Prescription Switching under China's Volume-Based Procurement Program

Abstract

Using procurement records from 1,293 hospitals in a major Chinese city, this paper examines how China's Volume-Based Procurement (VBP) program affected defined daily doses of diabetes drugs. The findings show that the usage of VBP-winning drug products increased significantly after the program was implemented, but the overall usage of drugs under the same generic name decreased, which indicates potential "prescription switching" due to the program. Further analysis indicates that physicians switch prescriptions to drugs within the same ATC Level-4 class or to combination products containing VBP-covered substances. Finally, paper finds that the intensity of "prescription switching" is greater in primary hospitals and lower during rounds of implementation of the VBP program with stronger regulator pressure.

Keywords: Prescription Switching, Volume-Based Procurement Program, China