Japan announces measure to crack down on drug pricing
pharmafile | December 20, 2016 | News story | Manufacturing and Production, Medical Communications | Japan, Shinzo Abe, opdivo
Japan has committed to annual drug price reviews whilst also expanding the scope by which the prices are deemed to be value for money. The current process is a review of prices every two years and is limited to drugs where there is a large difference between cost price and market price.
The updated review process will begin in 2018 and will occur annually after that. The review process will now include all prescription drugs to determine whether the pricing represents good value. The finer details of the review process have not yet been determined.
The move comes after Japan health ministry had chosen to cut the price of Opdivo by 50%, as part of a wider strategy to reduce the burden of rising drug prices combined with an aging population. At present, Japan is the third-largest market for prescription medicines, with the government spending $67 billion, and is a lucrative market for the pharmaceutical industry.
“The new regulations…will reduce the burden on the public while also improving the quality of healthcare in the country,” Chief Cabinet Secretary Yoshihide Suga is reported, by Reuters, to have told journalists.
Advisors to the Prime Minister, Shinzo Abe, have recommended that with judicious price cuts there could be savings of ¥190 billion a year in health care costs and reduce government spending by ¥48 billion.
The savings are important as health care expenses are highly influenced by proportion of elderly individuals within a society, a notable issue for Japan. According to 2014 estimates, 33% of Japan’s population is above the age of 60. This trend is only set to increase with time as, like most ‘developed’ countries, the number of citizens reaching an older age increases.
Though the measures have the pharmaceutical industry worried, the price reduction of Opdivo only brought the price of the drug in-line with the cost of the drug in the US market. The greater worry for the industry is that it continues the debate upon pricing of drugs that has caught fire in 2016, and has President-elect, Trump, promising to reduce the cost of drugs.
Ben Hargreaves
Related Content
Working mum develops COVID-19 vaccination database in Tokyo
A 36-year-old former English teacher living in Tokyo, Japan, has launched her own healthcare database, …
Japan approves Moderna & AstraZeneca COVID-19 vaccines
A Japanese government panel has approved Moderna and AstraZeneca’s COVID-19 vaccines for use in adults, …
Incyte biliary tract cancer treatment approved in Japan
The Japanese Ministry of Health, Labour, and Welfare (MHLW) have approved Incyte’s Pemazyre (pemigatinib) for …
