Table 1

Summary of drug reforms in China

WHO framework	Major initiatives between 2009 and 2020	Policy goals/expected outcome	Implementation progress
1. Effective regulation	Laws and regulations 2019: amend the National Law of Pharmaceutical Products Management 2020: announce Regulation of Drug Manufacture and Management Plan for Drug Registration Institutional reforms 2018: establish the National Medical Products Administration (NMPA) to manage the production and distribution of drugs 2018: establish the National Healthcare Security Administration (NHSA) to collectively manage the social health insurance schemes and their related decisions such as insurance listing, reimbursable price and procurement of drugs 2018: reform the National Health Commission (NHC) to manage the clinical use of drugs	Update the laws to legalise the drug reforms Streamline institutional settings; new agencies execute clearly defined and distinguished roles as production and distribution (NMPA), pricing and procurement (NHSA) and use (NHC)	Fully implemented
2. Quality products	Marketing authorisation holder (MAH) system Piloted in 2016 and fully scaled up in 2019: implement the MAH system that MAH takes full responsibility for the regulation of R&D, clinical trials (CTs), manufacturing, sales and distribution, and reporting adverse events Full life-cycle supervision by NMPA 2019: establish a national CT registration platform to improve the transparency of CTs and mobilise hospitals to conduct CTs 2019: NMPA monitors the manufacturing process and distribution Bioequivalence assessment (BA) 2018: drugs passing BA receive prioritised consideration in procurement led by NHSA	While mobilising stakeholders such as MAH, hospitals and manufacturers, NMPA holds accountable for monitoring the quality of drugs at full life cycle Introduce BA to improve the quality of generic drugs	By the end of 2019, 123 generic names (323 brand names) passed BA.126
3. Needs-driven innovation	Accelerated market approval (AMA) 2013: introduce AMA on innovative pharmaceutical products with patents or addressing clinical need 2016: expand AMA to breakthrough drugs, drugs for HIV/AIDS, cancer, major infectious diseases, paediatrics and rare disease 2018: issue Rare Disease List to encourage the R&D of orphan drugs Insurance listing (selection of National Reimbursable Drug List, NRDL) 2016: apply pharmacoeconomic evaluation evidence in the selection of NRDL to consider both the cost and effect of innovative drugs	Use AMA and insurance listing as policy levers to encourage needs-based innovation AMA also improves the efficiency of market approval and access to new drugs	Between 2016 and 2017, 423 pharmaceutical products got AMA. About 64.8% applications addressed critical patient needs.93 8 out of 12 domestic innovative drugs listed by NRDL in 2019.127
4. Intellectual property	Data protection for innovative drugs 2018: innovative drugs can enjoy maximally 6 years of data protection period during which no similar generic drug(s) will be reviewed or approved Compulsory licensing 2018: introduce compulsory licensing mechanism to force deprivation of a patent (thereby allowing the production of generics) during infectious disease epidemic emergencies or to address major public health threats	Provide data protection period to encourage innovation Issue compulsory licensing policy to prepare for public health emergency	Compulsory licensing hasn’t been applied to any product yet
5. Evidence-based selection	National Essential Medicine Policy (NEMP) 2009: 1st NEML included 307 drugs selected by expert committee, implemented at government-owned primary healthcare centres (PHCs) between 2009 and 2012 2012: 2nd NEML included 502 drugs, implemented at all PHCs 2014: NEMP at public township hospitals (rural) and public hospitals (urban) 2018: 3rd NEML included 685 drugs, implemented at all public hospitals NRDL 2009: pharmacoeconomic evidence was recommended for high-priced drugs 2016: pharmacoeconomic evidence should be used to compare similar lower-priced and high-priced effective drugs addressing critical clinical needs 2019: NHSA initiated a standard process of reviewing pharmacoeconomic evidence	Through phased scale-up strategy, the NEMP attempted to improve the equitable access to essential medicines; NEML has been revised to address clinical needs Pharmacoeconomic evidence received increasing attention in assisting the selection of NRDL to assess cost and effectiveness at the same time	In 2018, 17 anticancer drugs were added to the NRDL128; in 2019, 70 additional drugs have been selected for NRDL.129
6. Financing and pricing policies	Zero mark-up and compensation reform 2009: PHCs using NEML claimed zero mark-up drug prices and received special government subsidy for reduced drug profit 2015: all county public hospitals and city public hospitals in pilot sites 2017: zero mark-up on consumable medical supplies End of 2017: all public hospitals Pricing reform Before 2015: retail price ceiling 2015: classified pricing strategies Essential medicines and other commonly used drugs: provincial bulk bidding and procurement Patent drugs and drugs provided by a single manufacturer only: NHSA decides whether to list on NRDL (upon negotiation on price) and reimbursable price for drugs listed on NRDL Basic injections and commonly used low-cost drugs, and low clinical usage gynaecological, paediatric, emergency drugs: direct online procurement Clinically necessary drugs with low usage or drugs with a high risk of being in short supply: national bulk bidding for designated manufacturers and price negotiation Anaesthetics and psychotropic drugs, free drugs for infectious or parasitic diseases, vaccines for National Immunization Plan, family planning drugs and traditional Chinese medicine: price ceiling management and national procurement	To remove perverse revenue incentives from prescribing and to establish a sustainable, multichannel financing mechanism Apply a different pricing strategy to fully engage the market and to guide the price of medicines, and to better interact with procurement and insurance policies	The price of 45% of essential medicines decreased by an average of 12% in 2009.98 The new listed drugs on the NRDL through price negotiation achieved an average price decrease of 44% in 2017. 17 anticancer drugs were added to the NRDL in 2018 and a 57% price reduction was achieved on average. In 2019, 70 additional new drugs were listed through price negotiation, resulting in a 61% price drop, and 27 listed drugs successfully renewed their listing, with an overall 26% reduction in price.130
7. Procurement and supply	Bulk procurement 2009: a provincial bulk bidding and procurement platform for national essential medicines; bidding was conducted based on quality and price by the provincial government 2015, 2016 and 2018: Shanghai piloted three rounds of bulk procurement 2019: 11 cities piloted the bulk procurement policy 2019 Sep: scale up to 25 provinces Shortage management 2011: database to track NEML with shortage risk 2012: nominate manufacturers to produce essential medicines with shortage risk 2014: the bulk bidding and procurement policy was extended to all drugs with shortage risk in all government-owned county or higher-level hospitals 2016: designated manufacturers for clinically necessary drugs and those with limited supply in all government-owned PHCs and public hospitals 2017: drugs in limited supply and urgent clinical demand are entitled to AMA 2018: to further improve the availability of drugs, since 2018, negotiation with pharmaceutical companies has been included within the process of adjusting the NRDL for insurance Dual invoicing 2016: dual invoicing was required in bulk procurement for all public hospitals located in over 200 pilot cities. Each drug can have no more than two wholesalers and two invoices—one from manufacturer, and another from wholesaler—that need to be submitted at the bulk procurement platform for regulation 2018: dual invoicing has been rolled out across the country	Through information transparency, bid on price and quality, and bulk procurement to reduce drug prices Track shortage information to guide procurement and storage decisions Use AMA, manufacture designation and NRDL listing as policy levers to ensure supply To reduce the mark-ups of wholesalers and ultimately, reduce drug prices	By 30 May 2022, 234 drugs have been ordered through the national bulk procurement, with 53% price reduction on average.131 Over 20 bulk procurement alliances, mostly cross-provinces, have been formed.132 133 By the end of 2022, each province would cover 350 drugs on average through bulk procurement platform at national or subnational level.134
8. Quality and appropriate use	Administration of antibiotics and non-therapeutic drugs 2012: apply guideline on the administration of antibacterial drugs 2018: implement classified management of antibacterial drugs for physicians in different levels of hospitals 2018: evaluate rational use of medicine as a key performance indicator for assessing hospital leaders 2019: all hospitals including those in the private sector are subject to assessment of their (ir)rational use of medicine 2019: issue monitoring catalogue for drugs of high price and high volume, or non-therapeutic auxiliary drugs; special management regimes for glucocorticoid drugs, narcotic drugs, psychotropic drugs, antibacterial drugs, and Chinese herbal medicines and other drugs Pharmacist 2016: provide annual training on rational use of antibiotics to physicians and pharmacists 2016: all retail pharmacies may only sell antibiotics to customers with prescriptions	Improve rational use of medicine	No specific information available
9. Data, monitoring and evaluation	Online platforms Registration of clinical trials Monitoring of drug use Adverse drug reactions 2015: multiple policies have been announced to promote the traceability of medical product 2020: vaccine accomplished this milestone by March 2020 and drugs selected in the bulk procurement will be the next to follow	Trackable information to inform decisions	No specific information available

NEML, National Essential Medicines List; R&D, research and development.