Taiwan industry looking for progress on pricing under new minister
This article was originally published in Scrip
Pharmaceutical industry groups in Taiwan are planning to meet the new minister of health early next month to discuss their objections to the general drug price cut scheduled for September 1st.
While this looks likely to go ahead as planned, cutting the prices of some products by 28%, the hope is to find a solution to some of the wider issues surrounding the regular revisions.
"The industry as a whole, including domestic manufacturers, wants to de-link the price cuts from the regular price-volume surveys," Carol Cheng, chief operating officer of the IRPMA, explained to Scrip.
The association, which represents research-based multinationals, and seven other industry groups had planned a mass demonstration against the lower prices, but have postponed this to give the negotiations room.
The new minister, Dr Yang Chi-Liang, took office on August 6th and has undertaken to hear the industry's concerns, Ms Cheng said. He has already given signs that price reductions may not be necessary when the difference between actual market prices and reimbursement levels is not large.
"The minister has noted that the prices of many drugs have already been decreased and that it may not be fair to squeeze the pharma sector further," Ms Cheng said. The latest reduction sparked warnings from some companies that they may have to withdraw unprofitable products.
The industry is not necessarily against the surveys, but is continuing to question the legal basis of the price reductions, which ultimately stem from hospitals' pressure for discounts in order to generate dispensing profits. This issue remains difficult to address because "the government has no control over providers", Ms Cheng noted.
The IRPMA and other groups have petitioned the Control Yuan (one of the five administrative branches of the central government) to look into the legal basis of the cuts, but this is expected to take several months. In the longer term, the IRPMA would like to see a mechanism based on an overall drug spending budget with a soft cap under the NHI scheme, which, if exceeded, would trigger negotiations for possible price adjustments.
Taiwan's NHI scheme as a whole is facing serious funding problems, with a deficit projected to exceed NT$60 billion ($1.82 billion) by the end of the year. The management of the programme and the "black hole" of drug discounts are also being investigated by the Control Yuan, which has the power to audit government programmes and impeach officials if necessary.
Dr Yang has already hinted that the premiums paid under the NHI scheme may have to be raised.