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

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Abstract

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.

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Potential savings from substituting generic drugs for brand-name drugs: medical expenditure panel survey, 1997-2000.

Jennifer S. Haas, Kathryn A. Phillips, Eric P. Gerstenberger … (2005)

Generic substitution is one mechanism of curtailing prescription drug expenditures. Limited information is available about the potential savings associated with generic substitution. To estimate the potential savings associated with broad substitution of generic drugs. Cross-sectional, nationally representative survey of noninstitutionalized adults. United States. Adults included in the Medical Expenditure Panel Survey Household Component, 1997-2000. Use of a multisource drug (that is, a drug available in a brand-name and > or =1 generic formulation) or a generic drug and the potential cost savings associated with broad generic substitution for all multisource products. Fifty-six percent of all outpatient drugs were multisource products, accounting for 41% of total outpatient drug expenditures. Of these multisource drugs, 61% were dispensed as a generic. If a generic had been substituted for all corresponding brand-name outpatient drugs in 2000, the median annual savings in drug expenditures per person would have been 45.89 dollars (interquartile range, 10.35 dollars to 158.06) for adults younger than 65 years of age and 78.05 dollars (interquartile range, 19.94 dollars to 241.72 dollars) for adults at least 65 years of age. In these age groups, the national savings would have been 5.9 billion dollars (95% CI, 5.5 billion dollars to 6.2 billion dollars) and 2.9 billion dollars (CI, 2.6 billion dollars to 3.1 billion dollars), respectively, representing approximately 11% of drug expenditures. Specific information about an individual's formulary was not available, so the authors could not estimate how much of the potential savings would benefit an individual or his or her health plan. Although broad substitution of generic drugs would affect only a modest percentage of drug expenditures, it could result in substantial absolute savings.

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Evaluation, in three provinces, of the introduction and impact of China's National Essential Medicines Scheme

Yang Li, Cui Ying, Guo Sufang … (2013)

OBJECTIVE: To evaluate implementation of the National Essential Medicines Scheme (NEMS) in rural China. METHODS: Two rural counties/districts in each of three provinces where NEMS had been implemented were surveyed. Information was collected from NEMS staff at the province, county/district, township and village levels; patients with chronic disease were also interviewed. Service provision, finances, prescriptions, inpatient records and the expenditures of patients with certain diagnoses were investigated in township hospitals and village clinics. The results were compared with the corresponding data recorded before NEMS was introduced. FINDINGS: Following the introduction of NEMS, drug procurement in each study location was systematized. Total drug costs declined. This, and improved prescribing, reduced the costs of outpatient and inpatient care and led, apparently, to increased uptake of health services. However, the prices of some drugs had increased and the availability of others had declined. The compensation of health-care providers for NEMS-related reductions in their incomes had been largely ineffective. As a result of the introduction of NEMS, health facilities relied more on public financing. Many health-care providers complained about higher workloads and lower incomes. CONCLUSION: Although it was well conceived, the introduction of NEMS into China's decentralized, fee-for-service system of health care has not been straightforward. It has highlighted the problems associated with attempts to modernize health care and health financing for patients' benefit. Sustainable mechanisms to compensate health-care providers for lost income are needed to ensure that NEMS is a success.

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Patients' attitudes towards and experiences of generic drug substitution in Norway.

Inge Kjoenniksen, Morten Lindbaek, Anne Granas (2006)

The aim of the study was to assess patients' attitudes towards and experiences of generic substitution 3 years after generic substitution of prescription medicines was permitted in Norway. Prescriptions from 2,128 consecutive patients in a Norwegian pharmacy were retrospectively reviewed to identify all patients (n=274) receiving eight or more different prescription drugs on the fifth level in the Anatomical Therapeutic Chemical (ATC) classification system during the last 6 months. An age-adjusted control group (n=269) of patients receiving three to seven different prescription drugs was randomly selected. Of the 543 patients, 386 were eligible for inclusion. Both groups received a mailed questionnaire addressing their experiences with and attitudes towards generic substitution. The overall response rate was 73% (281/386) and the average age of the respondents was 66 years old. The study found that patients who reported to have received information from their physician or the pharmacy about generic substitution were more likely to have switched (P<0.001). About half (138/281) of the patients had experienced a generic switch, and a higher proportion of the polypharmacy patients had their medication substituted compared to the control patients (P<0.001). Altogether 50 (36%) of the patients who had experienced a switch, reported one or more negative experiences connected to the substitution, and 29 of these (21%) reported an overall negative experience after the change. The experiences of the patients were not related to age, gender, or number of medications or information about generics from either the pharmacy or the physician. About 41% of the patients would not switch if they had no personal economic incentives. About 1/3 of the patients who had their medication substituted reported negative experiences. Generic drug substitution for a number of patients is not considered an equal alternative to branded drugs, and these patients may need additional information and support. The lack of correlation between patient experiences and age, gender, and medical regimen complexity is interesting and should be investigated further.

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Author and article information

Journal

Journal ID (nlm-ta): Int J Environ Res Public Health

Journal ID (iso-abbrev): Int J Environ Res Public Health

Journal ID (publisher-id): ijerph

Title: International Journal of Environmental Research and Public Health

Publisher: MDPI

ISSN (Print): 1661-7827

ISSN (Electronic): 1660-4601

Publication date (Electronic): 15 December 2020

Publication date (Print): December 2020

Volume: 17

Issue: 24

Electronic Location Identifier: 9415

Affiliations

[1 ]School of Health Sciences, Wuhan University, 115# Donghu Road, Wuhan 430071, China; leichen04@ 123456whu.edu.cn (L.C.); yangying@ 123456whu.edu.cn (Y.Y.); 2012302430049@ 123456whu.edu.cn (M.L.); 2018203050038@ 123456whu.edu.cn (B.H.); yinshicheng@ 123456whu.edu.cn (S.Y.)

[2 ]Global Health Institute, Wuhan University, 115# Donghu Road, Wuhan 430071, China

Author notes

[* ]Correspondence: zfmao@ 123456whu.edu.cn ; Tel.: +86-27-6875-9118

[†]

These authors contributed equally to this work.

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Ying Yang https://orcid.org/0000-0001-9252-5071

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Publisher ID: ijerph-17-09415

DOI: 10.3390/ijerph17249415

PMC ID: 7765443

PubMed ID: 33334027

SO-VID: 3ad7b70c-ea04-473d-a35e-c810aa00db54

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Licensee MDPI, Basel, Switzerland. This article is an open access article distributed under the terms and conditions of the Creative Commons Attribution (CC BY) license ( http://creativecommons.org/licenses/by/4.0/).

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

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Most cited references 51

Potential savings from substituting generic drugs for brand-name drugs: medical expenditure panel survey, 1997-2000.

Evaluation, in three provinces, of the introduction and impact of China's National Essential Medicines Scheme

Patients' attitudes towards and experiences of generic drug substitution in Norway.

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