A new approach to market access in China: part 1

Sarah Giles of inVentiv Health explores new ways to tackle pharma market access challenges in China.

Through their role in effectively managing budgets to improve population-level health outcomes, payers have become the most influential gate-keepers of access to medicines in most developed countries across the globe. While this payer role is no different in China, the impressive speed at which new payer systems are developed at a national, provincial and hospital level, and the distinctive way in which these systems are implemented at a local level, leads to a unique payer environment.

In order to be successful in enabling patient access to medicines in China, the evidence-based value story for a given product should be tailored to the specific needs of the Chinese payer system. To help achieve this, the biopharma industry in China should consider adopting the model which is becoming the global gold standard – making market access the central goal of each function of the organization, whereby both internal functions (marketing, medical, HEOR) and external stakeholders work together to define the value of a medicine from multiple perspectives.

The opportunity for the healthcare industry in China

From the significant unmet medical need in terms of disease burden, to the increasing size, age, wealth and urbanization of the population, a number of factors have converged to make China one of the most attractive markets for healthcare industry growth in recent years. Key to this has been the government priority of implementing effective health reform, with the aim of establishing a universal healthcare system to provide safe, effective, convenient and low-cost healthcare for the whole population by 2020, as well as government support for the industry in the 12th Five Year Plan. Indeed, it is expected that the government will invest heavily over the coming years with healthcare expenditure anticipated to grow from $357bil in 2011 to $1tril in 2020. Patients are also becoming more empowered and more knowledgeable about their health and options available; China has the highest online population in the world accessing and sharing information via websites and social media, predominantly through mobile devices.

But to be successful in this market the industry needs to help create an environment where patients have optimal access to and are able to benefit from the most appropriate medicines. To achieve this, an understanding of the needs of various levels of government (who in China represent the vast majority of key payer decision makers) and influencers (such as KOLs, physicians, hospital administrators, patients) is required, in order to provide them with the most relevant evidence-base to support their needs and help inform their decisions.

What is happening with health reform?

In the three years since health reform began, basic medical insurance coverage has expanded to over 95% of the population. In rural areas and lower tier cities, healthcare infrastructure has started to improve, and with an opening up to foreign investment in the hospital sector, infrastructure is set to develop rapidly.

"...a number of factors have converged to make China one of the most attractive markets for healthcare industry growth in recent years."

Multiple drugs lists have been developed to support reimbursement for medicines through the various insurance systems. From the national essential drug list for generic and low-cost basic medicines, to the multiple provincial and local level reimbursement lists, there are local differences in how the lists are interpreted and the level of reimbursement that is applied for different therapies. Akin to the 'postcode' lottery in the UK, where a patient could be denied a medicine depending on where they lived, patients in China face a similar issue with levels of reimbursement varying depending on which region a citizen is registered.

Within each province there are a number of different approaches to tendering that have been designed and implemented. The current key influencing factor for inclusion on the resulting drug list is, perhaps not surprisingly, price. In the Anhui and the newly developed Guangdong model, the total tender score is determined by quality (10%) and price (90%). In some cases this scoring may lead to adoption of an appropriate medicine. However, more often than not the costs associated with poorer outcomes related to use of a cheaper (and often less effective, lower quality) product may outweigh the original cost offset by selecting the cheaper product. Therefore, there is a growing need to provide evidence that demonstrates not only the clinical benefits of a product, but also the economic value within a given population. There is also increasing interest amongst stakeholders in the different approaches to evidence-based decision making through use of cost effectiveness models and technology appraisals conducted in other markets. NICE International has been in ongoing discussions with the China government about the effectiveness of HTA systems for a number of years.

The next stage in health reform is to expand the drug lists and enforce further price caps to help reduce the financial burden on patients, through co-payments. There will also be a focus on shifting to a more primary care approach to tackle the imbalance of resource currently focused within top-tier hospitals.

So how do we demonstrate value?

There are some key points for consideration in demonstrating value to help optimize product access in China:

"...the government will invest heavily over the coming years with healthcare expenditure anticipated to grow from $357bil in 2011 to $1tril in 2020..."

1) Convene a cross-functional 'market access' team.

• Bring together a cross-functional team including medical affairs, marketing, communications, pricing and market access, HEOR and government affairs to align behind the common goal of achieving optimal access for a given product, or portfolio. Set out a clear working agenda, goals and responsibilities against key timeline milestones to ensure the team keeps on track. Bringing together this integrated team will help colleagues understand the greater impact that a team approach will have in demonstrating the value of a medicine to the broad spectrum of stakeholders involved in access decision making.

• Clinical experts remain central in influencing payers' decision-making and providing them with appropriate information to help inform payer decisions is essential. For most companies the most appropriate way to communicate with physicians is through a medical science liaison (MSL) network. The growing number and essential role of MSLs in in communicating the value of medicines was a point of discussion, and consensus, at the recent, inaugural China Medical Affairs Summit, held this June in Shanghai. Therefore, medical colleagues play an integral role in the 'market access' team.

2) Understand payer stakeholders' needs.

• Map and engage stakeholders early in a product's lifecycle to understand their key challenges and priorities and specific tendering / reimbursement process. Engage field teams and conduct systematic mapping, profiling and interviews to build the payer, policy and stakeholder landscape. Use a clearly defined 'mapping protocol' to create an objective picture that will enable you to understand stakeholders' current knowledge and current belief.

• Work together with external stakeholders to improve outcomes and help achieve health reform. Payers have a significant mandate in this process, so asking them how industry knowledge and resources can help them achieve their objectives to improve outcomes and make healthcare more efficient will be helpful, and will contribute to creating a favourable access environment. .

The rest of Sarah's tips can be viewed here

About the author:

Sarah Giles is the Access and Integrated Communications Director, inVentiv Health Communications China.

Sarah leads inVentiv Health China's access and integrated communications work as well as inVentiv Health's global access communications. Please contact her at sarah.giles@inventivhealth.com with any queries.

Sarah has a BSc Hons in biochemistry, as well as post-graduate studies in healthcare management, policy and health economics from the London School of Economics and Birkbeck. She has extensive health service experience in quality, service design, guideline development and patient group-provider strategy. Her work includes driving quality and service innovation improvement across leading European and Chinese private/public healthcare providers, consulting for patient advocacy groups, Department of Health agencies and NICE. She has also designed and implemented award-winning communications programmes for multiple biopharmaceutical companies at a global, regional and local level.

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