echemi logo
Product
  • Product
  • Supplier
  • Inquiry
    Home > Active Ingredient News > Drugs Articles > Foreign brand refers to monopoly of high price and moisture in Chinese medical device Market

    Foreign brand refers to monopoly of high price and moisture in Chinese medical device Market

    • Last Update: 2013-08-07
    • Source: Internet
    • Author: User
    Search more information of high quality chemicals, good prices and reliable suppliers, visit www.echemi.com
    2013-08-07 source: Oriental Morning Post last week, Shanghai high people's Court (Shanghai High Court) made a final judgment, Johnson & Johnson (Shanghai) medical equipment Co., Ltd and Johnson & Johnson (China) medical equipment Co., Ltd restricted the "minimum resale price" to form a "vertical monopoly", and was awarded compensation to dealers Beijing ruibangyong and science and Trade Co., Ltd (Ruibang) 53 Ten thousand yuan Since the fifth anniversary of the promulgation of the antimonopoly law, this case is the first effective judgment of the antitrust case in which the plaintiff wins the lawsuit After GlaxoSmithKline case revealed the phenomenon of false high drug price, Johnson & Johnson case caused the attention of the outside world to the monopoly high price of foreign brand medical devices Foreign brands account for seven components, ranging from diagnosis and treatment equipment to heart stents An industry recognized judgment in the medical device market is that the share of "domestic products" and "foreign products" is 37% According to the statistics of China Chamber of Commerce for the import and export of medical and health care products, in 2012, China's total medical device imports amounted to US $12.472 billion, an increase of 14.56% over 2011 The data reflects the reality that for patients, doctors are willing to recommend "foreign brands" for installing artificial joints, heart stents, etc., and the price is naturally much higher; for an examination, the color Doppler ultrasound, nuclear magnetic examination equipment, biochemical analyzer, etc are basically "made in foreign countries", and the examination fee is often hundreds of thousands "In Shanghai, at present, in the field of orthopaedic implants and cardiac implants, multinational companies occupy the majority of the products, and the price is about 50% higher than that of local enterprises." Yao Zhixiu, honorary director of the surgical implants Professional Committee of China Medical Device Industry Association, said In such "high price", in addition to performance factors, is there and how much "moisture"? "A 75 year old friend had a traffic accident The hospital had to install an artificial joint of 70000 yuan, or transfer." After he had to be transferred to another hospital, he spent only 40000 yuan on the same type of joint, an insider said "It's like if you want to buy a car, you only need Volvo, but the other side doesn't want you to buy Ferrari." Yao Zhixiu also told a reporter about the experience of a friend: an old lady in Hong Kong who had an operation in a hospital in the mainland and installed an artificial joint Although the operation cost was cheap, the material cost of the operation was refused to be reimbursed after she returned to Hong Kong, for the reason that it was more than twice the price in Hong Kong About 20% of the court staff involved in the trial of Johnson & Johnson case said that Ruibang was a distributor of medical devices such as Johnson & Johnson Medical suture and stapler However, in the distribution contract between the two parties in 2008, Johnson and Johnson agreed that Ruibang shall not sell the products at a price lower than the specified price When it was found that Ruibang had "violated the regulations and privately sold the products at a low price", Johnson and Johnson cancelled its distribution right in some hospitals and finally stopped supplying the products It is generally difficult to identify the vertical monopoly involving resale price This time, Shanghai high court takes the following four aspects as the most critical consideration: whether the relevant market competition is sufficient, whether the defendant's market position is strong, the defendant's motivation to limit the minimum resale price, and the competitive effect of limiting the minimum resale price According to Shanghai Academy of high technology, Johnson & Johnson has a strong market position in the medical suture market where the competition is not sufficient It restricts the behavior of the lowest resale price, crowding out the efficient dealers, not only excluding the price competition within the brand, but also hindering the price competition among the brands "This kind of behavior of restricting resale price of dealers leads to artificially high product price." Gong Jiong, a professor at the University of foreign economic relations and trade, said Monopoly, of course, is the result of the pursuit of high profits However, industry insiders revealed that some enterprises set high prices in order to digest the "cost" of commercial bribery behind them A former general manager of a medical device joint venture said that the product has high pricing, hospitals, departments and medical personnel have also received high kickbacks, the enthusiasm of recommending products is great, and the sales volume can be guaranteed Yao Zhixiu, for example, said that the proportion of rebates is almost the same, but the unit price of imported products is high, and the rebates are naturally more generous If the price of an imported artificial joint is 30000 yuan, its rebate may be 67000 yuan; if the price of a domestic artificial joint is 15000 yuan, then the rebate is only about 3000 yuan This phenomenon can be seen from the cases exposed in recent years: an American brand color blood flow imaging system is sold to the hospital at a price of 980000 yuan, and the rebate given to the president is 100000 yuan; a Korean made 3D multi-functional color Doppler ultrasound diagnostic instrument is sold to the hospital at a price of more than 1600000 yuan, and the "benefit fee" given to the president is 30 yuan The market price of a joint venture heart fixator is 20000 yuan, and the doctor's rebate is 3800 yuan Regulatory "loopholes" for upstream mandatory "low price limit", downstream dealers are often only "helpless to accept" Hao Junbo, an anti-monopoly lawyer, said that the difficulty of investigating and handling such monopoly cases lies in that although downstream enterprises are also victims of such monopoly agreements, they may not dare to "fight" under the pressure of upstream enterprises and can only passively accept the lowest resale price In addition, there are regulatory "loopholes" in procurement, pricing and other links, which have a large "operable space", leading to a cluster of interest chains in the field of medical devices "Some local medical equipment prices are reported by enterprises to the industry association and then to the price bureau for filing The industry association will not change the prices at will, which eventually leads to a great knowledge of who to use and how much money to set, and medical equipment has become a new rent-seeking direction." A medical device vendor said From April 2011 to may 2012, the Yunlong District Procuratorate of Xuzhou City, Jiangsu Province, investigated and dealt with 9 corruption cases involving 14 people in the field of medical device procurement, involving more than 4 million yuan Relevant experts believe that relevant departments should improve the pricing and purchasing system and standards of medical devices, speed up the breaking of the pattern of "medical care with drugs", strengthen supervision and eliminate the space for rent-seeking  
    This article is an English version of an article which is originally in the Chinese language on echemi.com and is provided for information purposes only. This website makes no representation or warranty of any kind, either expressed or implied, as to the accuracy, completeness ownership or reliability of the article or any translations thereof. If you have any concerns or complaints relating to the article, please send an email, providing a detailed description of the concern or complaint, to service@echemi.com. A staff member will contact you within 5 working days. Once verified, infringing content will be removed immediately.

    Contact Us

    The source of this page with content of products and services is from Internet, which doesn't represent ECHEMI's opinion. If you have any queries, please write to service@echemi.com. It will be replied within 5 days.

    Moreover, if you find any instances of plagiarism from the page, please send email to service@echemi.com with relevant evidence.