China is on its way to including more than 300 new and existing drugs to the list of medicines it will help patients pay for, reports Reuters. (For more, see Pfizer to Build $350M Biotech Center in China.)
The changes were much awaited, as this is the first major overhaul of the state sponsored drug list in last seven years. The expected additions to China's National Reimbursement Drug List (NRDL) will primarily include drugs to treat cancer, haemophilia, hepatitis, and kidney diseases.
Patients in China, which is the second-largest pharmaceutical market in the world, has been struggling with limited access to novel and necessary drugs, especially for cancer. In the absence of insurance coverage, patients and their caregivers often end up taking substantial loans for the costly treatments, or end up with unauthorized gray market therapies.
The NRDL was last updated in 2009 and currently includes around 200 drugs. Despite many new drugs being approved in China since then, patients were forced to bear the expenses of those drugs on their own.
Government Will Subsidize Expensive Drugs
Inclusion in NRDL will facilitate partial funding of the costly drugs by the Chinese government through its state insurance schemes, and the rebates can go up to 80%. (For more, see The 5 Biggest Chinese Insurance Companies.)
This will help the many patients in the world’s most populous nation get easy and affordable access to necessary drugs. Regulated and discounted access will also help the nation get away with illegal fakes, a global problem in the healthcare industry.
Global drug makers are expected to benefit from increased sales after years of declining sales in China.
Pharma Majors May See Sales Boost
Blockbuster drugs such as GlaxoSmithKline PLC’s (GSK) hepatitis B drug Viread, AstraZeneca PLC's (AZN) heart drug Brilinta, Shire PLC’s (SHPG) haemophilia therapy, and Sanofi AG's (SNY) chronic kidney disease drug Renvela are expected to be the top inclusions in China's National Reimbursement Drug List.
However, inclusion on the list may come at a cost. Often, drug manufacturers are required to offer steep discounts to be included on the coveted Chinese drug reimbursement list.
The price of GlaxoSmithKline’s Viread was slashed by two-thirds in May 2016. Still, most drug companies can expect to make up for any discounts by increased sales volume due to China's massive population. (For more, see China on a Record High International Healthcare Acquisition Spree.)