Research Report on Pricing of Pharmaceutical Products in China
In the face of continuing inflation, only those pharmaceutical companies that are entitled to the pricing right can win out. The research on the pricing mechanism of the links in the industry chain shows that the manufacturers of pharmaceutical raw materials (including active pharmaceutical ingredients, traditional Chinese Herbs and Chinese Herbal Pieces) basically determine on their own the drug prices on the basis of the cost and the situation of market demand & supply. The government’s control and management of the drug prices are mainly reflected in setting limits to the highest retail price of most drugs. Therefore, pharmaceutical manufacturers and medicine distributors are affected in this way.
1. SCHEMATIC CHART OF PRICING MECHANISM IN THE PHARMACEUTICAL INDUSTRY CHAIN
1.1 Raw material price: mostly determined by cost and supply-demand situation
1.2 The drug prices: varied control modes benefit brand and low-price drugs
1.3 Distributors: the rate of price rise strictly controlled by the government
2. DEVELOPED COUNTRIES’ MANAGEMENT ON DRUG PRICES
1.1 Raw material price: mostly determined by cost and supply-demand situation
1.2 The drug prices: varied control modes benefit brand and low-price drugs
1.3 Distributors: the rate of price rise strictly controlled by the government
2. DEVELOPED COUNTRIES’ MANAGEMENT ON DRUG PRICES
