On April 11th, the National Medical Security Administration held a regular press conference for the first half of 2024. At the meeting, in response to the view that "centralized procurement leads to pharmaceutical companies not making money and affects their enthusiasm for innovative research and development of new drugs," Ding Yilei, Director of the Pharmaceutical Pricing and Tendering Procurement Department of the National Medical Security Administration, responded with a set of data. In the past few years of centralized procurement implementation, the pharmaceutical industry has had strong R&D innovation momentum, with an average annual growth of about 23% in R&D investment across the entire industry. The number of new drugs under research in China has jumped to the second place in the world. Ding Yilei introduced that in the past when drug prices were high, 30% to 40% of drug prices were sales and promotion expenses. The income obtained from high prices has not been used for innovation and quality improvement, and has not even formed corporate profits, but has only become the "water" in the circulation process. For example, the case of injection of polymyxin B sulfate, which was jointly investigated and dealt with by multiple departments as reported by the National Medical Insurance Administration. In this case, relevant enterprises and individuals conspired to raise the production cost of drugs to over 2000 yuan for sale, and the inflated price is suspected of being used for commercial bribery. The drug was reduced from over 2000 yuan to over 100 yuan after an interview. "If you only look at price changes without understanding the background, some people may worry about whether reducing prices too much will not cover costs, affecting corporate profits and innovation," Ding Yilei said. Before centralized procurement, the core competitiveness widely recognized by pharmaceutical companies was not innovation, quality, and efficiency, but a model of seeking high pricing, high rebates, and high sales. "At various drug trade fairs, companies often introduce 'good drugs' with a large price space, wide applicability, and high development potential. Ding Yilei said," In such an environment, it not only leads to a lack of innovation enthusiasm in the industry, but also increases the burden on patients and easily deteriorates the industry ecology. "After centralized procurement, the selected products do not require marketing, do not need to develop hospitals, and can directly enter hospitals with" volume "without the so-called" cost ", bypassing the so-called" customer maintenance "and" market development "in the industry from the mechanism. To a certain extent, sales agents are no longer needed, creating a clean and positive industry environment.". Ding Yilei bluntly stated, "Enterprises have also realized that the old marketing methods that used to focus on marketing are no longer effective. It is necessary to truly rely on innovation, quality, and efficiency to establish a foothold in the market." Ding Yilei revealed that since the implementation of centralized procurement in recent years, the pharmaceutical industry's R&D investment has achieved an average annual growth of about 23%, and the number of new drugs under research in China has jumped to the second place in the world. In 2023, the National Medical Products Administration approved the listing of 40 varieties of innovative drugs. "These all indicate that after centralized procurement, the pharmaceutical industry not only did not slow down its innovation pace, but also became more clear about its development strategy and trend positioning, accelerating its transformation towards innovation."