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Japan Medical Association, pharmaceutical industry call for postponing review of drug prices

  • June 11, 2020
  • , Nikkei , p. 5
  • JMH Translation

The health care and pharmaceutical industry is calling on the Japanese government to postpone its plan to cut drug prices every year starting from fiscal 2021. Currently, drug prices are reviewed once every two years. The Japan Medical Association (JMA) and industry associations released a proposal on June 10 to shelve the fall 2020 survey needed to calculate price reductions. They cite reasons such as increased workloads for employees who are dealing with the new coronavirus outbreak.


The JMA, Japan Dental Association, and Japan Pharmaceutical Association gave a joint press conference on June 10 to request a postponement of the survey. The Japan Pharmaceutical Wholesalers Association and the Federation of Pharmaceutical Manufacturers’ Associations of Japan expressed similar views at the meeting of the Central Social Insurance Medical Council, an advisory council of the Ministry of Health, Welfare and Labour (MHLW).


MHLW will make a final decision before its Basic Policy on Economic and Fiscal Management and Reform is formulated in July 2020. If the survey is postponed, price cuts will also be postponed by two years.


Each prescription drug has an official price. However, the prices quoted by wholesalers when selling drugs to medical facilities is lower than the official price due to competition. MHLW surveys market prices and reduces the official price to minimize the difference. Up until now, drug prices have been revised every two years, but the Japanese government has changed its policy to revise them every year starting from fiscal 2021.


To cut prices in fiscal 2021, it will be necessary to survey the differences between official and market prices in fall 2020. The industry organizations claim that “wholesalers and medical facilities should not be forced to take on extra work when they need to respond to the new coronavirus.” There have been delays in price negotiations between hospitals and wholesalers.


Increasing the frequency of revising official drug prices is part of reform aimed at adjusting health care costs. The MHLW will consider the proposal with caution since a postponement would also delay reductions in the public’s share of health care costs.

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