OBJECTIVES: Since 2009, the Chinese government has launched a global healthcare reform program aiming to  control healthcare expenditure and increase the quality of care. As a part of this program, a new drug pricing reform was initiated starting 1^stJune 2015. The objective of this study is to describe the changing landscape of drug pricing policy in China. METHODS: We conducted a thorough research on drug pricing reform using three Chinese databases (CNKI, Wanfang, Weipu), Chinese health authorities’ websites, relevant press releases, pharmaceutical blogs and discussion forums. The secondary research was complemented with targeted interviews with Chinese key opinion leaders representing authorities’ and prescribers’ perspectives. RESULTS: With the current reform, the government attempts to replace its direct control over prices of reimbursable drugs by an indirect influence. Government pricing and government guided pricing are abolished for most drugs giving manufacturers more freedom to set market prices. However, an introduction of a form of internal reference pricing (IRP), named ”reimbursement standard” has been announced. To inform the best approach for implementation of this reform, China is currently running pilot projects in several cities. Sanming is piloting a form of IRP for drugs with the same active ingredient and dosage form; it set the reference price at the price of the cheapest generic. Shaoxing and Anhui are testing the concept of “2^nd price negotiation” allowing hospitals to directly negotiate discounts with manufacturers using provincial government procurement prices as reimbursement caps. First results of Sanming and Shaoxing pilots have already been reported, proving their potential for drug budget saving.  CONCLUSIONS: Many elements of the reform remain unclear and will likely depend on pilot projects outcomes. It seems that the Chinese government is considering adaptation of IRP policies commonly used by European countries. However, foreign pricing policies cannot be transferred to China without being adjusted for local characteristics.