Bulk drug buys make healthcare affordable

The national drug bulk-buy program initiated in late 2018 is estimated to have saved patients 106 billion yuan ($16.6 billion) by the end of last year, and the country is planning to implement the system on a regular basis, officials said on Jan 29.

After three rounds of price negotiations with drug manufacturers and centralized procurement campaigns, 112 types of drugs were selected and their prices fell by an average of 54 percent, said Chen Jinfu, deputy head of the National Healthcare Security Administration.

"The average price of these drugs used to be two to three times higher than global levels. Now, it has dropped to roughly the same level," Chen told a news conference.

In addition to the nationwide program, local authorities have launched 20 rounds of provincial-level bulk-buy programs, covering nearly 260 types of medications. Regional combined procurements are expected to yield savings of 24 billion yuan a year, he added.

According to a circular released this month by the State Council, the country's Cabinet, the drug bulk-buy program will become a regular and institutionalized practice to help lower medical costs for the general public.

Chen said a fourth round of drug procurements is underway, with the move projected to lead to price cuts in May.

"The long-term goal is to gradually cover a wider range of medications through national channels. Local authorities will be guided to target more high-demand and costly drugs as an additional boost to driving down pharmaceutical prices," he said.

To ensure the program brings concrete benefits to the public, officials said more incentives will be rolled out to encourage medical workers to prescribe selected drugs on a priority basis.

Wang Xuetao, an official at the National Health Commission's department of drug policy and essential medicine, said that medical institutions are being encouraged to regularly and appropriately upgrade their budgetary systems to make use of amounts saved through the bulk-buy program.

To make sure patients benefit from the new measures, he said, the use of selected drugs with price cuts will be taken into account when appraising the performance of hospital heads.

Chen said a certain amount of the 100 billion yuan-plus savings has been reserved for medical institutions to allow them to increase incomes of health workers.

"Some hospitals in Beijing have given more than 1 million yuan to medical workers as an incentive to choose centrally procured drugs for patients," he said.

The outcome of these incentives is evident as the use of drugs made by successful bidders has increased exponentially, Chen said.

"The demand spike shows that the program has already expanded public access to medications," he added.