Top News About the "Framework Policy 2020

Printable PDF

Akira Kawahara, Counselor, Japan Pharmaceutical Manufacturers Association

On July 17, 2020, the Cabinet approved the "Basic Policies for Economic and Fiscal Management and Reform 2020: Overcoming the Crisis and Toward a New Future" (the so-called "Keto-bata Policy 2020"). This paper provides an overview of the policy.

1. Introduction

(2) The unique nature and positioning of the "Bone Policy 2020

The "KOTA Policy 2020," which was compiled under the exceptional circumstances of the spread of the new coronavirus infection, has some characteristics that differ significantly from previous KOTA Policies.

Specifically, regarding (1), the "Basic Policies for Economic and Fiscal Management and Reform 2020," the government has narrowed down the contents of the "Basic Policies for Economic and Fiscal Management and Reform 2020" in line with the simplification of the mechanism and procedures for the FY2021 budget request as much as possible, since the response to the new coronavirus infection is an urgent issue under the current circumstances, In line with the simplification of the structure and procedures of the FY2021 budget request, the contents have been narrowed down and emphasis has been placed on the major direction of future policy responses. The "Basic Policies for Economic and Fiscal Management and Reform 2019" (approved by the Cabinet on June 21, 2048), items not included in the Basic Policies will also continue to be steadily implemented," and it is stated that this year's "Kenta-Kenta Policy 2020" is basically based on the "Kenta-Kenta Policy 2019" for FY 2019, and only items related to the major direction of future policy responses are described. It also notes that this year's "Keto Daigata Policy 2020" is based on the "Keto Daigata Policy 2019" and has a unique character and positioning in that it only describes items related to the major direction of future policy responses. It can also be pointed out that, as a result of learning from the various restrictions brought about by the spread of the new coronavirus, the current "Kotta Policy 2020" contains statements that more strongly promote the digitalization of Japanese society than ever before.

(3) Past history of the policy

The increase in social security-related costs, coupled with the aging of the population, is a major problem in Japan and other advanced countries. For this reason, the "Framework Policy" attracts attention every year for its descriptions of social security expenses, as they are directly related to the next year's budget compilation. If the statements related to social security costs are oriented toward extreme restraint of healthcare costs, especially drug costs, it will have a significant impact on the R&D-oriented pharmaceutical industry.

As of 2019, it was thought that discussions on "ongoing issues for consideration" related to drug price reform (April 2020) and "benefits and burdens" would be in full swing in preparation for the "Framework Policy 2020". However, the unforeseen spread of the new coronavirus infection has had a major impact on the social economy, and it is assumed that these full-fledged discussions had to be postponed.

In other words, while medical institutions and related industries, including the wholesale drug industry, were also severely affected by the new type of coronavirus infection, the impending implementation of the mid-year revision of NHI drug prices became a major issue and was taken up politically. In the end, the NHI decided to distance itself from the requests of those in the pharmaceutical industry and conduct a NHI price survey, but stated that it would "fully consider and decide on the contents of the Framework Policy 2018, etc., taking into account the impact of the new coronavirus infection. The final decision on the revision itself will be made at the end of the year when the FY2021 budget is compiled.

When the draft was presented on July 8, there was no specific statement, and the interpretation was conveyed that the policy would be the same as the FY 2019 policy, but because the medical and pharmaceutical industries were opposed to the proposal, a statement was added at the final stage regarding the mid-year revision, which was an unusual course of events. This is taken to indicate that the issue of the mid-year revision was recognized politically as a major directional issue.

By the way, many of you may remember that the "Kotto Policy 2006" included the uniform suppression of increases in social security-related expenses, which was pointed out to have led to the devastation of the medical field. The "Kotta Policy 2015" also includes a policy to curb the natural increase in social security expenses by about 1.5 trillion yen over three years, which has been implemented, and the pharmaceutical industry continues to be subjected to extremely severe restraint measures, as most of the spending restraint and funding for revisions are provided by the devaluation of drug prices.

The basis for recent revisions is the December 2016 "Basic Policy for Fundamental Reform of the NHI Drug Price System" (so-called four-minister agreement), which is to be implemented from the perspective of achieving both "sustainability of universal health insurance" and "promotion of innovation," as well as "reduction of the national burden" and "improvement of the quality of healthcare" that benefit the public. Although the policy is to be implemented, from the pharmaceutical industry's point of view, the reality is that it is remarkably unbalanced. Again, increasing social security costs are a common issue in developed countries. However, it is also an expense that is necessary for people to lead healthy and prosperous lives.

In Japan, the growth of the aging population will temporarily slow down during the three-year period from FY 2019 to FY 2021, and this period is positioned as a "period for strengthening the infrastructure" before the baby boomers begin their transition to 75 years of age or older in 2022. The "Kotto Policy 2018" states that the government will promote the optimization and efficiency of the medical and long-term care service supply system. Because of this, there was a possibility that the 2019 "Kotto Policy 2019" would also include a new description of how social security benefits and burdens should be distributed. As a result, however, the policy was postponed to 2020, with the following statement: "We will proceed with a comprehensive study, and in the Kotta Policy 2020, we will compile a comprehensive and focused policy for social security, including how benefits and contributions should be handled.

The consumption tax rate hike (from 8% to 10%), which has been postponed twice, will be implemented in October 2019, and in September 2019, after the House of Councillors election, the Council on Social Security for All Generations will be established. It was just when it was thought that the compilation of policies that should be comprehensively and intensively addressed, including the discussion of the "Kotta Policy 2020," including the concrete formulation of benefits and burdens, would begin in earnest. The spread of the new coronavirus came at such a delicate time.

(4) "Keto Daishin Seisaku 2020" and the overall chapter structure (pharmaceutical industry related parts) (5) Others

The "Keto Daigaku Seisaku 2020" is a 37-page document, half the size of the 75-page document for 2019. As mentioned above, this has to do with the uniqueness and positioning of this year's policy. The subtitle of the policy is "Overcoming the crisis and moving toward a new future," and the entire document is devoted to the recognition of the crisis caused by the new coronavirus infection and the description of measures to overcome it. Therefore, the stance of "aiming for economic growth first and foremost through productivity improvement in a society with a declining population by 2019" should remain unchanged, but I have the impression that it has become somewhat less prominent due to the emergence of major problems to be overcome in the immediate future.

The following is an explanation of the main parts of the "Keto Daigaku Seisaku 2020" that are considered relevant to the pharmaceutical industry.

In addition, I would like to mention the so-called "Four Government Plans," including the Growth Strategy Action Plan, which was approved by the Cabinet together with the Kenta-Keta Policy, and which are particularly relevant to the pharmaceutical industry.

(1) Chapter 1: Overcoming the Crisis under the New Type of Coronavirus Infection and Toward a New Future

Regarding the economic and financial situation brought about by the new coronavirus infection, he stated, "The situation is like a global crisis, and Japan's measures against infectious diseases have succeeded in overwhelmingly reducing the number of deaths," but he added, "The impact of the spread of infectious diseases on the Japanese economy has been enormous, and we have faced a situation that is truly a national crisis, something we have not experienced before. The Japanese economy, on the whole, has been extremely challenging. Overall, the Japanese economy is in an extremely difficult situation. The impact of the economic downturn caused by the spread of infectious diseases is spreading not only to the manufacturing industry, which is vulnerable to the slowdown of the overall overseas economy, including emerging countries, but also to the service industry, and as a result, the employment situation, which is particularly important for people's lives, is weak. The number of people who have lost their jobs due to the outbreak of the infectious disease has increased significantly, and companies are working hard to protect their jobs.

The report also states that the spread of the infection is attacking the vulnerable areas of each country, and after enumerating what should be called risk factors for Japan, citing examples such as Japan's lagging digitalization and online adoption in the field of public administration, it goes on to list (1) the advent of the fourth industrial revolution and increasing energy and environmental constraints, (2) frequent occurrence of large-scale natural disasters, (3) the need to improve social security and fiscal sustainability, and (4) the need to improve the quality of life. (3) structural problems related to the sustainability of social security and public finances. With regard to (3) in particular, the report includes the qualifying phrase "the amount of new government bonds issued this fiscal year reached 90 trillion yen, the largest amount in the postwar period," partly due to a series of supplementary budgets to deal with new coronavirus infections, indicating an extraordinary awareness of the problems related to social security and fiscal sustainability.

In addition, as "International Political, Economic, and Social Conditions in the Era of the Corona: Shakes in the International Order," the report cites (1) a significant decline in the global economy and growing uncertainty, (2) concerns about maintaining the free trade regime, and (3) the increasing formality of cooperation and international fragmentation at the global level, although the report does not mention any of these changes, If these changes become significant, they will have an impact on the pharmaceutical industry sooner or later, and will need to be closely monitored.

Following these statements, a new future in the post-coronary era, protecting the lives, livelihoods, employment, and businesses of the people, is described, and in particular, "We will protect the Japanese economy from this once-in-a-century crisis. We will protect the Japanese economy from this once-in-a-century crisis, and we will not allow deflation to return. Based on this determination, we will promote flexible and thorough policy responses during the "With Corona" period. In addition, the statement strongly asserts that "there is not a moment to spare in promoting DX (Digital Transformation) of society as a whole," based on Japan's awareness of the problem that the implementation of digitalization is lagging behind that of leading countries in order to realize a new everyday life (p. 5).

The budget for FY2021 (FY2021 budget) will be delayed by one month, and the request mechanism and procedures will be simplified as much as possible.

In addition, the "Promotion of Integrated Economic and Fiscal Reforms in Light of the Expansion of Infectious Diseases" clearly sets forth the direction of promoting the digitization and online shift of medical care, saying, "We will build a flexible and robust medical care delivery system and realize digitization and online shift, which have been recognized as challenges for the medical and long-term care systems due to measures against infectious diseases," and In addition, it also states that "While maintaining the world-class universal health insurance system, the government will make the social security system more sustainable and pass it on to the next generation by sequentially implementing reforms during the period of infrastructure reinforcement and promoting infrastructure reinforcement by 2022, when the baby boom generation will begin to reach 75 years of age or older," without mentioning the specifics of infrastructure reinforcement. Although it does not refer to the specifics of the strengthening of the foundation, it is a reference to the benefits and burdens that will be discussed at the Council for the Study of the Social Security System for All Generations.

Furthermore, the Science, Technology, and Innovation Policy states, "The government will focus its efforts on fields that contribute to solving social issues, such as drug discovery research, digitalization and remoteness, and AI and robotics, as the core of its efforts. In doing so, we will promote strategic R&D investment through public-private partnerships, while improving the quality of the budget, and will lead to the realization of "the most innovative country in the world"" (p. 8). This is a clear indication of the strong will to make Japan the most innovation-friendly country in the world. The R&D-oriented pharmaceutical industry is therefore expected to cooperate and make efforts toward the realization of this goal, as well as to continuously make constructive policy proposals.

2) Chapter 2: Protecting People's Lives, Livelihoods, Employment, and Businesses

As for our recognition of the current situation, "Japan is in a phase of phasing out economic activities while continuing to take measures to prevent the spread of infection. While it is difficult for the economy to immediately return to its previous state, including international movement of people, until a cure and vaccine are developed and disseminated, (omitted) we will steadily return the economy to a sustainable growth path after bottoming out in April and May of this year," the statement reads. It further states, "The recent outbreak of infectious diseases has plunged the global economy into the biggest crisis in the postwar period and is an unprecedented shock in the sense that it has significantly pushed down the economy from both supply and demand sides by artificially suppressing economic activities both domestically and internationally from the perspective of preventing the spread of infection," and calls for the enhancement of testing and surveillance systems as well as the strengthening of the medical care delivery system, the evolution of measures to prevent the spread of infection, the strengthening of the It also mentions the need to strengthen the medical care delivery system, to evolve measures to prevent the spread of infection, and to accelerate the development of therapeutic drugs and vaccines, as well as to improve testing and surveillance systems.

In addition, the Pharmaceutical Manufacturers Association of Japan (PMAJ) proposal includes the statement, "The National Institute of Infectious Diseases (NIID) and the National Center for Global Health and Medicine (NICHeM) should strengthen their systems and establish a framework to promote integrated efforts" (p. 10), which is expected to become more specific in future budget requests and budget compilation work. We expect that more specific details will become clear during the budget request and budget compilation process.

The statement, which is also closely related to the pharmaceutical industry, includes the following: "By bringing together the wisdom of the world, including Japan, we will advance research on disease mechanisms, further accelerate the research and development of effective treatments, cures, and vaccines, and as an emergency response, conduct a priority and rapid review and promptly establish a production system in Japan, In addition, the company will further accelerate research and development of effective treatments, therapies, and vaccines, etc., and conduct prompt screening as an emergency response on a priority basis, while quickly establishing a domestic production system," (p. 10).

In addition, although the direct relationship between the two may be rather weak, the section on "stimulating domestic demand such as consumption" also states, "In the recovery of personal consumption, we will strive to protect employment and livelihood through the prompt implementation of various support measures, and to dispel public concerns about the risk of infection by expanding the testing system and developing and disseminating vaccines and therapeutic agents at an early stage. In addition, the role of test drugs, therapeutic drugs, and vaccines in the recovery of the economy is expected to play a major role.

3) Chapter 3: Realization of a "New Normal

Chapter 3 (p. 15) is full of extraordinary descriptions of digitalization as the driving force behind the construction of a "new everyday life. In addition to the aforementioned DX (Digital Transformation), keywords such as "Digital New Deal," "Digital Government," "Fundamental Improvement of My Number System," "Construction of Digital Infrastructure," "Construction of Data Linkage Infrastructure among Fields (Construction of Base Registry)," "Promotion of Open Data The following words and phrases can be found in the document: "promotion of open data". In addition, in order to promote DX for society as a whole, the plan calls for the development of 5G networks as well as the promotion of post-5G technology development, and states that digitalization and smart technology will be the guiding principles of the next priority plan for social infrastructure development to be formulated.

In this chapter, there are also references to online education and medical care, etc., as new ways of working and living, along with the establishment and acceleration of telework, measures to combat the declining birthrate, women's activities, etc. Specifically, the chapter states, "In the context of new lifestyles, we will promote verification of tele-education, online and telephone medical care and medication guidance based on the opinions of various stakeholders, including users," and also states, "With regard to online medical care, we will establish a system to complete everything from consultation to receipt of drugs online through electronic prescriptions, online medication guidance, and drug delivery. While respecting the consensus of all parties involved, the direction of the plan seems to be to further enhance the convenience of online medical care, which has spread rapidly due to the Corona disaster.

There is also a description (p. 27) regarding the postponed Tokyo Olympics and Paralympics: "Toward the success of the Tokyo 2020 Olympic and Paralympic Games, which will be held next summer as the Olympic Games for recovery, we will promote measures against infectious diseases and heat, strengthen international competitiveness, and hold the Games as proof that humanity has conquered infectious diseases, We will hold the games as proof of humanity's victory over infectious diseases and create a legacy. We in the pharmaceutical industry sincerely hope that the new coronavirus infection will be dealt with through the contribution of new test drugs, therapeutic drugs, and vaccines, and that next year's Tokyo Olympics and Paralympics will be held without incident.

In the first part of "Accelerating Science, Technology, and Innovation" (p. 29), although there is no description specific to health and medicine, we find a statement that the public and private sectors will promote research and development together, as well as strengthen the functions and mutual collaboration of science, technology, and innovation-related command centers, which we also saw in 2019. In addition, specific technologies are listed in the "Efforts to maintain and strengthen the innovation ecosystem," and "regenerative medicine," "biotechnology," and "countermeasures against infectious diseases, including research and development of effective treatments, cures, and vaccines" are written, which is a description closely related to the pharmaceutical industry.

The next section, "4. Realization of an inclusive society that supports a 'new everyday life'" (p. 30), states, "The importance of flexible healthcare delivery systems, data utilization, and health prevention has been reaffirmed in the wake of the recent spread of infectious diseases. It is stated that "the government will steadily strengthen the foundations of the social security system and build a social security system that supports a 'new everyday life' (abbreviated below). The description of the mid-year revision is also included here after readjustment of the KOTENDAI draft (p. 31).

In this description, it is stated that "the government will steadily strengthen the foundations of the social security system in line with the contents of the KOTA Policy 2018, KOTA Policy 2019, etc., and build a social security system that responds to the 100-year life period, maintaining the world-class universal health insurance and pension system and ensuring its sustainability for the next generation," and other such statements are included in the preceding The policy also follows the preceding "Kotto" policy.

As you are aware, the draft of the KOSETA presented on July 8 did not include any mention of mid-year revisions, and when the question was posed as a confirmation, the response was "We will follow the existing policy," but it did not stop there, and in the final adjustment within the ruling party, it was stated that "In addition, the NHI price revision for FY2021, which is based on this year's NHI price survey, is not included in the draft. In the final adjustment within the ruling party, the statement was added, "In addition, the NHI price revision for FY2021 based on this year's NHI price survey will be decided after careful consideration of the contents of KOTA Policy 2018, etc., taking into account the impact of the new type of coronavirus infection.

In the preceding discussions and statements of opinion at the Central Social Insurance Medical Council (Chuikyo), despite the fact that the medical and pharmaceutical industries, including wholesalers, had opposed the implementation of the survey itself, various interpretations were possible: the survey would be conducted, but a decision on whether to implement the revisions would be made after a thorough review. The content of the amendment was postponed until the budget compilation at the end of the year.

In addition, there is a statement that "the whole genome analysis action plan will be steadily promoted, and a system will be developed to enable industry, government, and academia to widely analyze and utilize the results in order to provide new personalized medicine to patients who have no treatment options" (page 32). There are also many descriptions of international cooperation, and in response to the recent spread of the novel coronavirus, a considerable number of statements are found (p. 35). Specifically, it states, "In order to fundamentally resolve the spread of infectious diseases, the development and dissemination of effective therapeutic agents and vaccines will be accelerated at once, drawing on the collective wisdom of the world. Specifically, we will expand clinical research on candidate therapeutics and vaccines internationally, and contribute to the world through contributions to the Coalition for Pandemic Preparedness Innovation (CEPI) and the Gavi Vaccine Alliance (Gavi)" (p. 35). The statement goes on to say, somewhat lengthily, "In order to prevent the further spread of infectious diseases and their influx into Japan, we will work with the World Health Organization (WHO) and other international organizations to build international cooperation and support the improvement of medical systems and public health in countries with a high potential for the spread of infectious diseases. In particular, for developing countries with fragile health systems, we will further expand international cooperation in the fields of medicine and health, including grant aid, pharmaceutical and material support, and technical cooperation. Furthermore, using the lessons learned from the recent crisis, we will strengthen the world-wide infectious disease prevention system and aim to achieve universal health coverage (UHC). Under the Asian Health Initiative and the African Health Initiative, we will promote the overseas expansion of Japan's healthcare industry and further promote regulatory harmonization in Asia. In addition, we will play a leading role in countermeasures against drug resistance." Taking the opportunity of the recent spread of the new coronavirus infection, pharmaceutical-related companies are also expected to strengthen their international response in cooperation with the government and academia.

The importance of the pharmaceutical supply system

Among the four government plans approved by the Cabinet along with the Framework Policy, the Growth Strategy Action Plan includes a description of the importance of the pharmaceutical supply system. It refers to the supply system in order to ensure a stable supply of not only so-called new drugs, but also medicines necessary for medical treatment. Already as of 2019, the stable supply of pharmaceuticals has been recognized as an important issue due to the shortage of antimicrobial agents, and the Japan Federation of Pharmaceutical Manufacturers' Associations (JFPMA), the upper organization, has already formulated a scheme in early February of this year in response to the Ministry of Health, Labor and Welfare's request in its administrative communication, and is currently working on the "Measures to Ensure Stable Supply of Pharmaceuticals (Stable Supply of Pharmaceuticals)" at the Ministry of Health, Labor and Welfare. The Ministry of Health, Labour and Welfare (MHLW) is currently in the process of selecting "Stable and Secure Drugs (tentative name)".

In this sense, the pharmaceutical sector has been ahead of other sectors, but the case of masks has been reaffirmed in the midst of the spread of the new type of coronavirus infection, and the Growth Strategy Action Plan also includes the following provisions: "We will support domestic investment in consumer goods and drugs for medical and health use that are essential for the nation's health and highly dependent on foreign countries, and we will build a reliable supply system. In addition, for products and materials that are essential to the supply chain, we will support multi-layered and multi-layered production and build a supply net that can respond flexibly in times of crisis.

Although this point is not directly related to R&D, I would like to note that it is also an important matter required of the pharmaceutical industry in terms of ensuring access to medicines.

Back to Newsletter Top

TOP