Circular No. 06/2013/TT-BYT guiding the pilot implementation of drug price management using the maximum wholesale markup method throughout the supply chain for drugs paid for by the state budget and health insurance.

CIRCULAR

Guidelines for piloting the management of drug prices using the maximum wholesale markup method throughout the entire supply chain for drugs funded by the state budget and health insurance

tối đa toàn chặng đối với các thuốc do ngân sách nhà nước và bảo hiểm y tế chi trả ||| maximum full journey price for medicines paid from the state budget and health insurance;

 ______________________________

Pursuant to the Drug Law No. 34/2005/QH11 dated June 14, 2005 of the National Assembly;

Decree No. 63/2012/NĐ-CP dated 31 the 8 Pursuant to Decree No. 32/2019/NĐ-CP dated April 10, 2019 of the Government on assigning tasks, procurement or tendering for the supply of products and services using state budget from regular operating expenses;12 of the Government stipulating the functions, tasks, powers, and organizational structure of the Ministry of Health;

Pursuant to the Decree No. 79/2006/NĐ-CP dated August 9, 2006 of the Government detailing the implementation of certain provisions of the Drug Law; điều của Luật Dược; ||| Article of the Medicine Law;

Implementing the directive of Deputy Prime Minister Nguyen Thien Nhan as stated in the letter No. 1758/VPCP-KGVX dated March 19, 2012 of the Government Office agreeing to allow the pilot application of managing drug prices using the maximum wholesale markup method throughout the entire supply chain as proposed by the Ministry of Health; triển khai áp dụng thí điểm ||| implement a pilot application; quản lý giá thuốc bằng phương pháp thặng số bán buôn tối đa toàn chặng theo đề nghị của Bộ Y tế; ||| manage medicine prices using the maximum full journey wholesale mark-up method as proposed by the Ministry of Health;

At the proposal of the Director of the Drug Administration,

Article 1. Amending and supplementing some articles of Circular No. 21/2023/TT-BTTTT dated December 31, 2023 of the Ministry of Information and Communications on functions and technical features of the Administrative Procedure Handling Information System at the ministerial and provincial levels (hereinafter referred to as Circular No. 21/2023/TT-BTTTT) as follows: Ministry of Health issues the Circular these guidelines provide for the pilot implementation of managing drug prices using the maximum wholesale markup method throughout the entire supply chain for drugs funded by the state budget and health insurance. These guidelines guide the pilot implementation of managing drug prices using the maximum wholesale markup method throughout the entire supply chain for drugs funded by the state budget and health insurance according to the list of items subject to pilot application as stipulated in Article 4 of these guidelines.

PART I

GENERAL PROVISIONS

Article 1. Scope of Regulation

These guidelines apply to organizations and individuals in Vietnam permitted to engage in the production, importation, and wholesale sale of drugs; state-run medical examination and treatment facilities; provincial health departments organizing centralized bidding for pilot application; and other relevant agencies, organizations, and individuals involved in the bidding process for purchasing drugs from state-run medical examination and treatment facilities applying the pilot program.

Article 2. Applicability

Thông tư này áp dụng đối với các tổ chức, cá nhân tại Việt Nam được phép hoạt động sản xuất, nhập khẩu, bán buôn thuốc; các cơ sở khám bệnh, chữa bệnh của Nhà nước, các Sở Y tế có tổ chức đấu thầu tập trung áp dụng thí điểm; các cơ quan, tổ chức, cá nhân khác có liên quan trong công tác đấu thầu mua thuốc của các cơ sở khám bệnh, chữa bệnh của Nhà nước áp dụng thí điểm. ||| This Circular applies to organizations and individuals in Vietnam permitted to engage in the production, importation, and wholesale of medicines; state medical examination and treatment facilities; provincial health departments organizing centralized bidding for pilot application; other agencies, organizations, and individuals involved in the bidding process for purchasing medicines at state medical examination and treatment facilities applying the pilot program.

Article 3. Explanation of Terms

1. The import price includes the value of the drug based on its selling price in the exporting country, insurance costs, and transportation fees from the exporting country to Vietnamese ports (referred to as CIF price), but does not include import taxes (if applicable).

2. The cost of domestically produced drugs is the total cost determined in accordance with the Regulation on Pricing of Assets, Goods, and Services issued together with Circular No. 154/2010/TT-BTC dated October 1, 2010 of the Ministry of Finance, which is calculated as the sum of direct raw material and fuel costs, plus direct labor costs, plus common production costs, plus financial costs (interest payments if applicable), plus business management costs, plus sales costs, minus costs allocated to by-products (if applicable).

3. The base value of the drug for calculating the maximum wholesale markup throughout the entire supply chain: for imported drugs, it is the actual CIF price in Vietnamese Dong; for domestically produced drugs, it is the cost declared or re-declared by the domestic manufacturing facility or the commissioning facility that is currently valid, plus 20% of the cost.

4. The maximum wholesale markup throughout the entire supply chain is the prescribed maximum allowable difference between the wholesale price of drugs supplied to state-run medical examination and treatment facilities and the base value of the drug.

5. The foreign exchange rate applied to calculate the CIF price in Vietnamese Dong is the actual selling rate of the Vietnam Joint Stock Commercial Bank for Foreign Trade at the time of tender opening at medical examination and treatment facilities and provincial health departments organizing centralized bidding for pilot application.

Chapter II

SPECIFIC PROVISIONS

Article 4. Principles for selection and list of items to be piloted

1. Items containing active ingredients to be piloted must meet the following principles:

a) Having significant value at healthcare facilities;

b) Winning bids to supply in many hospitals;

c) Having significant price differences among items with the same active ingredient, concentration, or dosage form;

d) Many items containing this active ingredient have a high price difference ratio between selling price and original cost (production cost and CIF price).

2. The list of active ingredients to be piloted shall be implemented according to the provisions set out in Appendix 1 attached hereto.

Article 5. Principles for selection and list of healthcare facilities to be piloted

1. Based on the actual implementation of tendering activities by units, the Ministry of Health will select some healthcare facilities and provincial health departments that organize centralized tenders to implement the pilot application according to the following principles:

a) Representing various forms of ongoing tendering: Central-affiliated hospitals and institutes conducting their own tenders; provincial general hospitals conducting their own tenders; provincial health departments organizing centralized tenders.

b) Distributed across three regions: North, Central, and South.

2. The list of units to be piloted is specified in Appendix 2 attached hereto. Depending on the actual situation of tendering activities by units, the list of units to be piloted will be adjusted accordingly.

Article 6. Method for establishing the maximum wholesale markup throughout the distribution chain for the pilot application and the formula for determination

1. Method for establishing the maximum wholesale markup throughout the distribution chain for the pilot application:

a) Statistics on the markups of pharmaceutical items based on declared wholesale prices still in effect from domestic pharmaceutical production enterprises, drug manufacturing establishments, import establishments, and entrusted import establishments;

b) Classify the price ranges of drugs and corresponding markup ranges on the principle of ensuring that the higher the value of the item, the lower the markup;

c) In each surveyed price range of drugs, statistically determine the common markup level of over 50% of the total number of surveyed items;

d) Develop a calculation formula for the markup for each price range based on the maximum markup of the lowest value in the price range and the additional markup per unit value.

2. The maximum wholesale markup throughout the distribution chain for the pilot application is determined according to the formula stipulated in Appendix 3 attached hereto.

Article 7. Regulations on managing drug prices using the method of maximum wholesale markup throughout the distribution chain for items subject to the pilot application

1. Purchasing drugs containing active ingredients listed in the list of active ingredients to be piloted as stipulated in Clause 2 of Article 4 of this Circular must be carried out in accordance with Circular Joint No. 01/2012/TTLT-BYT-BTC dated January 19, 2012, issued by the Minister of Health and the Minister of Finance guiding the tendering of drugs in healthcare facilities and Circular No. 11/2012/TT-BYT dated June 28, 2012, issued by the Minister of Health guiding the preparation of tender documents for purchasing drugs in healthcare facilities.

2. Prices of items containing active ingredients to be piloted at healthcare facilities must comply with the following requirements:

a) The difference between the bid price proposed for items containing active ingredients to be piloted and the original value calculated with markup of those items must not exceed the maximum wholesale markup throughout the distribution chain stipulated in Appendix 3 attached hereto.

b) In cases where the item under consideration for the bid (the item with the lowest evaluated price) according to Circular Joint No. 01/2012/TTLT-BYT-BTC dated January 19, 2012, issued by the Minister of Health and the Minister of Finance guiding the tendering of drugs in healthcare facilities has a price difference between the bid price and the original value calculated with markup exceeding the maximum wholesale markup throughout the distribution chain stipulated in Appendix 3 attached hereto, the head of the unit specified in Clause 2 of Article 5 of this Circular must negotiate with the bidder with the lowest evaluated price to ensure that this difference does not exceed the maximum wholesale markup throughout the distribution chain as prescribed. If the price negotiation does not reach an agreement but the drug is still necessary for the unit's needs, the head of the unit must report to the Ministry of Health (Department of Drug Administration, Department of Planning and Finance) for examination and resolution on the principle of ensuring sufficient drug supply to meet the healthcare needs of the people.

Chapter III

RESPONSIBILITIES FOR ORGANIZING THE PILOT IMPLEMENTATION

Article 8. Responsibilities of Relevant Units

1. Department of Medicines Management:

a) Serve as the focal point, coordinate with relevant units under the Ministry of Health, Ministry of Finance, Ministry of Industry and Trade, and Vietnam Social Security to organize and guide the pilot implementation:

Aggregate information on production costs for domestically produced drugs declared by manufacturing facilities or contract manufacturing facilities, and CIF actual prices for imported drugs provided by the General Department of Customs for drug types subject to the pilot program that are currently circulating in the market to provide to the pilot implementation units.

Coordinate with the Planning-Finance Department in monitoring, supervising, and addressing any issues, difficulties, or inconsistencies arising during the pilot implementation process to report to the Ministry of Health leadership for timely guidance and resolution.

In necessary cases, organize working groups to guide units in organizing and implementing the pilot program.

b) Coordinate with relevant units to conduct evaluations, summaries, and draw lessons to present to the Ministry of Health leadership for reporting to the Prime Minister on the results of the pilot implementation and propose subsequent implementation directions.

2. Planning-Finance Department:

Serve as the focal point for monitoring, supervising, and receiving any issues, difficulties, or inconsistencies arising during the pilot implementation process to report to the Ministry of Health leadership for timely guidance and resolution.

Article 9. Responsibilities of the Provincial Department of Health under the Central Government

1. Direct, guide, and supervise medical examination and treatment establishments within the list of units applying the pilot program to implement the provisions of this Circular.

2. Organize the pilot implementation when the Provincial Health Department conducts centralized bidding according to the list of units applying the pilot program as stipulated in this Circular.

3. Summarize and report the results of the pilot application within 30 days from the date of approval of the tender results as specified in Appendix 4 issued together with this Circular to the Ministry of Health (Department of Medicines Management, Planning-Finance Department).

Article 10. Responsibilities of Medical Examination and Treatment Establishments

1. Directors of medical examination and treatment establishments listed in the pilot program application list are responsible for organizing the pilot implementation.

2. Summarize and report the results of the pilot application within 30 days from the date of approval of the tender results according to the form specified in Appendix 4 issued together with this Circular to the Ministry of Health (Department of Medicines Management, Planning-Finance Department).

Article 11. Responsibilities of Drug Manufacturing and Importing Establishments

1. Domestic drug manufacturing facilities and contract manufacturing facilities producing domestic drugs are responsible for the accuracy of the declared production costs of their drugs to the competent state management agency in accordance with the Asset, Goods, and Service Pricing Regulation issued together with Circular No. 154/2010/TT-BTC dated October 1, 2010, of the Minister of Finance.

2. Domestic drug manufacturing facilities, contract manufacturing facilities, drug importing facilities, and entrusted drug importing facilities have the responsibility to provide CIF price, production cost, and current wholesale price information for drug types subject to the pilot program that they have declared or re-declared upon request from the Department of Medicines Management and pilot application units during the tender procurement process, and are responsible for the accuracy of the price-related information and documents provided to the pilot application units.

Article 12. Period of pilot application

The period of pilot application at medical examination and treatment establishments and Departments of Health as prescribed in Clause 2, Article 5 of this Circular shall be one year from the date this Circular takes effect.

Chapter IV

IMPLEMENTING PROVISIONS

Article 13. Effective Date

This Circular takes effect from April 1, 2013.

During implementation, if there are difficulties or obstacles, units are advised to report to the Ministry of Health (Medicine Administration Department, Planning and Finance Department) for consideration and resolution./.