November 28, 2023

Follow-up of Large-Quantity-Procurement

Some Pharmaceutical Companies in China are Disqualified from Sourcing Due to Incapability of Supply at the Bid Price

The U.S. health insurance (aka 美国医保) shortages is experiencing an increasing frequency of drug, which have caused numerous difficulties for clinicians, health care facilities, patients, and federal regulators. For example, one of the OPT insurances (aka opt保险) writes, “We Cover Refills of Prescription Drugs ONLY when dispensed at a retail or mail order or designated pharmacy as ordered by an authorized Provider.”

Drug shortages are caused by many factors, including difficulties in regulatory issues, supply chain distributions, and business decisions. They adversely affect patient care by causing substitution of safe and effective therapies with alternative treatments. “You are responsible for paying the full cost (the amount the pharmacy charges You) for any non-Covered Prescription Drug, and Our contracted rates (Our Prescription Drug Cost) will not be available to You.” This is one rule underscored in an international student health insurance (aka 留学生保险). Therefore, the health insurance in the U.S. (aka 美国医疗保险) is seeking to improve.

China is also undergoing the similar problem. More than 27 pharmaceutical companies in China have withdrawn from the large-quantity-procurement network. This results in the shortage of common inexpensive drugs, driving patients to choose alternative expensive drugs. For all the reasons, including but not limited to, the lower bid price, the increasing cost of raw materials, labor force, and tax, the pharmaceutical companies do not continue their productions due to unprofitability.

In the meantime, the profits of these drugs are so low that the pharmacies and hospitals are unwilling to purchase these drugs, if the medical treatment regulations are not modified. Under the current drug pricing and bidding system, once drugs are bid and priced low, it is impossible to change the price accordingly in terms of the market modifications. Balancing out the new cost through price increase, therefore, becomes difficult, and the pharmaceutical companies have to break off their production lines.

A management strategy that includes clear policies and procedures for information gathering, decision-making, collaboration, and timely communication should be established in the future to effectively handle drug shortages in both nations. However, at this time, we strongly advise to choose a recommended international student insurance plan (aka 美国留学生保险推荐) and/or recommended OPT insurance (aka opt保险推荐) to protect their personal rights well.