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A catalyst for change

China’s plan to boost innovation and improve drug accessibility

china

In the past decade, the unreasonably long drug approval period in China (often up to six or seven years) had been a major concern for pharmaceutical businesses in China. A prolonged approval regime significantly undermined drug accessibility for Chinese patients. Complaints by business entities and patients have caught the Chinese government’s attention. The government is now determined to establish an efficient drug approval regime in order to encourage drug innovation and increase drug accessibility.

Since 2015, the China Food and Drug Administration (CFDA), the main authority responsible for the drug approval process, has implemented several improvement measures, including recruiting more examiners, piloting the drug Marketing Authorisation Holder (MAH) regime and improving the priority examination regime, etc. In June 2017, the CFDA joined the International Council for Harmonisation of Technical Requirements for Pharmaceuticals for Human Use (ICH). This was considered a significant step in the internationalisation of the Chinese drug approval process. Furthermore, another significant policy titled ‘Opinions on Deepening the Reform of Examination and Approval System and Encouraging Innovation of Drugs and Medical Devices’ (the Policy) was issued by the Chinese State Council on 8 October 2017. The Policy was a groundbreaking comprehensive instrument that targeted several key issues and fundamentally restructured the entire drug approval regime. The Policy further relaxed the regime on the drug approval process. In particular, it fully implemented the MAH regime, accepted overseas clinical data and strengthened the patent and data protection regime. In addition, liabilities for non-compliance under the Policy are much stricter than before.

Fully implementing the MAH regime

In June 2016, the Chinese State Council approved the pilot MAH regime in Beijing, Shanghai, Jiangsu province, Zhejiang province and six other cities and provinces. The pilot will be implemented until 4 November 2018. The Policy has further confirmed the full implementation of the MAH regime and has expanded the regime to include marketing approval for medical devices.

On 23 October 2017, the CFDA published the draft versions of the Drug Administration Law (the Law) and Administrative Measures for Drug Registration (the Measures), both of which fully applied the MAH regime. The Law and Measures further defined the administrative regime of MAH. MAHs are responsible for supervising the safety, effectiveness and quality of their drugs. This liability exists throughout the life cycle of the drugs. Under the MAH regime, a Chinese domestic applicant is a drug manufacturer or a drug research institution that is legally registered in China as an independent legal person; a foreign applicant is a legally established pharmaceutical company outside the territory of China that should entrust a domestic legal person as their agent to proceed with the registration. The domestic agent shall have the capacity to ensure the quality of the drug, prevent and control risks and compensate for any damage caused. The agent will assume the legal responsibility jointly with the MAH.

Accepting overseas clinical trial data

In March 2017, the CFDA hinted in a draft notice that overseas clinical trial data may be accepted in order to shorten the registration period of imported drugs. The Policy went further by allowing clinical trial data obtained from overseas to be used for registration in China, provided that the data complies with the relevant registration requirements. If any application is filed to launch a drug or medical device in China for the first time, the applicant shall provide clinical trial data on racial differences, if any.

Twelve days after the Policy was issued, the Centre for Drug Evaluation of CFDA (CDE) issued the Technical Requirements for Accepting Overseas Clinical Trial Data (Draft for Comments). According to this draft, overseas clinical trial data provided by the MAHs for the drug registration in China shall be complete, correct, true and traceable. The process of obtaining the overseas clinical trial data shall comply with both Good Clinical Practice of China and ICH. The applicants shall submit comprehensive data concerning biopharmaceutics, clinical pharmacology, effectiveness and safety and research results to evidence racial diversity. After a review, the CFDA may choose to fully accept, partially accept or refuse the submitted overseas data. The rule may be relaxed when it relates to applications for drugs of critical and rare diseases and paediatric medications, provided that the market currently lacks effective treatments.

Strengthening patent protection and data protection

Besides the time-consuming drug approval process, the insufficient Chinese drug patent protection system and nominal data protection regime have also caused a reluctance for multinational companies to designate China as their first market when launching new products. To solve this issue, the Policy establishes a Chinese equivalent version of the ‘Patent Linkage’ regime of the United States, and specifies the practical rules of the data protection regime. At the time of writing of this article, the specific measures of the patent linkage and data protection regimes are being drafted and are expected to be issued soon.

The Relevant Policies on Encouraging the Innovation of Drugs, Medical Devices and Protecting the Rights of Innovators (Draft for Comments) was issued on 12 May 2017 by CFDA. The policy provided a glimpse into the pending Chinese Patent Linkage Regime. When registering a drug, the applicant should submit a patent statement and inform the relevant patent holders within 20 days. The patent holder can then initiate patent infringement litigation with the court and inform the CFDA of the litigation within 20 days. The CFDA may then set a waiting period of up to 24 months, during which the examination of the application will be continued. If an effective judgement is issued during this period, the CFDA will decide whether or not to approve the registration based on the judgement. If there is no judgment delivered, the CFDA may proceed to approve the registration.

The Measures further clarified the data protection regime. Qualified applicants can submit an application for data protection together with their application for marketing approval. If the drug is an innovative drug, a drug used for rare diseases, a paediatric drug, a biological product used for breakthrough therapies, or if the applicants have challenged a relevant patent successfully, then the applicants could apply to protect their undisclosed trial data or other data, as long as they had obtained the data on their own. During the protection period, the authority will not approve the same kind of drugs from other applicants unless the initial applicants agree or if the other applicants had obtained the data independently.

Stricter liabilities for non-compliance

The Policy, Law and Measures clarified the liabilities for non-compliance during the drug approval process. In particular, they targeted the behaviour of providing fraudulent registration information or samples. If non-compliance was found, the CFDA shall not accept or approve such application and shall refuse any further applications from the applicant for the same kind of drug for three years from the day of discovery and any application for other kind of drugs for one year from the day of discovery. If the registration application has already been accepted, it will not be approved. The CFDA will also review prior market approvals issued to the applicant. If fraudulent information was found, prior approvals will be cancelled and no application for any drug from the same applicant will be accepted for the next five years. In addition, the individuals directly responsible may be blacklisted from the industry for ten years and may face criminal sanctions.

In the last two years, the government has issued more than a hundred policies, laws, regulations, guidance and administrative documents for public comments or implementation. From this, it can be seen that the Chinese central government and the new director of the CFDA are determined to perfect the drug approval regime in order to encourage drug innovation and provide further benefits for both pharmaceutical companies and patients. Although the most significant regimes as laid out above are still in the works, considering the government’s ambition combined with the authority’s determination, we can expect to see a promising new drug approval regime in China soon.

Article by
Nick Beckett

is managing partner of CMS Beijing and global co-head of CMS Life Sciences & Healthcare Sector Group

12th February 2018

Article by
Nick Beckett

is managing partner of CMS Beijing and global co-head of CMS Life Sciences & Healthcare Sector Group

12th February 2018

From: Regulatory

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