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111, Inc. plans to find new partners for marketing of drugs

CKN
minutes 2019/01/29 04:12:43
3,185
China's News, China's Financial News, 111, Inc.

Jan 29, 2019 (China Knowledge) - China's leading digital and mobile healthcare platform 111, Inc., is planning to partner up with generic drug makers, that have failed to win public hospital tenders, to help them survive by lowering their distribution costs.

The move comes after a pricing reform by Beijing through a centralized bulk drug procurement process in 11 major Chinese cities which led to an average 60% fall in winning bid prices. In addition, by stipulating that winning bidders will gain a 70% market share, losers now face increased pressures to cut costs in order to stay competitive.

The drug pricing reform introduced by Beijing is aimed at slashing healthcare costs by eliminating the need for marketing and distribution costs for winning bidders and forcing drug makers to vie for contracts.

At the same time, losing bidders will also be subjected to price caps set by the winning bidders while also having to compete among themselves for the remaining 30% of the market which would incur high marketing and distribution costs.

Yesterday, 111, Inc. also announced that it has signed a partnership agreement with U.S. pharmaceutical giant Eli Lilly. The U.S. company will be utilizing 111’s cloud computing solutions in areas such as online diagnosis, online prescription, warehousing, distribution and other patient services and support programs to develop new distribution channels.

111, Inc. which was set-up in 2010 is currently China’s largest direct-to-customer online pharmacy by gross merchandise value (GMV). The company runs an online medical consultation and drug prescription platform which gives consumers access to more than 2,000 doctors, the ‘1 Drugmall’ and over 130,000 brick-and-mortar pharmacies.

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