Med-tech Takes a Hit

Although the reduced remuneration for medical devices were less severe than those for medical service fees and pharmaceuticals, the reductions for the medical product sector were the biggest the industry has received since the authorized reimbursement system was implemented.

In Japan, several reimbursement prices for disposable medical products and implants are assessed by functional group. These reimbursement prices are also reassessed every two years, as actual market price is compared with that of other industrialized countries, such as the United States, United Kingdom, France, Germany and Canada.

In general, some medical products were found to be more expensive in Japan than they were in these other countries. From the viewpoint of dissolving this disparity between domestic and foreign prices, 80 functional groups of medical products were reassessed. As a result, 34 groups were reduced by more than 25%; a sampling of these items includes lead wires for pacemakers, mechanical heart valves, artificial blood vessels and spinal fixation implants.

The good news for suppliers is that any medical product that had been reduced by more than 15% will not be affected overnight. Instead, these remunerations will be reduced by stepwise manner over the next two years, as shown in Table 1.

Yoshio Mitsumori is the president and CEO for Tokyo-based ADMIS, a consultant specializing in the medical device industry. He has more than 25 years of experience in the medical industry, including positions with the Itochu Corp., U.S. Surgical, National Medical Enterprises and Century Medical. A member of RAPS, he has spoken at many industry events and worked extensively in international trade of medical products and technologies. He can be reached at [email protected].