Reform of Prescription Drug Marketing: Rise of Medical Driven Model

September 18, www.medcine.com Forty percent (non-federal hospitals, federal hospitals, private clinics and private institutions) of prescription drugs sold through Chinese pharmacies account for 9 percent, much lower than 34 percent in the United States. In addition, the United States Postal Service (e-commerce) accounts for 20%. It is not difficult to find that the distribution channels of prescription drugs in the United States are relatively dispersed and diversified, and the retail market of prescription drugs is characterized by chain stores as the main body and relatively balanced circulation patterns of multiple channels. The main marketing mode of pharmaceutical enterprises in China is to promote in-hospital marketing, which promotes the growth of sales by introducing medicines to individual doctors and promoting customer conditions.

In such an environment, a series of problems have arisen directly or indirectly, such as sales-driven promotion model, which leads to abuse of a large number of non-essential drugs (non-guided western medicine and proprietary Chinese medicine); increasing marketing costs, leading to high prices of drugs, etc. This series of problems, on the one hand, lead to the continuous overexpenditure of national health insurance costs, on the other hand, cause the problem of difficult and expensive medical treatment, the voice of public opinion is growing, and the doctor-patient relationship is becoming increasingly tense. Based on this situation, the state has continuously implemented a series of policies to regulate, which makes the means of medical marketing have to be reformed accordingly. From the policy point of view, the main goal of the government is to improve the quality of medical services and reduce the amount of medical insurance payments, thus formulating "graded diagnosis and treatment" and "medical treatment". A series of policies, such as drug separation, two-ticket system, purchasing with quantity and drug management law, fundamentally make the traditional sales-driven mode of enterprises more and more difficult. Specifically embodied in two aspects: (1) The promotion of the mode of separation of graded diagnosis and treatment from medicine makes the sale of drugs no longer decided by a few doctors in urban hospitals, but scattered to other channels such as community hospitals, County hospitals, pharmacies and so on. Pharmaceutical enterprises are increasingly promoting drugs by covering doctors. The harder it is. (2) The successive introduction of the original "4+7" purchasing with quantity (now nationwide collecting and collecting), consistency evaluation and other policies has clearly defined the government's goal of lowering drug prices, reduced the intermediate profits of enterprises, and forced enterprises to reduce marketing costs. Make domestic well-known pharmaceutical enterprises and innovative pharmaceutical enterprises pay more attention to drug research and development and first imitate, increasing the investment in R&D costs. For some other domestic enterprises, they can only continue to increase marketing costs in order to "catch" another revenue at the end of the sales-driven market, but in this process, the Ministry of Finance's penetrating regulatory audit undoubtedly adds the last knife to the sales-driven model. Online prescriptions are in the ascendant

2. From the distribution channels of prescription drugs in the United States, we can see that the total market share of chain pharmacies'retail market and e-mail channel is more than 50%, while that of Chinese pharmacies' prescription drugs is only 9%. This is because in the past, the government has been in a state of "long-term strict management and occasional relaxation" for online prescription drugs. At the 12th meeting of the 13th Standing Committee of the National People's Congress, held in August this year, the newly revised Law of the People's Republic of China on Drug Administration was adopted by 164 votes with 3 abstentions, and will come into effect on December 1, 2019. It is noteworthy that the original document "no direct sale of prescription drugs through the third-party platform of drug network sales" was deleted, replaced by the "online sales of drugs, should comply with the relevant provisions of this law" principle of "online and offline consistency". This is also interpreted by the industry as: at the operational level, the green light for online sales of prescription drugs. At the same time, on August 30, the State Medical Insurance Bureau issued Guidance Opinions on Improving the "Internet+" Medical Service Price and Medical Insurance Payment Policy, clarifying the implementation of an equal online and offline Medical Payment Policy, and promoting the coordinated development of online and offline. Further, it brings good news for the online diagnostic prescription model.

Table 1. In recent years, the policy changes of online prescription in China Of course, the online sales of prescription drugs in the actual operation process is still in the early stage, and has not been able to be promoted on a large scale. On the one hand, although the policy clearly stipulates that the drug distribution network must be interconnected with the information system of medical institutions to ensure the authenticity of the source of prescriptions and the safety of patients'medication. However, there are still some problems in online drug sales, such as difficulties in regulation, lax prescription review and the proliferation of counterfeit drugs. On the other hand, from the perspective of pharmaceutical enterprises, they will worry about impacting the existing sales model; from the perspective of hospitals, they will worry about medical disputes and profit outflow, so neither of them will have positive behavior in this respect. Only some mobile medical enterprises hope to promote as soon as possible because they can not find a good profit model for a long time.