More details emerged! The eleventh batch of procurement may release these signals.

Since the completion of the tenth batch of centralized procurement of drugs in December last year, after more than half a year, the long-awaited eleventh batch of national organized centralized drug procurement ("the eleventh batch of centralized procurement") has finally been launched. Following the announcement of the selection of 55 products in the eleventh batch on July 15, most recently, the National Healthcare Security Administration's Price and Procurement Division has entrusted the China National Chemical Engineering Pharmaceutical Industry Association, China Meheco Group Business Association, the National Federation of Industry and Commerce Chamber of Commerce for Medicine and Health, and other units to solicit opinions on the main rules of the eleventh batch of centralized procurement. With the release of the "Draft for Soliciting Opinions," the rules of the eleventh batch of centralized procurement have gradually become clear. The "Draft for Soliciting Opinions" reveals more details Because of the comprehensive optimization of the rules, the eleventh batch of centralized procurement is considered an important milestone in the process of drug quantity procurement reform, attracting widespread attention from the industry. Recently, Jiang Changsong, assistant to the director of the National Healthcare Security Research Institute and director of the Price and Procurement Office, stated in an interview with "Chinese Medical Insurance" magazine that the national organized centralized drug procurement has been implemented in ten batches, covering 435 drugs, with nearly 800 selected companies and representing over 2000 products, which has produced significant results in the reform. It has effectively reduced the burden of drug costs for patients, saved medical insurance funds, reduced hospital operating costs, and promoted innovation and upgrading in the pharmaceutical industry. However, as the reform progresses further, centralized procurement still faces three major challenges: some patients and doctors doubt the effectiveness of some generic drugs, concerns about excessive competition leading to "low price equals low quality", and potential impacts on doctor prescription rights and patient choice. Therefore, it can be seen that the eleventh batch of centralized procurement focuses on "ensuring clinical stability, maintaining quality, preventing price manipulation, and preventing internal competition," with a particular emphasis on addressing the pain points and challenges encountered in previous rounds of centralized procurement. Previously, the National Healthcare Security Administration had announced the selection of 55 centralized procurement products and disclosed some of the rule optimizations for this round of procurement, such as specifying that medical institutions can report quantities based on specific brands, optimizing the calculation of price differentials, and no longer simply using the lowest bid as a reference. With the release of the "Major Rules for the Eleventh Batch of National Organized Drug Centralized Procurement (Draft for Soliciting Opinions)," more operational details have emerged, including the "N-3" dynamic selection mechanism, the "bi-resurrection" rule, and the anti-monopoly quantity ceiling clause. Although the "Draft for Soliciting Opinions" does not equate to the final plan, it is expected that the differences between the draft and the final plan will not be significant. "Compared to previous rounds, the rules for the eleventh batch of centralized procurement have been significantly and comprehensively optimized," noted Jin Chunlin, director of the Shanghai Health and Health Development Research Center. He stated that the notable improvements are reflected in the finer selection of centralized procurement products, as various risk factors are taken into account besides market size and competition level. High-risk factors such as patent infringement and high clinical use risk are carefully excluded from centralized procurement to ensure the safety and stability of clinical drug use. Furthermore, raising the qualification thresholds for companies guarantees the quality of centralized procurement drugs. In addition, whereas medical institutions in previous national procurements mostly reported quantities based on generic drug names, the eleventh batch of centralized procurement allows medical institutions to report quantities based on specific brand names, respecting doctors' clinical choices and prescription habits. Regarding the bidding rules, Jin Chunlin believes that key improvements include adjusting the 1.8 multiplier circuit breaker mechanism previously based on the "lowest price" in previous centralized procurements in the eleventh batch, aiming to curb malicious low-price competition. By introducing a low-price protection mechanism that specifies prices for different types of drug formulations, enterprises are not subject to the 1.8 multiplier circuit breaker rule if their prices fall within the specified range. To address possible instances of unreasonable low pricing by some enterprises, the rules for the eleventh batch of national procurement specifically require the lowest bidding selected enterprise for each product to provide a detailed explanation of the reasonableness of their prices and commit to not offering prices below cost. Furthermore, the "Draft for Soliciting Opinions" shows that the eleventh batch of centralized procurement plans to implement two types of "resurrection" mechanisms: "qualified resurrection" and "unqualified resurrection." Jin Chunlin believes that this new rule is beneficial in avoiding enterprises blindly pursuing low prices while providing more opportunities for enterprises that made pricing errors in the initial bidding round, thus promoting rational competition among enterprises. Breaking the Price Game The new changes in the eleventh batch of centralized procurement from the perspective of enterprises have also received positive evaluations. According to an industry insider, one of the core highlights of this round of procurement is to strengthen the competitive advantage of mainstream brands and imported brands through rule design to the greatest extent. Mainstream enterprises can lock in core market share through clinical recognition, while imported enterprises can obtain selection opportunities through the resurrection mechanism. Even if their initial bids fall short of expectations, they can still qualify for "resurrection" by gradually lowering prices, thus creating a certain market space for imported enterprises. The insider told the "Science and Innovation Board Daily" that this design not only avoids the vicious competition of "bad coins driving out good," but also ensures the diversity of market supply, potentially achieving a win-win situation for patients, enterprises, and medical insurance. However, they also pointed out that despite easing the pressure on enterprises to reduce prices through rule optimizations in this round of procurement, especially by effectively curbing ultra-low-price competition, the large number of participating enterprises means that price negotiations are inevitable. For the eleventh batch of centralized procurement, the conditions for the competitive landscape require a total of seven qualified enterprises based on "reference formulations + consistency evaluation," but in reality, most of the 55 products have dozens of eligible companies, with a maximum of ten selected. "Therefore, if each company wants to be selected, they can only approach the cost price infinitely," the insider explained. National drug procurement aims to eliminate inflated drug prices, but striking a balance between reducing prices and providing reasonable profits to enterprises remains a key issue. In particular, with a large number of generic drug companies in China and severe homogenization competition, this excessive internal competition within the industry has had a profound impact on the implementation of centralized procurement: a large number of companies flocking to apply for popular products has resulted in a significant increase in the number of enterprises exceeding the evaluation criteria for some centralized procurement products. Taking the eleventh batch of centralized procurement as an example, it can be seen that many of the products with excessive evaluations are concentrated in the period of 2024-2025, with most of the over-evaluated enterprises being approved in the past two years for certain products such as injection of benzylpenicillin sodium, injection of cefotaxime sodium, injection of theophylline, and Rosuvastatin capsules. Therefore, many believe that in addition to the need for the medical insurance department to improve centralized procurement bidding rules, strengthening coordination of industrial policies, such as enhancing risk alerts for homogenous varieties in the review and approval process by the drug regulatory department, are equally essential. Yan Lin (pseudonym) from a top-tier hospital in Shanghai, who has been on the front lines of healthcare for a long time, offers a representative perspective on the centralized procurement policy: "There is no doubt about the overall direction of the centralized procurement reform, but there is continuous need for optimization at the specific implementation level. From the perspective of the rule adjustments in the eleventh batch of centralized procurement, this trend of optimization and improvement is evident and substantial." He particularly emphasized that to ensure the maximum benefits of the centralized procurement policy, establishing a cross-departmental collaborative supervision system is crucial. The eleventh batch of centralized procurement confirms this point - the national drug regulatory authority has further strengthened the quality supervision throughout the entire process in this round of procurement. After selection, enterprises will undergo "double-hundreds" inspections by the drug regulatory authority - 100% coverage for production enterprises and 100% product sampling for selected products. "For frontline clinical staff, drug quality and safety always come first," Yan Lin said. "Centralized procurement should not only make drugs cheaper for patients but also ensure that they are safe to use. The eleventh batch of centralized procurement, through strengthening quality thresholds and supervision, has found a better balance between price and quality." This article is translated from "" by Xu Hong, edited by Liu Xuan for GMTEight.