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Relationship Between Adjustment of Reimbursement Prices of National Health Insurance and Patent Right
James Yang
Paragraph 1, Article 46 of the National Health Insurance Act ("NHIA") stipulates that "The Insurer should adjust a reimbursement price based on prevailing market conditions; the reimbursement price for a drug with a patent should start being lowered within the first year after the expiry date of such patent, and be gradually adjusted to a reasonable reimbursement price within five years based on prevailing market conditions." Such stipulation sets whether a drug has a patent and how long the patent has expired as criteria for adjusting the reimbursement price of the drug. Principally, the reimbursement price of a drug would be reduced after its patent expires. Regardless of whether a drug patent expires and/or how long the patent has been expired, the reimbursement price of a drug should be reasonably adjusted based on prevailing market conditions.
On 2 December 2013, according to Paragraph 2 of the stipulation above, the Ministry of Health and Welfare announced the "Regulations on the Adjustment of Reimbursement Prices of National Health Insurance" ("RARPNHI") to implement the principle set in the stipulation above, and such regulation has been enacted since that day. It shall be noted in the RARPNHI that the scope of a drug patent thereof means "the patent granted according to the Patent Act that covers the active ingredient or a combination of active ingredients of a drug" (Item 1, Paragraph 1, Article 2 of the RARPNHI), wherein the active ingredient includes an isomer, a specific crystalline form, a hydrate, etc. that improves clinical efficacy and such improvement has been recognized by an expert in the pharmaceutical field (Paragraph 2, Article 2 of the RARPNHI).
Given the above, by not only a patent covering the active ingredient(s) in its drug but also a patent covering the isomer, specific crystalline form, hydrate, etc. of the active ingredient(s), a pharmaceutical company may try to postpone the adjustment on the reimbursement price of its drug. In addition, since the scope of the drug patent in the RARPNHI is limited, for example, a drug patent on its dosage form is excluded, it is worth observing whether such limited scope impacts the reimbursement price of the "me-better" drug that improves its dosage form to achieve better clinical efficacy.
