A new round of drug price adjustment plan will be released and the price reduction will be more than last year

According to media reports, a new round of Medicare drug price adjustment plan is scheduled to be announced this week. The four major categories of anti-tumor drugs, immunomodulators, blood products, and digestive system drugs will be the focus of this price reduction.

The price adjustment for the last round of medical insurance catalogs occurred on March 28, 2011. The National Development and Reform Commission reduced the maximum retail prices of 162 varieties and nearly 1,300 prescriptions in the Medicare Catalogue. The price of antibiotics and circulatory system drugs was reduced markedly. The average reduction was Adjusted 21% of the pre-regulated price, while eliminating the separate pricing of more than 20 varieties. The anti-tumor drugs in this round of price adjustment are all high-priced varieties, and we expect the decline in this round of price adjustment will exceed the average decline in 2011.

Before the reform of the public medical system, the control of drug prices was a temporary measure to reduce the pressure of rapid growth in medical expenses. Before the mechanism of “cultivating medicine by medicine” has not been completely changed, medical institutions can only compensate for the expenditures of hospital operations and equipment investment through the sale of high-priced medicines. However, until the government has found a practical solution for the reform of public medical institutions, it is only necessary to reduce the pressure on the rapid growth of medical expenses by lowering the prices of medicines. However, we must avoid shifting the pressure on medical insurance control costs to medical institutions and then transfer them to pharmaceutical companies, affecting the normal development of pharmaceutical companies.

Drug companies will "accelerate the fittest" process will accelerate. At present, there are more than 6,000 drug companies and more than 4,900 GMP production plants in the country. Under the environment where drug prices are lowered year by year, certain product lines will inevitably be too simple. Enterprises with low efficiency and gross margins will gradually be eliminated because they cannot make profits. We judge that the difference in drug prices will not be completely eliminated, but the price difference will be reduced, ultimately ensuring that drugs with good drug efficacy and high quality will have reasonable profit margins and encouraging quality enterprises to increase their enthusiasm for R&D investment. The survival of the fittest will improve the current status of small, scattered and chaotic enterprises in the industry.