changed the address swiftly: "Minister Mu, the reality of your country is here. It is too risky to fast-forward to the CRDMO and CTDMO models... Otherwise, how about we stick to the original idea and start with CMO (contract manufacturing outsourcing)?"

At this point, as if afraid of lowering the conditions too much and making Miss Mu angry, he immediately added: "Of course, given that both parties have previous experience in joint research on chiral catalysts, we still have some confidence in the scientific research capabilities of the Texas region... If we are only involved in production process research, it is not impossible to adopt the CDMO (contract research and development + production) model."

If Sankyo Co., Ltd. wants to get enough of the cake from the Ministry of Health, Labor and Welfare, the number of Chinese traditional Chinese medicine secret prescriptions suitable for geriatric diseases in China will be a key factor.

The weird thing is, I don’t know if Dahua Company has opened their eyes, but since the year before last, they have been buying up various Chinese medicine secret recipes at high prices in various parts of the country under the name of Momo Baiyao.

It just so happened that Momo Baiyao was an affordable drugstore chain project specifically targeting grassroots people in rural areas, and it itself had a strong public welfare nature. In addition, Dahua Company had always had a very good reputation among the domestic people. Therefore, after the news came out, both traditional Chinese medicine families and folk masters really sold a lot of secret prescriptions to it (in fact, they did not sell it, but signed a project technology investment agreement).

Therefore, this is the main reason why Sankyo Co., Ltd. and other Japanese pharmaceutical companies are making every effort to help promote industrial acceptance in Texas this time, and even take the lead with the awareness of being a sucker.

The Dahua Company is likely to have hundreds of prescriptions for elderly diseases or treatments. For them, this is tantamount to a super treasure trove worth trillions or even trillions of yen!
Hearing Suzuki Jiken's polite refusal, Miss Mu smiled slightly and said, "Director Suzuki, don't be anxious. Everyone here is an old friend of our Dahua Company."

"We Chinese people value friendship the most. Now that both sides have finally welcomed a golden opportunity to soar high, it is time for us to cooperate sincerely. How could I harm our hard-earned friendship for the sake of greed?"

At this point, Mu Liya pursed her lips and said, "In fact, the proposal to adopt the CRDMO and CTDMO models is, on the one hand, because after evaluation, the Texas region does have the initial ability to do so... or to be more precise, the potential to have this ability in the short term;"

"On the other hand, it is also for your benefit!"

Oh?
For our sake?
Suzuki Jiken looked at the others, with some doubt in his eyes...

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PS: I am in the hospital and originally did not write about my physical condition, but I accidentally opened the background of my phone and found that I was recommended yesterday (although it seems that the recommendation was stopped today, what bad luck!).

So I had no choice but to ask my family to bring a Bluetooth keyboard from home to type out more than 2,000 words, and then added it to the 2,000 words I typed before entering the hospital to make an integer and sent it out.

But I can’t guarantee whether I can continue to type so many words tomorrow, so I’m letting you know in advance.

Hey……

(End of this chapter)