China taking closer look at drug prices, cost structure

Chinese regulators say they will size up the cost structures and pricing of 60 drugmakers, both domestic and foreign, as it figures out what it should be paying for drugs. According to Bloomberg, the National Development and Reform Commission said in a statement on its website that it will look at 27 companies for costs and 33 for pricing. Bloomberg says that drugmakers including GlaxoSmithKline ($GSK), Merck & Co. ($MRK), Novartis ($NVS) and Baxter International ($BAX) are among those being reviewed. The news comes a week after China said it had started investigations of four foreign multinationals including GSK. It said it had detained several Glaxo managers in a probe of "economic crimes." It is also looking at Abbott Laboratories ($ABT), Nestlé, and Danone, which it said are under investigation for "monopolistic" pricing. China is an enormous emerging market but has been getting trickier for outside drugmakers to negotiate. The government has now cut drug prices four times since 2011, including 15% reductions earlier this year. Story | More

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