State Office: Strengthen the enforcement of illegal acts such as drug substance monopoly

The Party Central Committee and the State Council attach great importance to ensuring the supply of drugs in short supply. In recent years, China has continuously strengthened the supply guarantee for shortage drugs and achieved positive results. However, there are still problems such as insufficient timely and sensitive drug supply and price monitoring, policies for drug procurement, use, storage, and price supervision that need to be improved, illegal market manipulation and price hikes that are still prominent in some places, and some measures that have been introduced that need to be implemented. With the consent of the State Council, the following opinions are hereby proposed in order to further ensure the supply and price stability of drugs in shortage and better ensure the basic drug demand of the people.
State Office: Strengthen the enforcement of illegal acts such as drug substance monopoly
1、 Improve the sensitivity and timeliness of monitoring responses
（1） Strengthen collaborative monitoring. Establish a national multi-source information collection platform for shortage drugs, and the leading unit of the National Shortage Drug Supply Guarantee Work Consultation Linkage Mechanism (hereinafter referred to as the National Linkage Mechanism) will establish a collaborative monitoring mechanism with various relevant departments such as industry and information technology, medical security, and drug supervision and management, to achieve information communication and sharing of raw materials and preparations in registration, production, procurement, pricing, and other aspects, and refine operational monitoring and early warning standards, Real-time dynamic monitoring and early warning, and regular formation of monitoring reports to strengthen collaborative response. (The National Health Commission, relevant departments, and provincial people's governments are responsible for the implementation before the end of December 2019. The leading unit ranks first, the same below.)
（2） Improve hierarchical response. The leading unit of the provincial linkage mechanism shall organize the verification of the shortage or unreasonable price increase clues found in the monitoring within the specified time limit and coordinate the response according to the situation. If the provincial level cannot coordinate and solve the problem, it is necessary to report to the leading unit of the national linkage mechanism within the specified time limit. After receiving reports or monitoring clues, the leading unit of the national linkage mechanism should organize verification within the specified time limit and coordinate responses based on the situation. The leading unit of the national linkage mechanism should timely refine and improve the requirements for the scope of responsibility, time limit, and workflow of the verification and response work of national and provincial organizations. (The National Health Commission, relevant departments, and provincial people's governments are respectively responsible for the implementation before the end of December 2019. They are responsible for taking the lead for relevant units according to their responsibilities, the same below.)
（3） Implement classified disposal. For some shortage drugs with poor substitutability, insufficient production power of enterprises, and unstable market supply, measures should be taken to ensure supply by strengthening the construction of centralized production bases for small varieties of drugs (shortage drugs), improving and implementing centralized procurement policies, and strengthening reserves. (The Ministry of Industry and Information Technology, the National Health Insurance Bureau, etc. are respectively responsible for ensuring the supply of drugs in short supply that are determined not to be produced by enterprises or cannot be resumed in a short period of time, the leading unit of the national linkage mechanism will promptly consult with relevant departments and local authorities to promote the resumption of production by enterprises, accelerate drug registration and approval, and organize temporary import procurement.). (The National Health and Health Commission, the Ministry of Industry and Information Technology, the Ministry of Ecological Environment, the General Administration of Customs, the State Drug Administration, etc. are responsible for providing a reasonable production transition period for short pharmaceutical raw materials or preparation production lines that need to be shut down and rectified due to environmental factors such as excessive emissions.). (Responsible by the Ministry of Ecological Environment)
（4） Manage the list of shortage drugs. The State implements a list management system for shortage drugs, and the specific measures are formulated by the National Health Commission in conjunction with the State Drug Administration and other departments. The leading unit of the national and provincial linkage mechanism will work with each member unit to develop a national and provincial key monitoring list of clinically necessary and vulnerable drugs and a list of drugs in short supply, and make dynamic adjustments. Focus on monitoring and dynamic tracking of drugs on the list, and timely remove drugs from the list that have sufficient market supply and can form effective competition. All relevant departments and localities shall promptly respond to the drugs in the list of shortage drugs according to their responsibilities. (The National Health Commission, relevant departments, and provincial people's governments are respectively responsible for implementation by the end of December 2019)
（5） Implement a report on the suspension of production of drugs in shortage. The leading unit of the provincial linkage mechanism shall evaluate the drugs in the provincial shortage drug list and timely report to the leading unit of the national linkage mechanism according to regulations if it deems it necessary to conduct a production suspension report. The leading unit of the national linkage mechanism shall, together with relevant departments, comprehensively demonstrate the drugs reported at the provincial level and the drugs in the national list of short drugs. For short drugs that do require a production suspension report, a public announcement shall be issued to the community and dynamic adjustments shall be made. If the holder of a drug marketing license ceases to produce a shortage of drugs, it shall report to the drug regulatory department of the State Council or the provincial people's government in accordance with regulations. After receiving the report, the drug regulatory department shall promptly notify the leading unit of the peer linkage mechanism in accordance with regulations. The specific regulations and time limit requirements above shall be formulated by the leading unit of the national linkage mechanism and the State Drug Administration according to their respective responsibilities. The medical security department should timely report the impact of production suspension on the market supply situation to the leading unit of the peer linkage mechanism based on previous platform procurement information. The health department should promptly study and determine the risk of drug shortage due to discontinued production based on the previous clinical use information of medical institutions. (The National Health Commission, the National Health Insurance Bureau, and the National Drug Administration are respectively responsible, with the participation of the Ministry of Industry and Information Technology, and will be implemented by the end of December 2019.)
2、 Strengthen the allocation, use, and standardized management of essential drugs in medical institutions
（6） Promote the priority allocation and rational use of essential drugs. By strengthening drug use supervision and assessment, guiding and urging medical institutions to optimize drug use catalogs and drug prescription sets, and other measures, promote the priority allocation and use of essential drugs, increase the proportion of essential drug use, and timely adjust the national essential drug catalog, gradually realizing that the proportion of essential drug varieties provided by government run grassroots medical and health institutions, secondary public hospitals, and tertiary public hospitals is not less than 90%, 80%, and 60%, respectively, in principle, Promote medical institutions at all levels to form a "1+X" ("1" refers to the national essential drug catalog, and "X" refers to non essential drugs, which are determined by local governments based on actual conditions) drug use model led by essential drugs, and optimize and standardize the drug use structure. Strengthen the entire process management of drug catalog selection, procurement, and use in medical institutions, promote the implementation of requirements such as "being able to take orally without intramuscular injection, and being able to receive intramuscular injection without infusion", and promote scientific and rational drug use. (In charge of the National Health Commission and the National Bureau of Traditional Chinese Medicine)
（7） Optimize the management and use of shortage drugs in medical institutions. We will improve the national, provincial, municipal, and county level drug shortage monitoring network and information reporting system, guide and promote public medical institutions to develop and improve drug shortage management regulations, and refine and clarify the requirements for analyzing, evaluating, and reporting information on drug shortages in medical institutions. (Under the responsibility of the National Health Commission and the State Administration of Traditional Chinese Medicine, to be implemented by the end of December 2019) Guide and promote medical institutions to reasonably set up emergency (emergency) and rescue medicine and other specific drug inventory warning lines. Dynamically update the guidelines for the alternative use of clinically deficient drugs, support relevant industry organizations to recommend alternative varieties of clinically replaceable deficient drugs and dynamically update them, and guide medical institutions to standardize the use of drugs as substitutes. Support and encourage county central hospitals to increase the reserve of drugs that are prone to shortage. (In the charge of the National Health Commission and the State Administration of Traditional Chinese Medicine) Encourage conditional places to explore effective ways to disclose the variety of drugs sold by relevant medical institutions and social pharmacies to the public, and smooth the channels for people to purchase drugs. (Responsible for all provincial people's governments)
3、 Improve the procurement of shortage drugs
（8） Implement the direct online procurement policy. For the varieties listed in the national and provincial drug shortage lists, enterprises are allowed to independently quote and directly connect to the network on the provincial drug centralized procurement platform, and medical institutions are allowed to independently purchase. Supervision and guidance should not only improve price monitoring and management, but also avoid unreasonable administrative intervention. Provincial medical security departments should strengthen the supervision of direct online prices, timely collect and analyze information about the actual purchase prices of direct online purchases, and regularly publish it on the provincial drug centralized procurement platform. (Responsible by the National Health Insurance Bureau)
（9） Allow medical institutions to independently record procurement. For drugs in the key monitoring list of clinically necessary and vulnerable drugs and the list of drugs in short supply, if there are no enterprises on the provincial drug centralized procurement platform or not listed in the provincial centralized procurement directory, medical institutions can propose procurement requirements, search for drug manufacturers offline, negotiate directly with drug supply enterprises, determine the procurement price based on the principle of fairness, and independently record on the provincial drug centralized procurement platform, Be open and transparent. Medical security and health departments should, according to their responsibilities, strengthen supervision over the procurement and use of drugs purchased on record. "If drugs purchased directly through the internet or independently filed for purchase fall within the scope of the medical insurance catalog, the medical security department must promptly make payments in accordance with regulations.". (The National Health Insurance Bureau and the National Health Commission are respectively responsible for this)
（10） Strictly manage drug procurement contract performance. Relying on the provincial drug centralized procurement platform, the provincial medical security department regularly monitors the drug distribution rate, procurement quantity, payment settlement, etc., strictly manages drug purchase and sales contracts, and promptly penalizes enterprises for failing to deliver and supply as agreed. Strengthen supervision and notification, and promote medical institutions to timely settle drug payments according to contracts, and medical insurance funds to timely pay drug fees. (The National Health Insurance Bureau and the National Health Commission are responsible for the distribution of shortage drugs respectively) Distribution enterprises shall not be restricted, and shall not be subject to the "two ticket system" restrictions. (The responsibility of provincial people's governments, with the participation of the Ministry of Commerce, the State Administration of Taxation, and the National Health Insurance Bureau) In regions that do not have the economic benefits of distribution, in the absence of competition from pharmaceutical distribution enterprises, it is encouraged to explore the possibility of postal enterprises carrying out distribution work. (Responsible by the National Postal Administration, with the participation of the National Health Insurance Bureau)
4、 Strengthen drug price supervision and law enforcement
（11） Strengthen monitoring and early warning of abnormal drug prices. Relying on the provincial drug centralized procurement platform, the provincial medical security department regularly monitors the changes in drug procurement prices, promptly understands the situation and prompts for early warning in case of abnormal price fluctuations, and reports to the leading unit of the provincial linkage mechanism. The National Health Insurance Bureau collates and promptly prompts relevant departments and local authorities with information on key monitoring varieties for early warning, warns about abnormal fluctuations in drug prices, provides price survey clues and basic data to market supervision and other departments, and reports to the leading unit of the national linkage mechanism. (Responsible by the National Health Insurance Bureau)
（12） Strengthen regulatory normalization of drug prices. For drugs with abnormal price increases or frequency, significant price differences between regions, severe poor distribution, or multiple consecutive early warnings, comprehensive measures such as monitoring and early warning, cost investigation, correspondence and interview, information disclosure, and suspension of online access should be taken to resolutely control them. Improve the working mechanism for drug price and cost investigation, and national and provincial medical security departments can implement or commission cost investigations based on work needs. (The National Health Insurance Bureau is responsible for) relying on the centralized bidding procurement of drugs, establishing a credit evaluation system for price and bidding procurement, conducting credit evaluation on the price and supply behavior of drug suppliers, and implementing corresponding incentive and disciplinary measures. (Responsible by the National Health Insurance Bureau, with the participation of relevant departments)
（13） Strengthen the enforcement of illegal acts such as drug substance monopoly. Establish a collaborative working mechanism among market supervision, public security, taxation, and drug supervision and management departments, carry out joint rectification by multiple departments, and timely publish the rectification results to the public. Investigate and deal with monopolies and price violations in the field of raw materials and preparations according to the strictest standards, and adhere to the principle of strict and prompt investigation and punishment; If a crime is constituted, criminal responsibility shall be investigated in accordance with the law, and relevant responsible persons shall be resolutely disposed of to form an effective deterrent. (Under the responsibility of the State Administration of Market Supervision, with the participation of the National Development and Reform Commission, the Ministry of Public Security, the State Administration of Taxation, and the State Drug Administration, etc., phased progress will be achieved and sustained progress will be made by the end of December 2019.)
（14） Properly handle the problem of excessive price increases of some drugs by classification. Penalties for unreasonable and illegal price increases shall be imposed in accordance with the law and regulations; If the price increase is unreasonable but does not constitute an offence, the interview urges the enterprise to take the initiative to correct it, and if necessary, take measures such as public exposure, suspension of online access, and punishment for breach of trust. (The State Administration of Market Supervision and the National Health Insurance Bureau are responsible for each other, with the participation of various relevant departments) Strive to urge a group of enterprises to actively correct improper pricing behavior, suspend the online procurement qualification of a group of abnormally priced drugs, punish a group of enterprises suspected of price violations, fraud, or serious breach of trust, expose a number of typical cases of abnormal price increases and monopolies, and curb the excessive upward trend of drug prices. (The General Administration of Market Supervision and the National Health Insurance Bureau are responsible for each, with the participation of relevant departments)
5、 Improve the multi-level supply system for shortage drugs
（15） Establish and improve the normal reserve mechanism for shortage drugs. We will optimize the structure of central and local medicine reserves and increase efforts to reserve scarce drugs. Give full play to the provincial drug reserve function, and select a batch of clinically necessary, uncertain dosage, and prone to shortages of drugs to be included in the reserve. (The Ministry of Industry and Information Technology and the provincial people's governments are responsible for this, with the participation of the Ministry of Finance and others, and will implement it by the end of June 2020.) Clarify the procedures for transferring drugs in short supply to facilitate the procurement and use of medical institutions. The provincial drug reserve management department shall notify the leading unit of the provincial linkage mechanism of the shortage of drug reserve varieties. In the event of a shortage of related drugs, a paid allocation shall be made in accordance with the procedures according to the opinions of the leading unit of the provincial linkage mechanism. (The Ministry of Industry and Information Technology and the National Health Commission are respectively responsible for it) Encourage and guide large-scale pharmaceutical circulation enterprises to actively fulfill their social responsibilities and give play to the "reservoir" function. (The Ministry of Commerce and the State-owned Assets Supervision and Administration Commission of the State Council are respectively responsible for encouraging large pharmaceutical circulation enterprises to set reasonable inventory warning lines for clinically commonly used emergency (emergency) and rescue drugs and other drugs that are prone to shortage.). (Responsible for the SASAC of the State Council)
（16） Improve the production and supply capacity and quality level of drugs. In combination with the demand for drug supply assurance and the national layout, in 2019, we will promote the construction of two more centralized production bases for small and medium-sized drugs (short of drugs), achieving a stable production and supply of 40 more small and medium-sized drugs (short of drugs). By 2020, the stable production and supply of 100 small varieties of drugs (drugs in short supply) will be achieved. (Under the responsibility of the Ministry of Industry and Information Technology, and with the participation of the National Development and Reform Commission, the National Health Commission, and the National Drug Administration, among others), support the improvement of the supply guarantee capacity of shortage drugs through investment within the central budget and other means. (The National Development and Reform Commission and the Ministry of Industry and Information Technology are respectively responsible for promoting the upgrading of the pharmaceutical industry and optimizing the production and supply capacity and quality of drugs through measures such as increasing support and guidance, promoting the evaluation of generic drug quality and efficacy consistency, and improving drug procurement policies.). (The National Development and Reform Commission, the Ministry of Industry and Information Technology, the National Health Insurance Bureau, and the National Drug Administration are responsible for each of them.)
（17） Increase the effective supply of pharmaceutical raw materials. Promote pharmaceutical companies to form supply alliances with API companies, integrate high-quality industrial resources from upstream and downstream, guide API companies to directly supply to pharmaceutical companies, and encourage integrated production of API and pharmaceutical products. (Responsible by the Ministry of Industry and Information Technology, with the participation of the National Drug Administration, etc.) Implement policies and measures related to optimizing the registration, review and approval procedures for raw materials such as pharmaceuticals, continue to deepen the reform of "release, management, and service", and improve the efficiency and level of review and approval of raw materials such as pharmaceuticals. (Responsible by the State Drug Administration)
6、 Effectively strengthen organizational implementation
（18） Make regular reports. The leading unit of the national linkage mechanism shall establish a task list in accordance with the requirements of this opinion. Each member unit of the national linkage mechanism and the leading unit of the provincial linkage mechanism shall report to the leading unit of the national linkage mechanism on a quarterly basis on the progress of ensuring the supply and stabilizing the price of shortage drugs, as well as the monitoring and response related to drug shortages and prices. The leading unit of the national linkage mechanism shall, on a quarterly basis, report to the people's government of each province (region, city) and each member of the national linkage mechanism the work of ensuring the supply and price stability of drugs in short supply, as well as the monitoring and response situation related to drug shortage and price, as well as to the local and departmental situations where the tasks are not completed on time or the work is not effective. (The National Health Commission, relevant departments, and provincial people's governments are respectively responsible for implementation by the end of December 2019
（19） Strengthen supervision and accountability. Timely interview and supervise the rectification of areas where the work related to ensuring the supply and stabilizing the price of drugs in shortage is not effective. (Country