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While drug registration in China is easier today, market access is more challenging. Many foreign drug companies have seen their drug prices significantly reduced over the last few years. To succeed in China’s pharmaceutical market, it is crucial to understand the reimbursement dynamics discussed below.
One option to get reimbursed is to get your drug on China’s National Essential Medicine List (NEML). To do so, drugs must be reasonably priced, recommended by leading clinicians at top-tier Chinese hospitals, etc. The NEML includes pharmaceuticals that are needed for disease prevention. Most public Chinese hospitals are mandated to purchase a high percentage of their drugs from the NEML.
All drugs listed on China’s National Reimbursement Drug List (NRDL) receive reimbursement. All drugs listed on the NEML are fully reimbursed via the A list. Partially reimbursed drugs are on the B list. Please keep in mind that while the NRDL provides reimbursement, once one drug is on this list, other manufacturers of the same drug become eligible too. In addition, a price reduction is often needed to get on the NRDL. Therefore, some foreign companies are now deciding not to go on the NRDL.
In addition, Volume Based Procurement (VBP) is dramatically lowering the price of drugs in China. In VBP, companies trade off high-volume sales for reduced pricing. Normally, a drug with sales over 70 million USD is eligible for VBP. VBP has reduced the prices of some drugs in China by 50%-90%.
To maximize your drug’s market access in China, please contact us so we can provide the best market access strategy.
Written by: Ames Gross – President and Founder, Pacific Bridge Medical (PBM)
Mr. Gross founded PBM in 1988 and has helped hundreds of medical companies with regulatory and business development issues in Asia. He is recognized nationally and internationally as a leader in the Asian medical markets. Mr. Gross has a BA degree, Phi Beta Kappa, from the University of Pennsylvania and an MBA from Columbia University.