Hospitals voted to replace half of the countries collecting drugs, what is the operation of this wave in Shandong?

This article is written by No longer

At the end of last year, the first and third batches of drug centralized procurement agreements organized by the state expired, and the Shandong Provincial Medical Insurance Bureau carried out the renewal procurement of some drugs.

This time, the renewal period is three years, including the purchase of 47 drugs (the first batch of 25 drugs, the third batch of 22 drugs).

On January 5, 2022, the Shandong Provincial Medical Insurance Bureau issued the Notice on the Implementation of the Results of the Continuous Procurement of Drugs in Shandong Province after the Expiration of the Centralized Procurement Agreement of 38 National Organizations.

Unusually, 25 of the 47 products were turned over, including 16 RFQs and 9 bidding products.

More than half of the drugs purchased centrally at the national level have been "replaced" here in Shandong Province – the turnover rate is as high as 53.2%.

On the same offer, the small pharmaceutical company beat the original pharmaceutical factory and won the first place. In the notice, what role did the so-called "medical institution vote" play in the renewal of the bid?

Unusual collection

Why is it that this collection and renewal is unusual? Let's take a look at what happened.

Generally speaking, the current centralized procurement with quantity is mainly divided into two levels: centralized procurement of drugs organized by the state and procurement of local quantity.

The state organizes centralized procurement of drugs, and the State Medical Insurance Bureau and other departments organize provinces to form a procurement alliance, clarify the number of drug procurement and negotiate with drug manufacturers, and through centralized procurement and exchange prices for quantity nationwide.

Local procurement with quantity, the scope is within each locality, the main collection object is outside the scope of national collection, the procurement amount ranks the top varieties. Conduct price negotiations on drugs that are not included in the scope of centralized procurement and use of national organizations, and jointly promote the formation of a market-led drug price formation mechanism.

Image source: Screenshot of the 14th Five-Year Plan for Universal Health Security

Looking at Shandong, the national procurement agreement expired, and Shandong Province took over the baton.

Two methods: request for quotation and bidding.

Inquiry: refers to the purchaser to the relevant supplier to issue an inquiry form for its quotation, compare on the basis of the quotation, and determine the best supplier;

Bidding: The seller or buyer who organizes the transaction participates in the market bidding, determining the transaction volume and its price in a competitive manner.

In principle, the selected varieties in the previous round of collection and procurement time difference shall be determined by means of inquiry.

If the inquiry is unsuccessful, or the results of the selection are produced in the same amount during the previous round of collection, or the actual sales price of the non-selected products in the current Shandong market is significantly lower than the lowest selected price in the province in the previous round of collection and procurement, the winning enterprise and the selected price will be re-generated by auction.

In other words, those products that are not selected, if their actual price is lower than the collection price range, are likely to "flip against the wind" in the renewal bid.

Here's where the unexpected happened.

In the inquiry and procurement stage, in the process of bidding for clopidogrel hydrogen sulfate, the same offer of 17.81 yuan / box (75mg * 7), Yuan Dong Bio's Xin lai le defeated Sanofi's original research drug Bolivi, with the first pick.

And Xinlaile, until a year ago, even just got the "drug registration certificate".

Yuan Dong Bio Xin Lai Le registration batch number

Source: State Drug Administration

In the bidding procurement stage, when bidding for right medetomidine (2ml: 0.2mg * 1 stick), the Langfang Branch of Sinopharm Industry Group was selected at an ultra-low price of 4 yuan / piece, and the product was given at a price of 532 yuan / 4 pieces in Yangtze River Pharmaceutical, an average of 133 yuan per piece, a decrease of 96.99%.

Not to the right, the same situation occurs with pemetrexed disodium (100mg *1 bottle). Shandong New Era Pharmaceutical won the selection at a price of 97 yuan, beating the original national procurement enterprise Eli Lilly (the original national procurement price of 809 yuan), a decrease of 88.01%.

In addition, in the bidding for gefitinib tablets (250mg * 10 tablets), Shanghai Chuangnuo won the bid at a price of 41 yuan, and Chia Tai Tianqing lost the bid (the original national price was 450 yuan), a decrease of 90.89%.

In a very financial way, the whole collection process, "black swan" events are frequent.

Black swan events, or "Black swan" incidents, are very unpredictable and unusual events that often cause negative reactions or even disruptions in the market chain.

The logic behind it, we may wish to dig out the clues from this notice.

Why?

It is reported that the basis for the selection of several major "unpopular" is the "voting of medical institutions".

The announcement of the continued procurement in Shandong Province shows that after the quotation is decrypted, if there are 2 or more enterprises declaring the lowest echelon price of the inquired drug, or the same minimum price declaration of 2 or more enterprises appearing in the bidding drug, the public medical institutions in the province will evaluate and vote according to the supply and distribution, product quality and clinical reflection of the enterprise.

The voting weights of tertiary, secondary and first-level hospitals are determined by the ratio of 10:3:1, and the shortlisted order of enterprises is determined according to the number of votes cast by medical institutions from high to low. Medical institutions that do not vote within the time limit shall be deemed to have approved the voting results.

However, in response to the voting criteria for "medical institutions participating in the assessment", the Shandong Provincial Medical Insurance Bureau did not give corresponding rules.

Zhao Heng, founder of latitude Health, a medical strategy consulting firm, told Lilac Garden, "The determinants of hospital voting should have internal criteria, but they have not been announced, but they are definitely focused on price, clinical effects and pharmaceutical credit."

Under the premise of similar prices, giving the decision on drug use to the hospital provides a new "decision-making tool" and increases the participation of the hospital.

Pu Ying (pseudonym), deputy chief physician of a third-class hospital in East China, told Lilac Garden: "In clinical practice, such as urinary infections, if there is really evidence of infection, using some antibiotics of two or three dollars feels like 'hanging and playing.'"

"Under the general trend of collection, the introduction of hospital evaluation has also promoted the game between hospitals, pharmaceutical companies and medical insurance to some extent." In this regard, Zhao Heng said that in the future collection environment, the decisive factor should not only be medical insurance, "This policy in Shandong shows that in the process of transitioning to medical insurance payment, the prescription rights of hospitals have been partially restored."

But at the same time, he also pointed out that "the vote of medical institutions does not rule out the risk of pharmaceutical companies inducing medical institutions."

Wheels that can't be stopped

Looking at the whole country, the collection has gradually entered the renewal period.

And these pharmaceutical companies that have obtained admission tickets have to continue to compete in the trend.

Because the national procurement regulations, the procurement cycle of the selected varieties in 4 or more enterprises is 3 years (1 or 2, 1 year; 3, 2 years; 4 and above, 3 years), and 80% of the shared agreed procurement volume of 4 or more selected companies (50% of 1 selection, 60% of 2 companies, and 70% of 3 companies).

This leads to a very simple logic: for pharmaceutical companies, entering the collection is equivalent to obtaining a large share of the market, which means that drugs basically do not need to invest more in the marketing market.

When the collection enters the renewal period, the manufacturers who have lost the bid in the collection have the opportunity to re-select, and they have the desire to reduce the price to win the target.

In this regard, Zhao Heng said: "As long as there are new drugs on the market under the same generic name, if their prices are lower than the collection price, the collection products must adjust the price."

On the other hand, from the perspective of "sitting firmly in the chair", for a pharmaceutical company, the consequences of losing the collection of pillar products are very serious.

Clopidogrel is the leading product of Xinlitai. According to data from Ping An Securities, in 2017, the market share of clopidogrel hydrogen sulfate in the sample hospital was 30.13%, accounting for nearly 70% of the company's revenue.

In 2019, Xinlitai exploded and fell out of the standard for centralized procurement.

In 2019 and 2020, Xinlitai's net profit fell by 51% and 91% respectively, from an annual profit of 1.458 billion yuan in 2018 to 50.13 million yuan in 2020.

As one of the largest producers of clopidogrel hydrogen sulfate in China, Xinlitai had to gradually reduce its investment in clopidogrel hydrogen sulfate. Some colleagues of the clopidogrel hydrogen sulfate team were transferred to the blood pressure, special drugs, instruments and other teams; in addition, under the premise of legal compliance, some personnel terminated the labor contract by consensus.

For pharmaceutical companies that want to enter a new market, this collection and renewal of the standard provides an opportunity to counterattack - only need to reduce the production cost of the product as much as possible under the premise of passing the consistency evaluation, without worrying too much about the sales team.

Therefore, whether it is a one-way siege inside or outside the city, the move of pharmaceutical companies can be said to be "forced to play".

Behind the price

Let's go back to the renewal itself.

From the perspective of most pharmaceutical companies, it is a good thing to enter the collection. Therefore, in the renewal of the bid, the behavior of lowering the price may be more common.

But the price reduction has to be seen from multiple dimensions.

Dr. Pu said, "In the past, part of the profits of pharmaceutical companies were used for research and development, part of public relations publicity, and part of academic support. Now, although the public relations publicity is a province, research and development and academic support are also less, or even gone."

"To some extent, the flame of innovation of domestic pharmaceutical companies is getting weaker and weaker. Some pharmaceutical companies now want to imitate it - find a way to enter the collection and then lie down to make money for a few years."

From a macro point of view, the control field of a single enterprise is also easy to lay hidden dangers for "drug supply interruption".

In August 2021, North China Pharmaceutical was included in the "Violation List" by the State Joint Procurement Office for Drugs due to the failure of the third batch of national centralized procurement of the winning variety of ibuprofen sustained-release capsules in Shandong Province to supply the agreed procurement volume according to the agreement. (For details, please refer to the previous articles of The Lilac Garden: Medical Eldest Son Cut Off Supply collection: How is the board of North China Pharmaceutical hit?) ）

Announcement on the inclusion of North China Pharmaceutical Co., Ltd. in the list of violations

Source: Shanghai Pharmaceutical Procurement Network

Although in the third batch of national centralized procurement of ibuprofen sustained-release capsules, the winning bid price of North China Pharmaceutical was the highest among the four winning bidding companies, reaching 0.268 yuan / tablet, but the decline still reached 50%.

For the problem of supply interruption, North China Pharmaceutical explained that due to the long time period required to expand production capacity, and catching up with the eye of the epidemic in Shijiazhuang at the beginning of this year, the production capacity could not keep up, and it was impossible to complete the agreed supply of ibuprofen.

But in fact, the supply cut of pharmaceutical companies is not just an accident.

On September 18, 2021, the Henan Provincial Public Resources Exchange Center issued the Circular on the Results of the Evaluation of Pharmaceutical Prices and Credit Untrustworthiness in Our Province, which rated the pharmaceutical prices and credit untrustworthiness ratings of Beijing Biopharma Pharmaceutical Co., Ltd. as "serious".

Because OFC Pharmaceutical's "4+7" national drug collection and expansion of the selected product entecavir tablets, in Henan Province, there are low distribution rates and other supply problems, from May to June this year, there was even production suspension, supply cut-off, and did not inform the relevant collection institutions and units in advance, which seriously affected the clinical treatment order.

Zhao Heng told Lilac Garden: "The issue of drug supply after the supply cut has been perfected after the supply cut off in North China Pharmaceutical, on the one hand, it relies on the supply of other winning enterprises, on the other hand, it is to expand the number of winning enterprises and reduce the impact of a supply cut."

However, if in order to further bid, the drug price of the pharmaceutical company itself has decreased more, and the anti-risk ability of the cost increase such as the price increase of the API is low, and if the factors that increase the production cost such as the rise of the API, the possibility of supply interruption will increase accordingly.

Doctors under the policy

For doctors, the mixed feelings are mixed.

The original collection was to stipulate that hospitals should use a certain brand of products, rather than all products under the same generic name.

From the perspective of hospitals and clinicians, although the products involved in the collection have passed the consistency evaluation, the efficacy in clinical use remains to be examined. Choosing a drug that has been the result of years of clinical practice may be a safer option.

"Shandong's policy shows that the medical insurance payment price of drugs is determined by the medical insurance department, but the clinical effect and use assessment of drugs will be more determined by the hospital." Zhao Heng explained.

In the clinical frontline, Pu Ying told Lilac Garden, "Collecting, renewing bids, and reducing prices, in fact, the logic of each link is very smooth, and it is worth understanding: medical insurance wants to save money, hospitals want good efficacy, and pharmaceutical companies want to reduce costs." However, there is nothing new under the sun, "what doctors need to deal with is the means of long-term adverse reactions (not the drug itself), and they can't just think that the price is cut down, or they win."

Li Le (pseudonym), an endocrinologist at Shanghai Top 3 Hospital, confessed: "The actual situation is that perhaps because it is 'not bad money', many local patients always want to use imports, so they still tend to go to pharmacies to buy drugs outside the category."

"To be honest, I don't know what role medical institutions will play in the collection."

However, it is worth noting that "medical institutions participating in the assessment" as a signal released by Shandong provides a new idea for the future trend of collection and procurement.

Curated by: Carollero

Executive Producer: Gyouza

Resources:

http://ybj.shandong.gov.cn/art/2022/1/5/art_65415_10291700.html?xxgkhide=1

http://www.gov.cn/zhengce/zhengceku/2021-11/05/content_5649219.htm

http://ybj.zibo.gov.cn/art/2021/12/15/art_10746_2216579.html

http://www.gov.cn/gongbao/content/2019/content_5361793.htm