PUBLICATIONS & REPORTS
PUBLICATIONS & REPORTS
From Kitakyushu to the world: AGI, a research institute that studies Asia's economy
and society
How Expanding Insurance Coverage Shapes Drug Innovation and Prices: Evidence from China
| Author | YAO Ying |
|---|---|
| Affiliation | Asian Growth Research Institute |
| Date of Publication | 2025.3 |
| No. | 2024-10 |
| Download | 1.6MB |
Contents Introduction
This study examines how insurance coverage expansion shapes drug pricing and innovation in China. Using drug application and procurement data, we explore how pharmaceutical f irms adjust their R&D investments and pricing strategies in response to increased reimbursement coverage. While past studies in other markets suggest that broader insurance coverage often leads to higher drug prices due to greater demand or altered insurer negotiations, our preliminary results indicate minimal price changes, especially for cancer drugs. However, firms appear to adjust their innovation strategies, particularly in response to broader market access opportunities. Our findings provide early insights into the interactions between insurance policy changes and pharmaceutical innovation strategies in China’s cancer drug market.