--- title: "Good news! Drug prices are no longer \"one-size-fits-all\": Innovative drugs can increase prices reasonably, while generic drugs will face survival of the fittest" type: "News" locale: "en" url: "https://longbridge.com/en/news/282718859.md" description: "On April 14th, the General Office of the State Council issued \"Several Opinions on Improving the Price Formation Mechanism of Pharmaceuticals,\" marking the transformation of the pharmaceutical pricing mechanism and promoting high-quality development in the pharmaceutical industry. The new policy formulates differentiated policies for innovative drugs and generic drugs, supports reasonable pricing for innovative drugs, breaks the restrictions of medical insurance payment standards, and encourages enterprise innovation. The generic drug industry will face reshuffling, strengthening centralized procurement regulations, and preventing the impact of low-price bidding on supply. It is expected that small and medium-sized generic drug companies will accelerate elimination, leading to an increase in industry concentration" datetime: "2026-04-14T15:29:08.000Z" locales: - [zh-CN](https://longbridge.com/zh-CN/news/282718859.md) - [en](https://longbridge.com/en/news/282718859.md) - [zh-HK](https://longbridge.com/zh-HK/news/282718859.md) --- # Good news! Drug prices are no longer "one-size-fits-all": Innovative drugs can increase prices reasonably, while generic drugs will face survival of the fittest On April 14, the General Office of the State Council officially released the "Several Opinions on Improving the Price Formation Mechanism for Pharmaceuticals" (Guo Ban Fa \[2026\] No. 9), which introduces 14 specific measures from four dimensions: improving price policies for key links, leveraging the price discovery role of relevant entities, guiding reasonable drug prices in key areas, and strengthening price governance. This marks a transformation of China's pharmaceutical pricing mechanism from "cost control and price suppression" to "value-based pricing, incentivizing innovation, and ensuring accessibility," which will have a profound impact on the entire pharmaceutical industry chain and promote the industry into a new stage of high-quality development. The core highlight of this new policy is "differentiated measures and precise efforts," formulating differentiated policies for different fields such as innovative drugs, generic drugs, raw and auxiliary materials, and retail terminals, ensuring accessibility of medications for the public while delineating a clear path for the innovative development of the pharmaceutical industry. **The innovative drug industry is set to benefit significantly from policy dividends and may become the biggest beneficiary of the new policy.** The new policy clarifies the optimization of the initial pricing mechanism for newly listed drugs, implementing a self-assessment system for enterprises, guiding them to set reasonable prices based on comprehensive clinical value, market supply and demand, and other factors. For high-level innovative drugs with high innovation and clinical value, support is provided for setting prices in the early stages of listing that correspond to high investment and high risk, while maintaining relatively stable prices for a certain period. At the same time, the new policy breaks the constraints of medical insurance payment standards on the out-of-hospital market, allowing pharmaceutical companies to autonomously determine prices for negotiated drugs supplied to non-medical insurance designated institutions, effectively addressing the issues of "difficult access and payment for innovative drugs," ensuring returns on research and development, and stimulating corporate innovation vitality. **In contrast to the "relaxation and incentives" for innovative drugs, the generic drug (generic name drugs) industry will face ongoing reshuffling.** The new policy specifies that newly listed generic drugs must refer to reasonable pricing of the same generic name drugs, while further promoting the standardization, institutionalization, and normalization of centralized bulk purchasing of drugs, strengthening the link between quantity and price, and strictly prohibiting additional negotiations on selected and negotiated drugs in centralized procurement. In addition, the new policy severely cracks down on illegal activities such as collusion in bidding and irrational pricing, preventing low-price bidding from affecting drug supply, and forcing generic drug companies to shift from "price wars" to cost control, quality improvement, and capacity assurance. Industry insiders expect that small and medium-sized generic drug companies will be accelerated in elimination, while leading companies with a wide range of approved varieties, significant cost advantages, and stable production capacity will gradually monopolize the centralized procurement market, further increasing industry concentration. **The fields of pharmaceutical raw and auxiliary materials, traditional Chinese medicinal materials, and pharmaceutical packaging materials will welcome strong regulation and opportunities for standardized development.** The new policy proposes to promote the sharing of price information for raw and auxiliary materials, guiding raw and auxiliary material companies to supply directly to formulation companies, supporting the integrated development of "raw and auxiliary materials + formulations," while severely preventing disorderly price increases of key auxiliary materials and packaging materials, strengthening price guidance for traditional Chinese medicinal materials, and promoting high-quality and high-priced traditional Chinese medicine based on improved quality evaluation. This means that compliant, large-scale production, and quality-controlled raw and auxiliary material companies will receive long-term orders, while small, scattered, and price-gouging companies will be eliminated from the market, further accelerating the speed of industry chain integration **In the retail terminal sector, online and offline pharmacies will undergo differentiated development adjustments.** For offline designated medical insurance pharmacies, the new policy clarifies that drug prices will be determined by market competition, implementing a public price comparison and quantity-price comparison index system for medical insurance drugs to guide reasonable pricing. It also encourages pharmacies to participate in centralized procurement, enhancing the accessibility of selected drugs and promoting the transformation of pharmacies from "earning price differences" to value-added services. For online pharmacies, the new policy emphasizes utilizing their price discovery function, regularly conducting online and offline price comparisons, assessing abnormal prices, and promoting fair pricing across all channels. Additionally, it strengthens the management responsibilities of online platforms, pushing pharmaceutical e-commerce to move away from vicious price wars towards compliant operations and competition in pharmaceutical services. Leading chain pharmacies, leveraging their advantages in supply chain, compliance, and outpatient prescriptions, are expected to capture more market share during the industry reshuffle. Public medical institutions, as the core scene for drug use, will further deepen the "zero markup" reform. The new policy specifies that all drugs used by public medical institutions (excluding traditional Chinese medicine pieces) must be procured through provincial medical procurement platforms and sold at zero markup, with the same zero markup policy applied to traditional Chinese medicine formula granules. At the same time, it promotes medical institutions to register actual procurement prices, establishing a linkage mechanism between listed prices and negotiated prices, motivating medical institutions to actively control costs, cutting off the pharmaceutical interest chain, and promoting the transformation of hospital revenue structure from "relying on drugs to support medical care" to income from diagnosis, nursing, pharmaceutical services, and other medical services, optimizing the medication structure. In addition, the new policy constructs a comprehensive drug price governance system, relying on the medical insurance information platform to implement intelligent monitoring of drug prices, promoting price risk warnings, strengthening cross-departmental joint supervision, conducting comprehensive audits in the pharmaceutical field, and severely punishing illegal behaviors such as forced price increases and monopolistic price hikes. It also establishes a drug medical insurance value assessment system, providing scientific basis for adjustments to the medical insurance catalog and payment standards based on real-world research. It is reported that the medical insurance department will take the lead in coordinating the implementation of policies, and all relevant departments and regions will combine their responsibilities and actual situations to ensure effective implementation of various measures ### Related Stocks - [399989.CN](https://longbridge.com/en/quote/399989.CN.md) - [159849.CN](https://longbridge.com/en/quote/159849.CN.md) - [159102.CN](https://longbridge.com/en/quote/159102.CN.md) - [520880.CN](https://longbridge.com/en/quote/520880.CN.md) - [517380.CN](https://longbridge.com/en/quote/517380.CN.md) - [516500.CN](https://longbridge.com/en/quote/516500.CN.md) - [562050.CN](https://longbridge.com/en/quote/562050.CN.md) - [588860.CN](https://longbridge.com/en/quote/588860.CN.md) - [159615.CN](https://longbridge.com/en/quote/159615.CN.md) - [516820.CN](https://longbridge.com/en/quote/516820.CN.md) - [159892.CN](https://longbridge.com/en/quote/159892.CN.md) - [159297.CN](https://longbridge.com/en/quote/159297.CN.md) - [159992.CN](https://longbridge.com/en/quote/159992.CN.md) - [513120.CN](https://longbridge.com/en/quote/513120.CN.md) - [516080.CN](https://longbridge.com/en/quote/516080.CN.md) - [512290.CN](https://longbridge.com/en/quote/512290.CN.md) - [588250.CN](https://longbridge.com/en/quote/588250.CN.md) - [159570.CN](https://longbridge.com/en/quote/159570.CN.md) - [159506.CN](https://longbridge.com/en/quote/159506.CN.md) - [159316.CN](https://longbridge.com/en/quote/159316.CN.md) - [520690.CN](https://longbridge.com/en/quote/520690.CN.md) - [513700.CN](https://longbridge.com/en/quote/513700.CN.md) - [512010.CN](https://longbridge.com/en/quote/512010.CN.md) - [560600.CN](https://longbridge.com/en/quote/560600.CN.md) - [588130.CN](https://longbridge.com/en/quote/588130.CN.md) - [159859.CN](https://longbridge.com/en/quote/159859.CN.md) - [159837.CN](https://longbridge.com/en/quote/159837.CN.md) - [510660.CN](https://longbridge.com/en/quote/510660.CN.md) ## Related News & Research - [Analyst Reiterates Buy on Microbix, Citing Temporary China Slowdown and Growing Diversified Demand](https://longbridge.com/en/news/286665358.md) - [Everest Medicines Director and Major Shareholder Raises Stake in Company](https://longbridge.com/en/news/286481551.md) - [Flow Pharma U.S. Patent Application Allowed for Issuance Covering Broad-Spectrum Ebola Therapy](https://longbridge.com/en/news/287076761.md) - [20:03 ETHarbour BioMed Announces Promising Preclinical Data for LET003, Its First AI-Enabled Drug Candidate](https://longbridge.com/en/news/286688082.md) - [Wuxi AppTec to Raise Around $1 Billion Through Zero Coupon Convertible Bonds](https://longbridge.com/en/news/286487023.md)