Home > News Summaries > Asia Health and Wellness News Summary – May 2010

News Summaries

prev     main     next

Asia Health and Wellness News Summary – May 2010

May 25, 2010 | Written by rfasia

Medical Reform

Business Initiative

Health & Awareness

Public Health

Additional News from the Greater China and Other Markets:

Hong Kong

Taiwan

Korea

Singapore

Medical Reform

The Economic Observer reports that the new medical reform has expended 390 billion yuan in a year:

  • According to the National Development and Reform Commission, as of the end of February this year, various levels of fiscal authority in China have already expended 390.2 billion yuan. This investment has provided basic healthcare coverage to 1.2 billion individuals. In addition, the grassroots healthcare system has beeninitially established. The bad news is that the problems of healthcare access and affordability remain.
  • When the new medical reform plan was announced last year, the total investment over the three-year period was budgeted at 850 billion yuan. The 390 billion yuan expended in the first year represents close to half of the total budget. However, skepticism remains. Mr.Wang, a sales manager at a Beijing medical sales company, reported that the cost of an 80-day hospitalization for his father is only 1,000 yuan less than the year before. The manager acknowledges an improvement in healthcare access though.
  • As for the 30% drug price reduction, it is not unusual that manufacturers of low-priced medications often forfeit the winning bid. As a result, only high-price drugs remain on the essential drug list.
  • Another point of public discontent is that at community health centers, residents are only reimbursed for the cost of drugs and not for consultation fees or hospitalization. The cost of hospitalization has increased by 10 yuan to 18 yuan, according to Mr. Wang.
  • Link to full Chinese text

Oriental Morning Post reprinted a commentary that the new medical reform should not just focus on investing while neglecting fairness and efficiency. The commentator wrote:

  • In spite of the 390.2 billion yuan investment, the public remains unsatisfied. The recent expose´s on overpriced drugs show that if loopholes continue to exist in drug and medical regulation, no amount of fiscal input can address the problems in the healthcare market. Fiscal spending while neglecting investment fairness and efficiency will only benefit a select few and interest parties; patients will gain very little and risk receiving “negative benefits.”
  • This shows that fiscal investments without money management and accountability systems would have difficultydelivering positive results on the medical reform. It seems as though the current public discontent over healthcare services has yet to alert and pressure health authorities. In order to rectify the currentsituation, another reform would be needed.
  • Link to full Chinese text

The profit margin of a cancer treatment drug is found to be 2000%. CCTV’s News 1+1 reported:

  • Ondansetron, a cancer treatment drug, is found to cost 80 yuan when its manufacturing cost is less than 4 yuan. This easily overtakes an earlier expose´ that found a drug to enjoy a profit of 1300%.
  • Industry insiders pointed out that inflated drug prices reflect two problems. The first is that consumers lack bargaining power in the drug supply and purchasing chain. This is why the government needs to regulate the market. The second problem is that government regulation in itself has problems. Price guidance (published by the government) is already inflated.
  • Link to full Chinese text

The CPC Central Committee Political Bureau convened a learning meeting to discuss global medical development trends and China’s medical reform. Hu Jintao pointed out during the meeting:

  • The central government has affirmed five key tasks for the near-term medical reform work. Party committees and government offices of all levels should effectively target key issues to improve the accessibility and affordability of healthcare.
  • The five key tasks that the central government has identified include:
  1. Acceleration ofa basic medical security system, gradually expanding its coverage to include all urban and rural residents.
  2. Initial establishment of a national essential medicines system toensure reasonable prices,quality, and safety of basic medicines.
  3. Improve the primary care and health service system. Direct more financial and material resources as well as human resources and technology to the grassroots communities. Increase the service capability of primary health services.
  4. Promote the gradual equalization (fairness)of basic public health services. Maximize efforts on disease prevention.
  5. Advance the pilot reform of public hospitals to optimize the structure of public hospitals to secure public satisfaction.

The National Development and Reform Commission plans to introduce four measures to lower drug prices. According to People’s Daily:

  • The four measures aim to intensify regulation of drug prices and expand efforts to crack down on ill-intentioned price increases and profiteering activities. These measures aim to further lower inflated drug prices.
  • The four measures include:
  1. For businesses that determine their own prices, [the government] will intensify the investigation of market purchasing and distribution prices;
  2. For drug prices that follow government price guidance, [the government] will intensify the audit and review of production prices;
  3. Establish an adjustment system for basic medicine activities; and
  4. Research methods to improve drug price management.

The China Net reported that the Ministry of Health plans to introduce five measures to combat high drug prices and crack down on commercial bribery. The measures include:

  1. Further reform and perfecting of the online centralized purchasing system for drugs.
  2. Advance the implementation of the national essential drug system.
  3. Standardization of medical diagnosis and treatment service conduct.Bottom of Form
  4. Investigation of commercial bribery cases.
  5. Collaborate with pricing authorities to lower prices on drugs and medical procedures.

The Outlook Weekly reported on a 10-day seminar attended by key planners of the medical reform. The article concluded by asking if Taiwan’s experience with using private hospitals to break the monopoly of public hospitals, which resulted in greater benefits for the public, may replay itself again. The article wrote:

  • The seminar was organized for provincial-level leaders and represented the highest level of seminar on medical reform since the new plan was implemented a year ago.
  • Seminar instructors included the Minister of Health Chen Zhu, Deputy Minister of Finance Wang Jun, Deputy Minister of Human Resource and Social Security Hu Xiao-yi, Director of the Center of China Study Hu An-gang, and Professor Li Ling of Peking University’s National School of Development, among others.
  • Responding to the news expose´s on inflated drug prices, one seminar participant and deputy bureau director of the National Food and Drug Administration Bureau commented that the “key is to break down the profit chain in the drug supply channel.”
  • Another commented that the most effective measure might be through centralized and direct distribution, instead of the current provincial-based centralized purchasing model. This proposal was criticized as being a backtrack to the centralized planned system in 2008.
  • Another issue discussed was the financing scheme for public hospitals to make up for the shortfalls from the elimination of sales margins on hospital-dispensed prescription drugs. The drug sales margin is a main source of hospital financing.
  • The former Minister of Health GaoQiang wrote in a 2008 article that government financing represents 7% and sometimes only between 2% to 3% of a hospital’s operating budget. Hospitals need to generate the rest of the budget.
  • On the topic of allowing private investments in hospitals’ operation, on May 13th, the State Council published an opinion on encouraging and directing private investments in health development. Many private investors were excited by the news.
  • Professor Li Ling commented that private investment is a good direction. However, since private hospitals can only be supplementary organizations, we should not place our hopes on private hospitals. That would be unrealistic.
  • Link to full Chinese text

Business Initiative

Largest scale cardio-cerebrovascular disease prevention management system is launched in Chengdu:

  • The system is a joint effort by MSD and the Health Office of Sichuan province. This is the first provincial-level prevention management system for managing cardiovascular risks. The program will take five years and will cover the entire provincial elderly population.
  • According to 2008 government data, cardiovascular-caused deaths account for 40.27% of all deaths in China and are the leading cause of death in China. Every year, cardiovascular diseases result in 3 million deaths nationwide. Data from 2007 showed that the medical cost for managing cardiovascular diseases had already reached 130 billion yuan, representing a six-fold increase compared to the cost in 1993. A 1998 WHO report also showed that unless controlled, by 2030, the incidence of cardiovascular diseases will increase by 3.7 times compared to the year 2000.
  • The program aims to:
  1. Standardize the management of three key risk factors for cardiovascular diseases.
  2. Realize the collaboration and work allocations of health service center, Level III hospitals and regional health authorities.
  3. According to MSD, the program represents a unique public-private partnership model that the company has developed. The model has enjoyed a long-established history of collaboration with various government and health authorities worldwide.
  4. At the conclusion of the five-year period, MSD will transfer all rights of the program to Sichuan’s Health Office.

Health & Awareness

China Commercial Times reported that since 2005 a string of product quality issues involving multinational brands are challenging consumer confidence in global brands. The paper cited:

  • Incidents involving Kraft, SK-II, Johnson, Colgate, and Honda.
  • Kraft was profiled for the controversy involving the doublestandard applied on genetically modified ingredients in its products for China, which is different from the standards used for European markets.
  • On safety issues, Novartis, Johnson&Johnson, Protector&Gamble, and Nestle are named.
  • A pending legal case involving Novartis’Sebivo was extensively profiled. The article commented that the incident revealed the arrogance and prejudice of foreign brands toward Chinese consumers.
  • A survey conducted by Sina.com on the question of “Do you trust baby healthcare and bathing products by Johnson &Johnson, Pampers reported that of the 163,000 responses, 50.9% indicated that they do not trust these brands, and another 62.7% indicated that they will not purchase related products.
  • Link to full English text

Public Health

China Disease Prevention and Control Center reports:

  • Based on data from the first few months of 2009, the number of mental illness patients exceeds 100 million in China.
  • Patients with serious psychological disorders exceed 1.6 million.
  • Public awareness of various mental illnesses is less than 5%.
  • Link to full Chinese text

According to a government official of Sichuan Provincial Health Office:

  • 85% of medical disputes in China are due to hospital infections:
  • Hospital infections and doctor-patient relations are two of the biggest challenges faced by hospitals.
  • A doctor reported that that 4 million patients in China per year contract infections while in the hospital.
  • A key measure to lowering hospital infections is by improving the hygiene practices of hospital workers.
  • Link to full Chinese text

^ back to top

 

Digg It | Reddit | De.lic.ious

prev     main     next

Post Your Comment 

About News Summary

RF Asia's News Summary provides a snapshot of editorial and blogosphere opinions shaping the healthcare market landscape. We organize periodical review and analysis on how these opinion trends might impact healthcare communications strategies. To sign up for the next presentation, please contact Mai Tran at mtran@ruderfinnasia.com

 

Subscribe

 

 

Recent Post

 

 

 

 

 

 

Topics