OBJECTIVES: Drug shortages are a common challenge faced in many countries, especially the low price drugs. In order to solve the drug shortages of low price drugs in China, Chinese government issued a policy to encourage the supply of the low price drugs through abolishing the highest price restriction. The policy implementation date in Shandong Province was 16/3/2015. The purpose of this paper is to analysis the price change and the supply of low price drugs after implementation of the new low price drug policy in Shandong Province, China.

METHODS: Price, supply, and purchase date about low price drugs from 16/3/2014 to 16/3/2017 were collected. The database was from Centralized drug procurement platform in Shandong Province. All Public hospitals and health facilities should purchase drugs through this platform and the records will include the information about price, quantity, variety, and manufacturer of low price drugs in each order.

RESULTS: The low-price drug list issued by Shandong Province contains 796 kinds of generic drug(382 western medicine, 414 Chinese patent medicine ). The price of 71.85% low-price drugs were enhanced after the new policy issued. The median price of low-price drug increased from 2.9 RMB to 13.95 RMB for one package. The annual purchase quantity increased from 35.57 million packages to 113.77 million packages. The total transaction amount increased from 0.52 billion RMB to 1.38 billion RMB. Many manufacturers have recovered production some kinds of low-price drugs due to the price enhance. About 47.12% public hospitals and health facilities begin to purchase low-price drugs.

CONCLUSIONS: The new low-price drug policy showed effects on low-price drug market. More manufacturers begin to supply low-price drugs and more hospitals begin to use low-price drugs. The problem of drug shortages due to low price has been solved in a certain degree.