international

Clinica // March 2010

The “device gap” means Japan’smarket remains a challenge for industry
Industry has been lobbying hard to effect changes that would makeJapan a more favourable market for medical technology companies.
Considerable progress has been made, but key challenges remain, as
Dr Makoto Tamura, chairman, STM (special treatment material)committee, American Medical Devices and Diagnostics Manufacturers’
Association (AMDD) tells Clinica
Dr Makoto TamuraThe medical technology industry in Japan continues to facea challenging environment. In the past 12 months, however,
the industry has seen some government movement on, andrecognition of, issues which the industry has been bringing forward to
the government for a long time.
These include supply stability, reimbursement and eliminating
the device lag/gap. While the industry appreciates recognition fromthe government, action is urgently needed to solve these issues toallow patients and medical practitioners in Japan access to superior
medical technology without delay.

Huge device gap exists
The medical device market in Japan is facing a difficult situation.
According to an American Medical Devices and DiagnosticsManufacturers’ Association (AMDD) study, approximately half of the
medical devices available in the US and the EU are not available
in Japan.
The device gap denies patients access to the latest medicaltechnologies in Japan. Also, as a result, a stable supply of products
is threatened. In 2009 the industry faced various productsupply shortages.

Background to the device gap
There are two reasons for the device gap: the device lag(submission delay and review delay) and the manufacturers whochoose not to submit products for review/approval.
In an effort to eliminate the device lag, the government of Japanlaunched the ‘Action Program to Speed up Medical Device Approval’at the end of 2008.
The programme includes increasing the number of
Pharmaceuticals and Medical Devices Agency (PMDA) reviewers to104 by 2013 and a ‘Three-Track Review System,’ which includes tracks
for completely new, improved and generic (or ‘me-too’) medicaldevices, with separate review teams specialising in each track.
Such changes are expected to go a long way to shorten the review
period, a major influencer on the device lag. A reduced review time
will increase the speed in which the industry can supply medical
devices to patients in Japan

Manufacturers choosing not to submit
The industry believes the imbalance among reimbursement,
regulatory rules, and the volume and structure of the market arewww.clinica.co.uk

the root causes of manufacturers choosing not to submit medical
technology for review/approval.
In the past, Japan’s reimbursement level was higher than othercountries, though the regulatory hurdle was quite high, and themarket was fragmented.
However, the device reimbursement price in Japan has
decreased significantly and is becoming closer to the price seen inother countries.
In some cases, the reimbursement price of products is lower thanin other countries. If regulatory rules and market structure are notdrastically changed, the reimbursement price in Japan needs to berelatively high compared with other countries, otherwise the device
gap will continue to grow, and achieving a stable supply of products
will become increasingly difficult.

Reimbursement system
To improve the above mentioned serious situation, theindustry firmly believes that the current reimbursement rules should
be changed, for example, by abolishing the Foreign Average Price(FAP) rule.
However, for the past 8-10 years the government has been trying
to reduce the growth of total healthcare expenditure as much as
possible, as it has huge debt compared to other countries.
The new administration, Democratic Party of Japan (DPJ),
committed itself to increasing total healthcare expenditure during
the last election, and is to bring about the first rise in reimbursementin 10 years with the reimbursement revision, set for April 2010.
However, budgets for devices/drug were still reduced.

Economic growth strategy
The DPJ announced a new economic growth strategy atthe end of last year. A major strategy is the promotion of thehealthcare industry.
The announcement of the details of this strategy is expected ina few months, and the industry is hoping that it will be helpful inimproving the medical device market environment.
The industry will continue to insist on improving the market
environment for reimbursement as well as regulatory issues.
Then it will be able to maintain a stable supply and provide
patients and medical professionals in Japan with the latest medical
technology, which is the overall mission of device companies.
• To contact the AMDD, go to www.amdd.jp© Informa UK Ltd 201013