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Market access opportunities in China

Pope Woodhead highlights the key steps to accessing the high-value therapeutics market in China

China flag thumbObtaining reimbursement is a key determinant of access and commercial returns for high-cost, branded products in China, given the low capability of patients to pay for themselves. 

Compared with the tremendous success of economic and social reforms, the development of the healthcare sector in China is still lagging behind. However, the next decade will bear witness to a drastic transformation that will start to close the gap. Monitoring regional and national policy changes in this dynamic market is a prerequisite for understanding market access opportunities.

Background

In China, provincial governments create their own reimbursement lists: Free Medical Service List, Essential Drug List (for urban area employees), and urban/rural area resident reimbursement lists. All reimbursement schemes include the essential drugs (Type A) from the National Essential Drugs List (NEDL– also known as the Catalogue of Drugs for Basic National Medical Insurance). 

At regional level, provinces are given the power to customise and expand the products on the central Type B products list (medicines with 0–50 per cent patient co-pay) by up to 15 per cent to reflect the local budget and healthcare priorities. Each of these lists offers reimbursement opportunities for pharma.

A good case in point is the policy on chronic diseases. With the ageing population and changes in lifestyle, increasing numbers of people are suffering from chronic diseases such as coronary heart disease and diabetes. In 2011, Ganzhou City in Jiangxi province called for a public consultation to add more effective chronic disease therapies, including new medications, into the Type B list. 

In the following year, the Ministry of Health (MoH) Drug Policy Department published a proposal to include more chronic disease medications in the next National Essential Drug List (NEDL). Also under the spotlight is the draft proposal by the MoH to list smoking cessation medications in the NEDL, which reveals an increasing focus on the prevention of the chronic/severe diseases in China. 

Historically, the Free Medical Service list includes more Type B drugs and novel therapeutics than those available via other medical insurances. However, in order to reduce government expenditure on healthcare and reduce inequity, there is a trend to narrow the coverage of the Free Medical Service and/or gradually assimilate this reimbursement list into the corresponding local essential list. 

Also under the spotlight is the MoH draft proposal to list smoking cessation medications on the NEDL
At the time of writing, at least 24 of the 31 regions in mainland China have abolished the Free Medical Service for employees of local government and public institutions. The remaining seven regions – the provinces of Shandong, Guangdong, Jiangxi, Jiangsu, Hubei, Guizhou and Guangxi plan to follow. However, at present, there is no concrete timeline for these reforms due to resistance from the State Government employees affected by the loss of this benefit. 

The merger of these two reimbursement schemes may create an opportunity since it would increase the pressure to improve the local essential reimbursement coverage, for example, expansion of the Type B drug list to include innovative therapeutics.

Pilot programmes to demonstrate value and increase public awareness play a key role

According to experts involved in reimbursement panels from local major hospitals, increasing awareness and usage of products enhances the potential for reimbursement. 

For example, although Roche's Tarceva (erlotinib hydrochloride) has not been included in any reimbursement lists in China, it has paved the way by collaborating with the China Charity Federation to cap the cost of Tarceva to five months for responsive patients with stage IIIB/IV non-small-cell carcinoma. 

This scheme is facilitating patient access and increasing market share and awareness. It additionally supports post-marketing research since further assessment of biomarkers, efficacy and safety is conducted in the patients included in the scheme.   

Other companies are engaging in and sponsoring education programmes, academic research and conferences in order to build rapport with key stakeholders: key opinion leaders, clinical doctors, pharmacological/biological researchers and patients.  

The merger of two reimbursement schemes … would increase pressure to improve local lists …
AstraZeneca organised a summit in 2009 with 400 clinical and academic lung cancer experts in Guangdong province to discuss targeted cancer therapy and its place in the treatment pathway. They also provided funding for Wujieping medical funds and cooperated with Guangzhou People's Hospital to set up an AstraZeneca Chinese Creative Research Centre focused on lung cancer. 

Additionally, although compliance to guidelines is far from uniform, endorsement in treatment guidelines or academic publications may influence clinician's choices and enhance the use of the drug. 

In part as a result of these efforts, both Tarceva and Iressa have been appraised in the Guideline for Diagnosis and Treatment of Primary Lung Cancer published by the Ministry of Health in 2011, which is believed to have supported their use.  

Unlocking regional opportunities

Engagement with patient associations can also influence policy making. For example, the China-Dolls Fund for Rare Disorders submitted a petition to the National People's Congress in 2009, calling for attention to, and favourable policies on, rare diseases and treatments. 

In response, in 2012, the Ministry of Human Resources and Social Security proposed to include essential and effective rare disease medicines gradually into the NEDL, and suggested that the local government should begin to establish a process to allow proper compassionate use.  

While patient power is still limited and variable, this is a stakeholder group that should be considered and consulted as part of the advocacy effects of supporting reimbursement.

'Access all areas' is perhaps a little ambitious. However, given the ability to adapt to policy changes, understand and engage provincial decision makers and influencers as well as apply a clear long-term strategy to access the market, unlocking regional opportunities for reimbursement in China is viable.

The authors
Rebecca Yanhui Zhang Roper and Wenting Zhang are consultants in the Pope Woodhead Pharmaceutical Consultancy and Chris Easley is principal at Pope Woodhead Associates. 
The authors wish to acknowledge Dr Francois Lucas for his advice on this article.

29th October 2012

From: Sales, Regulatory

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