Chinese Premier Li Keqiang recently announced that China will cancel most of the drug price controls, so that the price will be determined by the market given – even though a specific timetable has not been determined. China may also make profit-margin regulations, and the price cap to ensure that the medicines available and affordable. This policy change is because China is working to strengthen the supervision and control of the pharmaceutical sector in order to improve the quality of drugs, increase transparency, and promote the development of domestic pharmaceutical companies. In addition, the government may soon allow the drug can be sold through online pharmacies. Drug consumption accounts for about 45% of China’s health spending in 2014.
The Chinese government also plans to reform the national drug distribution system, in order to reduce drug prices and reduce corruption. In the future, many hospitals may only buy drugs from the provincial drug procurement platform. In addition, the Chinese government has also suggested that many hospitals should be purchased directly from manufacturers, to minimize drug distributors in the process.
China’s pharmaceutical market is currently valued at about $100 billion, or the equivalent of about 30% of the US pharmaceutical market size. Chinese pharmaceutical market growth rate is nearly 15% per year.
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