China launches probe into drug pricing

China has launched a wide-ranging
investigation into the cost of
medicines, probing as many as 60
domestic and international
drugmakers.
It comes just days after it started a probe
into price fixing of infant milk by foreign
companies - a move which has already
spurred price cuts.
Foreign firms affected by the latest
investigation include GlaxoSmithKline,
Merck, Astellas and Baxter Healthcare.
Analysts said authorities were keen to
make healthcare more affordable.
"It's not surprising there's pressure on
these two industries," said Ben Cavender
of China Market Research Group in
Shanghai.
He explained that the Chinese
consumers' trust in domestically made
products in these segments is very low,
amid concerns about safety and
counterfeit products.
"That's driving consumers to spend extra
to buy foreign products," he added.
He said that given the higher prices of
foreign products it has become "a social
issue" amid concerns that those who can
not afford to pay extra don't have access
to safer products.
The National Development and Reform
Commission (NDRC) said that it would
look into the costs and pricing of the
companies, so that drug prices can be
adjusted in a timely manner.
China, the world's most populous nation,
has become increasingly important for
pharmaceutical companies seeking
growth.
And as the country's population ages,
demand for medicines is expected to
grow further in the coming years.
According to some estimates, China is
likely to overtake Japan as the world's
second biggest drug market after the US
in the next two to three years.