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Japan to review drug prices more frequently to curb rising healthcare costs
[TOKYO] Japan said on Tuesday it planned to start reviewing prescription drug prices once a year, increasing their frequency from once every two years, as the government tries to curb mounting healthcare costs in a rapidly ageing society.
The government also plans to expand the scope of the review to all prescription drugs on the domestic market, although not all drugs would see their prices cut each year.
Japan's health minister said he would finalise details of the review criteria next year.
The change is in line with a recommendation to Mr Abe's top economic advisory panel, which said such a change could save some 190 billion yen (S$2.3 billion) a year in healthcare costs.
It comes after the government last month decided to halve the price of Bristol Myers Squibb Co's cancer drug Opdivo last month, and an earlier move to slash the price of Gilead Science Inc's highly effective but expensive hepatitis C drug Sovaldi.
Foreign and domestic drugmakers oppose frequent price reviews, arguing that such changes will stifle investment and innovation by creating greater uncertainty over pricing.
Japan is the world's third largest market for prescription medicines, after the United States and China, but its annual growth rate in dollar terms from 2011 to 2016 is estimated at just 2 per cent, against the global rate of 6.2 per cent, according to Quintiles IMS.