New regulation to help drive down costs of expensive medical devices

China plans to drive down healthcare spending by making high-value medical devices more affordable, an official with the National Healthcare Security Administration said on Aug 1.

High-value medical consumables such as pacemakers, catheters and joint prosthesis are often overpriced and impose heavy medical expenses on Chinese people, said Li Tao, deputy director of the administration.

"The unreasonable pricing and overuse of high-value medical products really stand out as a thorny issue and a key factor in medical burdens, especially since progress has been made in the country's medical drug sector," she said.

According to a report released in 2017 by the local procuratorate in Guangzhou's Yuexiu district in Guangdong province, the price of a heart valve could be jacked up to more than 30,000 yuan ($4,350) from a few thousand yuan at the manufacturing site.

Hu Dayi, a physician at the Peking University People's Hospital, said in 2014 that in Europe, less than 40 percent of patients with cardiovascular diseases will receive heart valves. But in China, the rate is nearly 90 percent, Central China Television reported.

Li said the administration will first promote a nationwide registration system that assigns a category and a code to each type of high-value medical product.

"A lack of industry regulation on how to classify such a wide array of products has hampered effective supervision," Li said. "The registration system, which was launched in late June, will facilitate communication between medical device enterprises and healthcare institutions as well as government oversight."

She made the remarks while elaborating on a reform plan aimed at regulating high-value medical consumables. The plan was released by the State Council on July 31.

According to the plan, the longtime practice of price markups typically placed on high-value medical products at public hospitals will be abolished, and all products will be sold at procurement price as of the end of this year.

Hospitals are encouraged to unite together and then negotiate with manufacturers to further reduce prices, according to the plan.

Domestically made products are also expected to provide affordable alternatives to imported products, according to Jiang Deyuan, an official with the administration.

"We have expedited the approval process for innovative medical devices since 2014, and as of June, 64 domestic medical devices－including a few high-value innovations, such as a type of interventional heart valve－have gained market approval," he said.

He added that domestic high-value products are more competitive in terms of their prices and prove to be effective during clinical treatment.

Jiao Yahui, an official with the National Health Commission, said that according to the reform plan, the commission is compiling a list of high-value medical products with exorbitant prices and widespread applications.

"These selected products will receive the toughest inspections of their pricing system during a future campaign," she said.