context: Though price reductions were expected, the spectacular fall in coronary stent prices will have multiple repercussions for the medical equipment sector.
Bidding for centralised coronary stent procurement took place in Tianjin on 5 Nov 2020, reports Caixin. 26 products from 11 enterprises participated, says Jiemian.
All ten products in the final round are priced below C¥800, and seven will be selected, reports 8am Health Insight. Previously, stents were more expensive than in Europe and America, making them unaffordable for many patients, but now they are similar to prices in India. NHSA (National Healthcare Security Administration) says compared with the same products in 2019, price reductions reached 93 percent. Zhong Dongbo 钟东波 NHSA Department of Drug Price, Bidding and Procurement director says such price drops are beyond NHSA’s expectations. It will now spend C¥10.9 bn less on stents. Procurement results will be implemented in January 2021, says Sailing Health.
Such low prices raised quality concerns, but Zhang Tiejun 张铁军 Tianjin Healthcare Security Bureau vice director assures the public that quality standards have been strictly enforced.
The dramatic price reductions and the small market outside of the procurement left firms losing profits. Foreign firms were reluctant to take a large price hit; only three foreign products (from two firms, Boston Scientific and Medtronic) made it onto the final list of ten. Yicai notes the procurement will not affect the latest coronary devices in which foreign firms dominate. It might limit profits but will force firms to innovate. For example, drug-eluting balloons are expected to become a popular alternative to stents.
As centralised procurement is implemented, many doctors will lose the income they received through corrupt practices such as taking kickbacks, thought to be a major reason for high stent prices. Zhang says that with NHSA paying less to drug firms, funds can be used to reward medical services provided by doctors.