OTC price coordination mechanism or will establish drug companies will encounter problems

The regional coordination mechanism for over-the-counter drug prices has been clarified in the new "Drug Price Management Approach" and related methods are currently being studied and formulated.

Non-prescription drugs do have their own particularities. They should be more relaxed in terms of price management and should be chosen by the market. However, at present, the local price departments do not have systematic and differentiated pricing methods and can only follow the unified national drug pricing management approach.

Recently, the National Development and Reform Commission is rechecking the cost of essential drugs to prepare for another price adjustment. At the same time, the price departments of various provinces and cities are successively conducting review of drug prices in the local medical insurance catalog. Among the drugs undergoing review, OTC also occupies a certain proportion, and the prices of OTC products will also be adjusted.

It is reported that the China Over-the-Counter Drug Association (OTC Association) recently held a communication meeting on drug price issues in Beijing. More than 30 representatives from 17 companies including Xian Janssen Pharmaceutical Co., Ltd., Beijing Novartis Pharmaceutical Co., Ltd., and Bayer Health Care Co., Ltd. attended the event. Meeting.

The director of the Drug Price Committee of the Association’s Policy and Regulations Working Group and Director Qian Yun of Xi'an Janssen Pharmaceutical Co., Ltd. pointed out that the price review of local medical insurance catalogs, price adjustment of essential medicines, pricing of non-medical insurance catalogs (recording), and regional coordination mechanisms for non-prescription drug prices are all correct. OTC companies have no small influence.

These ongoing policies are all aimed at price adjustment services. According to the reporter's understanding, many OTC products have already cut their prices in the tendering process after entering the local medical insurance catalog. If the prices are adjusted again, companies will be hard to bear.

Guo Fanli, a research fellow in the pharmaceutical industry at China Investment Advisors, said that because over-the-counter drugs are in a highly competitive market and have experienced a long period of time, their price cuts are small. Of course, this also requires looking at the specific species, and some new entry species will also have some room for downward adjustment. However, overall, OTC products have limited room for price cuts.

Guo Jianying, Director of Pharmaceutical Price Division of the Price Development Department of the National Development and Reform Commission, suggested that non-prescription drugs do have their particularity and should be more relaxed in terms of price management and should be chosen by the market. However, at present, the local price departments do not have systematic and differentiated pricing methods and can only follow the country. Unified drug pricing management approach.

Corporate problems

Since the National Development and Reform Commission initiated the price review of essential drugs and local medical insurance catalogs, many OTC pharmaceutical companies have faced a new wave of price cuts. According to the participating companies, various provinces and cities have different procedural and methodological differences in conducting cost review. In some places, companies require more materials to provide enterprises with difficulties.

According to Guo Jianying, the price management authority for over-the-counter drugs has been delegated to various provinces and cities. It is reasonable and reasonable for local governments to adjust their prices. The method of formulating prices through cost review has also been insisted by the National Development and Reform Commission. In response to the problems faced by enterprises, the Price Division of the National Development and Reform Commission will convene a price review meeting as soon as possible to unify ideas and study related issues.

In addition, the new "Drug Price Management Measures" also adjusted the pricing management of OTC products. Many companies suggested that OTC's pricing power should not be decentralized. Industry insiders also pointed out that from the perspective of future development trends, OTC's price management will not be tighter. Therefore, the complete pricing by the country does not necessarily solve all problems.

Guo Jianying said that the regional coordination mechanism for non-prescription drug prices has been clarified in the new "Measures for the Administration of Drug Price," and the authority for coordination belongs to the National Development and Reform Commission. Currently, relevant methods are under research and formulation. Enterprises can also reflect opinions in this regard.

Guo Fanli pointed out that the regional coordinating mechanism for over-the-counter drug prices refers to controlling drug price differences that may occur due to the decentralization of non-prescription drug pricing, and the resultant phenomenon of stock-taking. Such a regional coordination mechanism can use, for example, the method of controlling the price difference of drug sales to ensure uniform prices.

Hospital pharmacy uniform

According to the introduction of a foreign-invested OTC director, foreign companies can accept price cuts of only about 20% to 30%. Recently, the industry has been rumored that the NDRC will reduce the price of essential drugs by 30% to 40%.

Guo Jianying pointed out that it is necessary to adjust the prices of essential drugs at this stage, including some drugs that are priced separately or with higher prices and better quality, and also include non-prescription drugs. Although these drugs cannot participate in the national essential drug bidding because of price, the price adjustment is a requirement of the country's overall drug price work. At the same time, it should be clarified that the price adjustment is not the same as the price reduction. It is based on cost review to formulate a reasonable price and the price reduction of 30% to 40% is not accurate.

Since OTC drugs are sold in pharmacies and hospitals, their price management is not uniform. In order to maintain the unity of prices and protect the interests of the people, some localities use the hospital bidding price to increase the retail price by 15%, and require the hospitals and retail pharmacies in the city to sell at a uniform price.

Guo Fanli pointed out that for pharmacies, OTC products are the main source of profits, and under the promotion of the new medical reform, the hospital has cancelled the 15% increase in drugs and has a relatively complete reimbursement rate. This results in more people. Willing to choose to buy drugs in the hospital, which has an impact on the pharmacy OTC drug sales.

Guo Jianying pointed out that the main bodies, varieties and methods of retail pharmacies are very different from those of non-profit hospitals. Such a pricing method is not very reasonable and will also affect the survival and development of drug retailers. The National Development and Reform Commission's Price Division will keep abreast of the situation and provide guidance.