In Response to the FY2026 (Reiwa 8) Drug Price System Reform and Cost-Effectiveness Evaluation System Reform
December 26, 2025
Japan Pharmaceutical Manufacturers Association
Chairperson: Asuka Miyabashira
The Central Social Insurance Medical Council (hereinafter referred to as the “Central Medical Council”) has recently finalized the “Outline of the Reiwa 8 Drug Price System Reform” and the “Outline of the Reiwa 8 Cost-Effectiveness Evaluation System Reform.” We view these outlines as the result of the wide-ranging efforts of all stakeholders.
To date, the JPMA has expressed its views in forums—primarily within the Central Social Insurance Medical Council—concerning the drug pricing system and the cost-effectiveness evaluation system, with the aim of contributing to the realization of a healthy and long-lived society and to Japan’s economic growth through the research, development, and stable supply of innovative new drugs.
We commend the fact that these Outlines explicitly state that (1) a review of the cost-effectiveness evaluation system will be conducted, and (2) the application of market expansion re-calculation (including special cases) to similar drugs (“tagging along”) will be abolished.Furthermore, regarding the cost-effectiveness evaluation system, after presenting points that should be reviewed, we will continue to actively participate in discussions with the aim of establishing a desirable system based on the results of the review.
On the other hand, action on the following industry proposals has been postponed, and we will continue to put forward these proposals in the future.
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Pricing Methodology for Innovative New Drugs
Establish a system that appropriately evaluates innovation, such as by broadly selecting comparable drugs in a manner that complements the current cost-based calculation method
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Price Maintenance System for Innovative New Drugs
Given that the average deviation rate is narrowing, the method of determining which products to maintain drug prices for based on the deviation rate should be revised, and drug prices should simply be maintained
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Special Market Expansion Re-calculation (Sustainability Special Price Adjustment)
Re-calculations that lack rationality should be abolished
Furthermore, given the current economic climate and the argument that official prices should also take economic and price trends into account, the increase in the base medical fee schedule should be evaluated from the perspective of the sustainability of healthcare; however, the fact that this approach was not reflected in drug prices—which are a component of the medical fee schedule—has a negative impact on the continued generation of innovation.
Furthermore, regarding the U.S. Most-Favored-Nation (MFN) treatment system, as outlined in the draft guidelines, we expect that responses will be made flexibly and in a timely manner, taking international circumstances into account.
Finally, as the average deviation rate continues to narrow, in order to balance fiscal sustainability without undermining innovation, the drug pricing system—which has been based on market-based price adjustments—has reached its limits and is now in need of a fundamental overhaul. We believe discussions on this matter should begin as soon as possible.