China announces which drugs it will reimburse

China’s state-run health insurance program has released its negotiated National Reimbursement Drug List. A number of drugs have been deeply discounted — Jefferies notes that drug prices were cut 61% on average. This includes drugs like Gilead’s Harvoni, whose price is down 85%, and Abbvie’s Humira, down 84%. 

Notably, only one anti PD-1 monoclonal antibody drug made the list — Innovent’s Tyvyt, which was included with a 64% price cut. But the government won’t reimburse for Merck’s Keytruda or Bristol-Myers Squibb’s Opdivo. The decision will be beneficial for domestic PD-1/L1 players like Beigene and Sino Biopharm, putting them in a stronger immuno-oncology position in China, according to an analyst note from J.P. Morgan.