BEIJING, May 8 -- The retail price cap of low-cost medicines in China will be scrapped to revive dampened production caused by weak profits and ensure supply of essential drugs, the country's top economic planner and regulator announced Thursday.

Restriction on maximum prices of 280 Western medicines and 250 Chinese patent drugs, previously priced low by the government to relieve patients' medical burden, will be lifted, allowing producers to set prices according to their production costs, according to the National Development and Reform Commission (NDRC).

Chang Feng, director of the medicine price research department under China Medical University, said that the move, allowing the market to play a bigger role in deciding prices, will help motivate low-price medicine production and guarantee necessary supply.

The supply of low-price drugs has decreased as rising costs and shrinking demand made producers shift their attention to more profitable medicines, causing production of some first-aid medication including digoxin to be suspended.

The NDRC has asked local authorities to release a list of low-cost medicines to the public by July 1 and strengthen monitoring over unreasonable price lifting.