(Yicai Global) March 26 -- BeiGene's stock price stumbled after China's drug regulator announced an embargo on sales of the US chemotherapy drug Abraxane, for which the pharmaceutical company is the country's sole distributor.
The Beijing-based firm's shares [HKG:6160] fell 5.6 percent today to close at HKD74.40 (USD9.60) each, after earlier dropping as much as 6.7 percent. The yardstick Hang Seng Index was off 0.7 percent. BeiGene's US-listed stock [NASDAQ:BGNE] ended 5.75 percent lower yesterday at USD121.84.
China will suspend the import, sales and use of Abraxane, developed by New Jersey-based drugmaker Celgene, a unit of Bristol-Myers Squibb, due to sub-standard manufacturing practices, the National Medical Products Administration said in a statement on its website yesterday.
Abraxane is mostly used to treat breast cancer in China. Last year, CNY721 million (USD101.7 million) worth of the drug was used in government-run hospitals, according to medical data information platform Menet. It was due to be included on the country's bulk drug procurement program in April.
A spot check in an overseas manufacturing facility found that part of Abraxane's key production procedures, such as aseptic management, did not meet basic quality control requirements for pharmaceutical drug production in China, the NMPA said.
Bristol-Myers has already submitted an application to the NMPA to supply China from another plant to rectify the situation, BeiGene said in a statement yesterday.
The NMPA said it will source alternatives to replenish supply. Local drugmakers CSPC Pharmaceutical Group and Jiangsu Hengrui Medicine are poised to fill the gap. In January they successfully bid to have their versions of Abraxane added to the list of medicines covered by national medical insurance.
BeiGene signed an exclusive China licensing agreement with Celgene in 2017 for the drugs Abraxane, Revlimid and Vidaza. Over half of the firm's 2019 revenue came from these three medicines, around USD223 million, driving annual earnings 70 percent higher from 2018, according to its most recent earnings report.
Editors: Dou Shicong, Kim Taylor