Big pharma's China dream meets reality of price-cutting campaign

Beijing

THE world's largest pharmaceutical companies are facing a roadblock in China as a state-led campaign to slash drug prices has triggered a slowdown in sales growth.

One of the biggest problems: China's government-run health insurance funds, which are struggling to keep up with an ageing population and surging incidence of diseases such as cancer or diabetes. As they grapple with tighter budgets and a slowing economy, many of these funds are capping reimbursements to patients and pushing local authorities to negotiate with companies to lower drug prices.