Centralized purchase reducing burden on patients

Pharmacists dispense drugs at a hospital in Huzhou, Zhejiang province, in August. (YI FAN/FOR CHINA DAILY)

China has rolled out nine rounds of bulk-buy programs for medicines and four rounds targeting high-value medical consumables, in a bid to ease the financial burden faced by patients, according to the National Healthcare Security Administration.

The nation began central procurement programs where drugmakers cut prices and bid for large-volume contracts with public hospitals in 2018.

So far, these programs have involved 374 types of drugs that have seen an average price cut of over 50 percent, as well as several kinds of medical equipment including heart stents, artificial joints, intraocular lenses and orthopedic supplies.

Yan Qinghui, deputy director of the administration, said during a news conference in September that bulk-buy programs have alleviated the financial burden of patients and boosted access to high-quality medicines.

"Antiviral drugs for hepatitis B, including entecavir and tenofovir, used to incur an annual cost of up to 4,000 yuan ($552) to 5,000 yuan on patients, but their annual expenses have fallen to around 100 yuan to 200 yuan following the bulk buy," he said.

Thanks to significant price reductions for insulin, Yan said that the usage share of the more advanced third-generation of the drug has grown from 58 percent to over 70 percent.

Yan added that the program has also promoted the health and high-quality development of the pharmaceutical sector.

"In the past, pharmaceutical enterprises focused more on marketing and competing for sales channels, but less on product quality and research and development," he said. "The bulk-buy program has provided a transparent platform for fair competition and enabled good products to quickly enter the market."

Yan said that the price cut seen for coronary stents and some medicines is made possible by reducing distribution costs, thus resulting in only a minor impact on the business profits of drugmakers.

"Cost savings can be used to spur innovation and more companies can shift their focus onto improving quality, scaling up production and advancing innovation," he said.

Yan said that the program has helped restore the public welfare nature of public hospitals and raised the legitimate income of medical workers.

"Central procurement has severed the gray profit chain in the flow of medicines and consumables and led to more standardized prescription practices among medical workers," he said.

For example, Yan said that the use intensity score of antibiotics — a medication inclined to be abused or overused — had decreased from 2018 to 2022.

Yan added that a certain amount of insurance funds saved through centralized procurement will be allocated to medical institutions, who can use them to increase the incomes of their personnel.

"Some regions have already rolled out trials to reform fee structures of pharmaceutical services to better reflect the value of physicians and pharmacists," he said.

Yan said that the administration is planning more bulk-buy programs and will include cochlear implants in the next round.

"Local authorities will also be guided to band together to roll out the bulk purchase of traditional Chinese medicine products, TCM herbal ingredients and in vitro diagnostic reagents," he said.