Recent Pricing Negotiations on Innovative Medicines Pilot in China: Experiences, Implications, and Suggestions

The China National Formulary (CNF) for reimbursable drug use, also known as the National Reimbursement Drug List (NRDL), was formally established in 2000, revised in 2004 and 2009, and covers 52% of China's population under the government urban health insurance programs. A third major and long-awaited update to the formulary was completed in February 2017 based on intensive reviews by a group of experts in medicine, pharmacology, health economics, and health policy. Shortly after this major update, a pilot project at the central government level was implemented for negotiations mainly on innovative but expensive medicines that were still outside the National Formulary. The pilot, conducted between March and July 2017, eventually reached an overall agreement rate of 81.8% regarding approved indications and drug prices between China's government and the pharmaceutical companies. This pilot showcased numerous leading edge features including a working definition of innovative medicines and opportunities to submit dossiers on drug clinical and economic information. This pilot covered 44 medications for negotiations in a breakthrough attempt to increase the appropriate access to innovative but expensive medicines. The implications to the future of the CNF go beyond the drugs included in the pilot. This paper describes the background of the CNF and the negotiation pilot. In addition, authors of this paper make six recommendations critical to CNF future developments, including enhancing criteria and process for evaluations, standardizing the dossier format, specifying data requirements, refining pricing calculation, and cultivating evaluation professional development.