Analysis on Pharmacy Trusteeship in Nanjing and Influence on Pharmaceutical Manufacturers

Published by: SunFAITH China Ltd.

Published: May. 9, 2008 - 8 Pages

Table of Contents

1. Introduction of Pharmacy Trusteeship Mode

2. Advantages and Disadvantages of Pharmacy Trusteeship

2.1 Advantages of Pharmacy Trusteeship

2.2 Disadvantages of Pharmacy Trusteeship

Chart 1: Income Segmentation of Chinese Hospitals in 2006

Chart 2: Control Index of drug sales income rate for Jiangsu Third-tier Hospitals in 2004

3. Influence on Drug Manufacturers

4. Possible Solutions from Branded Drug Manufacturers

Abstract

Pharmacy Trusteeship refers to that public hospitals outsource the Pharmacy business to outside pharmacy companies, which adopt non-free management model. The mode is greatly popularized in Nanjing, Jiangsu. As Pharmacy trusteeship only changes the operation right, and no increase for the government investment, the proportion of hospitals’ drug sales income is still very large, and the “Gray channel” of prescription and drug sales also exist.

To branded drug manufacturers, due to the increasing cost and pursuit for profit, the trusteeship companies are forced to introduce generic drugs instead of low-profit name brand drugs. Therefore, brand drug manufacturers should adjust their marketing mode in multi-aspects to deal with the problem.

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