Summary of Key Points
The draft for the 12th round of national centralized procurement has been released, featuring five major improvements compared to the previous eleven rounds. The core objectives are to combat blind price competition, provide opportunities for original research drugs (ORDs) to enter the market, and hold generic drug companies accountable for any patent infringement issues. By setting price benchmarks and adjusting the selection criteria, the procurement process is made more fair and reasonable. The focus is no longer solely on reducing prices but also on quality, clinical needs, and market competition.
Detailed Analysis
1. Generic Drug Patent Disputes: Companies Must Assume Responsibility Themselves; Medical Insurance No Longer Acts as a Judge
In previous rounds of centralized procurement, medical insurance departments had to determine whether generic drugs infringed on patents, which often led to delays (for example, sacubitril valsartan was excluded last year due to patent concerns). The new rule changes this: Generic drug companies must provide a commitment that their products do not infringe on patents. If they are selected and later found to be in violation, their products will be removed from the market, and their qualifications will be revoked. For instance, sacubitril valsartan (originally developed by Novartis with annual sales of nearly 8 billion yuan) has a patent extension until 2031, but now eight domestic companies claim they can circumvent this patent. Under the new rule, these companies can still apply, but they must bear the consequences of any infringement. This approach gives generic drug companies an opportunity to enter the market without waiting for the patent to expire and allows medical insurance to avoid the complexity of patent assessments, leaving the choice to the companies themselves (only those with the technical capability will dare to apply).
2. Return of ORDs: Patients Can Now Choose Imported Drugs; Generic Drugs No Longer Need to Compete on Low Prices
In the past, centralized procurement focused solely on price, and ORDs were often excluded due to their higher cost, leaving patients with no option but to pay out of pocket for imported drugs. Two changes have been made:
- Shanghai Pilot Program for Fixed-Dollar Reimbursement: ORDs are included in hospital pharmacies, and medical insurance will cover a fixed amount; any excess cost is borne by the patient (for example, if an imported drug costs 100 yuan, the insurance will cover 50 yuan, with the patient paying the remaining 50 yuan).
- New Procurement Rules Allow ORDs to Reenter: ORDs that did not make the initial selection but lower their prices can still be selected if they meet the requirements. Although hospitals are not required to purchase them, they can still be available in hospital pharmacies. This gives patients more options (they can pay more for higher-quality drugs), and generic drugs no longer need to offer extremely low prices to displace ORDs, as ORDs are still available.
3. Setting Price Limits: Blinding Low Prices Are a Thing of the Past
Previously, companies would bid excessively low to win bids (for example, Fokangren's dopamine hydrochloride in Beijing could not meet production capacity after winning the bid). The new rules establish price limits:
- Lower Limit: The system uses the higher of the “lowest bid” and the “average bid minus one standard deviation” as the benchmark. The selected price cannot exceed 1.8 times this limit; if a bid is lower than the average bid minus two standard deviations (for example, if the average bid is 10 yuan and the standard deviation is 2 yuan, the lower limit is 6 yuan, so a bid of 5 yuan would be rejected).
- Upper Limit: The highest valid bid considers 50% of the non-centralized procurement prices and the highest winning bid at the provincial level, as well as international and online market prices. This ensures that company bids are within a reasonable range, preventing them from offering excessively low or high prices.
4. Largest Number of Products with Clear Criteria: Procurement Focuses on Essential Clinical Drugs
The 12th round includes 77 products in 233 specifications, the highest number ever. The selection criteria require annual sales of over 100 million yuan, indicating that the procurement targets drugs that are frequently used by patients and have large market volumes (such as antihypertensive and hypoglycemic drugs), which aligns better with clinical needs.
5. Shift from Focusing Only on Price Reduction to Ensuring Quality and Preventing Competition
In the first eleven rounds, some companies were disqualified due to quality issues (for example, low-cost drugs that did not meet quality standards). The new rules place greater emphasis on maintaining quality:
- Preventing excessively low bids (to avoid companies sacrificing quality to cut costs).
- Providing space for ORDs (as their stable quality can serve as a reference).
- Holding companies accountable for patent infringement (encouraging them to invest in research and development rather than cutting corners).
Overall, the approach shifts from simply reducing medical insurance expenses to balancing price, quality, and patient choices, signaling a more market-oriented and mature development of centralized procurement.
Conclusion
The improvements in the 12th round of centralized procurement aim to return the market to rationality: companies must consider both costs and profits when bidding; patients have more options for medications; and medical insurance departments are shifting from price suppressors to rule-makers. Although the final rules have not yet been finalized, the draft already demonstrates a direction towards a fairer and more mature procurement process.