China will remove longstanding caps on the retail prices for low-cost drugs in an effort to help pharmaceutical companies grappling with slim profit margins and ensure adequate supply of essential drugs, the country’s top economic planner said Thursday.
Price caps will be lifted for 280 Western medicines and 250 Chinese patent drugs, the National Development and Reform Commission said in a statement.
The move will allow producers to set prices based on production costs and market supply and demand situation, the statement said. This will affect prices on drugs such as antibiotics, painkillers and vitamins.
Supplies of some low-priced drugs have been declining amid rising costs while producers have shifted to more profitable medicines. Some have even suspended the production of first-aid medication such as digoxin, Xinhua News Agency reported.
Local governments are required to release a list of low-cost medicines to the public by July 1 and step up efforts in cracking down on unreasonable price hikes, the statement said.
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