Japan’s Drug Prices will be Cut by about 4.7% in their 2024 Fiscal Year Revision

Japan reduces drug prices every two years or more recently yearly. As announced on March 5 in the MHLW’s gazette, starting April 1, drug prices will be reduced by about 4.7% for about 13,000 products including 7,000 oral drugs, 3,600 injectables, 2,000 topical agents, etc.

In the 2024 fiscal year budget, an additional $300 million USD will be allocated for higher pricing under Japan’s price maintenance premium (PMP) for patented drugs. However, about double that amount will be given back on products where there is a PMP, but the drug patent has expired. With respect to APIs, of the 370 APIs that have already received a PMP, 315 API prices will be maintained.

With respect to generic drugs, the MHLW will initiate a new program in 2024 to evaluate their supply performance and prices. The MHLW wants to eliminate supply shortages and generic prices outside of an acceptable range. Using points to score generic manufacturers, the MHLW has set up three tiers including Tier A (outperforming), Tier B (average), and Tier C (underperforming). To date, there are 40 tier A companies, 39 tier B companies, and 111 Tier C companies. Finally, there will be increased pricing for about 2,000 unprofitable drug products.

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.

Source used in the article: https://www.navlindaily.com/article/20870/japan-slashes-drug-prices-by-4-67-in-fy2024-health-insurance-revision