On January 14, Japan’s Central Social Insurance Medical Council (Chuikyo) implemented new pricing regulations for regenerative medicine products that are granted conditional and time-limited approval through a new pricing model. This new pricing model will be applied for the first time to the gene therapy product Elevidys developed by Chugai Pharmaceutical Corp.
Under this new model, the profit margin coefficient used for cost-based pricing of conditionally approved products will be set at 50% of the average profit margin of fully approved products. This is because the efficacy of drugs at this conditional stage is only “presumed.” Premiums related to usefulness and innovativeness will not be assessed at the initial listing. However, adjustment premiums (for example, the foreign average price and other special adjustments) will continue to be taken into account after launch.
Full cost-effectiveness evaluations will not be made until the product is granted full approval due to the lack of available data at the conditional approval stage.
This change is in line with increased scrutiny of the conditional approval system after two conditionally approved products were removed from the NHI price list in 2024.
Written by: Ames Gross – President and Founder, Pacific Bridge Medical (PBM)
Mr. Gross founded PBM in 1988 and has helped hundreds of medical companies with regulatory and business development issues in Asia. He is recognized nationally and internationally as a leader in the Asian medical markets. Mr. Gross has a BA degree, Phi Beta Kappa, from the University of Pennsylvania and an MBA from Columbia University.