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Pharmaceutical Pricing and Reimbursement in China - Series of Mandated Price Cuts Not Effective in Stemming Healthcare Expenditures
Date:2/7/2013

n and shift towards urbanization offer a large market for drug manufacturers, the market is tempered by the pricing and reimbursement system in China. Challenges faced by companies entering the Chinese pharmaceutical market include government price controls, extensive retail mark-ups, and wide regional variations in insurance.

Pharmaceutical price and pharmaceutical quantity are major factors contributing to healthcare expenditure. The control of retail prices alone is not effective in containing healthcare expenditures; it is also essential to prescribe efficient pharmaceutical utilization. Efficient pharmaceutical utilization is achieved by the use of appropriate reimbursement mechanisms, and a prospective payment system. This cost-driving reimbursement mechanism is incompatible with the goal of containing health-care costs. The reform of the reimbursement mechanism therefore plays a vital role in the changing incentives to the providers. The new reimbursement mechanism provides incentives to healthcare professionals, encouraging efficiency and cost savings when using all health resources, including drugs. The new reimbursement mechanism is an effective countermeasure for the Chinese healthcare system, which is plagued by over-prescription, abuse of quality technology services and cost shifting. A large part of the pharmaceutical market growth is propelled by the expansion of the public sector health insurance coverage, which also includes a greater reimbursement of drugs.

Scope - Detailed study of the healthcare scenario in the China

- Analysis of the pricing and reimbursement mechanisms in China

- Key changes that follow on from the implementation of new Healthcare Reform 2009 within the pricing and reimbursement system

- Details about government bodies which regulate different processes of pricing and reimbursement in China'/>"/>

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