The effect of the implementation of low price medicine policy on medicine price in China: A retrospective study

Xiaodong Guan, Mingchun Yang, Chunxia Man, Ye Tian and Luwen Shi

International Journal of Health Planning and Management, 2018, vol. 33, issue 3, e798-e806

Abstract: In an effort to relieve the pressure of drug shortages, the Chinese government implemented Low‐price Medicines (LPM) policy to raise the price cap in July 2014. The purpose of this study is to examine the effect of the implementation of this policy on drug price in China. Price data of 491 LPM, including 218 low‐price chemical medicines (LPCM) and 273 low‐price traditional Chinese medicines (LPTCM), were collected from 699 hospitals. We used interrupted time series design to identify the variation of monthly Laspeyres Indexes (LI) and Paasche Indexes (PI) for LPM, LPCM, and LPTCM. The result demonstrated that although LPM expenditures increased, the proportion of LPM expenditures accounting for all medicine expenditures fell from 3.6% to 3.2%. After the implementation of LPM policy, there was a significant increasing trend in LPM‐PI, LPCM‐PI, and LPTCM‐PI. The trend in LPM‐LI and LPCM‐LI was found from descending to rising. However, for LPTCM, the trend in the LI remained to decrease after the policy implementation. Despite the LPM policy had an increasing impact on the LPM drug price, the proportion of LPM expenditures accounting for all medicine expenditures did not increase. More efforts are needed in the future to promote the rational drug use in China.

Date: 2018
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