On Mar. 5, 2021, China National Healthcare Security Administration and the joint procurement delegates from Tianjin, Shanghai, Chongqing, and another eight provinces or cities attended a centralized drug procurement conference in Nanjing, Jiangsu. One of the topics discussed is to carry out nationwide volume-based procurement for special drug items, starting with insulin products.1
Wuhan is the only city that took the lead in carrying out volume-based insulin procurement in China now, and its experience could be a guidance for other cities. As early as Jan. 3, 2020, Wuhan Drug and Medical Device Joint Procurement Office issued a notice on the price negotiation of insulin drugs by volume.2
According to the notice, more agreed procurement volume will be assigned to products with a larger price reduction below the national minimum price. A total of 37 insulin products produced by six companies, including Novo Nordisk, Lilly, and Gan & Lee Pharmaceuticals, made the final procurement list.3 The total procurement volume was 1,705,690, with market size of about 130 million yuan ($20 million)4. The unit price of some bidding insulin drugs was reduced by up to 43%.
Pharmaceutical companies will face fierce competition for a much bigger national market once the insulin procurement being implemented nationwide. The Chinese insulin market was about 20 billion yuan in 2019 and is expected to reach 30.723 billion yuan in 2025.5
According to International Diabetes Federation (IDF), China had about 116 million diabetic patients in 2019, and the number is still growing.6 Moreover, Chinese people can afford more drugs like insulin products with an overall increase in their incomes. Insulin products like recombinant insulin glargine have also entered the National Reimbursement Drug List (NRDL). Therefore, the Chinese insulin product market has great potential for development.
In the Chinese Insulin market, Novo Nordisk, Sanofi, and Eli Lilly remained the top 3 providers at the country's public healthcare institutions from 2018 to the first half of 2020.7 The three giants were followed by Gan & Lee Pharmaceuticals and Tonghua Dongbao Pharma Co Ltd, two companies which are making rapid progress in developing and producing insulin products.
Apart from insulin products, there are traditional antidiabetic drugs such as biguanides, sulfonylureas, and alpha-glucosidase inhibitors and those relatively new ones like GLP-1 receptor agonists, DPP-4 inhibitors, and SGLT-2 inhibitors. The subsequent price changes of insulins resulted from the upcoming nationwide insulin procurement will impact the market competition of the whole diabetes treatment sector in China.