66 Medical Consumables from Johnson & Johnson and Mindray Undergo Voluntary Price Cuts Effective March 27

The Focus of Governance: Linkage of Consumables Prices in Online Procurement, "Price Cut in One Province, Shared Nationwide".

1. Johnson & Johnson, Mindray…
66 Medical Consumables Voluntarily Reduced in Price

Recently, the Liaoning Province Drug and Medical Consumables Centralized Procurement Website released the "Notice on Implementing the Voluntary Price Reduction Results for 66 Consumables Including Linear Cutting Staplers and Staple Cartridges." Johnson & Johnson, Mindray, and other companies adjusted the online procurement prices for a total of 66 consumables. All medical institutions in Liaoning Province will implement the new prices starting from March 27. (The list of consumables price adjustments is attached at the end of the article.)

Source of the image: Liaoning Provincial Drug and Medical Consumables Centralized Procurement Website

Among them, Johnson & Johnson's linear cutting staplers and staple cartridges, trocars, and other 11 consumables have actively reduced prices, while Mindray Medical has proactively cut prices on a total of 35 consumables, with some product prices slashed by half.

In fact, as early as 2020, Liaoning Province announced that all products from enterprises participating in the province's consumables centralized procurement should commit to be listed at the lowest price available across China.

Source of the image: Liaoning Provincial Drug and Medical Consumables Centralized Procurement Network

Following this, Liaoning Province implemented the results of multiple rounds of active price reductions for medical consumables. On December 29 last year, the Liaoning Province Pharmaceutical and Medical Consumables Centralized Procurement Network announced that a total of 3,439 medical consumable products from companies including Johnson & Johnson had proactively reduced their prices, with the highest reduction reaching 90.42%.

2. Lowest Price Nationwide Linkage
Stricter Control on Medical Consumables

Apart from Liaoning Province, regions such as Fujian, Sichuan, Shaanxi, Guangdong, and Hebei also require companies to report the lowest price for national provincial listings, further tightening the supervision of consumables listings. Meanwhile, with the full establishment and implementation of a unified national procurement subsystem, the governance of consumables pricing has gained stronger support. The system’s "coded bidding, coded purchasing, and coded settlement" facilitates a more transparent and efficient process for the centralized procurement of medical consumables across China, further preventing issues like indirect price hikes.

At the National Healthcare Security Conference held in Beijing this January, it was emphasized that 2024 should "advance the special governance of online listed drug prices, explore new mechanisms for drug price formation, and increase the disclosure of credit evaluations in price bidding and procurement." In addition, the governance of listed medical consumable prices has now become a key focus for multiple provinces. With the increasing frequency of centralized procurement, the monitoring of non-selected products will also become stricter.

At the same time, increasing the online procurement rate of consumables, especially high-value medical consumables, has become one of the key focuses of consumables management. Recently, Shi Zihai, Party Leadership Group member and Deputy Director of the National Healthcare Security Administration, emphasized during an on-site investigation that public medical institutions should procure all required high-value medical consumables through provincial centralized procurement platforms.

Source of the image: National Healthcare Security Administration

At the national level, in August 2023, the National Healthcare Security Administration held a meeting to advance data quality governance for the procurement subsystem of the national medical insurance information platform, emphasizing the importance of the pharmaceutical and medical device procurement subsystem in the governance of consumable pricing. In the future, enterprises must consider the entire Chinese market when quoting prices, rather than focusing solely on a specific province or region.

3. Conclusion

As the work on the listing and online procurement governance of consumables progresses, various regions in China are gradually entering an era of nationwide linkage for the lowest price of consumables. "Price cuts in one province, shared nationwide" is expected to become a reality in the near future.

Editor: Penicillin

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