Standard & Poor's Corp. said Wednesday that the Japanese government's planned cuts in drug reimbursement prices will have a limited impact on its ratings for seven Japanese pharmaceuticals.
The U.S.-based credit rating agency's bulletin concerns its short-term debt rating of A-1-plus for Takeda Chemical Industries Ltd., the A-plus-pi long-term rating for Sankyo Co., and the AA-minus-pi long-term rating for Yamanouchi Pharmaceutical Co.
Also concerned are the A-pi long-term ratings for Eisai Co., Fujisawa Pharmaceutical Co., and Daiichi Pharmaceutical Co., as well as the BBB-plus-pi long-term rating for Chugai Pharmaceutical Co.
Japan's Ministry of Health, Labor and Welfare on Tuesday announced a planned revision in drug reimbursement prices under the National Health Insurance system for fiscal 2002 beginning April 1. The revision will result in an average decrease of 6.3 percent.
S&P said the decrease will bring down prices for the drug companies by a range of about mid-5 percent for Fujisawa and upper-7 percent for Daiichi for their drugs listed under the system.
But the reduction is unlikely to lead to a substantial deterioration in cash flows at the companies, although it may have a greater impact in the medium and long term, if the government reduces reimbursement prices further, it said.