Drug policy in China: pharmaceutical distribution in rural areas

In 1978, China decided to reform its economy and since then has gradually o pened up to the world. The economy has grown rapidly at an average of 9.8% per year from 1978 to 1994. Medical expenditure, especially for drugs, has grown even more rapidly. The increase in medical expenditure can be attribu ted to changing disease patterns, a higher proportion of older people in th e population and fee-for-service incentives for hospitals. Due to the chang ing economic system and higher cost of health care, the Chinese government has reformed its health care system, including its health and drug policy. The drug policy reform has led to more comprehensive policy elements, inclu ding registration, production, distribution, utilization and administration . As a part of drug policy reform, the drug distribution network has also b een changed, from a centrally controlled supply system (push system) to a m arket-oriented demand system (pull system). Hospitals can now purchase drug s directly from drug companies, factories and retailers, leading to increas ed price competition. Patients have easier access to drugs as more drugs ar e available on the market. At the same time, this has also entailed negativ e effects. The old drug administrative system is not suitable for the new d rug distribution network. It is easy for people to get drugs on the market and this can lead to overuse and misuse. Marketing factors have influenced drug distribution so strongly that there is a risk of fake or low quality d rugs being distributed. The government has taken some measures to fight the se negative effects. This paper describes the drug policy reform in China, particularly the distribution of drugs to health care facilities. (C) 1999 Elsevier Science Ltd. All rights reserved.