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It is considered difficult and expensive to see a doctor in China. One of the main reasons is due to the "expensive price of drugs". The problem is not owing to insufficient medical supply; rather, patients have trouble paying the expensive fees associated with healthcare. To solve the problem, the National Development and Reform Commission had reduced the prices of various medications over 20 times over the past decade. However, these actions have largely been in vain.
Drug producers and hospitals are playing a cat and mouse game with the government. Whenever price cuts are announced, the drugs with mandated lower prices rapidly disappear from both doctors' prescriptions and drug stores. Hospitals usually look for substitutes for the same type of drug to maintain profit. Producers fine-tune the ingredients in many drugs so that the chemical name of the medication is changed, thus avoiding the regulated price reduction. No company would willingly produce huge amounts of medicine at a high quality but lower price because the sales volume of the expensive medicine is more profitable.
The current drug pricing principle focuses on the relation between the real costs of the manufacturer and the supply and needs of the market. Government officials indicated that various factors including the clinical value of the medicine, the degree of innovation, manufacture and operating costs, market supply and need and international comparison, etc., will be considered in the pricing system. There will be different regulations applied to new and generic drugs.
The Chinese government has enforced government pricing to drugs listed in medical insurance reimbursement systems, some monopolies and special drugs. It is said that in 2007, the government will reinforce the supervision of the real cost of drugs, improve methods of drug pricing, and expand the scope of drugs with government mandated prices. It is possible that all prescription drugs will be involved in the government pricing system. However, disputes still surround this issue. Many believe that the duties of the government and the market must first be clarified in the pricing mechanism.
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