China should not prioritise low prices in drug procurement plan, European lobby group says

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By Andrew Silver

SHANGHAI (Reuters) -A European business lobby group urged China to take steps not to prioritise low prices over product safety in the country’s centralised drug procurement programme.

The European Union Chamber of Commerce in China also questioned China’s recent investigation into quality concerns of off-patent medicines approved for the programme, calling it “unscientific,” and lacking in transparency.

China’s National Healthcare Security Administration (NHSA) launched an investigation in January after local media cited doctors in Beijing and Shanghai saying the cheaper generic drugs used at public hospitals did not appear to have the same efficacy or side effects as those made by Western pharmaceutical companies.

The regulator said it had looked into those claims by speaking to relevant experts as well as the heads of seven hospitals and concluded last month that the quality concerns were unsubstantiated.

The European chamber, whose online member directory lists drugmakers and hospitals operating in China, said the probe lacked transparency, because an “in-depth explanation” of its process, and data from it, had not been made public.

“The investigation was deemed unscientific due to a lack of transparency,” it said in a statement to Reuters. 

Jens Eskelund, the chamber’s president, said in a separate statement that it “hopes to see steps taken to ensure that the procurement system for drugs does not prioritise low prices at the expense of product safety and clinical outcomes.”    

The NHSA did not respond to a Reuters request for comment on the chamber’s concerns about the investigation.

An official report issued earlier this month said China would “refine the policy for centralized medicine procurement and enhance quality evaluations and oversight” to ensure consumers’ confidence in the medication they use.

China rolled out the bulk-buy programme in 2018 in an attempt to negotiate lower prices from drug manufacturers and has since expanded it to many parts of the country.

The drugs on the list include off-patent blockbusters made by Western pharmaceutical giants as well as generics produced by local players.

While the scheme puts pressure on margins, many drugmakers participate in the tenders to supply public hospitals in large volumes.

(Reporting by Andrew Silver; Editing by Miyoung Kim and Philippa Fletcher)