Health Policy Insights

Healthy China 2030: An Institutional Reshuffle to Improve Healthcare Quality and Prices

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Against the backdrop of Healthy China 2030, the Chinese government has gone through the most significant restructuring in years, consisting of personnel changes and a departmental shake-up. The reforms are part of China’s commitment to improving the overall health conditions of the Chinese people – looking beyond treating illnesses to enhancing prevention of diseases and improving health literacy1.

One of the three newly created health bodies, the National Medical Security Bureau (NMSB), has an ambitious agenda for 2019 which includes reimbursement reforms, a focus on tackling the rising prevalence of cancer and plans to introduce a health technology assessment system. The pharmaceutical industry is monitoring such changes closely, as reforms could impact current processes and legislation.


Three new health governmental bodies

The SAMR responsibilities include anti-monopoly regulation, standard setting, price monitoring, regulatory review and approval as well as intellectual property rights administration. The SAMR combines the former China Food and Drug Administration (CFDA) with the General Administration of Quality, Supervision, Inspection and Quarantine (GAQSIQ) as well as the State Intellectual Property Office (SIPO). The Director of the SAMR is Zhang Mao, former Director of China State Administration for Industry and Commerce.

This department will be responsible for formulating national health policy and standards for medical services as well as leading prevention-related work in relation to the challenges of the aging population. The NHC replaces the National Health and Family Planning Commission (NHFPC) and the State Council Health Care Reform office and will be led by Mr. Ma Xiaowei, the former head of NHFPC.

The NMSB responsibilities include pricing and reimbursement policy. The department will formulate policies, plans and standards for the medical insurance systems and will manage the National Drug Reimbursement List (NDRL) as well as head up drug and medical device pricing and procurement. Mr. Jinglin Hu, the former deputy director of the Ministry of Finance was elected to be the director of this new body

The pharma industry keeps an eye on NMSB pricing and reimbursement plans

The NMSB has started first overhauls of the pricing and reimbursement system in 2018. More significant changes are expected for 2019. Mr. Jinglin Hu has said the newly created NMSB will help the government to better ensure medical security and promote healthcare reform2. The bureau has three key aims: health equity, improving healthcare coverage, and strengthening healthcare systems. The main projects for 2019 include:


  • Pricing and reimbursement:

The newly established bureau is set to completely overhaul the pricing and reimbursement system in China. The NMSB is currently considering an update every two years, while industry is pushing for an annual update with clear and transparent criteria.

The pharmaceutical industry welcomes the new proposal to regularly update the national drug reimbursement list (NDRL). It is imperative that innovative medicines – particularly those tackling cancer and cardiovascular diseases– benefit from new reimbursement policies and improved financial coverage. Improved non-communicable disease (NCD) treatment coverage would also help tackle the country’s disease burden in cancer and cardiovascular diseases.


  • Reimbursement for cancer drugs:

The NMSB’s new reimbursement strategy for oncological products kicked-off in summer 2017 and is broadly welcomed by industry. This included the first update of the NDRL since 2009 with the addition of a number of cancer drugs. A subsequent update in October 2018 listed another 17 cancer drugs.

Overall, the reimbursement and pricing decisions are favorable to the pharmaceutical industry, although we have seen that price negotiations have become tougher. While we have seen price cuts range to 57 percent of prior market price, this could be compensated by the much higher volume of reimbursed products. Additionally in 2018, pharmaceutical companies also benefitted from the significant cuts to import tax and customs duties for cancer drugs that offset price cuts by about 3-15 percent. However, the newly established quantity-driven procurement policies such as the “4+7 cities” initiative must be closely monitored as they might lead to subsequent price erosion.


  • Establishing a health technology assessment (HTA) system:

The NMSB also called for establishing solid value assessment. A newly established health technology assessment (HTA) system in China will be a major game changer for Chinese reimbursement decisions. It is expected to systemize and render the national reimbursement decisions more transparent.

Continual governmental work in early 2019 will decide upon the general set-up. The pharmaceutical industry is still waiting to see the final workings of the HTA system and urges the government to reflect the value innovative medicines in the final model.





China Daily, New medical security body to boost population’s health, Last accessed December 2018

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Verena Kantel
Published: 27 May 2019
5 min read