Core Viewpoint - The National Medical Security Work Conference held in December 2025 emphasizes the optimization of centralized procurement policies, the development of maternity and long-term care insurance, and the strategic purchasing role of medical insurance to support the innovative drug industry [1][2]. Group 1: Support for Commercial Health Insurance - The National Medical Security Bureau will support the integration and complementary development of commercial health insurance with basic medical insurance, encouraging the inclusion of more reasonable medical expenses outside the basic medical insurance catalog into the coverage of commercial health insurance [2]. - There will be an encouragement for commercial health insurance institutions to expand their investment in innovative drugs, promoting research and development in this area [2]. - A one-stop settlement service combining "medical insurance + commercial insurance" will be provided for eligible commercial health insurance products, aimed at improving claims efficiency [2]. Group 2: Development of Maternity and Long-term Care Insurance - The National Medical Security Bureau aims to include flexible employment personnel, migrant workers, and new employment forms in the coverage of maternity insurance [2]. - The goal is to achieve "no out-of-pocket" expenses for childbirth within the policy scope nationwide, with enhancements to prenatal examination medical expense coverage [2]. - The long-term care insurance system will be comprehensively promoted, with encouragement for commercial insurance institutions to develop commercial long-term care insurance products [2]. Group 3: Support for Pharmaceutical Industry Innovation - The National Medical Security Bureau will guide the pharmaceutical industry towards healthy competition and differentiated innovation, implementing measures to support the high-quality development of innovative drugs [3]. - New rounds of national centralized procurement for drugs and high-value medical consumables will be conducted, with a focus on improving the efficiency of enterprise returns [3]. - The multi-price discovery function of the Chinese drug price registration system will be leveraged to assist the Chinese pharmaceutical industry in expanding internationally [3].

Investment Rating - The industry investment rating is "stronger than the market," indicating an expected relative increase of over 10% in the industry index compared to the broader market within the next six months [9]. Core Insights - The report emphasizes that the National Medical Insurance Administration (NMIA) will promote high-quality development in the pharmaceutical and biotechnology industry through various measures, including optimizing payment settlement mechanisms and supporting the development of commercial health insurance [2][3]. Summary by Sections Investment Highlights - The NMIA has included 949 new drugs in the medical insurance catalog, bringing the total to 3,253 drugs. Future plans include the release of a new version of the disease-based payment grouping scheme and the implementation of quarterly or monthly special case reviews to support the clinical use of new drugs and technologies [3]. - The NMIA has established a commercial health insurance innovative drug catalog, which includes 19 drugs with significant clinical value and innovation. This aims to encourage the integration of commercial health insurance with basic medical insurance and promote investment in innovative drug development [3][4]. - The NMIA will support differentiated innovation in the pharmaceutical industry and enhance the multi-channel payment capabilities for innovative drugs. This includes conducting new rounds of national drug procurement and expanding direct settlement for selected drugs and consumables [4]. - The NMIA plans to accelerate the construction of a national health insurance digital platform and explore a comprehensive value evaluation system for health insurance, which will enhance the participation of various stakeholders in the healthcare ecosystem [4].

Investment Rating - The report assigns an "Accumulate" rating for the industry [1] Core Insights - The National Medical Security Work Conference emphasizes the continuation of optimizing centralized procurement policies in 2026, promoting the development of maternity insurance and long-term care insurance, and leveraging strategic purchasing to support the innovative drug industry [3] - The report highlights the importance of commercial health insurance in complementing basic medical insurance and encourages investment in innovative drug development [5] Summary by Sections National Medical Security Work Conference - The conference held on December 13, 2025, summarized the work during the "14th Five-Year Plan" period and outlined the tasks for 2026, including support for commercial health insurance and the establishment of a multi-tiered medical security system [5] - The National Medical Security Bureau will promote the inclusion of flexible employment workers and migrant workers in maternity insurance coverage, aiming for "no out-of-pocket" expenses for childbirth within policy limits [5] Support for Innovative Drug Development - The report discusses the strategic role of medical insurance in fostering healthy competition and differentiated innovation within the pharmaceutical industry [5] - It mentions the implementation of new rounds of national centralized procurement for drugs and high-value medical consumables, aiming to enhance the efficiency of company receivables [5]

Core Viewpoint - The National Medical Insurance Administration emphasizes the strategic role of medical insurance in supporting the innovative development of the pharmaceutical industry by 2026 [1] Group 1: Policy Initiatives - The meeting calls for the promotion of differentiated innovation and healthy competition within the pharmaceutical industry [1] - Implementation of measures to support the high-quality development of innovative drugs will be deepened, enhancing the multi-payment capabilities for innovative drugs [1] Group 2: Procurement and Pricing - New rounds of national drug procurement and high-value medical consumables procurement will be conducted [1] - Continued promotion of national alliance procurement for traditional Chinese medicine and Chinese herbal pieces is planned [1] - The goal is to achieve direct settlement for selected drugs and consumables from national procurement, with a focus on improving corporate cash flow efficiency [1] Group 3: International Expansion - The Chinese drug price registration system will be leveraged to enhance multi-price discovery functions, aiding the international expansion of the Chinese pharmaceutical industry [1]

Core Viewpoint - The national medical insurance work conference emphasizes the strategic purchasing role of medical insurance to support the innovative development of the pharmaceutical industry [1] Group 1: Support for Pharmaceutical Industry - The conference aims to guide healthy competition and differentiated innovation within the pharmaceutical industry [1] - Implementation of measures to support the high-quality development of innovative drugs will be prioritized, enhancing the multi-payment capability for innovative drugs [1] Group 2: Drug Procurement and Pricing - New rounds of national drug procurement and high-value medical consumables procurement will be conducted [1] - Continued promotion of national alliance procurement for traditional Chinese medicine and Chinese herbal pieces is planned [1] - The goal is to achieve direct settlement for selected drugs and consumables from national procurement, with a focus on improving enterprise cash flow efficiency [1] Group 3: Price Registration and International Expansion - The Chinese drug price registration system will be utilized to enhance multi-price discovery functions [1] - Efforts will be made to assist the Chinese pharmaceutical industry in expanding internationally [1]

Core Insights - The article discusses the recent adjustments to the National Basic Medical Insurance, Maternity Insurance, and Work Injury Insurance drug catalog, highlighting the government's commitment to supporting innovative and differentiated drug development through strategic purchasing [1][2]. Group 1: Drug Catalog Adjustments - On December 7, the National Healthcare Security Administration (NHSA) released the updated drug catalog for 2025, which includes 114 new drugs, of which 50 are classified as Class 1 innovative drugs [2]. - The overall success rate of drug negotiations for the insurance catalog has improved to 88% in 2025, up from 76% in 2024, indicating a more favorable environment for drug inclusion [2]. - The total number of drugs in the catalog has increased to 3,253, with significant enhancements in coverage for critical areas such as oncology, chronic diseases, mental health, rare diseases, and pediatric medications [2]. Group 2: Financial Implications - Over the "14th Five-Year Plan" period, the cumulative expenditure of the medical insurance fund has exceeded 13 trillion yuan, benefiting nearly 20 billion patient visits [1]. - The NHSA has included 835 new drugs in the insurance payment scope over the past seven years, with 149 of these being innovative drugs, and approximately 80% of innovative drugs are included in the catalog within two years of their market launch [1]. - The NHSA's negotiations have resulted in over 4.6 trillion yuan in expenditures for negotiated drugs, driving sales exceeding 6 trillion yuan [1]. Group 3: Commercial Health Insurance Innovations - The first version of the commercial health insurance innovative drug catalog was introduced, including 19 drugs that are highly innovative and provide significant clinical value, such as CAR-T therapies and treatments for rare diseases [3]. - This new catalog aims to complement the basic medical insurance, clarifying the boundaries of basic insurance coverage and promoting the development of a multi-tiered medical security system [3].

Core Viewpoint - The article discusses the complexities of China's healthcare system, particularly the challenges of balancing quality, cost, and accessibility in the context of imported and domestic pharmaceuticals [6][19]. Group 1: Drug Registration and Market Dynamics - The National Medical Products Administration (NMPA) recently announced the cancellation of 80 drug registration certificates, with over 55% being products from foreign or joint venture companies, indicating a trend of imported drugs exiting the Chinese market [8][9]. - The cancellation of these drugs was initiated by the companies themselves, suggesting a strategic business decision rather than regulatory enforcement [8]. Group 2: Quality and Efficacy of Pharmaceuticals - Both original and generic drugs have identical active ingredients, but differences in formulation and manufacturing processes can lead to variations in clinical effectiveness [11][12]. - The quality of domestic generic drugs has improved significantly due to stricter regulations, but there remains a gap in bioequivalence standards compared to international benchmarks [15][19]. Group 3: Healthcare Financing and Policy - China's healthcare system faces the "impossible triangle" of quality, cost, and accessibility, necessitating the use of low-cost generic drugs to meet the basic healthcare needs of a large population [19][20]. - The government prioritizes the reimbursement of generic drugs over original drugs to ensure the sustainability of the healthcare system, which can lead to limitations on the availability of higher-priced original medications [20][24]. Group 4: Innovation and Future Directions - The introduction of innovative drugs into the healthcare reimbursement system has become more efficient, with the average time from market entry to reimbursement reduced to less than two years [22][24]. - The savings from using generic drugs are being redirected to subsidize the costs of innovative drugs, highlighting a strategic approach to healthcare funding [24][27]. Group 5: Patient Choices and Market Dynamics - There is a call for more flexibility in the healthcare system to allow wealthier patients to access original drugs, suggesting a need for a multi-tiered healthcare financing model [26][27]. - The article emphasizes the importance of maintaining a balance between cost control and individual patient needs, advocating for a system that supports both generic and innovative drug development [26][27].