Orient Securities released a research report stating that the introduction of a commercial insurance drug list for innovative medicines is expected to leverage market forces to address the accessibility and affordability of high-priced innovative drugs. Unlike previous years when pharmaceutical companies could only choose to apply for either the National Reimbursement Drug List (NRDL) or the innovative drug list, this year introduces a dual-application option, providing firms with more strategic flexibility.
Drugs applying solely for the NRDL reflect companies' intent to rapidly expand market access through price reductions ("volume-for-value"). In contrast, dual-application or commercial insurance-only submissions indicate lower willingness to cut prices, with firms instead relying on differentiated product advantages to target specific patient groups.
Key highlights from Orient Securities' analysis include: 1. **Event Overview**: The National Healthcare Security Administration recently conducted a five-day negotiation for the NRDL and commercial insurance drug list, involving 120 domestic and foreign companies. A total of 127 drugs competed for NRDL inclusion, while 24 participated in price negotiations for the commercial insurance list. The updated lists are expected to be released in early December and implemented from January 1 next year.
2. **Commercial Insurance List’s Role**: The newly introduced commercial insurance list aims to address market barriers for high-cost or rare-disease drugs, such as CAR-T therapies (with annual treatment costs exceeding RMB 1 million). Five CAR-T drugs were submitted this year, potentially improving patient access.
3. **Dual-List Strategy**: Companies like BMS opted for dual-application for Opdivo (nivolumab) after two prior NRDL failures, while Merck’s Keytruda (pembrolizumab) abstained from submissions. This divergence underscores varying corporate strategies—balancing price concessions with market expansion.
4. **Competitive Landscape**: Domestic drugs, such as Kelun-Bota’s TROP2 ADC (sacituzumab govitecan), are challenging imported counterparts by focusing on NRDL inclusion. Meanwhile, AKESO’s bispecific antibodies (e.g., cadonilimab) are gaining market attention.
5. **Investment Outlook**: Policy tailwinds for innovative drugs are strengthening, with commercial insurance emerging as a critical supplementary funding source. Recommended stocks include Hengrui Pharmaceuticals (600276.SH), Kelun Pharma (002422.SZ), and HUTCHMED (00013).
**Risks**: Potential policy shifts, intensifying competition, and underperformance in drug sales.