The Ministry of Health and Welfare decided not to put a drug pricing reform plan, including cuts to prices for generics, on the agenda of the Health Insurance Policy Deliberation Committee subcommittee meeting on the 20th. This effectively stalls the timeline that had pledged "implementation in July."
As a result, the item will not be taken up at the full Health Insurance Policy Deliberation Committee meeting scheduled for the 25th. With the government's push for steep cuts to generic drug prices delayed by a beat, observers say the timing of implementation has become uncertain.
The ministry said it would "gather additional input from the industry and then finalize the schedule." But since the subcommittee had initially been set to approve the overhaul plan on this day, some interpret this as a loss of momentum for the policy push.
The core of the overhaul plan previously presented by the ministry is to lower generic prices from the current 53.55% of original drug prices to the 40% range. Drugmakers have called for a postponement, saying "the scale of revenue decline would be considerable." They also raised concerns about a contraction in industrywide research and development (R&D) investment capacity and potential disruptions in the supply of low-priced medicines.
As the ministry aims to put the item before the subcommittee within the first quarter of this year, full-fledged discussions on the overhaul plan are likely to resume in March. However, the strength of the final plan and the timing of its rollout will vary depending on what compromise the government offers between pushback from drugmakers and pressure to curb spending.