(Yicai Global) Dec. 11 -- Coronary stent makers will still be able to make a profit despite prices being slashed to a fraction of their previous cost through a government bulk-buy program, China News Service reported today, citing a government official.

The price of a coronary stent has shriveled 94 percent to CNY700 (USD107) from CNY13,000 (USD1,987) due to the country’s centralized procurement program, which aims to cut the cost of generic and patented medicines and apparatus through economy-of-scale buying, thereby easing the financial burden on patients.

The bulk-buy purchase cost is still above cost price and orders will be large, therefore manufacturers can still make money, an official from the National Healthcare Security Administration’s department of pharmaceutical prices, tendering and procurement said.

Producers don’t actually have a high margin as most of their revenue is spent on marketing, he said. Coronary stents in China are also priced much higher than on the international market.

There were 10 winning bids for coronary stents, which supply 80 percent of medical institutions’ needs, the official said. Therefore patients’ choice is not likely to be affected. There is also still room for other coronary stent makers to supply the remaining 20 percent.

The new pricing is likely to generate savings of as much as CNY11.7 billion (USD1.8 billion).

Stents are the main interventional procedure use to keep the arteries open in the treatment of coronary heart disease. China treated around one million such patients last year, using about 1.5 million stents at a cost of CNY15 billion (USD2.3 billion). This accounted for one-tenth of all high-priced medical consumables used in the country.

China included high-end medical apparatus in its centralized procurement program for the first time last month. The NHSA will guide local governments to carry out centralized tenders, the official said. Anhui and Jiangsu provinces began to bulk-buy orthopedic disposable products and coronary stents last July. Beijing, Tianjin, Hebei and six provinces in northern China formed an alliance to conduct tenders of intraocular lens consumables in May.

Editor: Kim Taylor