Growth and collaboration: Embracing new challenges facing China's life sciences market

The Chinese government continues to invest in reforming its healthcare ecosystem. A key element of these reforms is the essential drug list (EDL), intended to reduce drug costs. The new EDL environment will create challenges and opportunities for pharmaceutical companies, pharmaceutical distributors and hospitals, as well as trigger changes in how they operate and compete. Integration and collaboration supported by information sharing will be required across four areas: new differentiated services development, operational excellence, sales effectiveness and supply chain optimization.

Implementation of the EDL program will not only lower drug prices for Chinese citizens, it will also trigger changes in how key industry stakeholders operate and compete. To sustain profitability and remain competitive, pharmaceuticals, distributors and hospitals must improve their own operational and managerial capabilities. Integration and collaboration in differentiated services development, operational excellence, sales effectiveness and supply chain optimization will benefit all players.