China continues to reshape its drug market access system in an effort to balance affordability with better healthcare for its citizens. At the core of this transformation are two reimbursement pathways: National Reimbursement Drug List (NRDL) and Volume-Based Procurement (VBP). Recent policy updates in 2025 indicate how the Chinese government is using these mechanisms to establish new market access pathways for innovative drug products.

Before diving into the latest market access updates, it is helpful to understand the two important concepts of NRDL and VBP.

National Reimbursement Drug List (NRDL)

The National Reimbursement Drug List (NRDL), issued by the National Healthcare Security Administration (NHSA), determines which medicines are eligible for reimbursement under China’s public health insurance system. Patients are reimbursed for a certain percentage of the drug cost depending on the category of listing.

There are two main categories:

Category A: Drugs that are fully reimbursed
Category B: Drugs that are partially reimbursed. Patients bear part of the cost

Drugs can enter the NRDL via two primary pathways:

Inclusion via negotiation, often used for innovative or high‑value medicines
Inclusion via bidding, typically applied to more established products

While NRDL inclusion provides broad and rapid market access, it often comes with significant price concessions. Therefore, some innovative drug companies may hesitate to pursue NRDL listing.

NRDL 2025: Record Competition and the Rise of the C‑List

China’s 2025 NRDL revision has been the most competitive to date. By mid‑August 2025, more than 300 drugs applied for new inclusion, over 200 drugs sought renewal or renegotiation, and more than 100 drugs pursued placement on the newly introduced C‑list.

The sheer volume of candidates highlights intensifying competition for reimbursement under increasingly tight public insurance budgets. While NRDL inclusion remains the gold standard for market access, the C‑list has emerged as a potential alternative, particularly for innovative and high-cost therapies. The “Category C” list is designed for commercial health insurance. This new list complements the existing public insurance Categories A and B, offering companies greater flexibility.

Unlike Categories A and B, which require nationwide inclusion, the C‑list operates under commercial health insurance (CHI) and allows provincial-level variation. This flexibility enables more tailored drug pricing and coverage strategies. Therefore, the C‑list is especially attractive for therapies that struggle to meet NRDL cost-effectiveness thresholds.

Oncology remains the largest therapeutic category, while rare disease treatments, including gene therapies for hemophilia B and innovative therapies for CDKL5 deficiency, are increasingly opting for the C‑list. In neurology, Alzheimer’s drugs such as Leqembi and Kisunla pursued both NRDL and C‑list pathways.

Although the long‑term funding mechanisms for the C‑list are still evolving, it is widely viewed as a game changer that could reshape access for high-value innovative drugs in China.

Supportive Policy for Innovative Drugs

China’s National Health Commission (NHC) and National Healthcare Security Administration jointly released a policy titled “Several Measures to Support the High‑Quality Development of Innovative Drugs,” which came into effect on July 1, 2025. The policy outlines 16 measures spanning drug research, regulatory approval, and reimbursement.

A key focus is the use of healthcare big data to align drug development with national priorities, particularly in areas such as rare diseases, pediatrics, and chronic conditions. On the reimbursement side, the policy introduces mechanisms to accelerate market access, including the temporary inclusion of urgently needed treatments into the NRDL.

According to NHSA officials, China has now established an updated end-to-end support system covering drug application, review, pricing, and negotiation.

Volume‑Based Procurement (VBP)

China’s use of volume-based procurement (VBP) provides a powerful mechanism for lowering drug prices, particularly for generic pharmaceuticals and mature products. The VBP process consolidates the procurement demand from public hospitals across China (or a region) and guarantees manufacturers significant purchase volume (i.e., 60%-70% of annual purchase volume for public hospitals in a region) in exchange for a significant price reduction.

Criteria for selecting drugs to participate in VBP programs are generally dictated by:

(a) clinical need for these products

(b) competitive nature of the market

In short, VBP has created deep price cuts within a variety of therapeutic categories. Early VBP rounds were dominated by price cuts as the only important criterion, while more recent VBP rounds are demonstrating an increasing focus on balancing price control with quality assurance and continuing supply stability.

Foreign drug companies with innovative drugs will normally not face VBP for a while because VBP only starts after sales are greater than $50 million per year.

11^th Round VBP: Focus on Sustainability

In October 2025, the 11th round of China’s national Volume Based Procurement (VBP) encompassed 55 different types of drugs across the four largest therapeutic classes – oncology, diabetes, cardiovascular conditions, and anti-infectives.

Historically, this VBP round had the highest levels of participation – over 46,000 healthcare organizations submitted volume forecasts, while 445 manufacturers submitted almost 800 tenders. In total, 272 manufacturers won contracts to supply 453 products to healthcare institutions. Thus, the overall winning rate increased from 49% in the previous round to 57%.

In addition to these significant advancements, there were also some key modifications:

The reference price mechanism, which was designed to identify “abnormally low” bids
The creation of a “revival” channel through which to reconsider products that did not win

These enhancements represent a transition away from the aggressive nature of discounts offered during previous VBP rounds and a shift towards a more balanced and sustainable approach to procurement.

Conclusion

China’s 2025 drug market access updates demonstrate a clear evolution in policy-making. While NRDL remains central to market access and VBP continues to deliver cost savings, new mechanisms are expanding strategic options for innovative drug manufacturers. These changes suggest that China is moving toward a more nuanced system that balances affordability, innovation, and supply stability.

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.