Chinese drugmakers and pharmacists are paying “limited attention” to the National Essential Medicines List (NEML) in their decisions to manufacture, purchase and stock essential drugs, and prescribing of these medicines is frequently inappropriate, says a new study.

The researchers found that drugmakers in Shandong province – one of China’s more developed regions and where the pharmaceutical industry is an important component of the economy – were producing only 62% of the essential medicines for which they held licenses, while the proportion for those in the less-developed Gansu province was only 50%. Also, more than 40% of pharmacy managers in both provinces did not know the NEML and 60% did not consider it in purchasing decisions, according to authors Wen Chen et al, reporting their findings in BMC Health Services Research this month.

Despite high pharmaceutical spending, China has significant problems relating to medicines access, and tackling this is a central platform of the massive health system reform plan announced by the government last year. But the study shows that manufacturers’ production decisions are determined primarily by economic considerations, with many essential medicines not seen as profitable because of low demand, as well as price and mark-up controls.

The researchers also found that while pharmacies tend to stock what is prescribed, prescribing is motivated partly by financial incentives. Hospital clinicians favor higher-cost medicines not subject to price controls because they generate greater revenues, which puts an added cost burden on patients and health insurance funds, they note.

The study concludes that there are competing interests between drugmakers’ profit orientations and the Chinese government's objective of securing access to affordable essential medicines. Also, the current pricing system has failed to stimulate competition in the production of essential medicines, and hospitals and doctors have no incentive to use cheaper generic versions of these products.

As the government develops its strategy aimed at dealing with the problems of access to medicines, the authors call for policies and incentives to be introduced to facilitate the use of the new NEML (introduced last August) in manufacturing, purchasing, and prescribing decisions at each level of the health care system.

- Earlier this month, Business Monitor International (BMI) forecast that the implementation of the health reform programme will contribute to the value of China’s pharmaceutical market surpassing that of a number of developed nations, including France and Germany, over the next few years, and that pharmaceutical market growth will be driven by the booming economy.

And IMS Health has projected that, with GDP of over $8 trillion, China will become the world’s third-largest pharmaceutical market next year, up from eighth place in 2006 and growing as much as 26% a year on average to 2013. Most growth will continue to come from branded generics manufactured and marketed by established domestic companies, although demand for innovative products from multinational companies is rising in the country’s leading urban centers, it says.