OBJECTIVES: As part of Japan’s major reform to improve sustainability of universal healthcare system and to promote drug innovation, Ministry of Health, Labour, and Welfare (MHLW) has implemented a comprehensive drug pricing system reform in recent years including the formal implementation of HTA (Health Technology Assessment). This study examines the drug pricing system reform since 2018 and the policy trends in Japan.

METHODS: Government policy reports, published papers, and grey literature were reviewed through literature search and web browsing.

RESULTS: In April 2019, HTA was formally implemented in Japan after a 3-year pilot program. Compared to other countries, the scope of HTA is still very small in Japan. Around 10 products with the most financial impact are assessed per year. Furthermore, unlike other countries where HTA results influence reimbursement decisions, they are only used for adjusting a small portion of drug price, i.e. either the premium (if there is a similar efficacy drug on the market) or operating profit (if there is no similar efficacy drug on the market) to ensure patient access to expensive drugs. In addition, MHLW has also implemented several new drug pricing policies in the past few years including setting price premiums to more accurately reflect innovation, more frequent price adjustments, and promotion of generic drug use. With the first official HTA results not yet unavailable and the initiatives implemented not too long ago, it is too early to determine the impact of the full reform on drug prices.

CONCLUSIONS: In order to improve sustainability of universal healthcare system and to promote drug innovation, Japanese government has started to place emphasis on cost-containment and efficiencies, while ensuring broad access to innovative products. With aging population and growing pressures to control healthcare costs, the importance for HTA is expected to grow over time in Japan.