China’s State Council Makes Major Latest Deployment for Volume-Based Procurement!

On January 10, the executive meeting of the State Council decided to normalize and institutionalize the centralized procurement of drugs and high-value medical consumables, so as to further reduce the medical burden of patients.

The meeting pointed out that the first is to focus on chronic diseases and common diseases, continue to promote the centralized purchase of drugs at the national level, and carry out provincial or inter provincial alliance purchase of drugs outside the national centralized purchase. By the end of this year, the national and provincial centralized procurement of drugs will reach more than 350 in each province.

Second, gradually expand the coverage of centralized procurement of high-value medical consumables, and carry out centralized procurement of orthopaedic consumables, drug balloons and dental implants concerned by patients at the national and provincial levels respectively. Third, ensure the long-term and stable supply of selected drugs and consumables, and ensure that the prices of selected products do not degrade. Medical institutions should give reasonable priority to the use of the selected products.

From November 2018 to now, China has carried out six batches and seven rounds of national centralized drug procurement, the implementation scope has been expanded from 11 cities to the whole country, and the procurement content has been expanded from oral dosage forms to injection forms, and from chemical drugs to biological drugs. The variety, quantity and degree of competition are constantly making breakthroughs. In addition, in terms of high-value medical consumables, coronary stents and artificial joints have been included in centralized procurement.

From the perspective of disease field, the treatment field focused on centralized procurement tends to be chronic diseases. For example, among the five batches and six rounds of centralized procurement of drugs, they are mainly systemic anti infective drugs, digestive and metabolic drugs and cardiovascular drugs. These drugs are commonly used clinically, and the top three treatment fields even occupy 49.15% of the market share. In addition, the drugs purchased centrally are mainly medical insurance, and the number of medical insurance drugs in each batch of centralized purchased varieties is more than 90%.

It is a trend for high-value medical consumables to be included in centralized procurement

Recently, the state has organized centralized procurement of artificial joints. The average price of artificial hip joint has decreased from 35000 yuan to about 7000 yuan, and the average price of knee joint has decreased from 32000 yuan to about 5000 yuan, with an average decrease of 82%. According to the data of the National Medical Insurance Bureau, according to the purchase demand of medical institutions and the price before centralized purchase, the market scale of artificial joints in China is about 20 billion yuan. Considering that the original market size of the first batch of national high-value consumables is about 15 billion yuan, the market covered by the two kinds of products has reached about 1/5 of the total market of high-value consumables in China.

In addition to national centralized procurement, at present, all provinces have independently or in the form of alliances to carry out the procurement of medical devices. The varieties are mainly high-value consumables, a few provinces have included low-value consumables, and some provinces have also included inspection reagents and large-scale medical equipment in the scope of centralized procurement, showing a trend of increasing coverage varieties, accelerating procurement frequency and expanding procurement scale.

In the future, the procurement of high-value medical consumables by volume will present the following trends:

First, at the national level, high-value consumables with large clinical consumption, high procurement amount, mature clinical use, full market competition and high homogenization level will be selected as procurement varieties. Based on the recent policy trends and the progress of centralized procurement in various provinces, orthopedic spine and trauma consumables may be the focus of attention at the national level in the next step.

Second, at the local level, centralized procurement involves a variety of categories. In addition to the main considerations of large consumption and high amount, consideration is given to “central and local coordination” in variety selection. For example, after the national centralized procurement of coronary stents, all provinces have included coronary balloons in the scope of centralized procurement, which is complementary to coronary stents.

For all kinds of medical consumables that are not selected and not included in the scope of volume procurement, all localities will still purchase in the form of price limit and online publicity. In recent years, all localities have accelerated the online publicity of medical consumables. Since 2021 alone, eight provinces such as Henan, Beijing and Sichuan have issued online publicity guidance documents for medical consumables to clarify the scope of online publicity varieties, online publicity process and price rules. ”

BradyKnows can assist manufacturers in China entry, including facilities establishment, QMS compliance and local manufacturing，please do not hesitate to contact us at info@ inspirativemed.com if you have any interest in bringing your products into China.