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Medical Insurance Negotiation 2.0 Era: âTrue Innovationâ Means Meeting âReal Needsâ
Medical Yao · 2024-12-06 07:41
Innovation should not be confined to form, but should focus on results.
With the closing of the 2024 medical insurance negotiations, Chinaâs medical insurance has officially entered the 2.0 era of fully supporting âreal innovationâ.
Since the establishment of the National Medical Insurance Administration in March 2018, a total of seven medical insurance negotiations have been held. Throughout these seven negotiations, the Medical Insurance Administration has continuously increased its support for âinnovationâ. Especially after the âImplementation Plan for Supporting the Development of Innovative Drugs Throughout the Whole Chainâ was formally reviewed and approved in July this year, supporting âreal innovationâ has become the main theme of this medical insurance negotiation.
According to the final negotiation results, a total of 91 drugs were newly added to the national medical insurance drug list this year. Among them, 90 were newly launched in the past five years, and 38 were âgloballyâ innovative drugs. Both the proportion of innovation and the number of new drugs included set a new record in Chinaâs medical insurance negotiations.
From âcompeting on priceâ to âcompeting on innovationâ, Chinaâs medical insurance negotiations have undergone a comprehensive transformation. Under such a tone, only âtruly innovativeâ products that can meet clinical needs can truly gain the attention and support of the Medical Insurance Bureau. The opportunity for Chinaâs innovative drugs lies in âtruly innovationâ.
01 Two-way movement between medical insurance and innovation
Under the main theme of supporting âreal innovationâ, innovative drug products have received unprecedented support from the Medical Insurance Bureau.
Of the 117 non-catalog drugs that participated in the medical insurance negotiations, 89 were successfully negotiated, with a success rate of 76%. The average price reduction was 63%, which was basically the same as in previous years. Among them, the negotiation success rate of innovative drug products exceeded 90%, significantly higher than the overall 76%. This also indirectly shows that the Medical Insurance Bureau is using real money to support âreal innovation.â
At the medical insurance negotiation site, negotiation experts will negotiate with companies based on the low price of drugs, which is based on the multi-dimensional measurement and evaluation of the value of drugs by the medical insurance party in the early stage. It is understood that this yearâs drug floor price calculation is more inclusive of innovation. Under the same conditions, drugs with high innovation and great benefits to patients will be calculated at a higher price.
In this regard, Zhang Xifan, director of the Catalog Management Division of the Medical Services Management Department of the National Medical Insurance Administration, said: âMedical insurance drug negotiations are definitely not simply about lowering prices, but more about value purchases. We need to scientifically measure and evaluate how much benefit this drug can bring to patients. To understand or calculate health benefits, we have introduced mainstream international pharmacoeconomics theory, combined it with Chinaâs actual situation, and then proposed a reserve price based on the fundâs affordability.â
With the continuous improvement of drug base price calculation technology and methods, pharmaceutical companies are guided to continuously aim at âreal innovationâ. In this process, clinical gaps are filled one after another, and the majority of patients become direct beneficiaries.
As the leading bispecific antibody in China, Kangfang Biopharmaâs two bispecific antibody products, cardunilimab (PD-1/CTLA-4) and ivocizumab (PD-1/VEGF), have been successfully included in the medical insurance catalog. Cardunilimab is the worldâs first tumor immunity bispecific antibody drug. It was approved for the indication of advanced cervical cancer in China in June 2022, filling the market gap in cervical cancer immunotherapy; ivocizumab was approved for marketing in May this year. It is the worldâs first bispecific antibody new drug with a âtumor immunity + anti-vascularâ mechanism, and it is also the worldâs first drug to defeat K drug âhead to headâ.
Coincidentally, two of Digene Pharmaceuticalsâ âoriginal innovationâ products, Suvotinib and Golixitinib, have also been included in the medical insurance catalog through medical insurance negotiations. Suvotinib was approved for marketing in August 2023 and is the worldâs only oral targeted drug for the treatment of non-small cell lung cancer (NSCLC) with EGFR exon 20 insertion mutations (exon20ins); Golixitinib was approved for marketing in June this year and is the worldâs first and only new drug for the treatment of peripheral T-cell lymphoma (PTCL) that acts on the JAK/STAT pathway.
These two companies are just a microcosm of the âreal innovationâ supported by this round of medical insurance negotiations. In this era where medical insurance and innovation are going hand in hand, only products that truly start from reality, solve clinical gaps, and have global innovation can enjoy the dividends of the times.
02 What is âreal innovationâ?
âReal innovationâ is the term most mentioned by the Medical Insurance Bureau this year. So what exactly is âreal innovationâ? To answer this question, we must go back to the basics and start from the âreal needsâ of clinical patients.
In Liang Ningâs new book âReal Needsâ, she accurately summarizes âreal needsâ. In the complex business phenomena, we can propose a minimalist model of âreal needsâ that includes three elements: value, consensus, and model.
Figure: The minimalist model in the book âReal Needsâ
The first is value, which is the practical significance that the product can provide to users. For the pharmaceutical industry, the core value of a drug is its excellent efficacy. Before any drug is launched on the market, it needs to undergo several years of clinical trials. Only with excellent clinical trial results can it finally be launched on the market.
The second is consensus, that is, the product must be consistent with the market consensus. In the pharmaceutical industry, this consensus comes from the long-term clinical practice of doctors and industry experts, especially for indications with clinical gaps, which is where the industry consensus is most consistent. For example, the FDA has quickly filled the gaps in indications through the âorphan drugâ and âdeepened approvalâ policies.
Finally, the model. In many cases, clinical data cannot be equated with the final commercial results, because there are compliance issues in actual use. For example, many drugs perform well in clinical practice, but due to insufficient water solubility and inability to be taken orally, they cannot be made into drugs or have poor commercial results. A good product must take into account all the practical problems that patients may encounter in their lives.
To sum up, the âreal innovationâ supported by medical insurance must be a product that can meet the âreal needsâ of patients.
The essence of a product is service. For medicine, the essence is to cure diseases and save lives. The president of Merck has a famous saying: âWe should remember that medicine is used to cure patients and medicine is made for people. As long as we remember this, profits will naturally continue to flow.â
Indeed, the pharmaceutical industry should never be too eager for quick success. Commercialization is only a result. The most important thing is to fill the gaps in the industry and meet the needs of patients. Only when pharmaceutical companies put themselves in the shoes of patients and think about problems from their perspective can they truly find products that patients need most urgently, and commercialization will naturally come naturally.
03 âTrue innovationâ means meeting âreal needsâ
Starting this year, medical insurance negotiations are no longer obsessed with a single price factor, but have increased their attention to blank clinical needs. This is an obvious trend signal, indicating that the Medical Insurance Bureau has a more thorough understanding of the meaning of âinnovationâ.
The essential difference between âreal innovationâ and âinnovationâ lies in the change of thought paradigm. âInnovationâ only needs to meet the requirements at the patent level, while âreal innovationâ starts from actual clinical practice and fills the treatment gap for patients.
Therefore, âreal innovationâ does not necessarily mean a 1.1 new drug, but it must be a product that solves a âreal needâ. For example, in the entire cervical cancer prevention and treatment system, patients with precancerous lesions who have been infected with HPV but have not progressed to cervical cancer are facing a lack of non-invasive treatments.
The main cause of cervical cancer is HPV infection, which induces some abnormal cells in the cervical epithelial tissue, a process also known as cervical intraepithelial neoplasia. As the number of abnormal cells increases, the degree of neoplasia continues to deepen and eventually develops into cervical cancer.
In the whole process of neoplasia, high-grade squamous intraepithelial lesions (HSIL) are both the last link and the most important link. Because the mutation of cervical epithelial tissue is actually a reversible two-way process, it may be reversed if treated properly, but if not treated in time, it will face the risk of progression to cervical cancer.
In current clinical practice, surgery is the first choice for HSIL, and there are no more innovative treatments available. The patient chose cervical resection, which can remove the lesion but is harmful to the patientâs cervical function. The patient urgently needs a non-invasive treatment solution that does not harm the cervix.
In the context of the lack of effective non-surgical treatment options for HSIL, Asieris Pharmaceuticals innovatively incubated APL-1702, the worldâs only product submitted for marketing approval for the non-invasive treatment of cervical precancerous lesions. It not only provides new options for HSIL patients, but also redefines the treatment logic of HSIL.
APL-1702 is a drug-device integrated photodynamic therapy product. Based on the principle of photodynamic therapy, after irradiation with light waves of a specific wavelength, it induces apoptosis and necrosis of diseased cancer cells. It is hoped that patients can reverse the disease process, better cope with recurrence, and achieve long-term management of precancerous lesions while preserving an intact cervix.
Prior to this, many therapeutic vaccines and drugs have appeared in the world, trying to develop HSIL indications but all ended in failure. However, APL-1702 has shown promising data in the international multi-center Phase III clinical trial, and is expected to become the worldâs first HSIL non-invasive treatment with proven efficacy through international Phase III clinical trials.
In terms of the three elements of âvalue, consensus, and modelâ, Yahong Pharmaceuticalâs APL-1702 fully meets the âreal needsâ. In terms of value, APL-1702 has excellent clinical data and is the only non-invasive treatment for cervical precancerous lesions in the world that has submitted an application for listing, with global innovation capabilities; in terms of consensus, âone size fits allâ has long been unable to meet the needs of HSIL, and innovative therapies are urgently needed to fill the clinical gap; in terms of model, Yahong Pharmaceutical has broken through with the âcombination innovationâ model, which is painless, non-invasive and convenient.
Under the âreal innovationâ system of the medical insurance fund, pharmaceutical companies are no longer competing on the ability to synthesize compounds, but are thinking about how to effectively fill clinical gaps based on actual clinical practice. Innovation should not be limited to form, but should focus on results. Focusing on filling clinical gaps is undoubtedly the innovation direction that the medical insurance fund will focus on supporting in the future.
This article is written based on public information and is for information exchange only and does not constitute any investment advice.
This article comes from the WeChat public account âYi Yaoâ , the author is Pharmacist Lin
WeChat or Weixin in Chinese (Chinese: ćŸźäżĄ; pinyin: WÄixĂŹn (listenâ) ; lit. âmicro-messageâ)[a] is a Chinese instant messaging, social media, and mobile payment app developed by Tencent. First released in 2011, it became the worldâs largest standalone mobile app in 2018[5][6] with over 1 billion monthly active users.[7][8][9] WeChat has been described as Chinaâs âapp for everythingâ and a super-app because of its wide range of functions.
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