This article is from WeChat public account: Guotai Junan Securities Research (ID: gtjaresearch) , author: GTJAS medicine team, FIG head source: IC photo
Online diagnosis and treatment + offline medicine collection, this O2O medical treatment scene covered by the full medical insurance has entered the fast track of development under the epidemic.
However, in addition to the Internet medical companies that have received great attention from the market, the Guotai Junan Medical team found that in this scenario, it is more beneficial, but it may be an opportunity to break through the “Medicine Collection” and “Drugs for chronic diseases” The two major bottlenecks of the offline retail pharmacy industry .
Despite the twists and turns of the reform process, with the gradual liberalization of policies, the three major constraints of online medical and retail pharmacies-“can sell, have money to sell, and reimbursement”-have taken their first steps smoothly.
The leading listed companies in chain pharmacies will also have new vitality.
Offline retail pharmacies, follow the Internet medical embark on the “wind mouth wave”
In order to avoid cross-infection as much as possible, during the epidemic period, a large number of medical scenes were transferred online, which also gave Internet medical care unprecedented market attention.
Online consultation has not only become an important way for patients to obtain medical services during the epidemic, but also has the full support of national policies.
On February 3, the National Health and Medical Commission General Office’s “Notice on Strengthening Informationization to Support the Prevention and Control of Pneumonia Epidemic of New Coronavirus Infection” clearly stated that actively organize medical institutions at all levels to use “Internet +” Newcomer pneumonia’s online compulsory consultation, home medical observation and guidance services, etc. are encouraged to carry out some common diseases, chronic diseases review and drug delivery services, and reduce the risk of cross-infection of offline consultation for other patients.
On March 3, the “Guidelines on Promoting the Implementation of” Internet + “Medical Insurance Services During the Prevention and Control of New Coronary Pneumonia” issued by the National Medical Insurance Bureau and the National Health and Health Commission further proposed that eligible “Internet +” medical treatment Service costs are included in the scope of medical insurance payments. During the epidemic, as long as the insured person relies on the electronic prescription issued online by the designated medical institution, the drug can be purchased at the nearest pharmacy or O2O, and can be reimbursed within the scope of medical insurance.
▼ Some Internet medical expenses are included in the scope of medical insurance reimbursement
Source: National Medical Insurance Bureau, Guotai Junan Securities Research
Encourage online diagnosis and treatment, and include “Internet +” medical service costs into medical insurance. The most directly benefited from these two measures are not only Internet medical companies but also offline retail pharmacies.
In this epidemic, Wuhan ’s demand for outpatients with severe and chronic diseases includes more than 1,300 “Internet +” medical service costs that are included in medical insurance payments daily, and more than 1,100 prescriptions are transferred to designated retail pharmacies, most of which are still final. Implemented as a dock for retail pharmacies.
In addition, the policy also proposes to implement the “long prescription” medical insurance reimbursement policy during the epidemic period, and actively promote the implementation of hypertension and diabetes outpatient drug protection mechanisms in urban and rural residents. Insured persons can dispense drugs at designated retail pharmacies with prescriptions, while encouraging innovative delivery methods of designated pharmaceutical institutions.
In this way, the outflow of prescriptions for chronically ill hospitals is expected to accelerate, creating conditions for offline pharmacies to connect with chronically ill prescriptions.
How does a chain pharmacy take on the responsibility of dispensing outside the hospital?
Policy is here, but not all offline pharmacies have the capacity.
In the detailed description of the policy, detailed requirements are made for the designated retail pharmacies that undertake out-of-hospital dispensing:
should be established for the patient And properly save information such as electronic medical records, online electronic prescriptions, and drug purchase records, so that the entire process of diagnosis, treatment, prescription, transaction, and distribution can be traced, and information flow, capital flow, and logistics can be monitored throughout the process, so that patients can check the inspection results online Medical records such as diagnosis and treatment plan, prescription and doctor’s order.
Compared with individual pharmacies, the leading pharmacies of large chain pharmacies cover a wide area, have a high level of information management, and are equipped with licensed pharmacists. They are expected to take the lead in outflow prescriptions and continue to expand their brand influence.
In the earlier report of Guotai Junan Medical Team, “The New Era of Mergers and Acquisitions Integration-Special Topics for Chain Pharmacies”, the possibility of retail pharmacies taking on the responsibility of hospital pharmacy was discussed in depth.
1. Capable: Chain drug stores have stronger pharmaceutical service capabilities
Social pharmacies need to have three feasible conditions for undertaking the duties of hospital pharmacies: guarantee of drug quality, guarantee of quality of pharmacy services, and guarantee of availability of drugs.
▼ Three conditions for chain pharmacies to accept outpatient pharmacies
![]()
Source: China Health Service Management, Guotai Junan Securities Research.
▼ Chain drugstores are expected to replace medical institutions’ outpatient pharmacies
![]()
Source: China Health Service Management, Guotai Junan Securities Research.
Specific toFrom the perspective of pharmacist service capabilities, large chain pharmacies are significantly ahead in the allocation of licensed pharmacists. The ratio of registered persons to the number of stores is double the national average, which highlights the competitive advantages of large chain pharmacies in the direction of pharmacy services.
▼ Proportion of registered practicing pharmacists and stores in each company
![]()
Source: Certified Pharmacist Certification Center, Guotai Junan Securities Research. 2015 data
In addition, at present, large chain drugstores have huge membership systems that can establish a file of patients’ medication behaviors and conduct long-term monitoring to achieve personalized pharmaceutical consultation and services, thereby improving service levels and customer stickiness. Gradually increase related chronic disease management services and expand value-added business.
2. There is space: only 29% of prescription drugs are sold in retail pharmacies, and there is a lot of room for improvement in the future.
According to the data of Zhongkang CMH, the scale of China’s pharmaceutical retail market in 2014 was 281.7 billion yuan, of which pharmaceutical sales accounted for 78% of the total market:
#Contains over-the-counter drugs (OTC) accounts for 43%
#Prescription drugs (RX) 29%
# 6% of medicinal materials
In the future, if pharmacies in the chain can further undertake the duties of Internet medical and hospital outpatient prescription dispensing, the proportion of prescription drug sales in the future is expected to rise, which will lead to an increase in overall revenue.
▼ About 29% of prescription drug sales
![]()
Source: Zhongkang Information CMH, Guotai Junan Securities Research
Pharmacies are expected to become important participants in the second round of drug collection
Under the current background of centralized drug collection in the country, hospitals are still the absolute main force in the field of drug distribution.
This is because during the past prescription outflow, the biggest concern for hospitals and patients was safety-if patients were prescribed in a hospital and bought medicines outside the hospital, in case the medicines they bought were not of the same quality and effect , Resulting in failure to achieve the desired effect within the course of treatment, or cause other health problems. Delaying treatment will not even say, and even make patients worry about their lives.
But as retail pharmacies join the purchase of the medical insurance directory, the impact of drug collection on retail pharmacies is also expected to change from negative to positive.
Recently, the second round of taped purchase landing policies has been introduced. Among them, the Guizhou Province document emphasizes that designated medical pharmacies for special medical insurance as one of the main bodies of centralized drug procurement; Jiangsu Province issued documents to encourage medical insurance designated retail pharmacies to participate in the volume procurement alliance; the Shenzhen document specifies the scope of implementation of the second round of volume procurement This includes voluntary participating health insurance designated retail pharmacies.
▼ Jiangsu Province issued documents to encourage medical insurance designated retail pharmacies to participate in bargain purchases
![]()
Source: Jiangsu Medical Insurance Bureau March 10, “Announcement on Public Solicitation of Opinions”, Guotai Junan Securities Research
From all indications, pharmacies are expected to become one of the main players in the second round of volume purchases.
When retail pharmacies and hospital drugs can achieve the same conditions, the same manufacturer, reimbursable conditions, the further acceleration of prescription outflows and online diagnosis and treatment will become more natural.
Offline retail pharmacies will also usher in a real spring.
The above content is selected from the research report “Medicine: Epidemic does not affect short-term operation and long-term structural optimization remains unchanged” published by Guotai Junan Securities Industry prosperity trend-Guotai Junan Pharmaceutical Industry Spring Investment Strategy, “Internet medical insurance service policy is expected to accelerate prescription outflow”, “Merger and acquisition integration new era opens-chain pharmacy special topic” and public information, please refer to detailed analysis content (including risk tips, etc.) Full report. If there is any ambiguity due to the abstract of the report, the full report content shall prevail.
Ding Dan (Analyst) S0880514030001
Yu Jiaxuan (Analyst) S0880519080014
Zhao Junfeng (Analyst) S0880519080017
Zhang Zhuyuan (Analyst) S0880519090001
Zhang Shuai (Analyst) S0880118090004
Huang Yan (Analyst) S0880120010036
This article is from WeChat public account: Guotai Junan Securities Research (ID: gtjaresearch) author: Guotai Junan medicine team