However, an article profiling medical representatives’ work show that local and international trade associations have cooperated based on shared ground and common interests.  Additionally, reports of local manufacturers’ comments on the impact of the Essential Drug List System echo concerns expressed by international pharmaceutical businesses on the effects of price control measures.

News relating to multinational business investment and activities in China abound over the course of the month. This trend contrasts with one expert’s view that China has shifted its focus to social welfare developments for the next five years from its previous focus on GDP growth.

News in the region reflects the robust growth prospects of medical tourism as well as opportunities for servicing the aging market.  News from Singapore points to new frontiers in medical services through innovative design of future hospitals and integration of web applications for disease management.  In addition, news reports on the lack of patient compliance in Hong Kong offered a rare glimpse of implications for public resources and health outcomes.

This month’s media reporting in China suggests a need for the international business community to engage in a communication strategy that reflects an awareness and engagement on issues of importance to the Chinese public.  The overarching themes of healthcare affordability and accessibility have driven a framework of discussions and policy considerations.  Until the public perceives business initiatives as part of the solution to these issues, the viewpoint will likely persist of business endeavors as self-serving and conflicting with the public interests.

各位尊敬的业界同仁:

这将是我们最后一次给您发送月度新闻摘要。我们决定终止该月报。今后，我们将转向为您提供其他种类的行业观察和服务。罗德公关亚洲区为客户提供量身定做的公关策略和咨询服务，以及在企业传播、医疗和健康传播等方面的专业指导性意见。

如需详细信息，敬请垂询Mai Tran，电子邮箱：mtran@ruderfinnasia.com 。

媒体报道摘要

三月份关于降价令频出 外资药“特权”已被陆续剥夺的媒体报道阐述外资与本地药企利益分歧的观点。竞争对手邮件曝光跨国药企缜密商战; 康芝药业指责强生“不正当竞争” “尼美舒利”很受伤？等报道也延伸了此类观点的表述。

媒体对医药代表工作的报导则显示其实中外医药企业有更多雷同的立场及互利的合作空间（一个医药代表的一天）。而媒体关于国内药企对基本药物招标的评论（委员热议基药制度 药价虚低比药价虚高更危险）也回响了外资对药价控制措施提出的看法。

针对药品一降价即消失的说法，发改委剖析药品降价致廉价药暂消失现象并表明严治药品变脸 降价药不会一降就死。与其同时，本月外资药企在华的投资和商业消息密集。此趋势对比一专家评论, “十二五”规划与“十一五”规划相比，“十一五”规划偏重于追求“国强”，而“十二五”规划则强调追求“民富”（幸福感五年十二问：住房是第一关注）。

北京大学政府管理学院教授顾昕提出神木医改模式就是有管理的竞争的看法。卫生部政策与管理研究专家委员、北京大学中国经济研究中心教授李玲则针对国务院推进公立医院试点改革 要求提高医生待遇表示：“《通知》中确有亮点，但还需下重力、动真格。”媒体揣测，安徽模式或将推广全国 医改“安徽模式”。而两会地方官哭穷：无地可卖 上一任已卖光了的报导，也指向医改关于地方、中央财政安排的挑战。

三月份的媒体报道显示，跨国企业需要一套反映企业关切并积极参与中国公众关注的话题的传播战略。“看病难，看病贵”一直是主导医疗讨论和政策考量的主题框架。直至公众舆论认可商业活动为解决“看病难，看病贵”的有效解决方案内容，商业活动或将持续受制于舆论的质疑。

Medical Reform

Acknowledging that medical reform challenges remain, China announces plans to continue to ramp up healthcare spending.

The National Development and Reform Commission announced the latest round of price cuts on pharmaceuticals to reduce public medical expenses by RMB 10 billion annual.  This will affect over 164 types of medicines involving 1300 formulations, including 140 medical formulations offered by foreign-invested companies.  Nanfang Metropolitan News interviewed businesses for their responses to the new price-cut measure and reported:

• Foreign-invested pharmaceutical businesses sounded alarms over the impact that the measure would have on business investment and risk projections.  Others expressed concerns that the policy may have overlooked past long-term investments involved in bringing the medicines to market.  RDPAC (The China Association of Enterprises with Foreign Investment R&D-based Pharmaceutical Association Committee) expressed its understanding of the policy as measures to reduce healthcare cost and burden on individuals.  The association also suggested that other cost-reducing options may serve to reduce medical costs as well.
• Domestic manufacturers, however, welcome the measure, and some businesses view it as a means to remedy market distortions caused by preferential pricing schemes enjoyed by foreign businesses.  An expert of the Chinese Pharmaceutical Business Management Association pointed out, “The concept of original R&D medicine is a manufactured and confusing concept.  It confuses the differentiation between patent and non-patent medicines.  In most cases, original R&D medicines are treated as patent medicines and have enjoyed long-term high pricing advantages.”
• Based on interviews conducted by the journalist, a significant number of representatives of the national congress attribute rising medical costs in China to the high pricing of original R&D medicines.
• 降价令频出 外资药“特权”已被陆续剥夺

According to Nanfang Daily, news of the pharmaceutical price cuts drew widespread comments posted by netizens.  According to the report:

• Over 15,000 netizens logged on to comment at qq.com alone within the first few hours following the NDRC’s announcement.
• One Guangzhou netizen wrote, “The news of the price cuts is like the long-awaited rain in a drought.”  Others expressed worries, “The price cuts will not have the intended impact.  Drugs will be repackaged and sold at the original price.  Further price cuts will only mean additional repackaging.”
• Experts expect minimal impact of the measure on local pharmacies as consumers have access to most of the therapies through hospital formulary.
• A security brokerage analyst also predicted that future price-cut trends may focus on high-price oncology therapies.  He mentioned the already low price margin for most commonly used medicines sold in pharmacies and the limited chances of further price reduction.
• 162种药品降价逾两成 减轻群众负担近100亿

First Financial Daily reported on interviews with local pharmaceutical business leaders who also serve as representatives of the People’s National Congress or CPPCC members.  According to the report:

• A common thread implies that the price-driven bidding approach of the Essential Drug List has forced out those manufacturers with higher production standards.
• An expert of the China Pharmaceutical Business Management Association offered that structural reform—separating the management and ownership structure of public hospitals—is central to improving healthcare affordability and accessibility.  The expert also pointed out that pharmaceutical pricing would need more market-based mechanisms to improve the quality of price management.
• 委员热议基药制度 药价虚低比药价虚高更危险

The NDRC defended the efficacy of price-reduction measures to improve healthcare affordability.  According to China Youth News:

• With reference to reports that many reduced pharmaceuticals either disappear or are repackaged to evade price-cut measures, an official identified what he considered out-dated misperceptions.  He asserted that newly introduced measures require evidence of superior efficacy for new formulations.  Merely repackaged pharmaceuticals do not qualify for exemption from reduced-price regulations.
• The official also highlighted the need for actively encouraging market-based measures as well as government interventions.
• In all, the NDRC has implemented 27 rounds of price reductions over the years.  Public discontent with issues of healthcare affordability and accessibility has continued unabated, however.
• 发改委：严治药品变脸 降价药不会一降就死

According to a separate news report, NDRC disclosed that in 2007 it had commissioned a study to investigate claims that medicines disappear or appear repackaged after undergoing price reductions.  The report disputed the claims. In addition, the article stated:

• In spite of complaints by manufacturers, the price-reduction measures have not forced any manufacturers out of business.
• An NDRC staff member commented, “Price adjustment only addresses symptoms of the problem.  Addressing the challenges of healthcare affordability would require deepening of the reform by separating the functions of healthcare service and pharmaceutical prescriptions.”
• The most important message from the new round of price-reduction heralds changes underway in the government’s approach to price adjustments and price management.  According to the NDRC staff member, in June 2010, the commission published an opinion piece outlining guidelines for pharmaceutical price management. Just before its release for public review and comments, the media exposed information on the sale of so-called reduced-cost medicines at profit margins of over 300%. This resulted in a delay of the launch of the proposed price-management measure.
• 发改委剖析药品降价致廉价药暂消失现象

The Economic Observer News published an article authored by Peking University Professor Gu Xing, and two other leading commentators on medical reform.  In the article, Gu argued for a “managed competitive” framework for guiding medical reform.  Citing the Shen-Mu model, Gu argued that Shen-Mu, in fact, demonstrates the feasibility of a “managed market-based; managed competition” model he advocates.  Under his proposed model, the healthcare system would provide:

• universal coverage with the government playing an active and effective role for funding;
• negotiation by the public health insurance authority on behalf of the insured with service providers; and
• healthcare service organizations operating under a market-based system with the government acting as the sole purchaser, supervisor, and promoter in the healthcare system.

….Shen-Mu is a province in Shaanxi that gained national notoriety for its model of offering free healthcare to its residents.  Gu urges the media and other public opinion commentators to broaden their understanding of the underlying working mechanisms of the model instead of drawing conclusions based on their interpretation of a “free healthcare” system.   (有管理的竞争)

The media interviewed Li Ling, a Peking University professor and Ministry of Health expert commissioner on policy and management research, on her view of a notice by the State Council on public hospital reforms for 2011. According to the report, this notice specifically places the topic of a compensation system for frontline medical workers on the working agenda.  Some officials view the notice as signifying a real breakthrough in hospital reforms; others criticize its lack of innovative thinking.  In Professor Li’s view, the merit of the notice depends on the following issues and their outcomes:

• Recruitment and retention of medical professionals.  Investments in community hospitals, for example, have resulted in procurement of sophisticated medical equipment that no one knows how to operate.
• Development of the management skills of hospital directors.  Most hospital directors rose from the medical ranks and have limited management expertise and experience.
• A system for incentivizing medical professionals.  Citing past state-owned enterprise management experience, Professor Li argues that offering doctors housing, education, and retirement benefits as part of a compensation package would facilitate interaction with doctors.
• 国务院推进公立医院试点改革 要求提高医生待遇

The 21^st Century Economic Herald called the Anhui Model a possible model for national roll-out.  The Anhui model, noted for its comprehensive approach, effectively implemented the Essential Drug System on schedule.  Key elements of the approach include government compensation mechanisms, a performance evaluation system, and a centralized tendering and pharmaceutical supply logistics system.  (2011年新医改收官，安徽模式或将推广全国 医改“安徽模式”调查)

One expert pointed out, “The government needs to figure out a sustainable funding mechanism that will not hurt the interests of stakeholders.”  Such a sustainable scheme would also involve financing input from the local governments.  News of the widespread complaints by local government officials about dwindling supply of lands for the auctioning sheds light on the challenges for a sustainable funding scheme.   Land auctions represent a key part of local government financing schemes.  (两会地方官哭穷：无地可卖 上一任已卖光了)

An expert interviewed by the weekly publication, Outlook, commented that “enriching citizens” will be the priority of the 12^th Five-Year Plan, replacing the focus of promoting national strength during the 11^th Five-Year Plan.  The level of well-being experienced by citizens will replace economic growth as a key leading indicator of development in China with housing a lead area of public concerns, according to the magazine.  (幸福感五年十二问：住房是第一关注)

China Youth News reported on the divergent profiles of work for individuals claiming the job title of a medical representative.  The article pointed out the popular perception that medical representatives serve as “sales-public relations” agents who contribute to the rising cost of healthcare.  To address the issue, the China Pharmaceutical Business Management Association is working with RDPAC to promote RDPAC’s medical representative certification program among 4,000 domestic pharmaceutical companies, according to the report.  (一个医药代表的一天)

Shanghai to reform healthcare

China to lower prices on medicine

China promises to improve public hospitals, cut their dependence on drug sales, lower costs

China to slash drug prices, saving 1.5 billion USD

Business & Initiatives

Xin Kuai Bao (New Express News) wrote that an anonymous package containing internal employee emails showed that Johnson & Johnson may have intentionally planned and launched a campaign challenging the safety of Nimesulide, an active ingredient used in pediatric cold medicines by local competitors.  Kan-Zhi Pharmaceuticals, a local manufacturer, filed complaints with Hainan’s Bureau of Industry and Commerce and alleged that Johnson & Johnson played a key role in “distorting and exaggerating facts; intentionally supporting and maliciously attacking competitors.”  The incident, according to the news report, has escalated from a “negative campaign” involving two competitors to one involving “a local manufacturer’s defense and fight against a multinational.”  (竞争对手邮件曝光跨国药企缜密商战; 康芝药业指责强生“不正当竞争” “尼美舒利”很受伤？)

While many see the latest pharmaceutical price-cut measure as part of overall reform initiatives to improve affordability, inflation pressure stands out as another force driving price control (China cuts maximum retail price of drugs to help tame inflation).  This pressure to contain prices applies to consumer products as well (集体涨价背后有无垄断魅影;  日用消费品提价方式今后将会非常隐蔽).

Medical diagnostic equipment company Roche Diagnostics sees more potential in China from its ongoing healthcare reforms. (The Right Diagnosis)

Bayer HealthCare relocates to China

Bayer boss puts faith in pipeline and China for future growth

Emerging Markets to Account for 25% of Merck Sales by 2013: CEO

Novartis acquires 85% stake in Chinese vaccine company Zhejiang Tianyuan

GE to Increase Focus on Chinese Market

Medtronic opens Shanghai base for China operations

MSD :  Supporting China’s Medical Reform through Price Reduction. (默沙东中国总裁：降价挺医改)

Health & Wellness

A recent study estimates that more than 170 million Chinese suffer from a mental disorder. (China: Slipping through the cracks)

Racotomain scare in China (China: Unawareness means many buyers are cheated)

China’s economy for kids to double within 5 years: report

Public Health

China Finds Traces of Radioactive Material in Atmosphere of Coastal Areas

Debate Continues After China Arrests Salt Panic Culprit

In TB fight, business and society gain from corporate responsibility

Additional News from the Greater China and Other Markets:

Hong Kong

HK hospitals looking to raise delivery charges

HA introduces new structure & remuneration for supporting staff

Shock finding in failure to follow doctors’ orders

Taiwan

Taiwanese companies promote medical tourism in Beijing

New care system to be launched in participating hospitals

Singapore

Where innovation’s a matter of life and death

New breakthrough in skin cancer research

Cancer research lab launched

Medical care within 30mins reach of each patient

Ageing with peace of mind

‘Silent’ strokes linked to dementia
Dementia not just about memory loss

Sleeping disorder affects 15% of S’poreans

NUH houses new fertility training centre

Re-designing hospitals for the future

Sole earner, sole caregiver
S’pore unveils Web app to monitor arthritis

More TB cases in Singapore last year

S’pore faces challenges to be among best in health care

Korea

Korea set to be world’s most aged country in 2050

UAE, South Korea sign MoU in health care

South Korea’s boom in medical tourism

Incidents exposing the volatile nature of doctor-patient relations also attracted online and media attention.  A doctor’s insensitive comments regarding a dying patient on her micro-blog went viral and drew widespread commentary.  Insensitivity also might have prompted a deceased patient’s relatives to assault doctors in a Shanghai hospital.  Another report cited research showing that 80% of medical confrontations arise from medical staff members’ attitude and improper language.

On the issue of healthcare’s affordability and accessibility, a study cited by the Chinese Academy of Social Science found that the new medical reform has reduced the costs for patients, especially among rural and low-income families.  However, over 70% of respondents to the people.com.cn survey said that healthcare remains too expensive.

The State Council issued a document outlining five areas to advance medical reforms, including an increase in annual subsidies for healthcare insurance premiums from 120 to 200 yuan.  Health Minister Chen also responded to inquiries about the challenges of making healthcare affordable and accessible.  The 21^st Economic Herald published an article by Professor Gu Xing of Peking University titled “UK’s Universal Health Scheme Moving Toward a Market-Based System.”

In the region, the media reported on news relating to public health initiatives and concerns.  Hong Kong’s government raised tobacco products’ prices in a bid to discourage their use.  Taiwan’s Department of Health reportedly is considering legislation to restrict television ads for fast foods to combat obesity.  In Korea, public health worries have arisen since the foot and mouth epidemic, and Singapore reported a big jump in endometrial cancer among Singaporean women.

February’s media reports in China showed the government’s responsiveness to the public’s concerns and the challenges to implementing policies.  Professor Gu’s article, published in a leading newspaper, indicates that the debate over the mechanism for providing basic healthcare remains vibrant.  Reports on the volatile state of doctor-patient relations also underscore the urgent need for a viable solution as this round of reform pushes toward its final year.  As for the business community, the news and opinion trends suggest a need for a communication platform that supports vibrant debate on the best approach to promote both the reform’s goals and harmonious relations among key stakeholders.

Ruder Finn Asia offers an issue tracking, analysis, and advisory service on behalf of clients.  The service is designed specifically to a client’s strategic positioning and competitive profile and provides insights to guide corporate, medical, and health communications.  For more information on this service, please contact Mai Tran at mtran@ruderfinnasia.com.

媒体报道摘要

二月份期间，《新世纪》周刊报道的“镉米杀机”引发媒体对环境污染话题的关注。根据《新世纪》周刊报道，“重金属镉正通过污染土壤侵入稻米；学者抽样调查显示中国多地市场上约10％大米镉超标；中国在多种重金属污染的稻米之前几不设防。” 人民网推出两会专题调查，就百姓最关注的热点、焦点问题征集网民意见。十大热点中，环境污染位居第六。这是环境污染首度入选十大热点话题。新华网也报导，国务院总理温家宝27日时指出，“我们绝不能再以牺牲环境的代价来换取高速增长。”

医患关系的话题也因为“冷血医生”微博让病人下班再死而成为公众聚焦话题。另据媒体报道，医院态度冷漠，可能也是上海“医闹”刺伤医生的导火线之一。其它媒体评论也指出，八成医疗纠纷源于医务人员态度及用语问题。

中国社科院发布的“社会蓝皮书”——《2010年社会形式分析与预测》中，公布了零点研究咨询集团最新完成的《2010年中国居民生活质量指数调查报告》。该报告显示，新医改已使公众医疗负担有所减轻。人民网征集的网民意见则显示，72%网友认为看病贵。

据中国网报导，国务院办公厅近日下发关于印发医药卫生体制五项重点改革2011年度主要工作安排的通知。通知明确，今年政府对新农合和城镇居民医保补助标准均由上一年每人每年120元提高到200元。卫生部部长陈竺在作深化医药卫生体制改革形势报告时，分析并回应了群众“看病难、看病贵”6大问题。 而21世纪经济报道刊登了北京大学政府管理学院教授顾昕撰写关于英国全民免费医疗走向市场化的文章。

本月的媒体报导显示政府对解决“看病难，看病贵”所采取的积极措施及在过去两年的执行医改过程中所遇及的挑战。顾昕教授的文章显示公众舆论对于最佳运行基本医疗方案持续的热烈探索。而媒体对于医患事件的报道，亦显示公众对于此话题的关注。这些新闻和舆论趋势意味着企业可以通过提供一个传播平台的形式，支持各方舆论对于推动医改目标和促进医患和谐关系的探索。

罗德公关为客户提供一套“论点追踪、分析、和咨询”的服务方案。该服务依据客户业务需求，为客户提供策劃及執行公共事務和公共關係傳播的工作的參考。詳情請洽：Mai Tran (mtran@ruderfinnasia.com)。

Medical Reform

A doctor’s insensitive comments regarding a dying patient went viral online and attracted widespread media attention.  According to Nanfang Daily:

• The doctor, dubbed a “cold-blooded doctor” by netizens, allegedly wrote, “Please die after I’m off duty,” “Good news!  The patient died in the afternoon.  I can get a good night’s sleep!” among other entries.  The doctor has since claimed that her blog was breached by hackers and that she did not write these entries.
• The micro-blog was reposted some 10,000 times and generated several thousand disapproving comments on the site.  Netizens also tracked down the doctor’s identity and the location where she works in Guangzhou.
• Liao Xinbo, deputy director of Guangzhou’s Health Office, acknowledged the entries’ negative impact on medical workers and added, “The issue is this doctor’s values, which could be because of her immaturity.  The media do not need to sensationalize the incident.”
• 微博让病人“下班再死”女医生被调洗衣房（图）

In another incident, a deceased patient’s relatives assaulted doctors in a hospital in Shanghai.

One writer urged doctors to adopt pleasant manners to improve their relations with patients, citing a study that found that medical workers’ poor attitude, communication skills and professional ethics cause 80% of medical disputes.  A reader whose comment received the most “like” votes wrote, “Ridiculous.  Please substantiate your claim (that medical disputes are due to poor communication).  Too much energy already is wasted on communication.  Many problems cannot be resolved with communication.  We should all face this reality.”  (八成医疗纠纷源于医务人员态度及用语问题; Readers’ Comments)

The Chinese Academy of Social Science cited a research showing that the new medical reform has achieved measurable progress.  According to China Business Times, the academy found:

• Rural and low-income families have experienced the most significant reduction in financial burden from the new medical reform.
• Community healthcare facilities’ overall capabilities and quality have risen.  The improvement is especially noticeable in the area of infrastructure and hardware improvement.
• Although efforts to reduce healthchare’s financial burden have made progress, the actual improvement continues to lag behind the public’s expectations.  In a similar study in 2009, close to 60% of respondents reported confidence in the new medical reform plan; over 70% expressed confidence in the Basic Healthcare System’s effect on reducing the financial burden.
• 2010中国居民生活质量指数报告显示：新医改已使公众医疗负担有所减轻

However, an online survey organized by people.com.cn found that 72% of participating netizens consider healthcare too expensive.  According to the report:

• Medical reform is seventh on the list of the top 10 issues ahead of the national congressional meetings, based on the votes of netizens who participated in the survey.  Medical reform ranked eighth in 2010 and third in 2009.  In 2009, drug safety tied with food safety for second place on the list.
• Drug safety has not made the list in 2011 and food safety has dropped to ninth place.
• Over 70% of respondents reported that healthcare remains expensive, and 46% reported that medical reform must abandon the practice of using pharmaceutical sales to finance medical operations.
• “两会”网民关注十大热点：环境污染首度入选

The State Council announced that annual subsidies for medical insurance premiums would increase from 120 to 200 yuan.  (China pledges more efforts to reform health care; 我国医保补助标准由每人每年120元提至200元)

Health Minister Chen also responded to inquiries regarding the challenges to making healthcare affordable and accessible.  According to the Xinhua Agency:

• Chen reported that there are two types healthcare inaccessibility:
  • The first is “absolute inaccessibility,” which is the lack of adequate basic medical services.  This problem is especially pronounced in central and western China.
  • The other type of inaccessibility is a lack of high-quality medical resources to meet the demand.  This problem is especially acute when patients with minor ailments seek care in large hospitals instead of low-level hospitals.
• Chen pointed out that there are also several types of affordability. 
  • The first is a patient’s subjective experience, by which he measures the price relative to his perception of the value of healthcare services and results.
  • Another type of affordability relates to a family’s ability to pay.
  • The third type relates to society’s ability to pay.  Unless medical costs are properly controlled, when they exceed what the overall society can afford, they impede economic sustainability and development.
• Remedies for addressing these issues should include:
  • Expediting the development of basic health insurance to lower the proportion of personal contributions in healthcare expenditures: The percentage of personal contributions had fallen to 38.2% by 2009, compared to 60% in 2001.  The goal during the 12^th Five-Year Plan is to move this number below 30% by the end of the five years.
  • Solid implementation of the National Basic Drug System: Chen reported that in areas that have implemented the zero sales margin policy, drug prices have declined by 30%.
  • Increase the number of medical gatekeepers at the community level: This will include building and procuring equipment for hospitals and other medical facilities.  A plan is being initiated to train 60,000 community primary care doctors as well.
  • Promote preventive health care including establishing health files for rural and urban residents, and providing chronic disease management and free physical examinations for those aged 65 and older.  The budget for public health services will increase to 25 yuan per person, from 17.5 yuan in 2010.
• 陈竺：深化医药卫生体制改革 逐步缓解群众看病就医问题

Xinhua English also covered Health Minister Chen’s address, focusing its report on China’s plan to further ease the cost of medical services.

The 21^st Economic Herald published an article by Professor Gu Xing of Peking University titled “UK’s Universal Health Scheme Moving Toward a Market-Based System.”  According to Gu, China’s key guiding principles for the reform are to “provide basic insurance, strengthen grassroots healthcare services, and establish a healthcare operating system.”  In his view, China’s efforts on this operating system have lagged behind the other two principles.  Gu wrote that the UK’s experience reforming its system of paying for primary healthcare could offer valuable insights on this last goal.

(英国全民免费医疗走向市场化)

Business & Initiatives

• Pharmaceutical Economics News reported that a quiet game-change is taking place in the glucose-lowering drug market, a market long dominated by foreign businesses.  According to the report, United Laboratories announced that it has secured production permits for three insulin preparations in China, giving the company a portfolio of four insulin products.  According to industry experts, very few domestic companies currently have the capability to produce this high-profit-margin (estimated to be over 70%) drug.  Analysts expect the company to enjoy a significant price advantage over its high-priced foreign competitors.  (决战胰岛素 内外资企业“火拼”降糖药市场)
• Bayer says to expand China R&D centre
• GE Healthcare aims to boost medical facile ties

Health & Wellness

• New Century Weekly reported that the heavy metal cadmium is poisoning rice through the contaminated soil in rice fields.  According to random tests scholars conducted, an estimated 10% of the rice in China exceeds the upper safety limit of cadmium in the grain.  Most worrying is that China has no policy guidelines governing agricultural planting on contaminated land.  A significant number of known contaminated lands continue to be used for agricultural purposes.  One estimate puts the total amount of contaminated land at 180 million mu (1 mu = 666 square meters), with cadmium-contaminated land accounting for 80 million mu.  (镉米杀机)
• Another article posted on china.com pointed out that the problem of contaminated agricultural land was first raised in 2007.  Since then, the situation of land pollution has deteriorated.  The article quoted an authority who estimated the annual contamination of crops by heavy metal at 12 million tons, which causes an economic loss estimated at 20 billion yuan.  Although the central government has introduced measures to contain pollution and treat the affected land, officials and businesses chasing high GDP and strong economic performance often overlook the issue.  (叩问农地污染:“中毒”怎会越来越重)
• One in 7 Chinese travel for health care
• Flu season has some turning to Chinese remedies
• China Cuts Economic Growth Target as Premier Wen Calls for Sustainability

Public Health

China’s Smoking Costs Have Risen More Than 300 Percent

China too connected to IV meds

Gates Foundation to improve child vaccines in China

China to crack down on antibiotics abuse

Additional News from the Greater China and Other Markets:

Hong Kong

• Tobacco taxes increased by 41.5%.
• Chinese University of Hong Kong plans to build a specialized, nonprofit, private hospital
• Hong Kong’s doctors are threatening to take action to force the Hospital Authority to do something about their heavy workload and poor morale.
• The record 65,000 runners participating in Sunday’s Hong Kong Standard Chartered Marathon are advised to put personal health and safety above all else.

Taiwan

• The Department of Health (DOH) is mulling regulations that would restrict the airing of fast food TV commercials to certain times to combat obesity.
• The Centers for Disease Control (CDC) yesterday announced this year’s first confirmed case of psittacosis (parrot fever) in the nation.
• Government might lift ban on additives in US beef products.

Singapore

• Big jump in endometrial cancer among Singaporean women
  Dr. Chua Hong Choon takes over as CEO of IMH
• Over 2,500 honored at Singhealth awards
• “No surge” in post-CNY MC requests
• Health screening on wheels
• “Single, low-income caregivers need more support”
• New framework for health screening tests
• Regulations for managed care companies

Korea

• Oriental medical doctors struggle for survival
• Public health worries after foot and mouth epidemic in South Korea

We have compiled a selection of news reports for China and Asia, including the headlines and a short summary in English, to share within your company. This monthly News Summary does not pretend to be exhaustive but allows you to get a sense of what we see as important trends in our sector, based on the reports we read both in print and on the web. This summary covers four categories – Medical Reform, Business Initiatives, Health & Wellness and Public Health – and will touch on news from Greater China and other markets.

We hope you find the next H&W News Summary valuable, and we invite you to provide feedback and suggestions on how we can make it more relevant to you.

In December, public grievances about healthcare affordability and access in China gained an official acknowledgment: legislators conducted an inquiry with government officials reporting on the progress (or lack of progress) of medical reform.  The entire inquiry was broadcasted through a webcast.

If the event indicated the government’s determination to resolve the healthcare issues, some industry insiders viewed the State Council’s decision to allow private capital to invest in hospitals as marking a shift of influence from the “government-led” camp to the “market-driven” camp on the medical reform.

With public grievances on healthcare unabated as this round of the medical reform plan enters the third and final year, industry insiders noted a quiet “notch up” in the decision-making body of medical reform policies from ministerial level to the Office of Medical Reform under the State Council.  Following the announcement to encourage foreign investment into the hospital sector, the office noted that the key focus of the reform for 2011 is to restore the social welfare nature of grassroots health organizations and that future initiatives will focus on fine-tuning the mechanisms of the basic drug system.

In the region, Taiwan and Chinese mainland signed a medical and health care cooperation agreement in a move to jointly combat epidemics and ensure the quality of traditional Chinese medicine.  Taiwan also reported revisions to its national insurance scheme which has accumulated a debt sum of more than NT$ 130 billion (US$ 4.2 billion), risking bankruptcy unless reform is undertaken.  Separately, Hong Kong’s health authority urges influenza vaccination for targeted groups.

Singapore’s news mainly touched on local healthcare services firm, Raffles Medical, and its plan to build a hospital in China.   An expert pointed out that many hospital processes in Singapore are not supported by IT systems.   This has often created duplicate work, clerical errors or redundancies.  Korea, on the other hand, is reported to be on track to bring the concept of ubiquitous health, or U-health, to reality.  Under the system, a patient’s body vital statistics can be monitored continuously from an environment away from the hospitals.  Other news in the region highlighted the rising affluence and demand for sophisticated healthcare will drive the market for medical devices in Asia higher.

December’s news in China indicates that public opinion continues to influence the direction of the healthcare market landscape in China.  The implication for the business community is the need for a communication strategy that contributes to the ongoing debate.  The secretary of the China Pharmaceutical Industry Association, for example, noted, “Pharmaceutical enterprises have been blamed for contributing to the high cost of healthcare… The introduction of competition into public hospitals is conducive to breaking through a traditional and stagnant thinking mode, which has intensified the pressure to reform.”

Ruder Finn Asia offers an issue tracking, analysis, and advisory service on behalf of clients.  The service is designed specifically to a client’s strategic positioning and competitive profile and provides insights to guide corporate, medical, and health communications.  For more information on this service, please contact Mai Tran at mtran@ruderfinnasia.com.

媒体报道摘要

公众舆论对“看病难，看病贵”的观点于12月获得更高层次的认可：十一届全国人大常委会第十八次会议举行联组会议，就国务院关于深化医药卫生体制改革工作情况的报告开展专题询问。整个讯问过程通过网络广播广播。（网络直播询问新医改）部分官员于会议上表示，医疗卫生体制改革工作启动以来，其成效已经初步显现出来，“看病难、看病贵”的问题初步得到了缓解。 部分机构则指出，称看病难看病贵初步缓解说法为时过早。

如果人大常委的专题讯问显示政府解决医疗问题的决心，部分行业专家认为国务院鼓励社会资金办医院的举措则指向医改的影响力由“政府派”转移至“市场派”。（民资办医院正式开闸 内资踊跃外资谨慎）

该篇报导也指出，明年是医改3年重点实施方案的最后一年， “与人们印象中卫生部主导医改不同，近期多项医改政策均由“国务院医改领导小组办公室”做出。” 业内人士表示，“此前一段时间，医改领导小组在各地组织了调研，颇为低调，今后相关政策还将陆续出台。”该办公室主任朱之鑫于20日讲话中指出，“明年医改重点确定：基层医疗将回归公益。”未来工作将在建立基层医疗新机制上下功夫。

新闻舆论对于社会资金办医的看法多为正面。以新京报为例，该社论表示：社会资本终于迎来进军医疗服务业的春天。

持“市场”观点的人士，如北京大学光华管理学院卫生经济与管理系主任刘国恩表示，此次新政对民营医疗机构和公立医疗机构“一视同仁”，社会资本举办的非营利性医疗机构，将和公立医院具有同样的待遇（社会资本进入医疗市场缺少清晰规则）。 北京大学政府管理学院教授顾昕也表示，　　“开放可能引来骗子；但不开放，变革的机会和可能性是零”（民资办医院正式开闸 内资踊跃外资谨慎）。

个别评论则表示“唯有使医生在医疗改革中受益，广大医生才能自觉地参与改革。其中，破除垄断才是医改关键。” 部分媒体也指出，在中央放宽社会资本进入医疗市场的同时，曾被卖出的公立医院又“被回购”，社资办医能否破解看病难仍待观察。

本月的新闻显示，公众舆论持续影响医疗市场的形势。对于医疗企业界而言，这意味着企业界需要一套传播战略，在市场讨论和探索医疗改革话题的过程中做贡献。以中国化学制药工业协会秘书长周燕为例，他在接受采访时表示，“‘看病贵’曾被指责为药企的唯利是图，现被普遍归结于‘药价虚高’。我们认为，根本问题在于医疗卫生体制改革严重滞后和补偿机制不到位。公立医院改革引入竞争机制，有益于打破传统思维和固化模式，增强改革的紧迫感。”

罗德公关为客户提供一套“论点追踪、分析、和咨询”的服务方案。该服务依据客户业务需求，为客户提供策劃及執行公共事務和公共關係傳播的工作的參考。詳情請洽：Mai Tran (mtran@ruderfinnasia.com)。

Medical Reform

The State Council opens the door to private investments into the hospital sector (China woos private, foreign capital to reform healthcare).

Legal Weekend reported that the State Council’s announcement signified five breakthroughs, according to Wang Hufeng, a scholar from the School of Public Administration at Renmin University:

1. Encourage and support private capital’s entry into the healthcare sector while proposing adjustments and give priority considerations to private investments in healthcare resources.
2. Encourage private investors’ participation in the reform of public hospitals.
3. Allow offshore capital to establish healthcare facilities with a “special emphasis for investment from Hong Kong, Macao, and Taiwan to enjoy preferential policies.  From a research perspective, this signifies the value these regions experience for the development of the healthcare sector in the hinterland.”
4. Comprehensive improvements in the working environment of private-sector-financed hospitals, from healthcare workers to medical facilities, medical reimbursement qualifications, price, and taxation policies.  The new measures aim to achieve “equality at unprecedented levels.”
5. The key focus is on encouraging private investments in not-for-profit medical facilities to “mobilize the private sector to support the development of not-for-profit organizations through donations and other methods.” (社会资本进入医疗市场缺少清晰规则)

Editorial reactions to the announcement are mostly positively.  New Beijing News for example applauded the new measures as a positive move to promote competition in the hospital sector to support the goals of medical reform. (社会资本终于迎来进军医疗服务业的春天)

Comments from individuals long identified as representing the pro-market camp perspective are cautiously optimistic:

• Liu Go’en of Peking University commented that privately operated medical facilities now have the basic conditions for survival now that the measures allow these facilities to qualify for medical reimbursements as enjoyed by public hospitals. (社会资本进入医疗市场缺少清晰规则)
• Gu Xing, also of Peking University, commented that the “liberalization may attract charlatans; but without the liberalization, the opportunity and possibility for reform is zero.”

（民资办医院正式开闸 内资踊跃外资谨慎）

The Century Weekly of Caing.com noted that while the news has cheered domestic investors, foreign investors remain cautious.  According to the report:

• The State Council’s decision has come almost two years after the introduction of the new round of medical reform.  With the three-year reform having already passed the mid-point milestone, public grievances on “kan bin nan, kan bin gui” (poor healthcare affordability and accessibility) continue unabated and confrontations and conflicts between doctors and patients have not seen improvements.
• While small domestic investors are excited by the news, international investors remain cautious.  According to an investment official of the British Embassy in China, foreign investors may opt for an indirect investment in the beginning, such as “collaborating with a Level III hospital and participating in the acquisition of hospitals in second-tier cities.”
• The article also noted that recently a number of medical reform policies have been led by the Office of Medical Reform Leading Group under the State Council.  According to an unnamed source close to the National Reform and Development Commission, the Group has been quite low key but experts expect the Group to introduce additional measures in the coming year.  The Group is led by Executive Vice-Premier Li Keqiang and consists of representatives from 16 ministries and departments.
• Some industry insiders view the new policy as indicating a shift of influence from the “government-led” camp to the “market-driven” camp.
• Gu Xing, a noted pro-market opinion leader, disagreed.  He noted that the new medical reform never denied the validity of the market mechanism.  In general, he believes that the “government is taking a lead in medical insurance and purchases of medical services using the insurance while supporting competition in medical services.”（民资办医院正式开闸 内资踊跃外资谨慎）

A commentator wrote that until doctors are granted the freedom to work as their own agents and their interests align with the goals of medical reform, the new measures would not be able to overhaul the monopoly that public hospitals enjoy.  (毕舸：破除垄断才是医改关键）

In the meantime, editorial media also noted municipalities “re-purchasing” hospitals sold a few years back and questioned whether the different activities by the central and local governments would lead to the goals of improved healthcare affordability and access.  (曾被卖出的公立医院又“被回购” 能否破解看病难)

Media widely reported on the Special Issue Inquiry in which representatives of the NPC Standing Committee questioned healthcare officials over the progress and issues of medical reform (Ministers taken to task over healthcare reforms).  News reports highlighted a number of issues raised by representatives, including a child who incurred a medical bill of 10,000 yuan while being treated for a fever and that China reports an annual usage of eight bottles of IV injections per person.  Commentators also challenged claims by government officials that the reform to date has been successful.  (机构称看病难看病贵初步缓解说法为时过早).

Business & Initiatives

GE Appoints Two Company Officers

Bayer to expand in China

Foreign firms get slice of China medical market

West’s drugmakers look for China buys

GE Healthcare eyes grassroots

Health & Wellness

Food becomes a hot issue in China

China improves well-being of people with disabilities

Public Health

China faces uphill battle against HIV

Chinese Newspaper Says AIDS Advertisement ‘Not Friendly’

‘China Daily’ Newspaper Rejects AIDS Healthcare Foundation Ad Exposing China’s Misuse of Global Fund

Additional News from the Greater China and Other Markets:

Hong Kong

Influenza vaccination urged for target groups
Deregistration of pharmaceutical products containing propoxyphene

Taiwan

Mainland, Taiwan negotiators sign agreement on medical, health care cooperation
Taiwan will not open doors to Chinese generic drugs soon
Taiwan to reform health insurance scheme

Singapore

Raffles Medical’s China plans
The Pharmaceutical Market: Singapore – Healthcare and Medical …
Rising affluence will drive demand for medical devices in Asia
Healthcare IT trails banking industry by 25 years
New residency system for specialist doctors

Korea

Foreign visitors to reach 8.8 million
South Korea positions for digital healthcare push

While the story shed light on the deeper issue of hospital financing, Beijing’s claim that close to 50% of the hospitals are operating in deficit drew criticism over hospitals’ use of resources.  The minister of health also alluded to a similar point when he said that hospitals should not blindly pursue expansions.  The financing issue is especially pressing in view of the “eruption” of healthcare demand due to the expansion of medical coverage.

As a remedy to promote healthcare affordability and accessibility, the National Development and Reform Commission announced the latest round of price cuts on pharmaceuticals.  Therapies that had enjoyed differential pricing status were targeted.  This round of price cuts focused mainly on therapies marketed by international pharmaceutical companies.

Separately, a patient-initiated ranking of good/bad doctors drew over 100,000 visits since its posting in October.  Patients’ impressions of doctors’ attitudes such as patience and professional integrity on prescriptions turned out to be the overriding qualities of concern in the ranking.  The Ministry of Health’s support of an upcoming TV program suggests efforts to promote understanding on the issue of doctor-patient relations.

International healthcare businesses are also aggressively positioning themselves by expanding into OTCs, launching medical IT platforms, deepening investments in R&D facilities, and expanding their geographic coverage in key therapy areas.

In the region, news on Singapore shows the country’s ambition to develop a competitive edge in hospital management and services.  Korea’s large conglomerates are also aggressively taking position in the healthcare and medical sectors.  Taiwan, on the other hand, is developing a niche in home care and biotechnology, while news in Hong Kong focused on public health concerns.

In our view, the key take away from this month’s news reports in China is that patients trust other patients’ opinions.  In addition, the news suggests an emergent influence of online public opinion to promote transparency and accountability in local government and hospitals.  Reprints of the stories in the traditional media suggest that the trends are viewed as potentially beneficial to the goals of medical reform.  For the business community, these trends indicate the need for a communications strategy that tracks emerging trends, in addition to one that responds to developments underpinned by already rooted opinion frames.

Ruder Finn Asia offers an issue tracking, analysis, and advisory service on behalf of clients.  The service is designed specifically to a client’s strategic positioning and competitive profile and provides insights to guide corporate, medical, and health communications.  For more information on this service, please contact Mai Tran at mtran@ruderfinnasia.com

媒体报道摘要

媒体于11月期间关注医务人员收受回扣的话题。据新华社报道，杭州一论坛出现一网帖，惊爆杭州多家医院数十名医生收受回扣。网帖发出之后，网民踊跃跟帖，同时传统媒体相继报道，当地医院和卫生部门也展开调查。  (网帖曝光杭州多家医院数十名医生“回扣清单”(图)；卫生部回应回扣清单称决不姑息商业贿赂行为；一篇网帖 凭什么引发医院自查；杭州“医药回扣门”调查结果污辱公众智商; 人民日报连登五篇读者来信 称医院卖药猫腻多; 浙江省副省长：医务人员收受回扣红包依然存在)

该新闻虽然暴露了更深层医院财政资源的问题，但北京市卫生局提出目前超过50%的医疗项目存在不同程度的亏损，却引起不少对于医院运用资金情况的评论。(“逾五成医疗项目亏损”应看怎么个亏法)  卫生部长也指出，大医院盲目扩张加剧看病难。而其它报道如，医疗需求井喷或致新一轮看病难，更进一步的突显医院资金运用的问题。

为解决看病贵看病难，国家发改委发出通知，单独定价药物将平均降价19%。此次降价涉及外资制药公司为主的原研等单独定价品种药物。

另外，一份名为2010年版济南医生“红黑榜”的帖子成为网民热捧的“看病指南”。目前，这一榜单跟帖数千条，浏览量达11万多人次。而之后推出的济南儿科医生“红黑榜”浏览量超过15万人次。据报导，网上的评价多以服务态度为主要标准。(网络热推医生“红黑榜”) 卫生部对即将推出的大型医疗职业剧《医者仁心》给予了高度的评价，也显示政府积极促进公众对医患关系的理解。(卫生部高度评价《医者仁心》 直面医患矛盾(图))

媒体报道同时显示，跨国企业—包括微软（Microsoft, iSoftStone Launch HealthVault PHR Platform in China），GE（GE医疗下乡 拓展中国基层医疗市场）, 赛诺非安万特等（Sanofi-Aventis eyes OTC market； 诺和诺德投资扩建中国糖尿病研发中心； 礼来中国糖尿病战略投资升级）– 正积极布局市场战略。

我们认为本月媒体报道最值得关注的是病患评价对其它病患观点的影响力。此外，杭州回扣门也反映了网民对医院和地方政府的影响。传统媒体对网络消息的转载意味着这些趋势对医改目标的正面作用。对于医药企业而言，我们认为这些趋势显示，传播战略除了回应已经成形的舆论论点，应该更加积极追踪正在形成的舆论影响。

罗德公关为客户提供一套“论点追踪、分析、和咨询”的服务方案。该服务依据客户业务需求，为客户提供策劃及執行公共事務和公共關係傳播的工作的參考。詳情請洽：Mai Tran (mtran@ruderfinnasia.com)

Medical Reform

An anonymous posting that exposed a detailed list of kickbacks to doctors in Zhejiang prompted the editorial media to focus on the topic of corruption:

According to Xinhua Net, an anonymous netizen wrote on a Hangzhou Web forum that he found a flash disk that contained a Word document listing details of kickbacks to doctors in Hangzhou.  The company involved was a medical diagnostics company.  (网帖曝光杭州多家医院数十名医生“回扣清单”(图))

Jiankang News reported that an official of the local health authority indicated that the government will take disciplinary action if the reported corruption is confirmed.  The paper also reported that the Ministry of Health has learned that the situation of commercial bribery involving medical purchases has worsened recently.  The ministry has already dispatched seven inspection teams in early November to investigate local activities and will file a report by the end of the month.  The report will be used to guide measures to discipline corrupt conduct. (卫生部回应回扣清单称决不姑息商业贿赂行为)

A commentator mused on why a Web posting prompted the hospital to undertake an investigation.  He further wrote, “If this report is true, it is no wonder why the healthcare cost is so high…  What is true is that after all these rounds of medical reform, doctors receiving kickbacks remains a rampant practice.”  (一篇网帖 凭什么引发医院自查)

Following a report by the named hospital on the results of its investigation, a commentator wrote that the findings are an insult to “the public’s IQ.”  (杭州“医药回扣门”调查结果污辱公众智商)   People’s Daily also reported that investigation results were doubted after the hospital bribery list was posted online in east China.

People’s Daily featured five patients’ stories that also supported the view of doctors abusing their power at the expense of patients’ interests.  (人民日报连登五篇读者来信 称医院卖药猫腻多)

The core issue driving the corruption is hospital financing as pointed out by Zhejiang’s deputy provincial governor:

…kickbacks remain a rampant practice.  Until the issue of medical workers’ compensation is addressed, the corrupt practices will continue to compromise the effectiveness of the medical reform.  (浙江省副省长：医务人员收受回扣红包依然存在).

However, claims by Beijing that 50% of its hospitals are operating in deficit drew criticism over the cause of the financing shortfall.

A commentator questioned the cause of the deficit.  He wrote, “When most people walk into a hospital, they tend to lament hospitals are getting richer and richer.  The buildings are getting taller; its facilities looking like a five-star hotel; and all of its equipment is imported from the U.S. or Europe.”  He further wrote that budget shortfalls are caused by hospitals blindly engaging in expansion projects. (“逾五成医疗项目亏损”应看怎么个亏法)

Such a perspective echoed the minister of health’s view that blind expansions undertaken by large hospitals are exacerbating the issue of healthcare accessibility.

The director of Shanghai Sheng Kang Hospital Development Center, the local government’s hospital investment management arm, commented that the term “blind expansion” should be rephrased as “disorderly expansion.”  The core cause of the expansion trend is the ineffectiveness of government planning.  (卫生部长：大医院盲目扩张加剧看病难).

The need to promote more efficient use of financial resources is especially acute in view of the “eruption” of medical demand:

According to the director of the Office of Medical Service Supervision under the Ministry of Health, based on data from the recent three years, outpatient traffic in hospitals has expanded by some 100 million visits per year.  The volume of hospitalization has increased by 10 million stays.  The pace of increase means that China will need to expand the equivalent of the entire hospital capacity of Australia every two years.  China is also close to capacity on hospital bed utilization in provincial hospitals and has only 0.7 physicians (of international standard qualification) per 1,000 people.  The strong growth and resource shortage may drive a new round of healthcare challenges. (医疗需求井喷或致新一轮看病难).

Therapies that enjoyed differential pricing treatment in the past are the most recent targets of the National Development and Reform Commission.

According to Reuters, China is to cut the retail price of many medicines by an average of 19% from Dec. 12 in a bid to rein in the country’s rising healthcare bill.  Prices for some individual drugs will fall a lot more than 19%, with Bristol-Myers Squibb’s heart medicine Capoten set to come down by 35% and Roche’s antibiotic Rocephin by 30%.  (China to slash drug prices by 19 pct to cut costs).  Bloomberg Business Week also reported China Slashes Roche, Bristol-Myers Drugs to Pare Medical Costs.

According to China Business News, the latest round of price reduction affected 17 categories of medicines, including antibiotics and cardiovascular therapies.  The story cited the price cut in the context of the larger anti-inflation measures that the commission is undertaking.  Lower production costs due to technological advancement was also cited as the rationale for the price cuts.    (单独定价药物将平均降价19%).

Earlier reports on the story profiled arguments in favor of eliminating preferential price treatments for these therapies.  In addition to the argument of cost containment as a means to improve healthcare affordability, the articles quoted perspectives on the need to allow local manufacturers to compete fairly in their own market.  According to the reports, many of the therapies are off patent and equivalent generics by local producers are widely available.  As such, the therapies do not offer added medical value to justify the differential pricing treatment.  (发改委部署药物降价 欲废除外资药超国民待遇)

Shanghai is reportedly deliberating price reduction or exclusion of preferentially priced medications from its essential drug amendment list. (上海酝酿抑制高价药 外资单独定价药或出局)

Xinhua Net reported that a patient-compiled ranking of good and bad OB-GYN doctors in Jinan drew over 110,000 viewers since its posting in October.  The ranking involved 20 doctors in 8 hospitals.  A ranking of pediatricians has drawn over 150,000 visits.  Similar rankings have been published in Beijing, Shanghai, Shenzhen, and Suzhou by local netizens. (网络热推医生“红黑榜”)

According to the website that posted the rankings, the original intent was for the list to serve as a reference for patients.  However, due to the factual nature of the list, many patients have now followed the list diligently and would queue for doctors recommended in the list.

A sociology professor at Shandong University commented that the proliferation of the list indicates patient dissatisfaction with public health services, and the list reflects the current state of doctor-patient relations.  He also offered that the ranking can serve as an effective measure for the government and hospitals to promote better services.

A doctor listed under “bad doctors” criticized that the ranking is based on subjective criteria such as patient impressions.  A hospital administrator also criticized the list for its overreliance on patients’ experience instead of an objective ranking of a doctor’s professional qualifications and professionalism.

The Ministry of Health praised the upcoming TV drama “The Doctors” for the program’s honest treatment of the issue of doctor-patient relations.  The program is scheduled to air on Dec. 9 on CCTV 8.  According to the news report by Sina, the Ministry of Health gave the program a high level of attention.  During the script development and production stage, Ministry of Health Spokesperson Deng Hai Hua acted as a director of production supervision.  The ministry also organized experts to review the draft program and provided professional comments.  (卫生部高度评价《医者仁心》 直面医患矛盾(图))  A similarly themed TV program based on a book by Liu Liu was canceled two weeks before filming.  (《心术》开机两周停拍 剧本不完善编剧主动叫停)

China aims to cover at least 70% of personal healthcare costs

Ministry of Health: the key task of deepening medical reform is to strengthen basic services

Business & Initiatives

Microsoft, iSoftStone Launch HealthVault PHR Platform in China

Sanofi-Aventis eyes OTC market

Analysis: Drug industry doses up on emerging markets

Merck Climbs on the Emerging Markets Bandwagon

Healthcare provider seeks to grow bigger

GE医疗下乡 拓展中国基层医疗市场

GE setting up 6 healthcare R&D centers in China

诺和诺德投资扩建中国糖尿病研发中心

礼来中国糖尿病战略投资升级

Healthcare provider seeks to grow bigger

GE Healthcare Sees 20% Revenue Growth in China Through 2015

Siemens eyes top spot for medical devices in China

Health & Wellness

China AIDS death toll up nearly 20,000 in a year

Diabetes treatment costs China US$25bn per year

China Spends RMB 173.4 Billion (US$25 Billion) A Year On Diabetes Treatment

China now global diabetes epicenter

Yunan Bai Yao, a well-known Chinese medicine brand, indicated that the company has been contemplating entering the cosmeceutical sector.  The company’s toothpaste ranks number five in China, making it the only domestic brand in the top five toothpaste brands.    (云南白药代表招标会现场透露：或将涉足药妆行业)

Following a CCTV program’s expose on hydrogenated oil, the public’s confidence over the issue of food safety has been challenged again.  (没有行业标准 市场管理混乱, 氢化油食品遭遇“寒流”)。

Public Health

Health reforms light moves to change China’s smoking culture

Cost of smoking higher than revenue

Additional News from the Greater China and Other Markets:

Hong Kong

Hong Kong hospital reports possible airborne influenza transmission

Avian influenza case detected in Hong Kong: WHO

How airborne influenza may spread

Medical pioneer closing in on AIDS vaccine

PRIVATE DOCTORS KEY TO E-HEALTH UPTAKE IN HONG KONG

Taiwan

Singapore healthcare firm to survey Taiwan market

Biotech industry to continue to prosper: President

Taiwan eyes home health-care market with medical innovations

Singapore

No known case of bird flu in Singapore, says MOH

Singapore Outlines Need For Safer, Better And Cheaper Drugs

SINGAPORE : Singapore medical tourism business grows despite competition

Singapore’s prestigious, pristine healthcare services

SINGAPORE TO BUILD MORE ‘HASSLE FREE’ HOSPITALS

Healthcare institutions need to continually innovate: MM Lee

Hospitals in Singapore to Observe Cleaner Practices to Reduce Hospital Infections

Korea

Leading Korean Health IT Provider Selects U.S.-based eProtex for Medical Device Security

The role of government incentives for health tourism and medical travel

LG Uplus to enter health care business

South Korean Hospitals Increasingly Adopt Healthcare IT to Remain Competitive, Finds Frost&Sullivan

Chaebol rush into medical business

Samsung, SK bid for medical firm Medison – sources

Hospitals to get rating for service quality

This optimism contrasted with the more somber note made by an investment consultancy on the lack of meaningful progress in the medical reform.  The anticipated adjustment to measures relating to the Essential Drug System also captured the attention of the editorial media.  The media reported that the “zero-margin” policy may be abandoned and the original planned system of designated production and distribution favored by major domestic suppliers adopted.

The news that captured the most attention in terms of follow-up commentaries, however, was the story that a district government in Hangzhou spent 300 million yuan to buy back the health institutes it sold for 75 million yuan to private investors between 2002 and 2003.  Commentators viewed the price as an expensive lesson for buying back public service responsibilities previously abdicated by the district government.

In the region, biomedicals are also capturing the attention of the Singapore government, which announced a plan to invest S$3.7 billion to further develop the biomedical sciences sector.  IT and electronic businesses are also expanding their presence in the healthcare sector in the region with Agilent Technologies announcing its plan to open a global bioanalytical instruments facility in Singapore and Samsung reported to be mulling an investment in a medical equipment company.

This month’s news reports suggest a generally optimistic prospect for biomedical and medical IT businesses.  In China, for business aiming to capitalize on opportunities from the medical reform, the evolving nature of the healthcare service system continues to present challenge.  Judging from the issue frames expressed through commentaries, public opinion remains critical of the medical reform’s progress to date and shall continue to represent a key force in influencing the future policy direction of the market.

Ruder Finn Asia offers an issue tracking, analysis, and advisory service on behalf of clients.  The service is designed specifically to a client’s strategic positioning and competitive profile and provides insights to guide corporate, medical, and health communications.  For more information on this service, please contact us.

媒体报道摘要

媒体于十月份广泛报有关“十二五”对生物医药与药品流通行业影响的利好消息。  北京、上海及其它省份纷纷相继推出配套政策。(生物医药产业振兴规划:三大领域受益最明显)

相对这乐观的前景预测，媒体对医改的进展的报导则显示各方观点的议论。卫生部部长陈竺表示，我国新一轮的医改，自去年启动以来进展顺利，基本医疗保障覆盖已超90%人口。 此外，经济观察报也报导，虚高药价得到控制。

中投顾问对医改进展的进度则持谨慎态度。该顾问公司发表的分析研究指出，“新医改已经过去一大半，其当初中央财政8500亿的拨款也所剩无几，但是为什么中央及地方投入这么大的财力和精力，医改仍然停滞不前？”（新医改方案进行大半仍浮于表面）。另根据新快报报导，广东省卫生厅副厅长廖新波在自己的博客上发起投票， 74%的网友选择“看病报销比例大了，自费也多了”。廖新波说，在一年半的实践中，很多问题都找不着北，或者重新陷入“政府与市场”之争。 (医改一年半费用降了吗?)

此外，媒体也关注关于调查称零差率实施困难基本药物政策面临调整的消息。据报道，基本药物“零差率”多处遇阻 或重回老路，国内几大医药集团目前已经就基本药物回归定点生产、定点配送的达成了初步的协议,接下来,他们或将向国家相关部门集体建言。

最受到舆论关注的则是有关杭州余杭区政府全资回购股份制卫生院的消息。多数舆论观点由3亿赎回卫生院 这“学费”太贵角度切入，南方日报则刊登舆论提出需要在出售与购回间思考“市场化”含义的观点。另宿迁医院引国资 公私合作”办医疗之路待尝试则体现该地方政府在类似问题的处理采取的不同尝试。

本月媒体报导的取向显示市场对生化医药领域的乐观态度。而对希望凭借医改商机发展的企业而言，医疗服务模式的转化的进程将持续是行业面临的最大的挑战之一。就媒体对医改进展采取的报道倾向看来，公众舆论对医改和未来市场形势的发展将持续形成一定的影响。

罗德公关为客户提供一套“论点追踪、分析、和咨询”的服务方案。该服务依据客户业务需求，为客户提供策劃及執行公共事務和公共關係傳播的工作的參考，请随时与我们联系。

Medical Reform

The Communist Party of China Central Committee has proposed the nation’s new five-year development program for 2011 to 2015.  On the social development front, the government indicated that China is to improve public services.

In addition, biomedical is listed as one of the key strategic areas for economic development.  The five-year plan for the pharmaceutical distribution sector is expected to continue the theme of consolidation and increased scale and strength.

According to China Security Net (生物医药产业振兴规划:三大领域受益最明显):

….The preliminary plan has confirmed the value of industry production target to exceed 300 billion yuan, a 200% increase from the value of 2009. Beijing, Shanghai and other provinces have all introduced supplementary 12^th five-year plan for their biomedical sectors.

…Medical equipment and vaccines are areas attracting the most market attention. Presently, the medical equipment market represents 14% of the overall medical market in China, compared with 42% in international markets. As for the vaccines market, the global vaccine market is 38 billion US while China’s market is estimated at 5 to 6 billion yuan.

…The pharmaceutical distribution sector’s 12^th five–year plan aims to nurture one to two key national market players with annual sales value in excess of 100 billion yuan and 20 regional market players with annual sales value in excess of 10 billiion yuan. The development key for the sector continues to be consolidation and increasing scale and strength.

In an investment analysis and prospect report covering 2010 to 2015, an investment consultancy pointed out that the progress of medical reform remains stagnant even as the reform has passed its half-way schedule and most of the 850 billion yuan expended.  The report urged the government to seriously identify areas that stalled the progress in order to right the reform’s track within the remaining schedule. （新医改方案进行大半仍浮于表面）

The media reported on the government’s report of key medical reform achievements:

China Broadcast News reported that the health insurance system is now extended to 90% of China’s population, according to the minister of health. (基本医疗保障覆盖已超90%人口)

The Economic Observer reported that the Essential Drug List has achieved an average savings of 25% to 30% on drugs, although it remains to be seen if the fiscal financing structure is sustainable. (虚高药价得到控制)

Great progress made in rural medical reform: minister

…in addition to questions and possible changes to the essential drug system:

Liao Xingbo, deputy health official of Guangzhou Province, who is an active blogger questioned whether healthcare charges have been lowered. According to an informal survey he conducted through his blog, 74% of respondents reported that “while there is an increase in the proportion of reimbursement, the out-of-pocket expenses are higher.” (医改一年半费用降了吗?)

Separately, the essential drug policy may undergo significant adjustment, according to Pharmaceutical Economics News. The report cited an unnamed source from a state-owned enterprise who indicated that the system might revert to the original proposed plan of designated production and distributions. (调查称零差率实施困难 基本药物政策面临调整) This is due to the difficulties that the government has had in implementing the “zero-margin” policy. (基本药物“零差率”多处遇阻或重回老路)

The news that a district government spent 300 million yuan to buy back 28 health institutes it sold to private investors for 75 million yuan set off an avanlache of editorial commentary.  (杭州余杭区政府全资回购股份制卫生院)

Most view the experience as a pricey lesson by the district government that had abandoned its public service mission. (3亿赎回卫生院 这“学费”太贵)

Others called for an investigation and demanded transparency for the decision to buy back the institutes. (在出售与购回间思考“市场化”含义)

Another city in Jiangsu that sold off its 134 hospitals a decade ago to private investors found an alternative way to qualify for government medical reform funding.  The city has established an investment management center that will manage and supervise non-public funded national healthcare assets.  The city has since successfully devised a new model for private-public partnerships.  (宿迁医院引国资 公私合作”办医疗之路待尝试)

Business & Initiatives

• China to be top three prescription drug market, but Merck’s Kellogg says don’t inflate emerging markets gains.
• Forbes China Rich List Focus: The Business Aftermath of H1N1
• Roche Diagnostics launches a diabetic care training program for community doctors in China
• (糖尿病管理培训：以社区为主战场), and a commentator writes that revolution in healthcare delivery (is) underway in the Asia/Pacific region.

Health & Wellness

• Ageing problem grips China… but also presents untapped business opportunities (银发经济蛋糕”为何鲜有人切?).
• Following the footsteps of multinational pharmaceutical and healthcare companies, Chinese medicine businesses are poised to enter the consumer healthcare sector (药企进军日化带来中医药新生 外资争相进入).

Public Health

• A blood shortage in China prompted the Red Cross to call for blood donations.
• One commentator wrote that the shortage reflects public dissatisfaction with the professional ethics of doctors and hospitals.  According to the commentator, the public is frustrated with hospitals charging high prices for blood transfusions while taking blood from the public for free (“血荒”背后的公众情绪值得重视).

Additional News from the Greater China and Other Markets:

Hong Kong
Hong Kong to increase public healthcare expenses
Hong Kong air kills more than SARS, pressuring Tsang

Taiwan
TAIWAN: Investors see medical tourism potential in Taiwan
Serious illnesses account for 27% of medical costs

Singapore
SINGAPORE: Latest medical tourism statistics from Singapore
Agilent Technologies Opens Global Bio Analytical Instruments Facility In Singapore

Korea
Samsung Electronics mulls stake in medical firm

The Minister of Health Chen Zhu offered another angle by pointing out that “the ambitious overhaul of the Chinese health-care system is a challenge that won’t be solved by money alone,” according to a report by the Wall Street Journal.  The Minister added, “Hospitals are often overburdened and the focus needs to shift away from emergency care and serious illness toward primary care, including health promotion and education and disease prevention.”

In Hong Kong and other markets in the region, concerns over the feasibility of a publicly funded healthcare scheme have surfaced as well.  Hong Kong’s most recent settlement on a health insurance subsidy reflects the financial strain the government must take on in the face of a rapidly aging population. Newsweek has observed that “In Asia, public health care gets less public, and governments want the middle class to pay their way.”

The implication of these opinion trends for the healthcare business community is the role of public opinion in shaping the larger market landscape, which in turn impacts business strategies and prospects.  Public opinion on the relationship between drug prices and pharmaceutical marketing practices in China, for example, helped shape views that defined the problem and solution for pharmaceutical pricing.

Ruder Finn Asia offers an issue tracking, analysis, and advisory service on behalf of clients.  The service is designed specifically to a client’s strategic positioning and competitive profile and provides insights to guide corporate, medical, and health communications.  For more information on this service, please contact us.

媒体报道摘要

医院管理和改革在9月期间是媒体及公众舆论关注的话题之一。

媒体评论和舆论对于”陕西神木原书记自称因推行免费医疗被贬”（都市快报）此条新闻的反应显示公众寄望政府和医院管理者扮演提供便利民众医疗服务的主要角色。 其它论点也反映了个别专家对医院管理和财政制度的观点，如世行顾问李玲表示：市场化将导致医疗费用越来越高（和讯网）。

與其同時，中国经济周刊报导，“高成本致北京很多公立医院亏损， 政府将全额补贴”。媒體同時報道高州模式受到各級政府的注意和推崇（高州模式”从广东走向全国 近3个月有12省80多个参观团取经高州人民医院）。顧昕則認爲高州的成功歸因于“高州医改”的精髓是去行政化。华西都市报的“外资在华独资办医院据称已获原则性通过”报导也反映了“业界对财政实际支出的认识更清醒，全国14086所医院不可能通过财政补偿找到出路。” 而南方日报关于“基本药物制度推行逾一周年， 药品变相涨价现象严重”的报道，也提供了各方论点争议的题材。

卫生部长陈竺提出另外一个观点。 根据华尔街日报报道， “医院系统的改革不仅涉及资金，它是对运营机制的全面改革。医院往往负担过重，需要将重点从紧急救助和治疗大病转为基础护理，包括卫生保健、健康教育和疾病防治”（中国医疗改革不仅仅是钱的事）。

对企业而言，媒体报道和公众舆论的取向意味着舆论对市场形势，及对企业商业策略的影响。正如舆论对药价和药企行销行为关系的论点，为药价高居不下的情况提供了问题分析和解决方案的诠释角度。

罗德公关为客户提供一套“论点追踪、分析、和咨询”的服务方案。该服务依据客户业务需求，为客户提供策劃及執行公共事務和公共關係傳播的工作的參考。詳情請洽.

Medical Reform

Editorials and commentaries over the demotion of Shenmu County’s party secretary Guo Bao-Cheng reflect popular expectation for the government to finance and serve as the sole negotiator in the purchase of health services from providers.  Shenmu County drew national attention when it began offering a local government-financed universal healthcare scheme.  Seven of the eight hospitals under the scheme are private hospitals.  Guo was a key mastermind behind the scheme.  Select editorials and comments concerning this situation include the following:

Yangcheng Evening News published a commentary entitled “Reformers Should Not be Treated as Dangerous Agents.” The author wrote that “Shenmu’s medical reform embarrassed [other local governments]. When asked if other regions can replicate the Shenmu model, Guo replied, ‘Yes.’ ….As such Shenmu’s medical reform was seen as a spoiler, and Guo was perceived as a dangerous agent for revealing to the people what the [local] government can and did not do” (link to full Chinese text).

Wu Ming, a senior journalist at People’s Daily, wrote that as a second-tier government official instead of the county’s party secretary, Guo now has more leeway to speak freely. Wu highlighted Guo’s comment that the issue for providing universal healthcare is not money, but rather the attitude of upholding the ideology to serve the people. Wu concluded that with the determination to augment what is missing, implementing the Shenmu model across the nation should not be a problem (link to full Chinese text).

Separately, Hexun Net reported on Li Ling’s recent public address.  Li Ling is one of the key architects of the current medical reform.  She is a professor at Peking University and a consultant on China’s medical reform at the World Bank.  According to the report:

Li Ling commented that research has shown that a market-based healthcare system would only lead to higher costs. She pointed out that a year after the reform, “While the government has invested significant sum into the medical reform, hospitals are encouraged to chase after profits, the people have yet to experience tangible benefits.” She cited hospital reform and pharmaceutical distributions as two key problem areas. In addition, she cited [local government] leadership as another problem that has stalled the success of medical reform in some local regions (link to full Chinese text).

The implication of a government-financed health system, as evidenced by Beijing’s experience, may help explain local and central governments’ interest in the Gaozhou model.

According to China Economic Weekly, the Beijing government’s previous announcement to subsidize public hospitals indicated a significant policy milestone. Many of the hospitals in the city have cited high cost as the key reason for their budget deficits. The policy continues to be a topic of debate in the media (link to Chinese text).

The Gaozhou model refers to a county-level (Level II) public hospital in Guanzhou that has achieved the goal of providing high-quality and low-cost healthcare without having to draw on local government funding. One media reported that in the past three months, the hospital has attracted over 80 groups of visitors to study its method. The visiting groups included one led by Li Ling, as well as a group from the Ministry of Health, and other groups from 12 provinces (link to Chinese text).

Gu Xing, however, commented that the success of the Gaozhou model is due to the local government’s “hands-off” approach on hospital administration.  Gu Xing is a professor of the School of Government at Peking University and a leading commentator sought by the editorial media concerning the medical reform issues (link to Chinese text).

The China Perspective cited the Ministry of Health spokesperson as saying that “the Chinese government is drafting rules that encourage foreign capital to invest in the nation’s healthcare sector and that private capital is welcome for the establishment of non-profit hospitals” (China’s healthcare sector hails foreign capital).  An earlier report by Western China City News, citing a source close to the Ministry of Health, suggested that the news indicates an internal consensus among ministries that it would be unrealistic to finance hospitals through government subsidies alone (link to Chinese text).  People’s Daily (English), however, reported that controversy brews over foreign-owned hospitals.  Separately, in response to media inquiry on whether the news would allow foreign wholly-owned hospitals, the Ministry of Health clarified that China’s policy has always prohibited foreign wholly-owned hospitals.  Individuals from Taiwan, Hong Kong, and Macao, however, will be allowed to invest in hospitals in designated cities beginning next year (link to Chinese text).

Experts expect the National Development and Reform Commission to launch another round of price cuts on pharmaceuticals.  Previous media reports exposed the persistent problem of overpriced drugs even a year after the introduction of the Essential Drug System.  Experts expect high-priced medications and exclusive categories to be the areas of focus for the price cuts (link to Chinese text).

A snapshot of patient experiences in China is offered in an article by The Seattle Times (China’s gap between health care for the rich and poor remains vast).

Business & Initiatives

Global drug firms take aim at made-for-China healthcare
Mindray Eyes U.S. as West Looks East
China starts healthcare tech reforms
IBM Says to Bring USD22bn Software Resources to South China
Chinese Mainland to Further Open Medical Market to HK, Macao and Taiwan

Health & Awareness

Middle-class Chinese report that they live their days as if on a treadmill run, according to a recent study.  Ninety percent report that they are too overworked, and 50% are unsatisfied with their physical and psychological well-being (link to Chinese).

Heartache of childless couples
New pharmacopoeia seeks to improve safety of Chinese medications
‘Chinese-style suicide’ stirs concerns
Children face obesity problem
China sees more thyroid problems

Public Health

13 deaths from tick bites reported in East China
Tick-borne pathogen yet to be determined: ministry
MOH to carry out large-scale measles vaccination plan: official
19 students sickened in east China’s latest cholera outbreak
“No smoking” law comes into effect in south China’s Guangzhou
Exact number of tick bite cases still unknown: MOH
Doctors struggle to find cause of deadly bug bites

Additional News from the Greater China and Other Markets:

Hong Kong
Hong Kong Undertakes First Mental Health Survey in Wake of Violent Cases
Hong Kong Settles on Public Health Insurance Subsidy

Taiwan
Legislative speaker calls for cross-strait medical cooperation
Home visit program helps prevent waste of medicines: pharmacists
Taiwan wants to speed up promotion of medical travel
Taiwanese Enterprises Eye China`s Medical Market

Singapore
Healthcare spending to double
Singapore’s elderly population at risk of disability due to malnutrition
Singapore launches dementia campaign for early detection

Korea
Expatriate healthcare centre opens in Seoul
Developing nations to study Korea’s health care system

The situation is muddied by the lack of reliable data from hospitals. The current system isn’t standardized and ignores pharmaceuticals, profits from which are used to offset operating losses in the hospitals’ operations. While some are looking to private hospitals as a way to increase efficiency and reduce costs, the lack of third-party verification of hospital accounts means that unclear incentives systems will continue to warp the service provided to patients.

In the region, there are mixed fortunes for countries hosting medical tourists. The OECD is encouraging South Korea to expand out of its traditional niche cosmetic surgery market to attract patients with more serious problems, such as by providing proton therapy for prostate cancer. However, the Asian medical tourism sector is already fiercely competitive, forcing down prices in more established markets such as Singapore. Even so, increasing numbers of visitors from Middle Eastern countries can bring Singapore closer to its target of attracting 1 million medical tourists a year, compared to just 60,000 to South Korea.

This news summary draws on the experience of Ruder Finn’s Health and Wellness specialists operating across Asia through our offices in Beijing, Shanghai, Guangzhou, Hong Kong and Singapore. By analyzing a wide range of sources across the region, we hope to give you a guide that, while not comprehensive, nevertheless offers valuable insights into Asia’s healthcare industry.  

If you would like to add a colleague to the distribution list or unsubscribe from it, please send an e-mail to Shannon Chou, Account Director H&W Ruder Finn Asia: Chous@ruderfinnasia.com

Medical Reform

• Chinese hospitals are battlegrounds of discontent (Link to English text)
• The lack of available medication in community hospitals in Beijing found to be the leading reason that close to 50% of residents opt for Level III hospitals.  In the meantime, during the China Health Summit, Minister of Health Cheng Zhu reported that the scope of the National Essential Drug List will be further expanded to meet the needs of community hospitals.
• A health economics expert argues in favor of private hospitals for introducing competition to improve cost efficiency and quality of care.  Separately, the lack of a uniform accounting method and IT platform is viewed as the main reason for the lack of clarity in the true cost of hospital management in Beijing.
• A World Bank economist pointed out that non-infectious diseases already account for over 60% of health expenditurein China.  Separately, the deputy minister of Human Resources also indicated that in 2009, 60% of the portion of the Medical Insurance Fund earmarked for hospitalization was expended on medical care for a quarter of retirees. 
• A hospital director explains why medical school graduates rather work in other professions than take jobs in community hospitals.

Business & Initiatives

• IBM launches cardiovascular disease management system in China (Link to English text)
• The deputy ministry of health challenged foreign medical equipment companies on their records of after sales servicesduring the China Health Summit. 
• Guangzhou plans to shorten the term of tenure for hospital directors and other “corruption high-risk” personnel following the prosecution of twelve hospital directors on corruption charges.

Health & Wellness

• The Ministry of Health launches a 10-city health literacy program for professional women ages 25 to 55.
• Healthcare remains the key concern for urban and rural residents alike in spite of their overwhelming optimism for the future.
• Study links Chinese kidney problems to genes (Link to English text)
• Chinese Health Ministry clears milk powder in latest scare (Link to English text)

Public Health

• Superbug may strike again (Link to English text)
• Developing nations to bear cancer brunt, unprepared (Link to English text)
• Doctors warn osteoporosis will be more prevalent in Asia (Link to English text)

Additional News from the Greater China and Other Markets:

Hong Kong

• Mamas without borders: Why more mainland Chinese women are rushing to give birth in Hong Kong  (Link to English text)
• Indian drug magnate sets sights on health care sector (Link to English text)
• Plans to build Pan-Asian healthcare empire intact:  Fortis Chief (Link to English text)

Taiwan

• Chinese visitors impressed with checkups in Taiwan (Link to English text)
• Taiwan, Japan expand services in medical market of China (Link to English text)
• Taiwan close to implementing historic economic agreement with China (Link to English text)

Singapore

• UPS to build healthcare logistics hubs in Singapore, China on Asia growth (Link to English text)
• Tiger Balm fails US drugs tests (Link to English text)
• Singapore government to invest 10 Million in senior living tech (Link to English text)
• Accenture wins contract to implement Singapore’s National Electronic Health Record System (Link to English text)
• Singapore sees rise in medical tourism (Link to English text)
• Growing need for community nurses as society ages (Link to English text)

Korea

• Health insurance premiums to surge (Link to English text)
• South Korean medical tourism growing despite problems (Link to English text)

Medical Reform

A journalist at the Legal Evening News found that in Beijing the limited scope of available medications in community hospitals has deterred many residents from using the facilities.  According to the report:

• While residents are aware that drug prices are cheaper in community hospitals, many have been disappointed to find that the prescribed medications are only available in large hospitals.
• Based on a survey of 150 residents, the reporter found that while 43% indicated a willing to seek consultation in community hospitals, 57% of the residents prefer to seek their initial consultation in Level III hospitals.  Of this group, 78% indicated “the lack of comprehensive portfolio of medications” to be the key reason for their reluctance to visit community hospitals.
• According to a director in a community health center, community hospitals are restricted from keeping a stock of medicines that failed to win the listing bidding and medications designated for large hospitals due to safety concerns.  In addition, community hospitals can only keep a stock of generics.  Further restrictions are applied to health service centers below the ranking of Level I hospitals. 
• Some community hospitals are worried that with the implementation of a policy requiring all hospitals within the city to charge the same price for the same types of medications would further exacerbate the issue.
• Link to full Chinese text.

The Daily Economic News reported that during the China Health Summit in Beijing, Minister of Health Cheng Zhu indicated that the scope of the Essential Drug List will be appropriately expanded.  According to the report:

• The Essential Drug List available in various regions only represents about 30% of the medications purchased by grassroots health facilities.
• The medical reform plan had planned for two versions of national essential drug lists, one for the grassroots facilities and the other for large hospitals, in order to fulfill the different clinical needs of hospitals.  While the “grassroots” version with 307 medications was published in August 2009, the version for “large hospitals” has yet to be published.
• A professor of Fudan University’s Public Health commented that “when Shanghai implemented the Essential Drug System, one of the problems was the limitations of available medications in the Essential Drug List for grassroots organizations.  The listing represents less than 30% of the needed medicines by the grassroots organizations.”
• Link to full Chinese text.

Gordon Liu, executive dean of Peking University Guanghua School of Management’s Institute of Health Economics, argues in favor of allowing private hospitals to participate more actively in the market.  During an interview with Outlook magazine, Mr. Liu pointed out:

• It would be difficult to rely solely on public hospitals to complete the mission of medical reform. By allowing private investments:
• o   It would provide an opportunity to private funds accumulated over 30 years of economic liberalization that is seeking opportunities for investments. 
• o   Private hospitals would expedite introducing modern management knowledge to hospital management and favorably support public hospital reform.
• o   Private hospitals would support the development of medical services based on core competencies instead of a development path based on protective measures and other policies that distort market functioning.
• The current discussion frame of presenting the not-for-profit operations model as a pre-requisite for fulfilling hospitals’ public welfare mission is not a relevant association.  Basic economic law requires that all organizations, including hospitals, observe the rule of minimizing cost to produce highest output.  Even if hospitals are defined as not-for-profit entities, they need to follow the same law in order to promote management efficiency.
• Mr. Liu argues that the key differentiator between a private and a not-for-profit hospital should be the treatment of profit.  Not-for-profit hospitals would re-invest the profit to support additional product and investments.  Private hospitals would have the option of retaining or distributing profit to shareholders.
• Mr. Liu also cited Taiwan’s example in which private hospitals succeeded in breaking the public hospital monopoly, which led to higher quality of care and lower cost for patients.  He attributed two factors to Taiwan’s success: market liberalization and competition.

The magazine pointed out that although the new medical reform plan has indicated a welcoming of private capital to invest in private hospitals, investors have complained that government officials are largely cautious.

Link to full Chinese text.

The Economic Observer reported that with the Beijing government’s announcement for reimbursing the full losses of public hospitals in Beijing—the so called “Beijing Model”—the true cost of medical care remains a mystery.  According to a healthcare economic scholar who declined to be identified:

• The figures hospitals have reported have not accounted for the cost and revenue of pharmaceutical sales.  As such, the losses reflect the cost of operations.  This is one of the reasons that the true cost and financial profile of hospitals remain a mystery.
• Three issues also require further attention.  First is the lack of a standardized accounting method for hospitals.  Second, the lack of a standardized IT platform for tracking and tabulating costs.  Third, the accounting method used most is for the tabulation of bonuses for doctors based on pharmaceutical and diagnostic prescriptions.  It is not an appropriate method for cost evaluation.
• Other industry insiders also pointed out that the current practice of cost accounting lacks third-party auditing and additional monitoring.  As such, there is significant risk involved for a local health authority to act as the sole entity for calculating the operating costs of public hospitals within its jurisdiction.
• A scholar of Sichuan University suggests introducing a comprehensive method of cost accounting in order to fulfill the real goal and standardize the method and scope of cost accounting.
• Link to full Chinese text.

During a speech at the China Health Summit held in Beijing, World Bank economist Ardo Hansson pointed out:

• Non-infectious diseases now account for over 60% of health expenditure in China and is projected to further increase.  The international average is 40%. 
• Non-infectious diseases now account for 80% of the leading causes of deaths in China.
• Most of the expenditure is expended in hospitals, ranking China among countries with higher percentages of expenditure expended in hospital care.  Should China succeed in bringing down the percentage of infectious disease expenditure to international norms, more money can be released from hospital care to outpatient and community healthcare facilities.
• Mr. Hansson pointed out that the health of a nation’s healthcare system has an intimate relationship with a country’s productivity and GDP growth.  It would also lower the rate of savings individuals and families direct toward safeguarding safety net spending.
• Link to full Chinese text.

According to the 21^st Century Economic Herald, the medical insurance fund is confronting challenges brought on by China’s aging population.  According to the news report:

• Hu Xiaoyi, deputy minister of Human Resources, said during the China Health Summit that in 2009, a quarter of retirees used up 60% of the medical insurance fund reserved for hospitalization.  At the end of 2008, individuals over 60 accounted for 12% of the overall population in China.  By 2015, the figure is expected to reach 15%.
• Tang Jun, secretary general of the Social Policy Research Center, commented that the government will need to increase fiscal funding should the trend of elderly care continue to increase.  In the meantime, the government needs to focus on expanding medical insurance coverage and raise the standard of medical insurance services.
• According to Tang Jun, the government spent 399.4 billion yuan on healthcare in 2009.  The amount was increased to 443.9 billion in 2010.  However, the total healthcare expenditure in 2009 represented only 1.3% of the GDP and 6% of the total fiscal budget.  These are very low ratios, which may see many folds of increase for developed nations.
• Link to full Chinese text.

Why do medical students rather work in other professions than take jobs in grassroots hospitals?  According to Guo Qiyong, director of China Medical University-Affiliated Sheng Jing Hospital:

• China graduates 700,000 medical students per year, and only some 200,000 pass the professional qualifying examination to work as doctors.  The remaining must work in other professions, as they are not qualified to work as doctors.
• This high ratio of students not working as doctors reflects the fact that medical education in China is a relatively more general education than in the West.  Secondly, the high-stress, low-pay nature of the medical profession always discourages many students from entering the field.
• Separately, medical education is also more comprehensive for the development of specialists than generalists.  As such, since the only available career opportunities for specialists are in large hospitals, few can find appropriate opportunities in grassroots healthcare facilities.
• As for solutions to the problem, international practices may not be appropriate for the challenges that China faces.  For example, China does not have a uniform medical education curriculum.  Some receive a three-year education, others a five-year education, and still others enter a master program that requires six or seven years.  This lack of uniformity is part of the reason for the lack of uniformity in the quality of doctors.
• Link to full Chinese text.

Business & Initiatives

The 21^st Century Economic Herald headlined that while foreign-invested medical equipment has flooded the market, after sales services are rare.  According to the report, during the China Health Summit, Deputy Minister of Health Wang Guoqiang confronted executives of foreign medical equipment companies such as Siemens, GE, and Phillips.

• Wang stated, “…you have sold to us all your high-end products; all the provincial hospitals now are equipped with your products.  Have you considered how the equipment is being used?  What the results are?”  He further asked, “Please raise your hand to indicate which of you have conducted a product usage review?  What’s the efficacy rate for using your products?  What’s the status of operation?  Are the operations in line with required standards?” 
• The executives of foreign-invested and domestic companies in attendance reportedly remained silent throughout the inquiry.
• Deputy Minister Wang added that based on the government’s own investigation, while the equipment is truly advanced, training and staff operation of the equipment is poor.  This has resulted in very poor medical efficacy for the equipment.”  He urged the companies to focus on medical efficacy while attending to their sales goals.
• According to the report, 80% of the CT market, 90% of MRI, 90% of ultrasound, 85% of diagnostic equipment, and 90% of high-end biometrics recording equipment in China are all monopolized by multinational companies.  For large hospitals, 90% of the equipment is of foreign brands.
• The Ministry of Health was reportedly considering introducing regulations on equipment monitoring and after-sales service, but no further information has been reported on the release of these regulations.
• Link to full Chinese text.

Nanfang Metropolitan News reported that twelve hospital directors in Guangzhou have been charged with corruption.  According to the report:

• Of the complaints received by the Guangdong Health Office, commercial bribery such as medical workers receiving kickbacks for purchasing pharmaceuticals and equipment represents the highest number of complaints.  The second highest relates to hospital management, followed by professional ethics. 
• Of the twelve hospital directors charged, eight were found to have received bribes for pharmaceutical and equipment purchases; the other four were for having set up slush funds within their hospitals.
• Pharmacy directors are also high-risk individuals for corruption.  Pharmacy directors in five hospitals in Zhuhai have been found guilty of receiving bribes. 
• To prevent bribery, Guangzhou plans to limit the terms of workers in “sensitive” functions to two years.  The original regulation was for three years per term.
• Link to full Chinese text.

Health & Wellness

The Ministry of Health launched a ten-city health literacy program aimed at professional women ages 25 to 55.  According to the ministry:

• Over 90% of the women in the age group report various levels of health problems.
• The first national survey on health literacy indicated that Chinese residents only possess an average of 6.48% of health literacy skills.
• The program is expected to last a year beginning this August and will roll out in various stages covering Beijing, Shanghai, Chongqing, Guangzhou, Hangzhou, and other first-tier cities.
• Link to full Chinese text.

An Economist Intelligence Unit survey sponsored by Bayer found that 90% of interviewees report optimism for the future.  The report found that healthcare remains a key concern, however.  According to the report:

• 84% of rural residents listed healthcare as the leading issue of concern in the future; 61% of them are most worried about medical cost.
• For residents in relatively wealthy urban centers, 60% are concerned about health in the future.  However, compared with rural residents, 49% are most concerned about the quality of doctors and hospitals.  Only one-third is concerned about medical cost.
• Link to full Chinese text.

• Industry insiders are skeptical that NDRC’s planned policy initiatives will address the core issues of inflated drug prices.
• A doctor’s blog disclosing corrupt medical practices drew a record 170 million views within three months of posting, though with very few comments. Another story of a week-old infant given 189 medical tests prompted a commentary on the key factors giving rise to excessive medical care.
• An online survey found that 90% of respondents would give doctors red pocket monies in order to feel more secure about hospitalization or surgical procedures. A blog post claims that a provincial-level OB/GYN specialist can easily make 100,000 yuan per month from red pocket money alone.
• Shengmu County uses various monitoring schemes, including a donated database server, to maintain cost control of the universal health coverage program.
• Popular author Liu Liu thinks that greater understanding would help facilitate better doctor-patient relations, a perspective that coincides with the intention behind Beijing Health Bureau’s planned “A Day in the Life of a Doctor.” A Nanfang Weekend reporter, however, argues that system reform, not understanding, is needed for achieving better relations. The reporter’s view drew the ire of one reader who posted a comment criticizing the reporter and the media in general for fanning the already contentious doctor-patient relations.
• China tweaks villagers’ health insurance system to encourage timely outpatient healthcare (Link to English text)

Business & Initiatives

• TSKF is reported to be in discussion to enter the traditional Chinese medicine market segment.
• Peking University People’s Hospital Partners with IBM (Link to English text)
• Merck in Talks for China Partnership (Link to English text)
• The Price of Admission: 10 Medical Companies Suspected of Paying Bribes in Foreign Countries (Link to English text)
• IBM plans $100mln global healthcare initiative (Link to English text)
• Asia is hot destination for medical tourists (Link to English text)
• A Healthy Investment in China (Link to full English text)

Health & Awareness

• China’s AIDS activists face uphill struggle (Link to English text)
• Organ donations on the rise: Official (Link to English text)
• China lowers dairy protein levels to curb melamine (Link to English text)
• Hospitals providing nutritional advice to patients (Link to English text)
• Curing cancer one zap at a time (Link to English text)
• China OKs online buying of medication at 27 websites (Link to English text)

Public Health

• China surveys chronic disease prevention capabilities (Link to English text)
• China needs more GPs, suggests summit (Link to English text)
• China’s elderly population leapt in 2009: state media (Link to English text)

Additional News from the Greater China and Other Markets:

Hong Kong

• DH reaffirms commitment to promote breastfeeding (Link to English text)
• Hong Kong: Safe use of medicines containing lamivudine and telbivudine (Link to English text)
• Hong Kong: Safe use of topical products containing ketoprofen (Link to English text)

Taiwan

• Taiwan courts Chinese patients (Link to English text)
• Taiwan has best terminal care in Asia: Singapore’s Lien Foundation (Link to English text)
• A healthy industry (Link to English text)
• Healthcare robotics on the verge of taking off (Link to English text)

Singapore

• Singapore Outlines 10 Year Plan For Integrated Patient Care (Link to English text)
• Singapore Invests $10 Million For Senior Living Initiatives (Link to English text)

Korea

• Welcome to the Medical Device Space Samsung (Link to English text)
• Tale of two economies in Korea (Link to English text)
• Revolutionary Medical Dressing Uses Nano-technology to Fight Infection (Link to English text)
• Kiwi medicine joins forces with Korean tech know-how (Link to English text)
• Healthcare firms call for innovative policies (Link to English text)

Medical Reform

The 21^st Century Economic Herald reported that the National Development and Reform Commission is planning a series of policies aiming to reorganize the pharmaceutical pricing system:

• The policy initiatives are in response to reports of inflated medicine prices marked to include a profit margin f over 1000%.
• Industry insiders generally believe the planned policies would only address the symptoms of inflated drug prices rather than the core factors driving the prices.
• This is due to the fact that provincial authorities retain significant leeway to amend the drug reimbursement lists. Oftentimes, the provincial authorities may almost double the size of reimbursement lists from the national level.
• Moreover, the NDRC and its local subsidiaries only have the authority to set the price for 20 to 25% of medicines available on the market. This means that close to 80% of drug prices are set by the market, including those with exorbitantly high levels of profit margin.
• Link to full Chinese text.

Jiefang Daily commented on a doctor’s blog that drew over 170 million views within three month of its posting and urged the “silent majority” in the medical community to speak up:

• A Guangzhou doctor’s blog post commented on the death of a Peking University medical professor and revealed what is already common knowledge—the impatient attitude of medical professors, redundant tests, prescription abuse, and the deterioration of doctor-patient relations.
• Interestingly, only a dozen or so comments have been posted on the blog. One way to explain this unusual phenomenon is that the issues exposed are already too familiar and most are “too numb” to join the conversation. In fact, the writer stated in the post that although the medical reform intimately impacts doctors’ interests, “most doctors are not willing to speak up.”
• Over the past year of the new medical reform, although much has been done, the public’s frustration with the issues of medical costs and access has yet to be tangibly addressed. One of the reasons is the lack of participation and monitoring from the public and especially the medical professionals.
• The medical reform needs to allow the silent majority to actively express their views and become active participants and supporters of the medical reform.
• Link to full Chinese text.

The Beijing News published a commentary by an anonymous doctor on the news report that a week-old baby had undergone 189 tests within 79 hours, including tests for AIDS, syphilis, rheumatoid arthritis, and diabetes. This anonymous doctor wrote:

• While some tests are in accordance to medical requirements, the high number of tests within such a short timeframe questions the bottom line of medical ethics.
• Three factors may account for this practice of excessive tests:
  • With regulatory policies limiting the percentage of pharmaceutical sales in the overall hospital revenue, some hospitals are trying to narrow the gap by increasing the revenue from diagnoses and tests.
  • Strained doctor-patient relations has motivated doctors to err on the side of over-testing in order to minimize the risk of medical disputes.
  • The system of evaluating doctors’ performance based on their financial contribution has resulted in eliminating doctors who fail to achieve certain levels of revenue through prescription writing or diagnostic tests.
• Link to full Chinese text.

Life Times reported that a recent survey involving close to 10,000 netizens found 90% of the respondents would give doctors red pocket money in the event that a family member required surgery or hospitalization. Respondents indicated that they would feel more secure by giving the red pocket money:

• The survey found that 34.19% would give a red pocket in the range of RMB 500 to 1,000 and 26.45% would give over RMB 1,000. Some 54.1% indicated a willingness to give between RMB 1,000 – 5,000.
• As for the use of red pocket money, 32.19% believe that it “would improve the attitude of doctors,” and 29.65% believe that it would motivate doctors to be more diligent when conducting surgical procedures.
• According to a deputy director at a Beijing hospital, “very few doctors ask for red pocket money.” Most of the money is given by patients voluntarily. It is a practice that even doctors themselves engage in when they seek medical care.
• How can the practice be stopped? An assistant administrator of the China Medical Science Institute believes that when doctors are fairly compensated and have opportunities to maximize the value of their labor, the practice of red pocket money will be eradicated.
• Link to full Chinese text.

The New Express Daily followed up on a blog post claiming that “a provincial-level OB/GYN specialist easily takes home RMB 100,000 in red pocket money”:

• The post drew 540,000 views within a few days and received 2,778 comment posts. Some comments questioned the authenticity of the blog account.
• The New Express Daily reporter randomly selected 30 families that had new births in the last 10 years and found that exactly half of the families had given doctors gifts or red pocket monies. All of the monies and gifts were given voluntarily.
• Link to full Chinese text.

The 21^st Century Economic Herald reported on the challenges facing Shengmu to control medical costs under the county’s universal health coverage scheme. According to the report:

• Compared with 2009, the budget for universal health coverage has increased by 30 million yuan to reach 180 million yuan.
• The county has developed a comprehensive system for monitoring costs that includes various layers of inspection as well as using digital records to monitor hospital spending.
• A county official revealed that an IBM server worth 2 million yuan was donated. The server keeps track of patients’ medical records. The county is working on a monitoring program to track hospital spending on treatments. Hospitals found to have exceeded the limits will receive warnings or be disqualified as a universal coverage hospital.
• Link to full English text.

Nanfang Weekend interviewed author Liu Liu who just published a much-anticipated fiction book on doctor-patient relations:

• [Liu Liu enjoys significant national popularity following the airing of a TV series based on her book Snail Home. Premier Wen cited the TV program during an online exchange with the public.]
• According to Liu Liu, the book is based on her experience going “undercover” (with the hospital’s agreement) in a hospital for six months. During the interview, Liu Liu said that she hopes the book will offer an alternative view on solutions to improving doctor-patient relations—that of understanding doctors.
• Her account indicated her views on the need for greater understanding of the work challenges confronted by doctors, better patient education on health information, and additional support to help doctors to communicate with patients.
• Link to full Chinese text.

Xinhua Agency reported that the Beijing Health Bureau plans to invite 200 residents to participate in “A Day in the Life of a Doctor” in August. According to the report:

• The 200 residents will be posted in 71 jobs throughout 41 community health organizations.
• According to the bureau, the objective of the program is to solicit recommendations that will help improve the public’s trust of community hospitals and to alleviate patient demand for services in large hospitals.
• The bureau had launched a previous program involving 100 residents. The program helped hospitals improved services to promote better doctor-patient communications and relations.
• Link to full Chinese text.

A reporter of the Nanfang Weekend known for writing on doctor-patient relations reported his disagreement with author Liu Liu’s perspective on the issue. The reporter wrote:

• System reform, not understanding, is the critical factor needed for resolving the issue of strained doctor-patient relations.
• Liu Liu’s talk of “understanding” (for addressing the issue of strained doctor-patient relations) is a joke. The only way to alleviate patients’ frustration is to establish legal recourse to protect the rights of patients. If laws cannot do so, it is time to change the laws.
• The most important task is in establishing a system that eliminates bad doctors and rewards good doctors—not the other way around. The current system incentivizes doctors who take commissions on prescription writing and prescription abuse.
• China reports over a million cases of medical disputes per year, and in over 70% of these cases, patients have opted to “take on direct confrontation with the hospital.” Many of the problems are not related to “a lack of understanding” nor issues of medical cost and access. Based on [the reporter’s] experience, many of the cases may have involved criminal conduct in which a legal channel for resolution could not be found.
• Link to full Chinese text.

A reader’s commentary to the above report criticized the reporter for demonizing doctors and fanning already inflamed doctor-patient relations.

• Link to full Chinese text.

Business Initiatives

The Economic Observer reported that TSKF (Tianjin Smith Kline & French Laboratories, Ltd.) is planning to enter the traditional Chinese medicine consumer market:

• TSKF is in discussion with Tianjin Da Ren Tang on possible sales collaboration for traditional Chinese medicines.
• Other global pharmaceutical companies, including Pfizer and MSD, are all reported to have visited the Traditional Chinese Medicine Association, retained consultants to develop market entry strategies into the market segment, or have established intimate contacts with domestic suppliers.
• Following these global companies’ shift of strategy from patented medicines into generics and general medicines, industry insiders believe that these companies are seeking partnerships to further their reach into the general medicine market.
• Da Ren Tang in this case will provide the sales platform that TSKF needs to further its reach into the market segment. TSKF’s 1,000-person strong sales force will also eliminate the need for Da Ren Tang to build its own national sales network.
• Link to full Chinese text.

• Drug prices continue to dominate headlines with news that basic drug prices may be further reduced by 30 to 40%. Separately, fewer imported drugs are expected on the essential drug lists some community health organizations use.
• The NDRC is to investigate reports of price increases by some companies whose pharmaceuticals qualified for the drug reimbursement listing. Separately, the MOH announced plans to conduct an evaluation of the progress of medical reform that will involve international organizations such as the WHO.
• The Gaozhou hospital reform model drew national attention for its ability to improve health services at a reduced cost through market-based solutions. On the other hand, Shenmu’s hospital reform model, which offers universal coverage through government financing, also showed promise for creating win-win outcomes for patients, hospitals, and government alike. Of note is that the Shenmu model includes private hospitals for providing public-financed care. Additional information on the Shenmu experience can be found here.
• News reports link Johnson & Johnson Medical to the latest scandal at the SFDA, which saw the removal of a high-ranking official over suspected bribery charges. The company has since issued a public statement noting that it has not received any official notice relating to the case and reiterating the company’s stance to abide by Chinese laws and regulations.
• Several incidents of patients stabbing doctors prompt a commentator to urge the government to address the issue of doctor-patient relations in the medical reform.

Business Initiative

• GE Healthcare To Launch Ecosystem In Greater China (Link to full English text)
• Eli Lilly Sets Plans for Emerging Markets (Link to full English text)
• AstraZeneca answers the great call of China (Link to full English text)
• IBM, Chinese hospital start med project (Link to full English text)
• Eli Lilly and Company not to acquire swine vaccine business in China from Pfizer (Link to full English text)
• Abbott targets better nutrition with new R&D facility in Singapore (Link to full English text)

Health & Awareness

• China announces plans to expand and build hospitals dedicated to the treatment of mental illness. The government also announced that medical records have been established for 900,000 patients suffering from critical mental illnesses.
• China eyes milk test after melamine deaths scandal (Link to full English text)
• For China’s Growing Middle Class, Expanding Waistlines Pose Problem (Link to full English text)
• Medical Tourism: A vacation from the reality of high-cost healthcare (Link to full English text)

Public Health

• China, U.S. to enhance collaboration in public health (Link to full English text)
• H1N1 Flu Acts Much Like Its Seasonal Cousin (Link to full English text)

Additional News from the Greater China and Other Markets:

Hong Kong

• Health facts to chew over as scheme starts – A new nutritional labeling scheme took effect from 1 July, 2010 which applicable to 4,000 types of prepackaged food in Hong Kong. (Link to full English text)
• New name takes the ‘crazy’ out of epilepsy – The Chinese name for epilepsy has officially changed to avoid connotations of madness and to prevent discrimination by those who confuse it with mental illness. (Link to full English text)
• Sixth school shut by foot and mouth – A few schools were closed to stop the spreading of foot and mouth disease. The usual peak season in Hong Kong for HFMD and EV71 infection is from May to July. EV71 infection can have severe complications. (Link to full English text)

Taiwan

• Taipei health department collects 1.5 tons of discarded medicines. (Link to full English text)
• DOH sets limit for medical fees. (Link to full English text)
• Healthcare system lets many down – a commentary on the current healthcare system in Taiwan (Link to full English text)
• First fatal case of Japanese encephalitis in 2010 confirmed; Taiwan CDC urges public to protect themselves from mosquito bites and make sure children receive appropriate vaccination. (Link to full English text)

Singapore

• Singapore General Hospital gains elite status. (Link to full English text)
• Researchers in Singapore make breakthrough in treatment of septic shock. (Link to full English text)
• Govt says no to posting of docs’ fee guides. (Link to full English text)

Korea

• Samsung ventures into medical device market. (Link to full English text)
• Weight-loss drugs raise health threat in Asia. (Link to full English text)
• Jeju to become international business hub – it is in the perfect location to become premium tourism, medical and educational hub in Northeast Asia. (Link to full English text)

Medical Reform

According to Securities Daily, the NDRC may be considering to reduce basic drug prices by 30 to 40%:

• A number of pharmaceutical enterprises and associations have received a notice to submit commentaries review on a proposed measure for drug price administration.
• An insider revealed that this round of price reduction may be as high as 30 to 40%. The official announcement is expected this month.
• This will mark the 26^th round of price reduction in China.

Hangzhou Daily reported that expensive imported pharmaceuticals to significantly decrease in community health organizations. According to the report:

• A number of community healthcare organizations in the test pilot districts are leading the effort to implement the National Essential Drug System.
• Expensive imported medicines will see a significant reduction. Replacing them will be cheap domestically produced medications. Most importantly, 457 types of basic drugs will be sold to patients at cost. The number of medications available (900) will be reduced by half.
• The antibiotics category saw the most significant reduction in the national and provincial drug lists. In the past, 72 types of antibiotics were available in community health facilities; now only 13 are available.
• A formulary administrator commented that the measure will help reduce antibiotic abuse, in particular, patients’ over-reliance on branded antibiotics.

A news program on the Voice of China reported that the NDRC is to investigate reports of price increase of reimbursement listed drugs:

• in 2009, the National Drug Reimburesement List saw an increase of 260 types of medications, of which 30 of them raised their prices immediately prior to listing.
• The National Development and Reform Commission (NDRC) has urgently responded that this type of conduct will be thoroughly investigated.

Minister of Health Chen Zhu disclosed that China is drafting a proposal to evaluate the progress of the medical reform:

• The evaluation method will perform a scientific analysis of the medical reform work and draw up a summary of what was learned from the experience to guide future improvements.
• China plans to invite the World Health Organization and others to participate in the evaluation work.

According to Guangzhou Daily, the “Gaozhou Model” is receiving widespread national attention:

• Within two months, 52 delegates from 12 provinces have visited Gaozhou Hospital to learn from its hospital reform experience.
• After their visits, the delegates praised the Gaozhou model as being able to “provide high-quality medical technology at a low price point. The hospital has successfully provided a triple-win solution to patients, government, and hospitals through market competition that also realizes the public welfare missions of public hospitals.”
• Gaozhou Hospital is a provincial-level hospital that offers up to 2,360 hospital beds and 63 specialty departments. In 2009, it achieved a hospitalization rate of 60,600 persons. Patients come from over 23 provinces in China, as well as from the U.S. and Indonesia.
• According to a review report by the Guangzhou Health Office, “The quality of medical service has not declined due to this high level of patient volume. In 2009 alone, the hospital performed 1,801 cardiovascular procedures with a success rate of 98.9%. This has allowed the hospital to enjoy a high provincial and national rank for 12 consecutive years.”
• Gaozhou Hospital also offers other medical specialties that are usually available only in provincial Level III hospitals. The hospital has succeeded in providing these highly difficult procedures often at half the cost of provincial-level hospitals. Such a feat has been achieved through stringent control of medical costs and a market-based strategy of “low cost and high volume.”
• A counselor of the State Council concluded after visiting the hospital that “the experience of Gaozhou People’s Hospital has clarified many misconceptions in public hospital reforms. It has offered an effective pathway for the public to access care at a low cost.”

Separately, the Oriental Outlook reported on the Shenmu experience:

• The party secretary of Shenmu district’s commission, Guo Baocheng, commented that from an economic perspective, Shenmu’s “universal healthcare coverage” allowed the government to make a profit. Shenmu is in the Shaanxi province. His comment ignited avid discussions among scholars and consultants of seven international think tanks who were attending a meeting.
• According to Guo, although Shenmu was among the regions most impacted by the financial crisis, the district registered a consumption growth of 22%, the government’s net fiscal revenue grew by 2.1 billion yuan. The net income of rural (farm) residents grew by 1,000 yuan, while urban residents’ average disposable income increased by 3,000 yuan.
• Guo believes that these numbers have a direct or indirect relationship to the universal healthcare coverage. According to Guo, “Based on my personal perspective, from an economic perspective, investments in social welfare are a high return investment.”
• While some experts endorse the analysis, some remain cautious, as the Shenmu model has only been implemented for a year. A separate study by a professor at Peking University on the urban basic healthcare insurance in Beijing concluded that the measure contributed to a 5% increase in consumption.
• During the interview, Guo offered that the Shenmu model has succeeded by avoiding the debate between adjusting the demand or supply side of healthcare to solve the problems. Instead, the model directly addresses the needs of the people. From his perspective, healthcare and pharmaceutical reforms are very problematic territories, so Shenmu has avoided these areas entirely in its reform.
• Of the seven hospitals designated for providing universal healthcare coverage on one is a public hospital. This reform experience has invited the comment of an official at the Ministry of Health that “the plan can help the control cost. Some issues are resolved through market practices. This needs to be further observed.”
• Wang Zhenyao，a director of the social welfare and charity promotion office of the Civil Affairs Ministry, estimates that China only needs to spend 430 billion yuan to implement universal healthcare coverage nationwide.
• Other experts have advocated for the mainland to consider the Hong Kong model of providing universal healthcare coverage. Government officials and scholars, however, have questioned the financial sustainability of the Hong Kong model during previous public addresses.

A deputy chief of the State Food and Drug Administration (SFDA), Zhang Jingli, has been removed from post and faces official investigation:

• Insiders reported that Zhang is implicated in a corruption investigation involving Johnson & Johnson Medical and other medical device companies.
• Industry insiders further speculate that corruption charges most likely involved the registration permit for a medical device in China. The application process for the permit usually takes between one to two years for the collection of supplementary clinical data. The permit also requires re-application every four years. Insiders speculate that the product involved may be Lifescan.
• Johnson & Johnson Medical (the maker of Lifescan) and Roche dominate 60 to 70% of the blood sugar meter market in China.

Johnson & Johnson Medical issued a statement relating the case:

• The statement announced that the company has yet to receive a notice from the government regarding an investigation of the company in relation to Zhang Jingli’s case.
• The statement further reiterated the company’s commitment to abide by all SFDA laws and regulations and other related Chinese laws.

A commentary reported that the deteriorating work environment for doctors is a hidden threat in the success of medical reform:

• Several cases of violence against medical professionals have been reported in the media. One case involved a deputy director in a Hubei hospital who was stabbed in the chest. The director survived the attack. Another case involved two incidents of the stabbing of medical personnel in Shandong, which resulted in one death and one critical injury. The perpetrators in these cases were all patient family members.
• A February 2002 survey conducted by the China Physician Association showed that 60% of doctors indicated dissatisfaction with their work environment.
• The commentary further cited a similar survey in 2009 that still showed that over 60% of physicians are dissatisfied with their working conditions. The report concluded that doctors in general fear for their physical safety and do not feel an assurance of personal dignity while at work. Medical disputes were cited as the key factor negatively impacting their working environment.
• The commentary urged government authorities to give more attention to the issue of physician-patient relations to address this hidden threat to the success of medical reform.

Health & Awareness

China to Improve Treatment Rate for Critically Ill Mental Patients:

• The deputy minister of health Yin Li disclosed during a recent meeting that China plans to improve the rate of treatment for critically ill mental patients in order to reduce threats to society.
• The government also plans to expand and build 550 psychological hospitals to strengthen the work of mental illness prevention, treatment, and convalescence.
• He further indicated that medical records for 900,000 critically ill mental patients have been established.

• Separately, a survey of health workers in Guangzhou found the group to suffer from a higher than average level of stress (Psychological Problems Afflict Many Medical Workers in Guangzhou).

• A lack of trust in the quality of community hospitals is cited as the primary issue deterring residents in Shenyang from seeking care at these facilities, even though policies are enacted to lower service and medicine costs (No Crowds Observed in Community Hospitals Following the Launch of “Zero Price Difference” Policy; Close to Half of Survey Respondents Indicate Willingness to Visit Community Hospitals Following the Unveiling of the “Zero Price Difference” Policy; Shenyang Government to Buy Public Health Services).

• The issue of trust also underscores the public’s reaction to a new standard introduced by the Ministry of Health (Public Concerned with Possible Abuse with New Standard Allowing Hospitals to Sign Consent Forms on Behalf of Patients).

• A number of public hospital directors are reluctant to participate in the public hospital reform pilots ahead of further clarity on the compensation system (With the Compensation System Remaining Unclear, Public Hospitals Reluctant to Participate in Reform Pilots), while an expert opines that health authorities should not be allowed to play both the regulator and investor of public hospitals (Experts: Health Authorities Should Not be Allowed the Identity of Public Hospital Investor).

• China issues the first national standard prescription drug formulary that is expected to curtail prescription abuse (China Issues Prescription Drug Formulary; Prescription Abuse Expected to be Curtailed).

Feb 2

Doctor-Patient Disputes are More Involved than a Matter of Expression

With the goal of resolving medical disputes, the Ministry of Health plans to initiate a project to promote the use of colloquial language in consent forms for surgical procedures. The reform in the communication model between doctors and patients will be tested in two public hospitals in Beijing for 6 months before a test pilot report is prepared and submitted to the ministry for consideration of a national rollout. From my perspective, the escalation of medical disputes is not just an issue of expression. The issue may be as what the Minister of Health Chen Zhu wrote recently that unreasonable systems have contributed to the dilution of public service mission of hospitals and contributed to the economic adversarial positioning between doctors and patients. The fundamental way to improve doctor-patient relations is by aligning doctors and patients that let the two parties join to become one party with shared interests. (Link to Chinese text)

Feb 5

With the Compensation System Remaining Unclear, Public Hospitals Reluctant to Participate in Reform Pilots

On February 2, the Executive Meeting of the State Council passed in principle a guiding opinion on public hospital reforms. According to the director of the Office of Reform of Nanjing Health Bureau, “Hospital directors do not want their hospitals to be selected for the pilot.” Until further clarifications are made on the issue of the financial compensation scheme, public hospitals are all cautious. This newspaper reporter learned that after the elimination of allowing sales margins on prescription drug sales, differences of opinion exist pertaining to the compensation schemes for hospitals to make up for the shortfall in revenues and the issue of separating hospital [regulatory] management from operations. Taking Nanjing for example, the city’s three-year pilot program requires over 8 billion yuan, but fiscal financing represents less than 10% of hospital revenue. Moreover, reforms of public hospitals’ property rights structure remain absent in this round of medical reform. (Link to full Chinese text)

Feb 8

Public Concerned with Possible Abuse with New Standard Allowing Hospitals to Sign Consent Forms on Behalf of Patients

The “Basic Standard for Medical Record Writing” issued by the Ministry of Health will be implemented starting March 1. The “Standard” specifies that during the course of saving a patient’s life, in the absence of a legal representative or authorized person for signing [the required medical authorization forms], a legal person or authorized person of the medical institution can sign [the required forms]. Some doctors acknowledged that the “Standard” might mean a greater share of responsibility for hospitals. One doctor commented, “The purpose of signing the forms on behalf of a patient is to save lives. However, should the medical procedure fail, the patient’s family members may turn around and pursue a legal judgment against the hospital.” Another doctor commented that given the strained doctor-patient relations today, patients and their families may believe that hospitals use the “Standard” as justification for ordering unnecessary tests and procedures in order to make a profit. Some citizens have expressed concern that individual doctors might abuse the “Standard” and believe that it needs further specification and clarification. (Link to full Chinese text)

Feb 27

(??????)Wen Jiabao: The System is the Fundamental Reason for Doctor-Patient Problems

During an online exchange with netizens, Premier Wen Jiabao commented that the overall situation between doctors and patients is good. He added that there are some problems that are not attributable to issues with doctors or patients and that the fundamental problem is with the system. (Link to full Chinese text)

Feb 27

Psychological Problems Afflict Many Medical Workers in Guangzhou

According to a survey conducted by the Guangzhou health authority, slightly over 17% of doctors and nurses in Guangzhou have had thoughts of suicide; close to 90% believe that they have had to deal with difficult patients; over 90% feel that they need to defend themselves against questions or investigations brought on by patients; and close to 50% indicate that given another career opportunity choice, they would not choose their present occupation. The survey was conducted in 2008, targeting 84 hospitals in 12 districts. It interviewed 1,182 medical workers. The survey found that the level of depression among medical workers is higher than in the overall population. Another recent survey found that over the past six months, close to 30% of medical workers have been assaulted verbally by patients, while 0.42% have experienced physical assaults. (Link to full Chinese text)

Feb 28

Chinese Premier Emphasizes the “Power of Morality” to Combat Crises in Modern Society

On the eve of the NPC and CPPCC 2010 session, Premier Wen Jiabao has once again joined netizens online. This is the second time that the premier has conducted an online exchange with citizens. Regarding the issue of problem infant formula, Wen reiterated that business people need to have a sense of morality in their blood. He highlighted that credibility and morality are urgent issues requiring resolution in modern society. He called upon youths and doctors to respond to the call for the “power of morality.” Analysts believe that the reiteration of the “power of morality” shows that, confronted with various crises, the government has given the “power of morality” a high level of consideration in order to rebuild Chinese moral and value systems, in addition to the government’s efforts to improve laws and other systems. Scholars pointed out that China is in the midst of a transition in which the old value system is being dismantled while the nation is still in the process of searching for a new value system. Wen Jia-bao’s promotion of concepts such as “loving others” and “compassion” are the core values of Confucius’ philosophy and should also be the common values of the modern civilized society. (Link to full Chinese test)

Feb 28

China Issues Prescription Drug Formulary; Prescription Abuse Expected to be Curtailed

The Ministry of Health issued the “China National Formulary (Chemical and Biological Products Volume)” on February 7. The volume is China’s first authoritative national standard formulary. The director of the Chinese Hospital Association, Cao Ronggui, remarked, “[The objectives for] the preparation and release of the National Formulary are to regulate medical practices, to improve clinical drug application, and the implementation of clinical path management. The National Formulary is also of significance for promoting better physician-patient communication and establishing a harmonious relationship between doctors and patients.” Some experts also commented that, in addition to providing citizens with a guiding reference on frequently used medicines, the “National Formulary” is also expected to curtail practices of prescription abuse. (Link to full Chinese text)

Feb 28

Experts: Health Authorities Should not be Allowed the Identity of Public Hospital Investor

Following the issuance of the guiding opinion on public hospital reform pilots, voices for promoting and supporting private sector participation in the medical sector have become clearer and louder. Some opine that the business environment for private hospitals will change for the better. Others believe that private hospitals will face further challenges. Yu Hui, an analyst at the Industrial Economics Institute of the Chinese Academy of Social Science, believes that the guiding opinion specifying that “the government is responsible for the basic building of public hospitals and the purchase of large-scale equipment” suggests that the government maintains a role to intervene in the internal management of public hospitals. This suggests that health authorities continue to play the role of an investor in public hospitals. This overlap of interests—health authorities as both the regulators and “bosses” of public hospitals—would be unfair to non-public hospitals. He further pointed out that discrimination remains in the scheme for qualifying hospitals for the [public] medical insurance. (Link to full Chinese text)

Feb 28

Close to Half of Survey Respondents Indicate Willingness to Visit Community Hospitals Following the Unveiling of the “Zero Price Difference” Policy

Following the implementation of the “zero price difference” policy on medicines in Shenyang community hospitals, a survey conducted by the Chinese Business Morning Post shows that close to half of the respondents indicated an interest in visiting community hospitals for care. The survey also showed that because many residents do not trust community hospitals, many would not be able to enjoy the benefits of the policy. A hospital director commented, “Until we address the issue of residents’ distrust of community hospitals, additional government policies will not translate into real benefits for residents.” Another hospital director pointed out that in order to achieve the goal of directing patients to visit community hospitals for common conditions and large hospitals for life-threatening diseases, it is not enough to rely solely on the “zero price difference” policy on drugs. The survey distributed 120 questionnaires of which 103 questionnaires were returned. (Link to full Chinese text)

Feb 28

No Crowds Observed in Community Hospitals Following the Launch of “Zero Price Difference” Policy

Yesterday was the first weekend following Shenyang’s implementation of a “zero price difference” policy for basic medicines in community hospitals. Patient traffic remains quiet at several community health centers and stations visited by a reporter from the China Business Morning Post. Residents’ reactions to the news of the policy were mostly uninspired. One resident commented, “I learned from TV about the ‘zero price difference,’ but I don’t have a favorable impression of public hospitals, so I will not visit there for care.” Another resident reported, “I will only buy medicines when I need them. I will not buy a lot of medicines simply because they are cheaper.” (Link to full Chinese text)

Feb 28

Shenyang Government to Buy Public Health Services

Shenyang issued a guiding opinion on a compensation scheme for community health organizations. According to the guiding opinion, Shenyang’s municipal government will now pay for residents’ healthcare services in community healthcare centers, in effect acting as a purchaser of public health services. The guiding opinion affirms the role of the government as the primary responsible party for basic health investments. Most of the public health services will be provided through government financing. (Link to full Chinese text)