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China to add 56 drugs to price-slashing bulk-buy programme

BEIJING (Reuters) - China has added 56 medicines, including some global blockbuster drugs, to its state bidding programme aimed at procuring key treatments at big discounts in return for offering large-volume state contracts, a state agency said.

The procurement authorities released late on Wednesday the list of drugs open to the upcoming round of bidding.

It includes some products that contributed more than $1 billion each to foreign drugmakers’ sales in 2019 but face challenges from generic versions offered by local drugmakers.

They include AstraZeneca Plc’s heart disease treatment Brilinta, blood-thinning blockbuster Eliquis, jointly developed by Pfizer Inc and Bristol Myers Squibb Co, and Novartis AG’s diabetes drug Galvus.

Beijing has pledged to lower consumer costs of off-patent drugs by pushing forward a national scheme where drugmakers have to go through a bidding process and chop prices low enough to elbow out competitors to be eligible to sell their products at public hospitals in bulk.

The scheme helped China notch up more than 50% of price cuts on average from drugmakers at home and abroad in its previous bidding held in January.

While competition for older brands intensify, Novartis said in an earning call last week that new drug launches are expected to be a main driver of its growth in China.

“We will continue to support the Chinese government’s policies by actively introducing innovative medicines and therefore improving accessibility to benefit more patients in need,” a Novartis representative said in an email.

AstraZeneca and BMS didn’t respond to a request for comment, while Pfizer asked to get in touch with partner BMS for any queries regarding the inclusion of their drug.

For most products on the list, if only one company wins the bid to supply a certain drug, the winner can bag up to half of the total procurement volume in the first year, according to the plan. If a product has at least four bid winners, 80% of the volume can be shared.

Information about drug companies’ applications to participate in the upcoming bidding will be released on Aug. 20 in Shanghai, according to the plan.

Reporting by Roxanne Liu and Tony Munroe in Beijing; Editing by Miyoung Kim and Rashmi Aich