ABSTRACT
OBJECTIVE:To provide basic industrial research and development recommendations for the supply-side structural reform in drug distribution in China. METHODS:Structure-conduct-performance(SCP)analysis paradigm from Harvard was used for in-depth study of market structure,business conduct and business performance in China since 2010. RESULTS:Since 2010, drug distribution industry in China had shown the scale of decline in the growth rate,low market concentration,increased barriers to entry,the leading of state-owned capital,etc. Though corporate mergers and acquisitions and public financing expanded the scale,management information,third-party logistics,Internet+and pharmacy alliance business model flourished,the industry op-erating performance was poor,state-owned enterprises showed poor performance. CONCLUSIONS:The transformation and upgrad-ing of the industry business model should be promoted by targetedly accelerating the supply-side structural reforms in the drug distri-bution industry,encouraging corporate finance mergers,breaking local protectionism,developing cooperative pharmacies and phar-maceutical third-party logistics alliances and leveraging the Internet.