Drugmakers agree to halve prices to enter Chinese market

Drugmakers have agreed to cut prices by around 50% on average for more than 100 medicines to have them included in China’s state medical insurance scheme from March, potentially heralding a massive leap in sales.

The National Healthcare Security Administration (NHSA) said in a statement on Monday that 119 medicines would be added to the National Reimbursement Drugs List (NRDL) with an average price reduction of 50.64%.

According to the statement, ninety-six of them have branded drugs with no generic versions available in the domestic market.

They included some key products made by foreign pharmaceutical companies, such as Novartis’ blockbuster inflammation drug Cosentyx and Israeli firm Teva Pharmaceutical’s Austedo treatment for Huntington’s disease.

The list also adds more home-grown PD-1 inhibitor products, a fast-growing class of drugs that help the immune system attack cancer by blocking a mechanism tumors use to evade detection.

PD-1 drugs from Shanghai Junshi Biosciences, Beigene Ltd, and Jiangsu Hengrui Medicine have been added, compared with only one Chinese product in an earlier round of drug list update.

“It’s a healthy thing not to have a winner take all approach and show there is room for multiple companies,” said Brad Loncar, whose Loncar Investments runs an ETF for Chinese drug firms.