Adhere to not cut prices, foreign drugs go to the grassroots like a cloud

Business News Agency January 18th Among the 688 varieties of the current Shanghai Essential Drugs Catalog, the vast majority of foreign-funded pharmaceutical products will withdraw from basic drug bidding because of price issues, and will also withdraw from Shanghai's primary medical institutions. On the 12th, Deputy Director of the Pharmaceutical Market Development Committee of the Chinese Foreign Drug Development and Development Industry Committee (hereinafter referred to as RDPAC) stated that RDPAC is a non-profit organization composed of 37 multinational pharmaceutical companies.

A person in charge of a foreign pharmaceutical company confirmed that “Although the generic name of our drugs is in this list, our prices are much higher than those of generic drugs, and are higher than the national maximum price for essential drugs. We will not Go to participate in basic drug bidding."

As a spokesperson for foreign pharmaceutical companies, RDPAC is concerned that after omitting the primary medical market, multinational pharmaceutical companies will lose at least 15% of the market share in the Shanghai market. However, according to a person in charge of the Shanghai Pharmaceutical Association, this is in line with the original intention of the state to implement a basic medicine system. "Basic medicine is about accessibility, and low prices are what it should be."

Missed the essential drug market

On December 13, 2010, Shanghai released a supplement to the list of basic medicines, which is a list of basic medicines supplemented by the province's own 307 varieties of basic medicines and based on its own economic level.

In addition to 307 varieties, Shanghai's catalog has added 381 varieties, totalling 688 essential medicines. Among the RDPAC member companies, there are 133 basic drugs, including the original 71 varieties and 62 additional varieties.

"Although their generic name entered the catalog, prices have no advantage over generic drugs." Yan pointed out that out of the original 71 products, only 4 products are eligible to participate in the bid, and all other products will exit. . Of the 62 varieties added later, the vast majority of foreign pharmaceutical companies will also exit the market.

For example, taking the French medicine company Sanofi-Aventis anti-thrombotic drug Polivi as an example, its generic name is clopidogrel bisulfate tablets and entered the catalog. However, there are also generic drugs in China. Therefore, Polivia must first meet the country's ceiling price requirements for essential drugs before they are eligible to participate in the bidding for essential drugs. Finally, it is often a lower-priced variety that will enter the market. Polivi is basically hard to enter. Basic medicines directory.

The price of ice

So, why are foreign pharmaceutical companies unwilling to enter the list of essential drugs through price cuts?

The reason for RDPAC is that the original research pharmaceutical company is stricter in terms of GMP certification and quality assurance. If a number of companies’ products are successively significantly reduced in price in a short period of time, companies will be in chaos in all aspects of arranging production, recruitment, and marketing. They called for the establishment of a quality-centric price adjustment system and ensured policy stability.

However, the domestic pharmaceutical companies obviously do not think so. "If there is a difference of more than ten times or even several times, will there be such a big difference in quality?” asked the person in charge of a domestic pharmaceutical company.

Ciprofloxacin injection is taken as an example. The product name of Bayer Pharmaceuticals in Germany is “Sipuole”. The individual price of 200mg/100ml is 84.60 yuan, and that of domestic ciprofloxacin injection is 4.50 yuan per bottle, the difference is 1880%. . Domestic companies that produce this product include Chongqing Tiansheng Pharmaceutical and Zhejiang Pharmaceutical.

Statistics show that the overall profits of domestic drugs are basically 7% to 8%, while foreign drugs are generally 30% to 40%, and the profit rate of high-priced drugs is even higher.

In this regard, Song Ruilin, executive president of the China Pharmaceutical Industry Research and Development Promotion Association, pointed out that the reason is very complicated: the quality standards for foreign drug quality are higher than domestic standards; foreign companies have a unified pricing system in the world and generally do not set separate prices for the Chinese market.

"For foreign companies, drug prices are difficult to shake." Insiders pointed out that prior to the Development and Reform Commission on the original research drug prices, foreign drugs for the first time encountered government price cuts.

At the end of 2010, for the first time, the National Development and Reform Commission pointed to “price cuts and swords” to foreign-funded pharmaceutical companies: In the announcement of the reduced retail price of the 48 generic names and 174 items of individually priced drugs, foreign-invested inventories accounted for nearly 62% of the average. The price cut was 19%. So far, only those who choose to take the initiative to cut prices to exchange for prices are Merck.

In January 2010, Hangzhou Merck East Pharmaceutical Co., Ltd. took the initiative to reduce the price of its star product, “Shujiangzhi” (common name: simvastatin). The price of the 20-mg 7-pack was adjusted to 25 yuan; the 40-mg 5-pack was adjusted to 30.70 yuan. Compared to the stipulated ceiling price of the NDRC, the reduction is more than 50%. The price after the downward adjustment is lower than that of the domestic sample of simvastatin produced by Zhejiang Jingxin Pharmaceutical Co., Ltd. with a sample price of RMB 27.

However, the general manager of a foreign pharmaceutical company bluntly stated that “The price reduction of Shujiang is a special case. The reason why it is willing to cut prices to enter the primary medical market is because its share in the high-end and tertiary hospital market is squeezed by other brand drugs. Therefore, the price reduction is not a rule. We can't follow the behavior."

He told reporters that most of the major market shares of transnational pharmaceutical companies are still in tertiary and tertiary hospitals. If prices are reduced to enter the primary medical market, sales in secondary and tertiary hospitals will fall drastically, even more than in primary medical institutions. Get new shares. Therefore, foreign pharmaceutical companies will not be willing to take the initiative to cut prices.

Government attitude

According to the data from the Southern Medicine Economic Research Institute (South) of the State Drug Administration, in the first half of 2010, 14 seats in the top 20 sample hospitals were occupied by foreign companies, with an average increase of 32.7%, which together accounted for 21.1% of the market. In tertiary hospitals, the market share of foreign drugs and imported drugs exceeds half.

A person in charge of the Shanghai Pharmaceutical Industry Association stated that at present, this situation is in line with Shanghai's initial thinking on formulating a list of medical reform programs and basic drug supplements. “They hope that the high-priced hospitals in the Jinda Hospital will sell at low prices. Large quantities enter the sales of basic-level medical institutions.” As the most basic first-line medication, the basic drugs have a high degree of homogeneity and prices are relatively low, and they are positioned in the low-end market.

The state stipulates that basic drugs will be included in the basic medical insurance payment coverage, and the reimbursement rate is significantly higher than non-essential drugs. The source pointed out that if too many high-priced drugs are selected, it will surely cause government financial pressure to pay. In fact, the zero rate of essential medicines has already made tight local financial subsidies. "In the premise of quality assurance, generic drugs with lower domestic prices are more likely to win the bid for essential drugs."

He believes that most of the drugs of multinational corporations will miss the basic drug market in the future. “For patients, a direct effect is that some foreign drugs that can be prescribed in community hospitals must be allocated to the second and third-tier hospitals. This also violates the original intention of medical reform to divert patients to community hospitals."

A person in charge of a foreign-funded pharmaceutical company stated that the price of the company's related drugs is much higher than that of domestic generic drugs, and it is also higher than the state's ceiling price for essential drugs, and the company chose to withdraw from the primary medical institutions.

In the first half of this year, the basic medicine list system in Shanghai will be formally implemented, and 688 essential medicines entering the city's community health service center will all be subject to a “zero margin” and all will be open tendered. If multinational pharmaceutical companies cannot participate in bidding for essential medicines, they will simply give away the primary medical market and lose a lot. “How much of this specific market is, we will initially lose at least 15% of the market share in Shanghai,” he said.