Core Viewpoint - The article discusses the results of the 11th batch of national organized drug procurement in China, highlighting the inclusion of 55 commonly used drugs across various therapeutic areas, aiming to enhance drug accessibility and affordability for patients [1][2]. Group 1: Procurement Results - The 11th batch of drug procurement included 55 drugs, with participation from 4.6 million medical institutions and 445 companies submitting bids, resulting in 453 products from 272 companies being shortlisted [1]. - Notable shortlisted drugs include Dapagliflozin, Pravastatin, and Metformin combined with Ertugliflozin, which are expected to further improve accessibility due to their inclusion in the procurement [1]. Group 2: Market Dynamics - The procurement aims to stabilize clinical use, ensure quality, and prevent excessive competition among companies, which has been a concern in previous rounds [5][6]. - The introduction of price anchors and measures to prevent collusion among related companies has led to a more stable pricing environment, with overall pricing reported as normal and stable [6][8]. Group 3: Clinical and Quality Assurance - The procurement process has been optimized to respect clinical needs, allowing institutions to report quantities based on either generic names or specific brands, with 77% of institutions opting for brand reporting [8][9]. - Measures to ensure drug quality include mandatory consistency evaluations and stringent penalties for non-compliance, ensuring that low prices do not compromise quality [10]. Group 4: Industry Impact - The procurement process is seen as a way to balance profits from generic drugs while encouraging innovation, as companies are now more inclined to invest in research and development due to stable cash flows from guaranteed procurement [11][12]. - The introduction of a "revival mechanism" allows companies that do not win bids to still secure a portion of the market, promoting a more competitive environment [11].

Core Viewpoint - The new procurement rules aim to prevent pharmaceutical companies from engaging in harmful price competition while ensuring quality and affordability for patients, aligning with medical insurance cost control requirements [2][3]. Group 1: New Procurement Rules - The latest round of centralized drug procurement involves 55 types of drugs, including those for infections, tumors, allergies, diabetes, and cardiovascular diseases [2]. - The new bidding rules optimize the price difference calculation anchor, moving away from a simple lowest price model, requiring the lowest bidder to justify their pricing and commit to not pricing below cost [2][3]. - A "revival" mechanism has been introduced, allowing mainstream brands that did not win in the first round to qualify at the highest proposed winning price, recognizing the market value of quality brands [3]. Group 2: Quality and Compliance - The new rules impose strict quality controls, requiring that the production lines of bidding drugs have no violations of quality management standards in the past two years, with comprehensive inspections and product sampling by regulatory authorities [3]. - The reporting rules have shifted from generic drug names to allowing medical institutions to report based on specific brand names, emphasizing respect for doctors' prescribing autonomy and ensuring patient access to medications [3]. Group 3: Industry Impact and Future Outlook - The new procurement rules are expected to accelerate the reshaping of the pharmaceutical industry, with many companies likely to be eliminated due to severe product homogeneity [4]. - Companies are reminded that competing solely on price is not sustainable; they must focus on quality and innovation to thrive in the industry [4]. - Continuous feedback from stakeholders is essential for evaluating the impact of the new rules, ensuring that the procurement policy remains effective and beneficial for both patients and companies [4].

Core Viewpoint - The National Healthcare Security Administration has released the 11th batch of centralized drug procurement documents, emphasizing principles of stabilizing clinical needs, ensuring quality, preventing collusion, and countering excessive competition. Group 1: Stabilizing Clinical Needs - The primary goal of the procurement is to ensure clinical medication needs, with optimized reporting methods for medical institutions allowing for both generic and brand-specific reporting [4] - Approximately 46,000 medical institutions participated in this procurement, with 77% of the reported quantities specified by brand [4] - The procurement volume is set at 60% to 80% of the reported quantities, allowing institutions to choose brands for the remaining portion [4] - New selection rules encourage major companies to participate by offering opportunities to those whose products meet clinical demand but did not initially qualify [4] - Special attention is given to ensuring the supply of pediatric medications, with adjusted pricing rules for small specifications to encourage supply [4] Group 2: Ensuring Quality - The procurement process has incorporated higher quality control standards based on feedback from regulatory bodies [2] - Bidders must have at least two years of production experience for similar formulations, and their production lines must pass GMP compliance checks [4] - The assessment of production quality has been expanded to include the production line's compliance history [4] - Preference will be given to companies with stable quality and clinical recognition when bids are equal [4] Group 3: Preventing Collusion - Measures to prevent collusion have been enhanced, including treating closely related companies as a single entity during bidding [4] - A "first to report leniency" mechanism has been introduced to encourage reporting of collusion [4] - Stricter penalties will be applied to companies found to be colluding, including being placed on a violation list [4] Group 4: Countering Excessive Competition - The procurement will implement a "weak elimination" rule to prevent extreme price increases, with the highest valid bid being a critical measure [5] - Adjustments to price control mechanisms will ensure fairness and prevent excessively low bids from disrupting the market [5] - Companies are required to commit to not bidding below their costs, with explanations needed for any bids below the established price anchor [5] - The procurement process will strengthen the execution of selected results, holding companies accountable for timely delivery and medical institutions for adhering to procurement agreements [5]

Core Points - The National Healthcare Security Administration has released the 11th batch of centralized drug procurement documents, emphasizing principles of "stabilizing clinical needs, ensuring quality, preventing collusion, and countering excessive competition" Group 1: Stabilizing Clinical Needs - The primary goal of the procurement is to ensure clinical medication needs, with a focus on optimizing procurement measures [2] - Medical institutions can report quantities based on either generic names or specific brands, with 77% of the reported quantities specified by brand [2] - The procurement volume is set at 60%-80% of the reported quantities, allowing institutions to choose the remaining portion independently [2] - New selection rules encourage major companies to participate by allowing them to match the prices of winning bids if their initial bids were not selected [2] - Special attention is given to ensuring the supply of pediatric medications, with adjusted pricing rules for small specifications [2] Group 2: Ensuring Quality - The procurement process incorporates higher quality control standards based on feedback from regulatory bodies [3] - Bidding companies must have at least two years of production experience for similar dosage forms and must pass GMP compliance checks [3] - The quality assessment now extends to the production line of the bidding drugs, requiring no GMP violations in the past two years [3] - Preference is given to companies with stable quality and clinical recognition when bids are equal [3] Group 3: Preventing Collusion - Measures to prevent collusion have been enhanced, including treating closely related companies as a single entity during bidding [4] - A "first to report leniency" mechanism is introduced to encourage reporting of collusion [4] - Stricter penalties are imposed on companies found to be colluding, including being placed on a "violation list" and facing maximum penalties under pricing and procurement credit evaluation systems [4] Group 4: Countering Excessive Competition - The procurement process promotes transparency and fair competition, with voluntary participation and self-quoted prices [5] - The rules for determining the highest effective bid have been optimized to prevent extreme price increases [5] - A new price control anchor is established, ensuring that if the lowest bid is below 50% of the average winning bid, the anchor will be set at 50% of the average [5] - Companies are required to commit to not quoting below their costs and must justify any low bids [6] - Selected companies are held responsible for supply guarantees and must fulfill orders promptly [6]