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Cancellation of drug sale subsidization for medical services and separation of drug sales from hospitals

2015

According to Roland Berger's analysis, the "separation of drug sales from hospitals" and cancellation of "subsidization of medical services with drug sales" policies will be substantially and widely implemented during the 13th Five Year Plan, creating a major, long-term impact on the pharmaceuticals market and industry.

This report analyzes sales within China's pharmaceutical market, which is based heavily on prescription drug sales, predicting both policy trends and the extent to which the "cancellation of drug sale subsidization for medical services" and "separation of drug sales from hospitals" policies will be implemented following the 18th CPC National Congress. The report also examines how the existing models adopted by health care institutions and private companies can be integrated, analyzing the effects the "separation of drugs from hospitals" will have on industry institutions and enterprises.

Roland Berger Greater China Partner Joe Jin advises pharmaceutical industry players to take action early. "The government has clearly signaled its readiness to cancel 'drug sale subsidization for medical services,' and there have been numerous signs of the changes to come," said Mr. Jin. "We believe this policy will be implemented forcefully and at an unprecedented speed and scale. Under these conditions, the only way for companies and institutions across the industry to ensure future success is to proactively make preparations and position themselves in advance of the coming changes."

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