Research On The Legal System Of Drug Government Procurement

In February 2015, General Office of the State Council issued the “Guidelines on Improving Public Hospital Centralized Drug Procurement”, which aims to insist on the direction for centralized drug purchasing online and constantly improve the supply of medicines in public hospitals. However, the implementation of centralized drug purchasing system has been criticized over decades, because the connotation and denotation of government procurement- the reference to the application- is not clear. It is controversial whether centralized drug purchasing belongs to the range of government procurement or not, so that it is difficult to use existing laws to explicitly restrict specification. Therefore, in order to effectively deal with the deficiencies of centralized drug purchasing, it is necessary to accurately master the relationships of government procurement and centralized drug purchasing in substantive law level. The central issued the guidelines on improving centralized drug purchasing in 2015; China lift price controls on most medicines; the hospital entity were included in the sixth bid list of China joining in the GPA negotiations. These above all are imperative to reflect that canceling centralized drug purchasing and introducing government procurement in that is around the corner. In short, from natural relationship perspective, centralized drug purchasing ought to be included in the government procurement law system.Such is the idea and the structure is organized as follows:The first part notes the existing problems of drug centralized purchasing in China. Since centralized drug purchasing system began to pilot, local government constantly explored innovative and eventually forming the more unified government-led provincial drug bidding and purchasing patterns. But during the implementation of centralized drug purchasing,there exists a lot of problems. We can conclude defects mainly from the case of “first case of the drugs tendering purchasing”—Original Pharmaceutical Cooperation vs. Shandong Province. The case resulted a dispute whether centralized purchasing of drugs belong to government procurement, which is the root of the defects of centralized drug purchasing.The second part analyzes centralized drug purchasing is not attributed to government procurement. “Government Procurement Law” itself has a certain detachment on the definition of the government procurement. It is different between the centralized drug purchasing and government procurement in the procurement subject, procurement object, the procurement of funds, procurement purposes and the operating procure. Just both use "tender" which could be used by any purchaser of the whole society.The third part is the analysis of the attribute of centralized drug purchasing ought to be government procurement. In principle, centralized drug purchasing should be incorporated in the government procurement system. Because drug is public goods; public hospitals provide public welfare and are the agent of government; the hospital entity was included in the sixth bid list of China joining in the GPA negotiations; canceling the government pricing will bring about a favorable conditions for drug procurement etc. With the help of the basic theory of Economic Law and Finance and Tax Law, such as public product theory, the government and market theory and principal-agent theory, centralized drug purchasing ought to be attributed to government procurement.The fourth part explores how to manage such conflict that is on the centralized drug purchasing and government procurement. Factually, centralized drug purchasing is not government procurement. But centralized drug purchasing should be incorporated in the government procurement system. Therefore, it should follow three principles in dealing with the conflict between the two. Firstly, enacting the Drug Government Procurement legal system. Secondly, establishing a cohesive mechanism between centralized drug purchasing and government procurement. Finally, selectively learning from advanced legislations of drug procurement from other countries and regions.The fifth part throws out a suggestion that constructing legal system of Drug Government Procurement. The paper puts forward the idea of the main procedure of drug government procurement and then suggests revising and improving the “Government Procurement Law” and relevant laws and regulations. Besides, combining the latest normative documents, connecting the existing centralized drug purchasing and government procurement systems, strengthening other supporting measures including but not limiting public budget, supervision and so on are necessary to make the legal system perfect.