Public Disclosure Research Paper
Public Disclosure Authorized
Public Disclosure Authorized
Public Disclosure Authorized
Public Disclosure Authorized
58410 V2
@hotmi
© 2010
The International Bank for Reconstruction and Development / The World Bank
1818 H Street, NW
Washington DC 20433 USA
Tel. + (202) 473-1000
Internet: www.worldbank.org
China Health Policy Notes
China Health Policy Notes is a series of occasional papers on lessons and experiences from
China’s ongoing healthcare reform. The series is published by the World Bank in collaboration with the Government of China. The papers track and analyze the reform process, and evaluate early results. Each paper focuses on a key challenge that is central to success. The papers are written from …show more content…
For example, the cost-plus markup in China is in the 60 to 70 percent range (including VAT), compared with ranges of about 10 to 20 percent for the United States, and about 20 to 25 percent for Japan.
vii
China Health Policy Notes, No. 1
While pharmaceutical cost containment has mostly focused on government-directed price control, other approaches are increasingly being explored. Many new policy levers are being considered and tested—for example, reforming the payment system from fee-forservice to global budget control, implementing a capitation system in ambulatory services, and using disease-related groups (DRG) payment in inpatient departments.
In 2006, the State Development and Reform Commission (SDRC) announced measures to consolidate markets for pharmaceuticals and medical services. These included increasingly sophisticated (and transparent) price-setting methodologies. The practice of creating ―new drugs‖ to avoid price regulation was banned, and specific incentives aimed to expand the production and use of lower-priced generic drugs. At the same time, more latitude …show more content…
The Sinopharm network sells drugs in about 7,800 hospitals and in 2,000 shops of its own, and its 3,000 distributors provide drugs to another 8,200 pharmacies. Sinopharm alone has sales of over RMB 50 billion.
Domestic market: Domestic manufacturers (traditional medicines), imports, and joint ventures
Hu (1996) studied pharmaceutical sales for domestic manufacturers, joint ventures, and importers in Shanghai. In 1992 drugs manufactured domestically (including those producing chemical generic drugs as well as traditional Chinese medicines) accounted for 46 percent of the market, followed by 36.4 percent for imports and 17.6 percent for joint venture products
(Table 2). In 1993–94, the drug reimbursement list and a policy on hospital revenue-capping were introduced. As a result, by 1996 traditional Chinese medicines declined to 39 percent of the market, measured by the value of drugs sold; imports dropped to 28 percent and joint venture products rose to 32 percent. [8] The pharmaceutical value accounted for by Western chemical drugs rose from 54 percent of the market in 1992 to nearly 61 percent by 1996.
Table 2. Category of Pharmaceutical Products by value of Sale and by Year,
Shanghai (in percent)
1992
Public Disclosure Authorized
Public Disclosure Authorized
Public Disclosure Authorized
58410 V2
@hotmi
© 2010
The International Bank for Reconstruction and Development / The World Bank
1818 H Street, NW
Washington DC 20433 USA
Tel. + (202) 473-1000
Internet: www.worldbank.org
China Health Policy Notes
China Health Policy Notes is a series of occasional papers on lessons and experiences from
China’s ongoing healthcare reform. The series is published by the World Bank in collaboration with the Government of China. The papers track and analyze the reform process, and evaluate early results. Each paper focuses on a key challenge that is central to success. The papers are written from …show more content…
For example, the cost-plus markup in China is in the 60 to 70 percent range (including VAT), compared with ranges of about 10 to 20 percent for the United States, and about 20 to 25 percent for Japan.
vii
China Health Policy Notes, No. 1
While pharmaceutical cost containment has mostly focused on government-directed price control, other approaches are increasingly being explored. Many new policy levers are being considered and tested—for example, reforming the payment system from fee-forservice to global budget control, implementing a capitation system in ambulatory services, and using disease-related groups (DRG) payment in inpatient departments.
In 2006, the State Development and Reform Commission (SDRC) announced measures to consolidate markets for pharmaceuticals and medical services. These included increasingly sophisticated (and transparent) price-setting methodologies. The practice of creating ―new drugs‖ to avoid price regulation was banned, and specific incentives aimed to expand the production and use of lower-priced generic drugs. At the same time, more latitude …show more content…
The Sinopharm network sells drugs in about 7,800 hospitals and in 2,000 shops of its own, and its 3,000 distributors provide drugs to another 8,200 pharmacies. Sinopharm alone has sales of over RMB 50 billion.
Domestic market: Domestic manufacturers (traditional medicines), imports, and joint ventures
Hu (1996) studied pharmaceutical sales for domestic manufacturers, joint ventures, and importers in Shanghai. In 1992 drugs manufactured domestically (including those producing chemical generic drugs as well as traditional Chinese medicines) accounted for 46 percent of the market, followed by 36.4 percent for imports and 17.6 percent for joint venture products
(Table 2). In 1993–94, the drug reimbursement list and a policy on hospital revenue-capping were introduced. As a result, by 1996 traditional Chinese medicines declined to 39 percent of the market, measured by the value of drugs sold; imports dropped to 28 percent and joint venture products rose to 32 percent. [8] The pharmaceutical value accounted for by Western chemical drugs rose from 54 percent of the market in 1992 to nearly 61 percent by 1996.
Table 2. Category of Pharmaceutical Products by value of Sale and by Year,
Shanghai (in percent)
1992