Bloomberg News

China Drugmakers Advance on H1N1, Industry Plan: Shanghai Mover

January 07, 2013

Chinese health-care shares rose the most in two weeks on speculation medicine demand will increase after two women died from the H1N1 flu strain in Beijing and the government set targets for growth in the biomedical industry.

Beijing Tiantan Biological Products Corp. (600161) surged by the 10 percent daily limit to 13.41 yuan as of 1:07 p.m. in Shanghai. Hualan Biological Engineering Inc. (002007) rallied 8.5 percent, Shijiazhuang Yiling Pharmaceutical Co. climbed 2.4 percent and Shandong Dong-E E-Jiao Co. (000423) gained 2.4 percent in Shenzhen. A gauge of health-care shares on the CSI 300 Index (SHSZ300) jumped 1 percent, set for the biggest gain since Dec. 25.

The two women, aged 22 and 65, died amid the highest number of flu cases in China’s capital since 2008, Beijing News reported. Separately, the State Council said China is targeting annual output growth of more than 20 percent from 2013 to 2015 in the biomedical industry, according to a statement posted on the central government’s website yesterday.

The rally in drugmakers today “is related to short-term panic buying after reports of H1N1 cases in some Chinese cities,” said Li Ying, a Shanghai-based analyst at Capital Securities Corp. “Investors also favor prospects for the industry after the release of the state council’s plan.”

People shouldn’t worry because the H1N1 virus, also known as swine flu, has become a “seasonal strain” that can be controlled and prevented, the Beijing Centers for Diseases Control and Prevention was cited as saying in the article.

Swine flu spread quickly in China in 2009, prompting mass inoculations by the Asian nation. The virus was responsible for an estimated 659 deaths as of Jan. 2, 2010, China’s health ministry said at the time.

Biomedical Growth

China will encourage the research and development of new drugs, including vaccines, and improve the quality of its medicines, the State Council said in yesterday’s statement. China needs to develop new medicines, crops, biofuels and environmental technology as its population ages and to ensure food safety and conserve energy, according to the statement.

Li Keqiang, No. 2 in the ruling Communist Party’s hierarchy, urged yesterday that China increase financial support to reform the medical industry.

To contact Bloomberg News staff for this story: Jack Gao in Shanghai at ygao40@bloomberg.net

To contact the editors responsible for this story: Shiyin Chen at schen37@bloomberg.net; Grant Clark at gclark@bloomberg.net


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