Presentation (CTI)

OBJECTIVES: In FY2025, Japan once again implemented an off-year price revision, contrary to pharma industry’s wishes. Across-the-board price revisions are normally biennial, but off-year repricing has led to eight consecutive years of price reductions. Unlike previous revisions, more flexible allowable price gap thresholds - based on drug type - were applied the first time in FY2025. This analysis examines the price revision outcomes in 2021-25, aiming to understand the trends in scope and price adjustment rate in each periodic revision.
METHODS: Drugs reimbursed by the National Health Insurance (NHI)-were examined and categorized into three types: patent-protected branded drugs, off-patent products, and generics. Each product’s NHI list price on April 1 (after the repricing) was compared to its price in the previous month in 2021, 2022, 2023, 2024 and 2025. Each product, including different packages, was weighted equally. Price history data was extracted from the GlobalData’s POLI database.
RESULTS: Regular biennial price revision rounds were found to result in more drugs subject to price reductions compared to off-year rounds. The share of drugs facing price decreases in FY2025 is the smallest for all the three drug types compared to earlier years. The share of branded drugs receiving price reductions has significantly decreased since 2023, but the share of off-patent drugs whose prices were cut has remained high. The price reduction rates of branded drugs have also fallen since 2023, while off-patent drugs had higher price reduction rates than branded drugs and generics.
CONCLUSIONS: Japan is attempting to strike a balance between keeping its market attractive to pharma and ensuring public healthcare system’s financial sustainability. This study shows that recent repricing cycles have led to lower price cuts especially for branded drugs, reflecting to the government’s promise to improve the market’s attractiveness. However, the improvement may not have met the industry’s expectations.