As China plans to remove tariffs on imported cancer drugs, Party mouthpiece calls for self-innovation
With China set to remove tariffs on imported cancer drugs to ease the burden of patients and their families, a Party newspaper has said the key to bring down sky-high prices of cancer drugs is to “break up the monopoly” by boosting innovation capabilities of domestic drugmakers.

Chinese Premier Li Keqiang pledged to slash tariffs on popular imported consumer goods in the market including drugs and apply zero tariff on much-needed cancer drugs on March 20, during a press conference at the closing of the country's annual “two sessions”. In merely one month's time, the State Council, China's cabinet, decided at an executive meeting to adopt zero tariff for imported cancer drugs, effective from May 1.

China reportedly has the largest population of cancer patients in the world with tumor incidence and mortality continuing to climb up. Based on the 2017 data of the country's National Cancer Center, each day, about 10,000 people are diagnosed with cancer. Also, the lung cancer incidence and mortality in China exceeds other countries in the world.

According to a report by, a Shanghai-based news portal, China has become the second biggest drug market in the world, with its size exceeding 1.57 trillion yuan in 2017. And, a news portal run by the Phoenix New Media, reported that the market for oncology medicines was valued at somewhere near 100 billion yuan and the figure was estimated to exceeded 120 billion yuan by 2017. Besides the country's big population, sky-high prices of imported drugs have also contributed to the huge market.

It's widely reported that for a long time, half of the market has been dominated by imported drugs and many cancer patients have to rely on imported drugs to stay alive. Due to patent reasons, the medicines are exorbitantly priced and in most cases could not be covered by the country's national insurance program.

So, stories of burdened families going bankrupt due to the high expenses are not unusual. Some were forced to give up while some took risks to purchase “illegal drugs” from neighboring countries. In 2015, news about a blood cancer patient getting sued for helping people suffering from the same disease buy cheaper generics in India made national headlines, becoming a case in point to highlight the suffering of Chinese cancer patients and their families.

According to China's pharmaceutical administration law, drug imports must go through the State Council drug regulators' approval and licensing process, otherwise even authentic foreign drugs would be treated as bogus medicines.

“In fact, the 'confidence' in pricier imported drugs derives from their originality. To truly and basically bring down prices, the key is to break the monopoly by raising the innovation capabilities of domestic pharma,” wrote a commentary in the People's Daily, a Party mouthpiece, citing the case of the country's self-developed Icotinib Hydrochloride tablets, a targeted cancer drug.

According to the commentary, the introduction of the new drug in the Chinese market had broken the monopoly of imported lung cancer drugs. Priced one-third of Gefitinib, its imported counterpart, the targeted drug developed by a company based in East China realized sales of over 200 million yuan in the year when it was put in the market.

The commentary proposed to create a “more level playing ground” for domestic drugmakers while pushing forward opening up. “In practice, the drug review process is too long (in China) and the innovative medicines by Chinese pharma are also hindered by the drug acquisition (system) to be more quickly included into China's National Reimbursement Drug List, which names all drugs covered by the national insurance program.

On December 1, 2017, China had already cut tariffs on 26 imported drugs to 2 percent. So it is believed that the zero tariff policy would not bring big changes. It was previously reported by Chinese media that besides tariffs, the value-added tax (17%), costs of multiple levels of commission agents, and a super-national treatment enjoyed by some foreign medicines have all contributed to the problem.

The Party newspaper noted the government actually has played a 'boxing combination' to address the price issue. Except for the highly advocated zero tariff policy, value-added taxes accompanying the drugs' production and import procedures would also be slashed. Some much-needed cancer drugs would be included in the national insurance program. Meanwhile, it's believed that cross-border online shops will be used to prevent unreasonable price markups.

Above all, China had previously initiated the so-called “reimbursement negotiation” with multinational drugmakers for gaining innovative and patented drugs at lower prices. The companies had agreed to considerably cut prices for the sake of big deals and bigger market share. It's reported that through the negotiations, in 2016, the average prices of drugs involved in the talks dropped 44 percent.

“The continuous reform efforts aimed at making it easier for people to access treatment is indicative of (the government's) people-centered thought,” the commentary noted.

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