![]() ![]() Diffusion of NCE is important for patients to have access to new innovative medicines that potentially be more effective in treating their disease. On average, nearly 60 new chemical entities (NCEs) are registered in the Malaysian pharmaceutical market annually. Generally, pharmaceutical manufacturers will apply for regulatory approval to the national regulatory authority of countries that they plan to market their medicines. The introduction of these new therapies improves population health but is also expensive and contributed to the growth in pharmaceutical spending, thus putting increasing pressure on the health system. Rapid development of drug treatment in few therapeutic areas are observed in recent years due to pharmaceutical innovation such as targeted therapies and biopharmaceuticals. Similar to healthcare utilization trends, public sector medicines supply accounts for 67 % of prescription medicines volume in Malaysia, yet only spends 33 % of total share of prescription medicines expenditure. Pharmaceuticals represent a sizable share of healthcare expenditure in Malaysia, with 12 % of total health spending in 2017. Public healthcare system is vital as utilization of healthcare services is larger, with public hospitals treating 86 % of total outpatient attendance and 77 % of total inpatient admissions. Public healthcare services are financed through general taxation (2.2 % of gross domestic product in 2018) while private healthcare services are funded by household out of pocket payments (72 % of total expenditure on private healthcare), private insurance and employers. Malaysia has mixed government - funded public health service delivery with parallel private health service delivery funded from private funds. Understanding key aspects of sectoral variation in diffusion of NCEs are crucial to reduce the differences of access to new medicines within a country and ensure resources are used on cost effective treatments. Market concentration was negatively associated with utilization of NCEs, however result tends to be mixed according to sector and Anatomical Therapeutic Chemical (ATC) category. Price per DDD was negatively associated with diffusion of NCEs, while generic utilization share was significantly regressive in the public sector. The utilization of NCEs was larger in the private sector compared to the public sector but the speed of diffusion over time was higher in the public sector. A panel fixed effect model was performed to measure diffusion of NCEs for each year and test possible determinants of diffusion of NCEs for overall market and sector specifics. The price per Defined Daily Dose (DDD), market concentration and generic utilization share variables were calculated. We matched medicines from the product registration database by medicine formulation to medicines in IQVIA National Pharmaceutical Audit database for each year. ![]() ![]() The objectives of this study were to examine the diffusion of New Chemical Entities (NCEs) into the public and private healthcare market between 20, and determine the factors explaining the diffusion. There is little overlap between public and private healthcare service delivery with access to new innovative medicines, as differentiated by sources of funding. In a mixed healthcare market such as Malaysia, coverage decisions of new medicines are different: public funded health system has a formulary listing process whereas for private sector, which is a market-based economy, depends on patient’s willingness to pay and insurance coverage. Policymakers are faced with the challenge of balancing patient’s access for effective and affordable medicines to sustain the rising healthcare costs.
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