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Chinese Official Says Reform Needed to Make Medicine Affordable


The man in charge of China's top planning body says medicine is still priced beyond the reach of most Chinese citizens, despite repeated government efforts to lower prices and reform the drug market. Daniel Schearf reports from Beijing.

Ma Kai, the director of China's National Development and Reform Commission, says the Chinese government has lowered drug prices 22 times in the past few years on 1,600 kinds of drugs - in some cases several times.

But despite those moves, Ma says, drugs are still so expensive the average Chinese often cannot afford them.

Ma was speaking on the sidelines of China's annual legislative session, the National People's Congress, where health care is one of the issues to be addressed.

He said that when the government orders a drug's price to be lowered, some drug companies simply change the product's name or the packaging, and continue charging the same high price. He also said some hospitals rely on profits from drug sales to fund their operating costs.

Ma describes the medicine market as "chaotic," with thousands of retailers and wholesalers to contend with. He says a comprehensive reform of the health care system is needed.

He says the government should reform hospital funding and strengthen oversight in the review and approval of new drugs. If it does not, he says, the government cannot really lower medical costs and bring tangible health benefits to the public.

China's health care system was once a symbol of pride for the ruling Communist Party, which lauded its free or low-cost basic medical care to almost the entire population.

But in the process of moving to a market economy, Beijing removed massive government subsidies, forcing many hospitals to fund themselves. They sometimes do this by overpricing medicine and carrying out costly but unnecessary medical procedures.

The result is that many people are shut out of the health care system. Many Chinese refuse to go to a hospital even when they are seriously ill because they simply cannot afford the high costs of medical care.

Chinese officials have called China's medical system reform a "failure," and much attention has been paid to trying to make health care more affordable.

At the opening of the National People's Congress session Monday, Premier Wen Jiabao announced an 87 percent increase in funding for health care. Mr. Wen said a plan to offer farmers basic health care would be extended to reach most parts of the country by the end of this year.