The scope of medical insurance drug reimbursement is expanding—Which pharmaceutical companies will benefit?

On May 13, the National Healthcare Security Administration, jointly with the Ministry of Finance, issued the "Notice on Doing a Good Job in Basic Medical Insurance for Urban and Rural Residents in 2019," which clearly emphasized the need to establish and improve a unified outpatient expense management and payment mechanism for urban and rural residents' medical insurance, with a particular focus on covering common and chronic diseases that place a heavy financial burden on the public. Medications prescribed for outpatient treatment of conditions such as hypertension and diabetes will now be included in the scope of medical insurance reimbursement.

　　Meanwhile, sources close to regulators revealed to reporters that the second batch of the "4+7" product catalog for 2019 is already on the agenda and will be released soon. Among these, antihypertensive drugs and hypoglycemic agents are particularly prioritized.

　　The diabetes pharmaceutical market is growing rapidly.

　　In recent years, the incidence of diabetes in China has been rapidly increasing. Data from the National Health Commission show that the number of people with diabetes in China has reached 114 million, among whom Type 2 diabetes accounts for nearly 90% of the diabetic population.

　　The 2019 National Medical Insurance Catalog Adjustment Plan has officially been implemented, and the new adjustments to the catalog are already poised for action. In this round of updates, diabetes medications have become one of the priority categories for revision.

　　The new edition of the National Medical Insurance Catalog includes 33 diabetes medications, among which 12 are insulin-based drugs and 21 are second-type diabetes medications designed to lower blood sugar levels.

　　In 2017, the four major oral medications in the diabetes field—acarbose tablets, metformin tablets, repaglinide tablets, and glimepiride tablets—accounted for 15.3 billion yuan in public medical institutions, representing 70.69% of the total expenditure on oral antidiabetic drugs and playing a crucial role in clinical practice. Notably, acarbose alone captured nearly half of the entire oral antidiabetic drug market.

　　According to data from Meinian Data, in 2017, the acarbose drug market in China's public hospitals reached 7.4 billion yuan, representing a year-on-year growth of 18.79%. Acarbose is a first-line antidiabetic medication recommended in China's clinical guidelines for diabetes treatment, and it was included in both the 2017 National Medical Insurance Catalogue (Category A) and the 2018 National Essential Medicines List.

　　Bayer's acarbose tablets surpassed 4 billion yuan in sales in 2017, while Huadong Medicine's acarbose tablets not only became the first domestic generic version but also the first to pass the consistency evaluation. In the past four years, the product has maintained an average annual sales growth rate of approximately 30%.

　　Meanwhile, companies such as Beijing Wansheng Pharmaceutical, Hainan Rizhongtian Pharmaceutical, Qianjin Pharmaceutical, Xintai Pharmaceutical (Suzhou), and Haizheng Pharmaceutical are also making strategic moves in this area.

　　In addition to insulin and fixed-dose combination drugs, among the currently available antidiabetic medications in China, biguanides, sulfonylureas, glinides, α-glucosidase inhibitors, and DPP-4 (dipeptidyl peptidase-4) inhibitors have all received approval for consistency evaluations.

　　Currently, the manufacturers that have passed the consistency evaluation for Metformin Hydrochloride Tablets include Guizhou Tian'an Pharmaceutical, Guangdong Huannan Pharmaceutical, Beijing Sihuan Pharmaceutical, and Shiyao Group.

　　The manufacturers that have passed the consistency evaluation for Metformin Hydrochloride Extended-Release Tablets include Deyuan Pharmaceutical, Shanghai Pharmaceuticals, Yuekang Pharmaceutical, and Shanghai Xuantai Pharmaceutical.

　　DPP-4 generic drugs began receiving product approvals in 2019. Among them, Osakem's saxagliptin tablets 2.5mg and 5mg, as well as vildagliptin tablets 50mg approved separately by Jiangsu Hausen Pharmaceutical and Qilu Pharmaceutical, were all newly approved products in the first quarter of 2019.

　　The competition for hypertension medications is fierce.

　　Based on population size and structure estimates, China currently has approximately 330 million hypertension patients. Among the 36 drugs included in the second batch of negotiations that entered the national health insurance catalog in 2017, 6 were cardiovascular medications.

　　Olmesartan medoxomil is one of the blockbuster drugs used to treat hypertension, with Daiichi Sankyo as its original research and development manufacturer. Data shows that in 2015, Daiichi Sankyo's global sales of olmesartan medoxomil reached a remarkable $1.847 billion, accounting for 25% of the company’s total sales.

　　Zhengda Tianqing's olmesartan medoxomil tablets just received approval for consistency evaluation this March, undoubtedly posing a challenge to Daiichi Sankyo's relevant market.

　　Both losartan, an antihypertensive drug, and another similar medication are currently in the market. Huahai Pharmaceutical has already passed the consistency evaluation, but due to the unresolved genotoxic impurity issue from 2018, the product can only be reintroduced once stability studies are completed.

　　As for a common hypertension medication like amlodipine, data from Menet show that in 2017, sales at the retail level of public medical institutions reached 5.689 billion yuan, with the original manufacturer Pfizer competing in the market against several generic drug companies.

　　Currently, several pharmaceutical companies under China Resources Double-Crane—including CR-Sinochem, Jingxin Pharmaceutical, Jiangsu Huanghe Pharmaceutical, Yangtze River Pharmaceutical, Suzhou Dongrui Pharmaceutical, Chenxin Pharmaceutical, and Yabao Pharmaceutical—have already passed the generic drug consistency evaluation.

　　In 2017, terazosin hydrochloride tablets—used for the treatment of mild to moderate hypertension—generated sales exceeding 150 million yuan at the terminal level in public medical institutions. Abbott, the original research company, held over 80% of the market share, while China Resources Double Crane's subsidiary, China Resources Sike, captured a 12% share, making it currently the only company approved to have passed the consistency evaluation for this product.