China "Sticking To New Drug Price Plan"

The Chinese State Pharmaceutical Administration is sticking to its plansto introduce a new drug pricing system by year-end or shortly thereafter, according to Japan Chemical Week.

The administration has reportedly said that the official health insurance system, covering mainly employees of large companies, is in financial trouble, and that the market is being confused by foreign drugs. In addition to foreign drugmakers selling products at high prices, there have been complaints that increased kickbacks to hospitals have been disturbing the market order. As many as 2,000 doctors are rumored to have been arrested on suspicion of taking bribes from foreign drugmakers, the magazine reports.

The Chinese government was also said to be negotiating with the Pharmaceutical Research and Manufacturers of America, the Japanese Pharmaceutical Manufacturers Association and others on substantial drug price cuts. Chinese prices are now determined by market needs, but the authorities propose a system where they will be determined by adding a margin and marketing expenses onto production costs.