Lu Yong, a Chinese CLL patient who purchased an unlicensed counterfeit version of NVS’ GLIVEC (imatinib) from India, was finally released without charge from local authorities. The case set off raucous debates in China over the lack of government coverage and patients’ inability to afford high-cost oncology therapies.
Due to active advocacy by KOLs and patient groups, several provinces in China, such as ZheJiang, JiangXi, ShanDong and NeiMengGu, have initiated an access negotiation mechanism to expand drug coverage under the ‘Severe Diseases Insurance’ and improve patient access to ‘life-saving’ high-cost high-value drugs. Under this insurance mechanism, the government covers up to 70% of the drug cost and patient OOP copay dramatically decreases upon listing.
ZheJiang Province HRSS (Human Resources and Social Security) selected a list of 31 products to prioritise for access negotiations based on KOL recommendations. 21 products selected were from 14 multinational pharmaceutical companies, with only 10 products from 8 local players. Out of the 31 prioritised products, 15 made to the final list which will be covered under the ‘Severe Diseases Insurance’. Most of them are oncology products (Table 1).
In NeiMengGu province, 12 high-cost oncology products treating 8 malignant cancers, such as NSCLC, CRC and CML, are included in the ‘Severe Diseases Insurance’ this year. Similarly, in JiangXi provinces, five high-cost oncology products, including HERCEPTIN and GLIVEC (from ROCHE and NOVARTIS, respectively), gained access through the ’Severe Diseases Insurance’ programme following access negotiations with the provincial HRSS.
Though only a few provinces have made significant progress, many more are trying to establish this mechanism for access and the associated negotiation process. From the manufacturer’s perspective, there is hope to improve access of high-cost high-value specialty products in China, but there is also increasing pricing pressure. In ZheJiang province, on average, there was a 19% price reduction after the price negotiation and some manufacturers even cut their products’ prices in half. Future launches may need to benchmark against these prices for reimbursement coverage in China. Therefore, pharmaceutical companies need to carefully evaluate the potential opportunities and challenges of this negotiation mechanism when developing their market access strategies in China.
Table 1. Products Covered Under the “Severe Diseases Insurance” in ZheJiang Province Through Access Negotiation.