Analysis Of Drugs Pirce Regulation In China Based On The Game Among Interest Groups

In recent years, unreasonably high prices for medicines are uncoveredthrough all kinds of media, and attracted attention from the whole society. Tobring medicine prices under control will decide not only the success of ourpharmaceutical reform but the livelihoods of all the Chinese people. Since1998, our government has issued more than twenty times administrativeorders to bring down drug prices, but the effectiveness of these measures isnot very ideal, too high prices of the drug has not been fundamentallyresolved. Researchers from home and abroad have done theoretical andpractical researches on the rule-making system of medicine prices fromdifferent angles, and their researches enlightened me a lot and formed thetheoretical base of this essay. In this article, the author applied Interest GroupTheory and other relevant theories to established the Game Model to point outthat the interacts of different interests groups have put great impact on China’sDrug pricing system. This article has some breakthrough in the way ofresearch, and will help us to understand the problem of unreasonably-highprices for medicines. The researching direction and conclusion of this essaywill be a theoretical answer to the question of how to build a reasonablepricing system to bring down medicine price, and the essay also has realisticvalue in promoting pharmaceutical system reform to better our lives.This article has six main parts and the first part being the generalintroduction. The background, significance, methodology and innovations ofresearch, and a literature review on theories of drug’s pricing systems wereprovided in this part. Part two reviewed the history and current status ofChina’s drug prices regulations. This part described the forming process ofinterest groups in the developing process of drug prices regulations. Part threedescribed the development of different interest groups in the pharmaceuticalfield. In the process of drug price regulation, medicine producers, medicinecirculating enterprises, hospitals, consumers and rule makers are benefit mainbodies. As the direct beneficiaries, medicine producers, circulating enterprisesand hospitals are an interest group that pushes up medicine prices. In thisarticle, this interest group is named medicine producing and circulatinginterest group. In contrary to this group, customer interest group demands for the lowest medicine prices. When the amount of social wealth is certain,competition between the two groups will decide the distribution of wealthbetween them. Thus, the two groups would try to influence the decision ofrule makers. In the fourth part, Interest Group Game Model was establishedbased on the previous analysis, and through this model, competition amongdifferent interest groups was studied, and the reason for unreasonably highmedicine prices is that the power of medicine producing and circulatinginterest group and consumer interest group is not in balance and therule-making system is not fair, public and just. In the fifth part, based on themodel the problems in China’s drug price regulation were analyzed. In the lastpart, to prevent negative influence of interest groups and standardize allparties’ behavior, some problem-solving solutions and suggestions weremade towards to China’s pharmaceutical reformation.