Sector News

Generic drugs face April 2016 price caps in Japan

December 3, 2015
Life sciences

If Japanese health officials follow through on current plans, beginning in April of next year makers of generic drugs that until now have enjoyed the government’s strong backing will face their own price caps, reportedly a reduction of about 17% from current levels.

The Kyodo News cited officials of the Ministry of Health, Labor and Welfare who said an advisory panel strongly recommended the current cap of 60% of the price of the innovative version of a drug be lowered to 50% and the cap for biosimilars be set at 70%.

Other parts of the proposal, which the ministry is expected to make before the New Year, would make other price changes based mostly on the timing with patent expirations, the Kyodo story carried in the Japan Times said.

Until now, the Japanese government has been more lenient with generics prices than branded drugs as it carried out a plan to get the healthcare industry to focus more on the cheaper versions. But a series of recessions have forced budget cuts, including in the nation’s national health system, at a time when the population is aging at a fast rate.

Before the most recent recession, Japan already had planned that more than 80% of prescriptions written by March 2021 be for generics instead of branded drugs. The pace today is only 50% but is expected to reach 70% in 2017.

According to the unnamed officials cited by Kyodo, the proposal would include allowing a maker of the innovative drug to bring its own generic to the market as soon as its patent for the medicine has expired.

Also, if several generics of a brand are available as that patent expires, the generic cap would be set at 40% of the price of the innovator’s drug.

In addition to lowering the cost of the medicines it and the population buy, the ministry was also expected to accept the recommendation of another advisory panel to limit the fees it pays to hospitals and physicians, an estimated savings of $3.5 billion.

The cut in those fees would account for nearly all of a proposed budget cut of $4.1 billion, needing only $600 million from other sources, pharmaceuticals

By EJ Lane

Source: Fierce Pharma Asia

Related News

February 21, 2021

Sanofi invests in health tech firm Novadiscovery, boosting trial simulation platform and COVID-19 work

Life sciences

Novadiscovery uses its so-called JINKO platform that runs disease models on virtual patients to support decision-making and de-risk clinical development.

February 21, 2021

Gilead lets local HIV community groups take the lead with $3M grant

Life sciences

The pharma is pledging $3.2 million over two years to the Human Rights Campaign, the largest lesbian, gay, bisexual, transgender and queer (LGBTQ+) civil rights organization in the U.S.

February 21, 2021

Biotech company funds research project on diversity

Life sciences

In collaboration with Genmab, a new anthropological postdoc project at the Department of Anthropology will now explore and help develop the company’s efforts to ensure a diverse and inclusive workplace.

Send this to a friend