90% of Japan Pharmaceutical Prices Reduced in April

Normally, every two years in April the Japanese government revises drug prices. Recently, such revisions have occurred annually or in so-called “off years”. Drug price revisions went into effect on April 1st, 2023. Drugs in Japan with price variances between their market prices and NHI prices that exceed 0.625 times the average price variance rate in 2022 face corrections. More than 2,100 drugs saw their prices reduced in April. On the other hand, about 150 drugs saw price increases, including some drugs that had previously been unprofitable. In addition, about 95 drugs saw no price changes under the Japanese Price Maintenance Premiums (PMP) program. Generally, drug prices for branded drugs versus generics showed about an 8.5% price reduction, while generics saw significantly larger price reductions. Despite these price reductions, Japan is the world’s 3rd largest drug market. There are still excellent opportunities and decent pricing for international drug companies in Japan.