Relationships between developmental strategies for additional indications and price revisions for anticancer drugs in Japan

Background The relationships between developmental strategies for additional indications and drug price revisions have not been thoroughly studied. Here, we investigated the price revisions for anticancer drugs approved in Japan. Methods The study was based on published information on anticancer drugs approved between January 2009 and March 2020 in Japan. We investigated the relationships between the pharmacological and regulatory characteristics of anticancer drugs and occurrence/non-occurrence of the Japanese National Health Insurance (NHI) price revisions. Results Eighty-one new anticancer drugs were given NHI price listings during the survey. On April 1, 2020, the prices of 23 anticancer drugs had been revised from the initial pricing, the prices were reduced for 21 drugs (91.3%). Several parameters showed the relationships between drug characteristics and NHI price revisions. The achievement of additional indications and compound type were identified as explanatory factors for these relationships. Additional indication profiles were defined to assess the relationships between the methods for additional indication achievement and price revisions. When the type of additional indication was “Expansion”, the percentage of drugs received NHI price revisions was the highest (P<0.001). Conclusions NHI price revision was significantly related to the achievement of additional indications and compound type. The strategy for additional indications was found to affect the occurrence/non-occurrence of NHI price revisions.

The Price Effect of Drug Price Ceilings: Intended and Unintended Consequences

Policy makers in many developing countries use maximum price or markup policies to control pharmaceutical costs, which represent 20%–60% of their overall healthcare expenditure. We study the price effect of price ceiling policies by exploiting a major policy shift in China: the elimination of longstanding ceilings on retail drug prices. We collect weekly price and characteristics data on more than 4,500 drug stock keeping units (SKUs) from a leading pharmacy chain. By comparing the rate of discontinuous price jumps across drugs with and without price ceilings during the years before and after the policy change, we find that while price ceilings are effective in containing the prices of some drugs, they can lead to higher prices for others, particularly if the ceilings are set at the national level irrespective of local economic conditions. About 5% of nationally controlled drugs (or more than 125 drugs) had inflated prices because of price ceilings, with an average price inflation of 10%. We attribute this perverse price effect to focal point pricing and asymmetric information about production costs. Further supporting this view, we find the perverse price effect most prominent in lower-income regions where the centrally set price ceilings are arbitrarily high considering their poorer economic conditions. Moreover, drugs with highly concentrated production and less elastic demand face heightened risks of inflated prices under price ceilings. Finally, based on a sample of drugs with available price ceiling data, we find that drugs with manufacturer-specific ceilings are 100% more likely to be priced at or near their ceilings and 70% more likely to experience price drops once the ceilings are removed compared with other drugs with regular ceilings. Overall, this paper documents the unintended perverse effect of price ceilings in pharmaceutical markets and sheds lights on the ongoing debate of drug price regulation. This paper was accepted by Stefan Scholtes, healthcare management.

Relationships between Developmental Strategies for Additional Indications and Price Revisions for Anticancer Drugs in Japan

Background The relationships between developmental strategies for additional indications and drug price revisions have not been thoroughly studied. Here, we investigated the price revisions for anticancer drugs approved in Japan. Methods The study was based on published information on anticancer drugs approved between January 2009 and March 2020 in Japan. We investigated the relationships between the pharmacological and regulatory characteristics of anticancer drugs and occurrence/non-occurrence of the Japanese National Health Insurance (NHI) price revisions. Results Eighty-one new anticancer drugs were given NHI price listings during the survey. On April 1, 2020, the prices of 23 anticancer drugs had been revised from the initial pricing, the prices were reduced for all, except for one drug. Several parameters showed the relationships between drug characteristics and NHI price revisions. The achievement of additional indications and compound type were identified as explanatory factors for these relationships. Additional indication profiles were defined to assess the relationships between the methods for additional indication achievement and price revisions. For the 32 drugs with additional indications, the relationships between the additional indication profiles and occurrence/non-occurrence of NHI price revision were investigated. The proportion of drugs with NHI price revisions was higher if the additional indication had more patients than if the additional indications had approximately the same numbers of patients or fewer patients. Conclusions NHI price revision was significantly related to the achievement of additional indications and compound type. The strategy for additional indications was found to affect the occurrence/non-occurrence of NHI price revisions.

Drug price control in Malaysia: a stakeholder analysis

PurposePharmaceutical pricing has always been a contentious issue around the world. Recently, the Government of Malaysia has proposed for drug price control. This proposal has received backlash from pharmaceutical industry. Therefore in this study, the authors would like to examine the position of various stakeholders on this issue.Design/methodology/approachThe authors used Policy Maker software to identify and evaluate the position of the stakeholders, their interest and their power. Next, the authors contextualize the factors that might contribute to the success or failure of the policy using Kingdon's multiple stream analysis.FindingsThe authors found that the drug price control regulation received mixed reactions from the stakeholders, with the public sector mainly supporting the proposal whereas the private sectors opposing it. The findings indicate that the drug price control proposal have a high chance of success due to strong political will from both the government and the opposition and also strong support from the public and the consumer groups.Practical implications1. The drug price control proposal received strong political will and strong public support. Thus, it has a high chance of success. 2. The government should be careful in managing concentrated powerful groups. The government should strategically engage with the stakeholders to move them to more positive attitude. 3. The government should avoid backtracking on policies as this will portray critical weakness to other stakeholders.Social implicationsThe public sector provides strong support for the regulation. However, this support must be maintained and remain as their top priority. Their opinions are important in shaping health policies. The public's feedback will provide transparency and accountability in the policy-making process.Originality/valueThe findings indicate that the drug price control proposal have a high chance of success due to strong political will from both the government and the opposition and also strong support from the public and the consumer groups.