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China to Implement Drug Bulk-Purchase Scheme to Reduce Price Gap

China will use its national drug bulk-purchase program to decrease the price of medicine currently sold at higher costs in contrast with other markets, it said in an official statement.

The step might force foreign drugmakers to cut costs further and enable copycat medicines to replace imported off-patent brands at a faster rate.

Many branded versions of the medication are presently more expensive in China than in other leading markets. They could now be subjected to a centralized procurement program where producers will have to undergo a bidding process to get the right to distribute drugs to public hospitals, the National Health Commission stated in a document printed on late Friday.

The bulk-purchase program, which at present covers 25 types of medicines, permits no more than three successful bidders access to China’s public hospitals, where most Chinese people purchase their drugs.

The program brought about the price of some medicines to plunge over 90% when it was rolled out in 2018 in some cities, state news agency Xinhua stated

Multinational drug companies usually reduce the price of medicines after they go off-patent and face competition from generic versions, however, such price drops were slow to take place in China, partially because many local drug manufacturers had been unable to develop high-quality generic medicines to compete with off-patent branded drugs.

In the first round of nationwide implementation of the program, in September, multinationals, including Sanofi and Eli Lilly, managed to chop some prices low enough to ranges close to these offered by local generic manufacturers.

Beijing will strengthen its monitoring of the foreign drug market and collect global prices for imported medicines, Friday’s guidelines mentioned.

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Joseph Flowers

Joseph is leading the team writing under the medicine category. Before joining health dialysis, he has worked with many research organization and also in labs and hence his understandings on the field of medicine is vast and exciting. His articles hold the account for every recalled medication and even those medicines whose approval has risen a storm in the market. Personality wise he is a very soft-spoken person.

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