Study On Chinese Drugs Price Regulation During The Transformation Period: An Interest Group Perspective

Recent years, the medical cost of many countries increases quickly, the burdens of citizens and the fiscal pressure of government both become greater and greater. As an important component, considerable drugs cost should be partly responsible for the great medical cost. When many countries take measures to reform their medical and health systems, China also put forward many methods to reduce drug prices, but they proved to be less efficient.Many factors should be responsible for the failure of decreasing of the drugs price, although, the paper just wants to find out the reasons through the aspect of "interest group". Different from other exist articles about the regulations of drugs price, the article will use "interest group theory" of Mancur Olson and Sam Peltzman, and study the problem that the interest groups would affect the policies the process of governmental decision making, through both positive and normative analyses.The policies that are being used now including "drugs bids policy" and new-drugs approving policy generally encounter all kinds of resistance from pharmaceutical manufactures and hospitals. Among the circulation of drugs, all relative units are restricted by pluralistic interests. However, these units can be divided into two sides, "up" and "down", according to their attitudes towards drugs price. We can find that, the failure of drugs price regulation of China can be attributed to the imbalance of the two interest groups. To find the reason of the two groups' imbalance, it comes to be the institutional defects of government function, democracy and the medical & health system during the process of society transformation. To reduce drugs price to a proper level, we must change government function, enhance the process of political democracy, and encourage different hospitals compete fairly. Only if all these are done, Chinese drugs price regulation would success.