2024 National Medical Insurance Drug List: Key Updates

The National Healthcare Security Administration (NHSA), in collaboration with the Ministry of Human Resources and Social Security, has released the 2024 National Medical Insurance Drug List (NEDL) and launched updates regarding this year’s drug price negotiations on October 27, 2024.

The comprehensive update reflects China’s continued efforts to optimize the healthcare reimbursement system, ensure access to innovative therapies, and strengthen cost containment mechanisms. The 2024 NEDL will officially come into effect on January 1, 2025, with the outcomes of the price negotiations published in November 2024.

2024 National Medical Insurance Drug List: New Updates

1) Implementation timeline and transition measures

The 2024 National Essential Drug List will come into effect on January 1, 2025, replacing the 2023 version. For drugs removed due to unsuccessful negotiations, a 6-month transition period (until June 30, 2025) will ensure reimbursement continuity at original payment standards. This allows pharmaceutical companies time to manage product transitions while minimizing disruptions to patient access.

2) Dynamic adjustments and focus on innovation

The NHSA continues its “one-year-one-adjustment” policy for the seventh consecutive year, ensuring timely inclusion of newly approved therapies. Over the past six years, 744 drugs have been added, bringing the total to 3,088 reimbursable drugs, including Western and Chinese patent medicines.

This year’s 162 negotiated drugs include a mix of new therapies, price-renegotiated treatments, and those under clinical review. Innovation remains a priority, with particular focus on treatments for oncology, rare diseases, and chronic illnesses. Pharmaceutical companies are encouraged to secure timely market approvals to align with NHSA’s negotiation cycles and innovation objectives.

Key Policy Changes: Negotiation, Pricing, and Distribution

1) Price management and competitive generics

• Negotiated drugs will adhere to national payment standards, with clear cost-sharing rules. Patients will bear any costs exceeding reimbursement limits, while lower-priced drugs will be reimbursed based on actual purchase prices.

• Hospitals and pharmacies are encouraged to prioritize cost-effective generic alternatives from multiple suppliers, aligning with reimbursement thresholds to reduce patient burden.

2) Strengthening the two-channel system

Effective January 1, 2025, prescriptions for “two-channel” drugs (hospital and retail pharmacy distribution) must be processed via electronic prescription platforms, improving transparency and fraud prevention. Paper prescriptions will only be permitted for up to 3 months with provincial approval.

3) Supply chain readiness

• Provincial authorities must list newly added drugs on centralized procurement platforms by December 31, 2024, with negotiated prices capped at national standards.

• Companies must ensure robust inventory management and supply chain optimization to meet clinical demand and avoid disruptions.

4) Monitoring compliance and reducing patient burden

The NHSA will implement enhanced monitoring systems to track drug supply, usage, and pricing data. Companies must ensure real-time reporting compliance to avoid scrutiny, particularly for underutilized drugs with limited clinical value or insufficient supply, which risk removal in future adjustments.

Since the NHSA’s establishment, negotiated drug inclusion has benefited 800 million patients, generating cumulative savings of 800 billion yuan, including 340 billion yuan reimbursed by medical insurance funds. The 2024 updates are expected to further reduce out-of-pocket expenses and improve access to high-value therapies.

Considerations for Regulatory Affairs and Compliance Managers

To effectively navigate the updated NEDL, regulatory and compliance teams should focus on:

Operational readiness
- Align internal systems with the January 1, 2025 implementation date.
- Manage the 6-month transition for delisted drugs to ensure continuity and compliance.
Data management and reporting
- Implement systems for real-time tracking of drug usage, pricing, and reimbursement.
- Maintain rigorous reporting standards to meet NHSA’s compliance requirements.
Market access and pricing strategies
- Prepare for annual negotiations with competitive pricing strategies for innovative and generic therapies.
- Prioritize drugs addressing unmet clinical needs to enhance likelihood of inclusion.
Distribution and supply chain optimization
- Integrate seamlessly into the “two-channel” system with electronic prescription mandates.
- Strengthen partnerships with hospitals and pharmacies to ensure steady supply.
Stakeholder communication and advocacy
- Collaborate with healthcare providers and authorities to interpret and implement NEDL updates.
- Educate stakeholders on pricing structures, reimbursement pathways, and policy changes.

Conclusion

The 2024 National Medical Insurance Drug List reflects China’s ongoing efforts to enhance healthcare access, foster innovation, and optimize cost-efficiency. For regulatory affairs and compliance managers, these changes require strategic planning, robust monitoring, and operational preparedness.

By proactively aligning with NHSA requirements, pharmaceutical companies can navigate this evolving landscape while supporting improved patient outcomes and ensuring compliance with policy mandates.

Further Information

Below are the original announcement and update about the National Medical Insurance Drug List:

NHSA on the issuance of the National Drug Catalog for Basic Medical Insurance, Workers' Compensation Insurance and Maternity Insurance

Medical insurance negotiations in 2024 will be officially launched, involving 162 drugs

For more information on how these updates might impact your development process, contact us to learn about our specialized services for pharmaceutical products in China.