What is a price cutting tool? What is the effect of price for quantity? Collection and negotiation of anticancer drugs

Source: pharmaceutical economic news may 17, 2018 recently, China's initiatives to benefit people's livelihood in the field of anti-cancer drugs have been released one after another First, during the two sessions, the premier made a commitment at the press conference to "strive to reduce the import tax rate of anti-cancer drugs to zero"; just over 20 days later, the executive meeting of the State Council decided to implement zero tariff on imported anti-cancer drugs and encourage the import of innovative drugs Since then, the State Food and Drug Administration and the Ministry of finance have responded positively and implemented the policies of tariff adjustment, import customs clearance facilitation, value-added tax adjustment in the form of official documents The national health and health commission later made it clear that, on the basis of zero tariff for imported drugs, the government should focus on price negotiation and purchase for the anti-cancer drugs that have been included in the medical insurance, and implement the medical insurance access negotiation for the anti-cancer drugs that have not been included in the medical insurance Through the joint efforts of all links in the industrial chain, the above comprehensive measures promote the public's accessibility and affordability of imported drugs, especially anti-cancer drugs, which is another practical and effective implementation and implementation of the purpose of China's medical reform According to the data of the 2017 China cancer registration annual report released recently by the National Cancer Center, China has 4.29 million new cancer cases every year, accounting for 20% of the world's new cases, and 2.81 million cancer deaths, equivalent to 12000 new cancer cases and 7700 cancer deaths per day on average Cancer prevention and treatment is not optimistic The main medical methods of cancer treatment are surgical treatment, radiotherapy and chemotherapy, and targeted drug treatment Among them, the most expensive are imported chemotherapy drugs and targeted drug treatment costs Such drugs are expensive If they are not covered by the medical insurance reimbursement, patients bear a heavy burden at their own expense The high incidence of cancer and the high price of anticancer drugs have become the main driving force of poverty caused by disease in today's society, and also the pain point of medical reform which needs to be reformed for a long time Analysis of tax reduction policy: how much the influence of price reduction knows about zero tariff of imported drugs, involving category expansion On April 23, the Tariff Commission of the State Council issued the announcement [2018] No 2 of the Tax Commission, which made it clear that since May 1, 2018, the import tariff of all general drugs including anticancer drugs, alkaloid drugs with anticancer effect and Chinese patent drugs with actual import will be reduced to zero in the way of provisional tax rate In this announcement, the import tariff of 28 drugs was adjusted and cancelled, and the drug categories covered by the zero tariff policy at the landing level were significantly expanded, basically covering the commonly used imported chemotherapy drugs, targeted drugs, biopharmaceuticals, etc for cancer patients, and even the common ampicillin, cooling oil, etc were also included in the tariff adjustment In a word, tariff, as a fixed cost of imported drugs, has been removed The policy not only reduces the burden of drug cost of patients, especially cancer patients, but also gives patients more choices of drug use "Superposition and slimming", VAT rate reduced On April 27, the Ministry of finance, together with the General Administration of customs, the State Administration of Taxation and the State Drug Administration, issued the notice on value added tax policies for anticancer drugs, which made it clear that from May 1, the general VAT payers who produce, sell, wholesale and retail anticancer drugs can choose the simple method to calculate and pay value-added tax according to the 3% collection rate, and the above-mentioned taxpayers choose the simple method to calculate and pay value-added tax After that, it shall not be changed within 36 months The notice is attached with the list of the first batch of anticancer drugs, including 103 pharmaceutical preparations and 51 APIs 103 anti-cancer drug catalogues cover most of the imported anti-tumor drugs listed in China, including oxitinib and afatinib for lung cancer, lucotinib for myelofibrosis and malignant tumor, regotinib for liver cancer, ibotinib for leukemia and other anti-tumor targeting drugs, with specifications covering tablet, capsule, injection and other dosage forms As we all know, the value-added tax on imported drugs is generally about 17%, similar to the tariff, which is a fixed cost in the import process As tariff is an important part of the duty paid price of import value-added tax, the two measures of zero tariff and reduction of value-added tax rate can be described as "superposition and slimming" to significantly promote the tax burden of drug import, which will effectively improve the accessibility and universality of imported drugs The impact of tax reduction on price needs to be considered rationally The above two measures will undoubtedly reduce the cost of imported drugs, but whether the cost reduction will be immediately reflected in the terminal supply price remains to be tested The reasons are as follows: ① the imported anticancer drugs are typical high priced goods due to intellectual property rights, patent protection, etc., and the reduction of import tariff and value-added tax may not be particularly obvious compared with the high terminal supply price ② The formation mechanism of drug price is complex, and the influencing factors of drug price are various From the manufacturer to the terminal patient, the price of imported drugs consists of R & D cost, manufacturing cost, import tariff, drug value-added tax, profits of domestic pharmaceutical companies, etc Similar drugs will also have price differences due to exclusive, medical insurance, regional bidding and other factors ③ The simple method of VAT has limited influence General taxpayers of value-added tax, who produce, sell, wholesale and retail anticancer drugs, can choose to pay value-added tax at a simple rate of 3%, which is a flexible policy with limited impact on the terminal price The benefits are not only tax reduction, but also more important The acceleration of customs clearance process is more far-reaching Compared with the uncertain or yet to be tested effect of the above-mentioned price reduction, the acceleration of import drug process is undoubtedly a major benefit for the public to "no longer wait" On April 26, the State Food and Drug Administration issued the announcement on relevant matters of customs clearance and inspection of imported chemicals, which made adjustments on relevant matters of customs clearance and inspection of imported chemicals Imported chemical raw materials and preparations (excluding chemicals sold for the first time in China) will not be subject to compulsory inspection batch by batch when they are imported The drug regulatory authorities at the port location are handling import chemicals At the time of filing, the notice of port inspection of imported drugs will not be issued, and the port drug inspection institute will not conduct port inspection of imported chemicals For a long time, it is necessary for the process to wait for the drug test of imported drugs before they are put on the market after customs clearance On the one hand, the process of drug inspection in 40-60 days increases the operation cost of enterprise storage In addition, drug shortage often occurs during drug testing, which seriously affects the clinical supply Therefore, it is of great significance to improve the access of patients to imported drugs In the near future, the health care Commission announced that in addition to the tax regulation policy, it is planned to implement the government's centralized price negotiation and procurement of anti-cancer drugs that have been included in the medical insurance For the production of more than three enterprises, it is planned to carry out special centralized bidding; for the production of less than three enterprises, it is encouraged to form a unified national purchase price through negotiation, matchmaking and other ways; for the anti-cancer drugs not included in the medical insurance, it is necessary to carry out medical insurance access negotiation For 17 anticancer drugs negotiated by the state since 2016, due to the large decline in the early stage and the agreed period has not expired, the early negotiation price is still implemented From the past experience, compared with the above tax rate adjustment, centralized bidding and national negotiation are the real tools for drug price reduction The first batch of 103 anticancer drugs issued by the Ministry of finance are taken as an example, which covers most of the anti-tumor drugs listed in China The author found that 53 of the 103 varieties are more than 3 production enterprises, and all of them have entered the national medical insurance Table 1 shows the varieties with terminal sales exceeding 1 billion among 53 varieties Due to the large amount of clinical use and the relatively large occupation of medical insurance funds, the author predicts that the special bidding for anticancer drugs may be faced first Due to the fact that the health care Commission has not yet published the bidding rules, it is uncertain whether the original research and imitation system can distinguish the quality level However, it is more clear that under the premise of focusing on the affordability of patients, the price of products will go down and be lower than the current national minimum price Among the 103 varieties mentioned above, there are 35 exclusive varieties, including 6 new anti-cancer varieties approved by CFDA in 2017 (see Table 2) It is expected that these varieties will enter the medical insurance through national negotiation and price for quantity Thirdly, among the 35 exclusive varieties, there are 14 anticancer varieties negotiated by the previous two groups of countries From the previous data, most of the negotiated varieties have a rapid growth rate, and the effect of price for quantity is obvious It is expected that the short-term price will be maintained (see Table 3) Conclusion: To sum up, in the near future, all departments have made sustained efforts in the distribution and payment of anti-cancer drugs, aiming to reduce the price of drugs and improve the accessibility of drugs It is a firm signal of the government's efforts to benefit the people and eliminate poverty caused by illness, which is in line with the goals and aims of healthy China and medical reform The entry threshold of imported drugs will be lowered, which will intensify competition in the domestic pharmaceutical market in the short term In the long run, it will accelerate the supply side reform of the domestic pharmaceutical industry and encourage local innovation, which is of great significance for the pharmaceutical market to be clear and healthy, and is in line with the trend and direction of industrial evolution