China boasts 48% price cut on insulin as domestic drugmakers eclipse Big Pharma in bulk order
In a first, China has featured insulin in its centralized drug procurement program — but the bulk order comes at a sizable cost for multinational pharma players.
Novo Nordisk, Sanofi and Eli Lilly were among eight companies, domestic and foreign, whose insulin products won tenders from the Chinese public hospital system. In exchange, the drugs’ prices were cut, on average, by 48%, saving the medical institutions a collective $1.4 billion on the first batch of 210 million doses, according to state media.
As a result of the tender process, some domestic drugmakers scored bigger orders because they offered lower prices than their (previously dominant) foreign counterparts.
According to local reports, the prices got as low as $2.81 (RMB17.89) per vial.
Given centralized price negotiation in reimbursement and procurement in China, competing on discounts — and how far they can go — has become imperative for the pharma industry. But where drugmakers concede on price, they typically expect to make up with volume.
Over the weekend, Novo Nordisk noted a combination of lower prices and reduced volumes could have a negative impact on sales, slowing growth down by about 3%. Analysts expect it to catch up with next-generation diabetes drugs such as its GLP-1 agonists.