Playing hardball, negotiator secures nation's health

Few bargaining videos can have garnered as much attention and praise as the one featuring Xu Wei, head of the Zhejiang Provincial Medical Insurance Bureau's Medical Services Management Department.

In the clip from November 2019, Xu, who leads a team of medical insurance experts, managed to cut the price of dapagliflozin tablets from 5.62 yuan ($0.87) to 4.36 yuan per tablet during negotiations with pharmaceutical company representatives.

Dapagliflozin tablets are used to treat Type 2 diabetes, which affects about 11 percent of Chinese population. The medication's average price on the international market is about 7 to 8 yuan.

The meeting in late 2019 was part of a national initiative aimed at lowering drug prices and alleviating the public's medical burden.

Since 2018, the National Healthcare Insurance Administration has conducted four rounds of negotiations with drug companies, and has centralized procurement campaigns.

A total of 533 drugs have been selected so far and their prices have fallen by an average of 53 percent, the administration said recently, as it gears up for the latest round of negotiations, which are set to begin in the second half of this year.

Some of Xu's comments in the video went viral, prompting netizens to coin a new term－"soul bargaining tactics"－to describe his bold, assertive approach.

When one representative said that the price they were offering was already lower than in South Korea, Xu replied: "Have you ever thought about the huge population in China? We are negotiating with you with the entire country behind us. You have one more opportunity to get this right."

In response to a new quote of 4.4 yuan, Xu said, "There are too many fours. Four sounds bad in Chinese. How about taking off another 0.04 yuan down? Is 4.36 yuan OK?"

It was not until the representative nodded that Xu's pokerface broke into a slight smile. "We hope you will keep making good drugs, and keep making our people healthy," he said.

When asked why he pressed so hard for a decrease of as little as 0.01 yuan, Xu said that "there are more than 100 million diabetes patients in China. Suppose 10 percent use dapagliflozin tablets, a small reduction of 0.01 yuan could save 100,000 yuan per day, and 36 million yuan annually. So even an extremely small reduction should not be overlooked."

In addition to the direct benefit to patients, Xu said price negotiations can bring many more positive outcomes, including maintaining the balance of the country's medical insurance funds, helping drugmakers tap into the domestic market, and providing a wider range of products for hospitals to choose from.

He said that during negotiations, he often stressed that as long as pharmaceutical companies offer the best price, their interests will be protected. "In the face of disease, we are not adversaries, but allies," he said.

As the latest version of the national reimbursement drug list took effect on March 1, the Administration said that it estimated patients will save about 28 billion yuan this year, thanks to the reductions.

"With price cuts to 14 anti-cancer drugs, cancer patients alone are projected to save more than 3 billion yuan," said Xiong Xianjun, head of the administration's Medical Services Supervision Department.

On June 17, the General Office of the State Council released a circular laying out 20 key tasks in deepening healthcare reform this year. One is to expand the use of drugs selected during price negotiation campaigns, and improve relevant policies by the end of August.

In addition, the administration is closely monitoring the clinical outcomes of generic drugs that have been added to the national bulk-buying program, in order to address the concerns of some patients.

In a report released by the administration on June 9, it said that a two-year study into 14 generic drugs selected during the first round of negotiations shows that they match name-brand counterparts in terms of safety and efficacy.