China will introduce more measures to control drug prices across the country to reduce people’s medical expenses, according to a report in state media.

To effectively regulate drug prices, a governance mechanism would be put in place, along with classifications between medicinal drugs, complementary drugs and supplements, as well as standards for corresponding price adjustments, according to a report in the Economic Information Daily which was recapped by the Paper.

An insider who did not wish to be named told a reporter from the Paper that Chinese government departments were reviewing and revising possible measures on the centralized procurement of drugs, price management and setting up standards on charges for medical consultations and prescriptions.

At present, drugs which are under price controls by health authorities include raw material pharmaceuticals, proprietary Chinese medicines, prepared Chinese medicines, biochemical pharmaceuticals and drugs manufactured by hospitals excluding anesthetic drugs and type 1 psychiatric medication, while others are under market mechanisms.

However, for those priced according to demand and supply in the market, the problem has been a lack of transparency in terms of costs, resulting in new measures being introduced to improve transparency and curb price surges.

A nationwide public procurement system in which each drug would be given a code and tracked in terms of the price, stock and sales to allow early warnings for low stocks or price fluctuations would be introduced.

The insider believed that such a system could curb surging drug prices and make sure those with a priority could get their medication as soon as possible.

Institutions which charged abnormally high drug prices without legitimate reasons would be liable to disciplinary action by authorities, including restrictions on participation in centralized procurement, restrictions on medical insurance payments and medical insurance funds.