Easy cuts, easy rebound: Drug expenditures with massive price cuts in Korea

A Five-Year Analysis of Market Share and Sales Growth for Original Drugs after Patent Expiration in Korea

INTRODUCTION

The sales patterns of original drugs after patent expiration in Korea show a relatively high market share and continuous sales growth differently from those in the U.S. and European countries. This study aims to investigates a five-year sales pattern of original drugs after patent expiration in Korea using empirical data.

METHODS

Using data from the Ministry of Food and Drug Safety, original drugs whose patents expired in 2012-2018 were extracted. And we used IQVIA data to determine the market share and sales growth rate of 48 original drugs, whose generic drug launched for the first time in the same molecule market, and whose sales data over five years after first generic entry were available. We analyzed the differences by the attribute of variables.

RESULTS

The sales volume of original drugs in the fifth year (Q 20) had an average growth rate of 150.6% compared with that before the first generic drug launched, indicating a continuous growth. The average market share of original drugs in the fifth year (Q 20) decreased to 70.6%, but it was higher than previously reported research results in Korea and other countries. Differences were observed across the category of attribute.

CONCLUSION

This study demonstrated that while market share of original drugs is decreasing, the sales volume increased continuously until the fifth year, differently from those of other countries. Variations in sales patterns by attributes reflect unique dynamics in Korea.

Analysing the effects of National Centralised Drug Procurement and Price Negotiation Policies on novel hypoglycaemic drug usage and costs in Shanghai, China: an interrupted time series analysis

OBJECTIVES

To analyse the impacts of multiple rounds of National Centralised Drug Procurement Policy (NCDP) and National Drug Price Negotiation Policy (NDPN) on the utilisation, expenditure and daily cost of novel hypoglycaemic drugs.

DESIGN

The drug procurement data were obtained from the Shanghai Medical Procurement Agency between January 2016 and December 2022. We examined changes in volume, expenditure of overall hypoglycaemic drugs by descriptive analysis. For novel hypoglycaemic drugs, we employed interrupted time series analysis with segmented regression to investigate the change in usage, expenditure and daily cost of specific drug affected by related policies.

SETTING

All the public and private hospitals in Shanghai, China.

PRIMARY OUTCOME MEASURES

Volume, expenditure and daily cost of novel hypoglycaemic drugs.

RESULTS

From 2016 to 2022, the overall usage and expenditure of hypoglycaemic drugs in Shanghai have been gradually increasing. Consumption of novel hypoglycaemic drugs had shown a rapid increase, which was significantly increased by 212.28 defined daily doses (95% CI 188.25, 236.31, p<0.001) after policy implementation. For each specific drug, daily cost was significantly decreased immediately after policy implementation (p<0.001). Dulaglutide, loxenatide, liraglutide, semaglutide and dapagliflozin had all seen significant increases in consumption and expenditure after NDPN implementation (p<0.001). Vildagliptin and saxagliptin, which were affected by the NCDP, experienced a significant decrease in usage. Empagliflozin and canagliflozin, which were regulated by both NCDP and NDPN, experienced an initial increase, followed by a significant decline. Consumption of beinaglutide and exenatide was not upregulated by NDPN.

CONCLUSION

Implementation of NDPN and NCDP had successfully cut-off the price of novel hypoglycaemic drugs and significantly increased their utilisation. In the future, the government needs to control pharmaceutical expenses more strictly while ensuring the rational use of the drugs.

Pricing, Procurement and Reimbursement Policies for Incentivizing Market Entry of Novel Antibiotics and Diagnostics: Learnings from 10 Countries Globally

BACKGROUND

Fostering market entry of novel antibiotics and enhanced use of diagnostics to improve the quality of antibiotic prescribing are avenues to tackle antimicrobial resistance (AMR), which is a major public health threat. Pricing, procurement and reimbursement policies may work as AMR 'pull incentives' to support these objectives. This paper studies pull incentives in pricing, procurement and reimbursement policies (e.g., additions to, modifications of, and exemptions from standard policies) for novel antibiotics, diagnostics and health products with a similar profile in 10 study countries. It also explores whether incentives for non-AMR health products could be transferred to AMR health products.

METHODS

This research included a review of policies in 10 G20 countries based on literature and unpublished documents, and the production of country fact sheets that were validated by country experts. Initial research was conducted in 2020 and updated in 2023.

RESULTS

Identified pull incentives in pricing policies include free pricing, higher prices at launch and price increases over time, managed-entry agreements, and waiving or reducing mandatory discounts. Incentives in procurement comprise value-based procurement, pooled procurement and models that delink prices from volumes (subscription-based schemes), whereas incentives in reimbursement include lower evidence requirements for inclusion in the reimbursement scheme, accelerated reimbursement processes, separate budgets that offer add-on funding, and adapted prescribing conditions.

CONCLUSIONS

While a few pull incentives have been piloted or implemented for antibiotics in recent years, these mechanisms have been mainly used to incentivize launch of certain non-AMR health products, such as orphan medicines. Given similarities in their product characteristics, transferability of some of these pull incentives appears to be possible; however, it would be essential to conduct impact assessments of these incentives. Trade-offs between incentives to foster market entry and thus potentially improve access and the financial sustainability for payers need to be addressed.

Effect of China national centralized drug procurement policy on anticoagulation selection and hemorrhage events in patients with AF in Suining

Background: Launched in March 2019, the National Centralized Drug Procurement (NCDP) initiative aimed to optimize the drug utilization framework in public healthcare facilities. Following the integration of Non-Vitamin K Antagonist Oral Anticoagulants (NOACs) into the procurement catalog, healthcare establishments in Suining swiftly transitioned to the widespread adoption of NOACs, beginning 1 March 2020. Objective: This study aims to comprehensively assess the impact of the NCDP policy on the efficacy of anticoagulation therapy, patient medication adherence, and the incidence of hemorrhagic events in individuals with non-valvular atrial fibrillation (NVAF) residing in Suining. The analysis seeks to elucidate the broader impacts of the NCDP policy on this patient demographic. Methods: This study analyzed patient hospitalization records from the Department of Cardiology at Suining County People's Hospital, spanning 1 January 2017, to 30 June 2022. The dataset included demographic details (age, sex), type of health insurance, year of admission, hospitalization expenses, and comprehensive information on anticoagulant therapy utilization. The CHA2DS2-VASc scoring system, an established risk assessment tool, was used to evaluate stroke risk in NVAF patients. Patients with a CHA2DS2-VASc score of 2 or higher were categorized as high-risk, while those with scores below 2 were considered medium or low-risk. Results: 1. Treatment Cost Analysis: The study included 3,986 patients diagnosed with NVAF. Following the implementation of the NCDP policy, a significant increase in the average treatment cost for hospitalized patients was observed, rising from 8,900.57 ± 9,023.02 CNY to 9,829.99 ± 10,886.87 CNY (p < 0.001). 2. Oral Anticoagulant Utilization: Overall, oral anticoagulant use increased from 40.02% to 61.33% post-NCDP (p < 0.001). Specifically, NOAC utilization among patients dramatically rose from 15.41% to 90.99% (p < 0.001). 3. Hemorrhagic Events: There was a significant decrease in hemorrhagic events following the NCDP policy, from 1.88% to 0.66% (p = 0.01). Hypertension [OR = 1.979, 95% CI (1.132, 3.462), p = 0.017], history of stroke [OR = 1.375, 95% CI (1.023, 1.847), p = 0.035], age ≥65 years [OR = 0.339, 95% CI (0.188, 0.612), p < 0.001], combination therapy of anticoagulants and antiplatelets [OR = 3.620, 95% CI (1.752, 7.480), p < 0.001], hepatic and renal insufficiency [OR = 4.294, 95% CI (2.28, 8.084), p < 0.001], and the NCDP policy [OR = 0.295, 95% CI (0.115, 0.753), p = 0.011] are significant risk factors for bleeding in patients with atrial fibrillation. 4. Re-hospitalization and Anticoagulant Use: Among the 219 patients requiring re-hospitalization, there was a notable increase in anticoagulant usage post-NCDP, from 36.07% to 59.82% (p < 0.001). NOACs, in particular, saw a substantial rise in usage among these patients, from 11.39% to 80.92% (p < 0.001). 5. Anticoagulant Type Change: The NCDP policy [OR = 28.223, 95% CI (13.148, 60.585), p < 0.001] and bleeding events [OR = 27.772, 95% CI (3.213, 240.026), p = 0.003] were significant factors influencing the alteration of anticoagulant medications in patients. Conclusion: The NCDP policy has markedly improved anticoagulation management in patients with AF. This policy has played a crucial role in enhancing medication adherence and significantly reducing the incidence of hemorrhagic events among these patients. Additionally, the NCDP policy has proven to be a key factor in guiding the selection and modification of anticoagulant therapies in the AF patient population.

Impacts of national volume-based drug procurement policy on the utilization and costs of antihypertensive drugs in a Chinese medicine hospital: an interrupted time series analysis of 5138 patients

Objectives: The study aimed to estimate the effects of National Volume-based Drug Procurement (NVBP) policy on drug utilization and medical expenditures of hypertension patients in public medical institutions in mainland China. Methods: This study used patient-level data based on electronic health records retrieved from the hospital information system of Nanjing Hospital of Chinese Medicine. Data on patients with hypertension who received care at this institution between 2016 and 2021 was used for analysis. Segmented linear regression models incorporating Interrupted Time Series (ITS) analysis were adopted to examine the effects of NVBP policy on drug utilization and health expenditures of eligible patients. Drug utilization volume and health expenditures were the primary outcomes used to assess the policy effects, and were measured using the prescription proportion of each drug class and the overall per-encounter treatment costs. Results: After the implementation of NVBP policy, the volume of non-winning drugs decreased from 54.42% to 36.25% for outpatient care and from 35.62% to 15.65% for inpatient care. The ITS analysis showed that the volume of bid-winning drugs in outpatient and inpatient settings increased by 9.55% (p < 0.001) and 6.31% (p < 0.001), respectively. The volume changes in non-volume based purchased (non-VBP) drugs differed between outpatients and inpatients. The proportion of non-VBP drugs immediately increased by 5.34% (p = 0.002) overall, and showed an upward trend in the outpatient setting specially (p < 0.001) during the post-intervention period. However, no significant differences were observed in the proportion of non-VBP drugs in inpatient setting (p > 0.05) in term of level change (p > 0.05) or trend change (p > 0.05). The average per-visit expenditures of outpatients across all drug groups exhibited an upward trend (p < 0.05) post policy intervention. In addition, a similar increase in the overall costs for chemical drugs were observed in inpatient settings (coefficient = 2,599.54, p = 0.036), with no statistically significant differences in the regression slope and level (p = 0.814). Conclusion: The usage proportion of bid-winning drugs increased significantly post policy intervention, indicating greater use of bid-winning drugs and the corresponding substitution of non-winning hypertensive drugs. Drug expenditures for outpatients and health expenditures per visit for inpatients also exhibited an upward trend, suggesting the importance of enhanced drug use management in Traditional Chinese Medicine hospital settings.

A quasi-experimental study of the volume-based procurement (VBP) effect on antiviral medications of hepatitis B virus in China

Background: The Pilot Plan of National Centralized Volume-Based Procurement (NCVBP) was adopted to cope with the rapid increase in drug expenditures. This research aimed to quantitatively evaluate the impact of the NCVBP on antiviral medications for the hepatitis B virus. Methods: Data on nucleoside analogs (NAs) medications of hepatitis B virus monthly procurement records in the pilot cities from January 2018 to December 2019 were extracted from the China Drug Supply Information Platform (CDSIP). The impacts of the NCVBP on purchased volumes, expenditures, and pre-defined daily dose costs were evaluated by interrupted time-series (ITS) analysis using Stata 16.0. We constructed two segments with one interruptive point (March 2019). Results: Compared to the same period between pre-and post-intervention, the purchased volume of NAs medications were increased by 92.85%, and selected medications were increased by 119.09%. Analysis of changes in the level of NAs medication followed a decrease in purchased expenditure (coefficient: 5364.88, p < 0.001), meanwhile, the purchased volume was increased with statistical significance (coefficient:605.49, p < 0.001). The Defined Daily Dose cost (DDDc) of NAs medication followed a decrease (coefficient: 8.90, p < 0.001). The NCVBP reform was followed by an increase of 618.41 ten thousand Defined Daily Dose (DDD) (p < 0.001) in purchased volume and a reduction of 5273.84 ten thousand Chinese Yuan (CNY) (p < 0.001) in the purchased expenditure of selected medications in the level. The DDDc of selected medications decreased in the level (coefficient: 9.87, p < 0.001), while the DDDc of alternative medications increased in the slope (coefficient:0.07, p = 0.030). The purchased volume and expenditure of bid-winning products increased by 964.08 ten thousand DDD and 637.36 ten thousand CNY in the level (p < 0.001). An increase of 633.46 ten thousand DDD (p < 0.001) in purchased volume and a reduction of 4285.32 ten thousand CNY (p < 0.001) in the purchased expenditure of generic drugs in the level was observed. Conclusion: The NCVBP reduced the DDDc of NAs medication, improved the utilization of the selected medications, and promoted the usage of generic products.

Effects of volume-based procurement policy on the usage and expenditure of first-generation targeted drugs for non-small cell lung cancer with EGFR mutation in China: an interrupted time series study

OBJECTIVES

In December 2018, China launched national volume-based procurement (NVBP) to negotiate drug prices with manufacturers. Gefitinib was one of the 25 pilot drugs, which is used for treatment of non-small cell lung cancer. Lung cancer is the most common type of cancer in China and targeted drugs like gefitinib have been proven to provide clinical benefits to patients. This study aims to explore the impact of NVBP policy on the usage and expenditure of anticancer drugs.

METHODS

Gefitinib and alternative drugs (icotinib and erlotinib) were used as objects of study. Quarterly data from the China Hospital Pharmaceutical Audit database in 9454 hospitals in China were used for analysis. Descriptive analysis was conducted using purchase volume and expenditure as variables. Interrupted time-series (ITS) analysis was applied to further analyse the effect of NVBP policy on the medicines under study.

RESULTS

During the 12-month period before (2018Q2-2019Q1) and after (2019Q2-2020Q1) the NVBP policy, the total purchase volume of medicines rose from 4.48 million defined daily dose (DDD) to 7.02 million DDD, with an increase of 56.66%. Purchase volume of gefitinib and alternative drugs increased 100.61% and 14.88%, respectively. After the implementation of NVBP policy, procurement volume of alternative drugs decreased by 72 051 DDD (p value=0.044) and trend change decreased by 56 738 DDD (p value<0.01). The overall expenditure reduction was 14.7%, with the expenditure of gefitinib reducing by 38.47% and alternative drugs increasing by 10.70%. ITS analysis indicated statistically significant differences in level and trend changes for expenditure of total drugs and gefitinib.

CONCLUSIONS

The evidence provided in this study indicated that the implementation of NVBP policy was related to the expenditure reduction of the first generation of anti-EGFR lung cancer drugs. The policy effectively controlled the increase in expenditures for corresponding drugs while ensuring the use of drugs.

The Effects of Cost Containment and Price Policies on Pharmaceutical Expenditure in South Korea

BACKGROUND

Policy-makers have proposed and implemented various cost-containment policies for drug prices and quantities to regulate rising pharmaceutical spending. Our study focused on a major change in pricing policy and several incentive schemes for curbing pharmaceutical expenditure growth during the 2010s in Korea.

METHODS

We constructed the longitudinal dataset from 2008-2017 for 12 904 clinics to track the prescriber behavior before and after the implemented policies. Applying an interrupted time series model, we analyzed changes in trends in overall monthly drug expenditure and antibiotic drug expenditure per prescription for outpatient claims diagnosed with three major diseases before and after the policies' implementation.

RESULTS

Significant price reductions and incentives for more efficient drug prescriptions resulted in an immediate decrease in monthly drug expenditures in clinics. However, we found attenuated effects over the long run. The top-spending clinics showed the highest rate of increase in drug costs.

CONCLUSION

Future policy interventions can maximize their effects by targeting high-spending providers.

The impacts of the “4+7” pilot policy on the volume, expenditures, and daily cost of Serotonin-Specific Reuptake Inhibitors (SSRIs) antidepressants: A quasi-experimental study

Objectives: The purpose of this study was to quantitatively evaluate the impacts of the”4 + 7” pilot policy on purchase volume, purchase expenditures, and daily cost and to find the changes in the use of SSRIs.

Methods: Data was collected covering 31 months, before, during, and after the “4 + 7” pilot policy was implemented in Shenzhen. Interrupted time-series (ITS) analysis was used to examine whether there had been a significant effect with the onset of the “4 + 7” pilot policy in March 2019.

Findings: The daily cost of policy-related drugs had a substantial drop of 2.93 yuan under the “4 + 7” pilot policy. The result has shown a 76.70% increase in volume and a 3.39% decrease in the expenditure on policy-related drugs. This study found that the “4 + 7” pilot policy increased the proportion of purchasing winning drugs, with an increment of 85.60 percent. After the implementation of the “4 + 7” pilot policy, policy-related drugs decreased by 443.55thousand Chinese yuan. The study indicated that volume of winning products significantly increased as shown in the regression with a level coefficient (β₂) of -224.17 (p < 0.001) and trend coefficient (β₃) of 15.74 (p < 0.001). The result revealed that both volume and expenditures on branded products showed a significant decrease in the regression in the post-intervention period (level coefficient of volume: β₂ = -57.65, p < 0.01, trend coefficient of volume: β₃ = -3.44, p < 0.01; level coefficient of expenditure: β₂ = -712.98, p < 0.01, trend coefficient of expenditure: β₃ = -40.10, p < 0.01).

Conclusion: The volume-based procurement has successfully led to price reductions and improved the affordability of medicines, especially for those with chronic diseases. The volume-based procurement has demonstrated initial success in reshaping the composition of the Chinese pharmaceutical market in favor of generics with high quality and low prices.

Has the Volume-Based Drug Purchasing Approach Achieved Equilibrium among Various Stakeholders? Evidence from China

Volume-based drug purchasing by China’s health insurance system currently represents the largest group purchasing organization worldwide. After exchanging the market that accounted for nearly half of the volume of the healthcare system for the ultra-low-price supply of limited drugs, what are the effects on patient and funding burdens, drug accessibility, and clinical efficacy? We aimed to verify the effectiveness of the policy, explore the reasons behind the problem and identify regulatory priorities and collaborative measures. We used literature and reported data from 2019 to 2021 to conduct a stakeholder analysis and health impact assessment, presenting the benefit and risk share for various dimensions. The analysis method was a multidimensional scaling model, which visualized problematic associations. Seventy-nine papers (61 publications and 18 other resources) were included in the study, with 22 effects and 36 problems identified. The results indicated favorable affordability and poor accessibility of drugs, as well as high risk of reduced drug quality and drug-use rationality. The drug-use demand of patients was guaranteed; the prescription rights of doctors regarding clinical drug use were limited; unreasonable evaluation indicators limited the transformation of public hospitals to value- and service-oriented organizations; the sustainability of health insurance funds and policy promotion were at risk; and innovation by pharmaceutical companies was accelerated. The problems associated with high co-occurrence frequencies were divided into the following clusters: cost control, drug accessibility, system rationality, policy fairness, drug quality, and moral hazards. These findings suggested that China has achieved short-term success in reducing the burden on patients and reducing fund expenditure. However, there were still deficiencies in guaranteed supply, quality control, and efficacy tracking. The study offers critical lessons for China and other low- and middle-income countries.

The impacts of Chinese drug volume-based procurement policy on the use of policy-related antibiotic drugs in Shenzhen, 2018-2019: an interrupted time-series analysis

Background

In 2019, Chinese government implemented volume-based procurement of 25 drugs in 4 municipalities and 7 sub-provincial cities, i.e. “4 + 7” policy. Competitive bidding was conducted by the government based on the annual agreed procurement volume submitted by each public medical institution in pilot cities. Pilot cities were required to implement bid winning results in March 2019 and the use volume of bid winning products was examined to ensure the completion of agreed procurement volume. In the policy, an oral antibiotic (cefuroxime) was included. Given the current condition of the irrational use of antibiotics in China, this study aims to evaluate the impact of “4 + 7” policy on the use of policy-related antibiotics.

Methods

This study used drug purchase data from the Centralized Drug Procurement Survey in Shenzhen 2019, covering 24 months from January 2018 to December 2019. Oral antibiotic drugs related to “4 + 7” policy were selected as study samples, including cefuroxime and 12 antibiotic drugs that have an alternative relationship with cefuroxime in clinical use. Purchase volume and expenditures were selected as outcome variables, and were measured using Defined Daily Doses (DDDs) and Chinese yuan, respectively. Segmented linear regression analysis with interrupted time series was adopted to examine the effect of “4 + 7” policy.

Results

After the implementation of “4 + 7” policy, the overall volume of cefuroxime and its alternative drugs increased from 9.47 million DDDs to 13.42 million DDDs, with an increase of 41.8 %. The results of segmented linear regression showed that the volume of cefuroxime significantly increased 161.16 thousand DDDs after “4 + 7” policy (95 % CI: 59.43 to 262.90, p-value = 0.004). The volume of alternative drugs significantly increased 273.65 thousand DDDs (95 % CI: 90.17 to 457.12, p-value = 0.006). The overall “4 + 7” policy-related antibiotics significantly increased 436.31 thousand DDDs (95 % CI: 190.81 to 681.81, p-value = 0.001) after “4 + 7” policy.

Conclusions

This study provides evidence that the implementation of “4 + 7” volume-based procurement policy was associated with significant increases in the volume of policy-related antibiotic drugs. The increase in antibiotic use after the policy needs special attention and vigilance.

Supplementary Information

The online version contains supplementary material available at 10.1186/s12913-021-06698-5.

Gender Differences in the Risk of Ischemic Heart Disease According to Healthcare Utilization and Medication Adherence among Newly Treated Korean Hypertensive Patients

We aimed to investigate gender differences in ischemic heart disease (IHD) according to healthcare utilization and medication adherence among newly treated Korean hypertensive adults. The National Sample Cohort version 2.0 of the National Health Insurance Service was used for analysis. Newly treated hypertensive patients ≥ 20 years and without IHD in 2002 were selected from a population that underwent health examination during 2003-2006. Of those patients, 11,942 men and 11,193 women were analyzed and followed up for 10 years. We determined the association between IHD and healthcare utilization and medication adherence using the Cox proportional hazards model. Hypertensive women patients had a lower risk of IHD than men patients (hazard ratio [HR] = 0.93, 95% confidence interval [CI] 0.88-1.00). The IHD risk was increased in patients who visited healthcare providers > 12 times/person-year (HR = 2.97, 95% CI 2.79-3.17), paid high out-of-pocket expense/person-year (HR = 1.55, 95% CI 1.41-1.69), and had medication nonadherence (HR = 1.67, 95% CI 1.58-1.77). However, the risk was decreased in patients who used both urban and rural areas (HR 0.75, 95% CI 0.67-0.84) and mixed types of providers (HR = 0.93, CI 0.88-0.99). The risk of IHD was significantly different between men and women only in the visiting frequency to healthcare providers (men, HR = 3.21, 95% CI 2.93-3.52; women, HR = 2.78, 95% CI 2.53-3.04, p for interaction = 0.0188). In summary, the risk of IHD was similar according to healthcare utilization and medication adherence between men and women, except visiting frequency to healthcare providers.

The Impacts of National Centralized Drug Procurement Policy on Drug Utilization and Drug Expenditures: The Case of Shenzhen, China

In 2019, the Chinese government implemented the first round of the National Centralized Drug Procurement (NCDP) pilot (so-called “4 + 7” policy) in mainland China, in which 25 drugs were included. We conducted this study to examine the impacts of NCDP policy on drug utilization and expenditures, and to clarify the main factors contributing to drug expenditure changes. This study used drug purchasing order data from the Centralized Drug Procurement Survey in Shenzhen 2019. Drugs related to the “4 + 7” policy were selected as study samples, including 23 “4 + 7” policy-related varieties and 15 basic alternative drugs. Driving factors for drug expenditures changes were analyzed using A.M. index system analysis (Addis A. & Magrini N.’ method). After the implementation of the NCDP policy, the volume of “4 + 7” policy-related varieties increased by 73.8%, among which winning products jumped by 1638.2% and non-winning products dropped by 70.8%; the expenditures of “4 + 7” policy-related varieties decreased by 36.9%. Structure effects (0.47) and price effects (0.78) negatively contributed to the increase in drug expenditures of “4 + 7” policy-related varieties, while volume effects (1.73) had positive influence. NCDP policy successfully decreased drug expenditures of “4 + 7” policy-related varieties with structure effects playing a leading role. However, total drug expenditures were not effectively controlled due to the increasing use of alternative drugs.

Evaluation of the effectiveness of comprehensive drug price reform: a case study from Shihezi city in Western China

BACKGROUND

China carried out a comprehensive drug price reform (CDPR) in 2017 to control the growing expense of drug effectively and reduce the financial burden of inpatients. However, early studies in pilot regions found the heterogeneity in the effectiveness of CDPR from different regions and other negative effects. This study aimed to evaluate the effects of the reform on medical expenses, medical service utilisation and government financial reimbursement for inpatients in economically weaker regions.

METHODS

Shihezi was selected as the sample city, and 238,620 inpatients, who were covered by basic medical insurance (BMI) and had complete information from September 2016 to August 2018 in public hospitals, were extracted by cluster sampling. An interrupted series design was used to compare the changing trends in medical expenses, medical service utilisation and reimbursement of BMI for inpatients before and after the reform.

RESULTS

Compared with the baseline trends before the CDPR, those after the CDPR were observed with decreased per capita hospitalisation expenses (HE) by ¥301.9 per month (p < 0.001), decreased drug expense (DE) ratio at a rate of 0.32% per month (p < 0.05) and increased ratio of diagnosis and treatment expenses (DTE) at a rate of 0.25% per month (p < 0.01). The number of inpatients in secondary and tertiary hospitals declined by 458 (p < 0.001) and 257 (p < 0.05) per month, respectively. The BMI reimbursement in tertiary hospitals decreased by ¥254.7 per month (p < 0.001).

CONCLUSION

The CDPR controlled the increase in medical expenses effectively and adjusted its structure reasonably. However, it also reduced the medical service utilisation of inpatients in secondary and tertiary hospitals and financial reimbursement for inpatients in tertiary hospitals.

Price-Cutting Trends in New Drugs after Listing in South Korea: The Effect of the Reimbursement Review Pathway on Price Reduction

This study aims to analyze the trends of post-listing price changes for new drugs listed from 2007, when the health technology assessment (HTA) was introduced in South Korea, until 2017. We analyzed 135 products that have undergone price cuts. These products were analyzed by their respective review pathways, namely, pharmaco-economic study (PE), weighted average price (WAP), and the without a cost-effectiveness (CE) pathway. Prices were discounted faster in PE than in WAP (p = 0.002 in a comparison between PE and WAP). In addition, the median discount rate of the first price cut was 5.0% (range: 0.1–20.0) for PE, 3.0% (range: <0.1–30.0) for WAP, and 5.0% (range: 0.6–10.9) without a CE pathway. The median cumulative discount rate of PE and WAP showed that the PE pathway products’ discount rates were higher: 10.4% for PE and 6.0% for WAP (p = 0.025 for comparison between PE and WAP). It is necessary to discuss the practical effects of the price-cutting system from a myriad of perspectives, including insurance finance, the value of new drugs, and the accessibility of new drugs to patients.

Consistency of new drug pricing in Korea: Bridging variations among personnel in price negotiations

OBJECTIVES

This study aims to explore the performance of price negotiations, over a period of 10 years, and identify individual variations in pricing that directly affect the consistency of pricing decisions.

METHODS

Existing literature and relative regulations were reviewed, and data provided by the National Health Insurance Service (NHIS) was analysed to evaluate the performance of price negotiations. To examine individual variations in pricing, hypothetical scenarios of four types of drugs were developed. These were subsequently given to the reviewers who have been actually conducting price negotiations at the NHIS.

RESULTS

Over the last decade, negotiations succeeded at a rate of 85.5 %, with a higher agreement rate in the more recent years. The reduction rate, via price negotiations, from the price approved for reimbursement by the Health Insurance Review and Assessment Service (HIRA), was 12.2 %. The survey results confirmed a significant individual variation in pricing. Especially, in the case of Drug N1, the higher-grade personnel and non-pharmacists tended to give higher prices with a significant difference.

CONCLUSIONS

The individual variations that would greatly affect the financial results were confirmed when making decisions on price of new drugs.For the consistency of drug pricing, some measures to minimise the variation of reviewers' judgement are needed.