From today (May 15), the prices of 182 medicines in China have been cut by an average 19% - although for some the reduction is as much as 62% - in a move which the government expects to save consumers around 5 billion yuan, or around $650 million.

This represents the seventh drug price adjustment since the beginning of last year to be implemented by the National Development and Reform Commission (NDRC), the government’s economic planning body, as it battles to make medicines more affordable for consumers. In that period, the prices of more than 900 drugs, accounting for some 70% of the market, have been lowered, while for around 70 (representing 5% of total sales) they have been increased. Prices of a further 300 drugs, representing the remaining 25% of the market, have been maintained. Nevertheless, many medicines still remain overpriced, with manufacturers changing the names of many of their products in order to avoid price cuts, said NDRC Minister Ma Kai, who added that the market is “very chaotic.”

The new arrangements, which affect more than 1,200 products overall, also include a “moderate” increase in the prices of 18 medicines which are currently in short supply, in order to boost their production, while upper limits on the retail prices of 260 western medicines have now been capped.

Reforms to the medical system are also necessary in order to make drugs more affordable, the Minister added. To this end, the government will reform the process under which hospitals are required to sell drugs in order to make money, and is also seeking to tackle current irregularities surrounding new drug approvals.

China’s central government currently sets the prices of about 1,500 medicines, and local government fixes the levels for more than 800 additional products. The NDRC also said that it plans to bring the prices of a wider range of basic medicines under central control, and to make adjustments to drug prices on a two-yearly basis. By Lynne Taylor