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The Multinational Pharmaceutical Giants’ Query and changing Chinese regulatory on pharmaceutical market

Heathcare Research Reports

China possesses a large healthcare market that is indispensable for overseas and multinational pharmaceutical companies. In 2014, the total value of drugs in the Chinese healthcare market reached RMB 1332.6 billion (approx. US$214.9 billion). Imported drugs made by overseas and multinational companies account for about a fourth of the Chinese healthcare market. It is estimated that by 2015, the total value of drugs in the Chinese healthcare market are likely to be more than RMB 1559 billion (about US$251.5 billion). The Chinese healthcare market will surpass Japan to become the second largest drug market following the United States making it a field worth playing on.

 

However, in the pharmaceutical field, stringent approval for clinical trials and application of drug registration are quietly executing, which pose big challenges to global pharmaceutical companies. What are big challenges and how affect business in China? How do businesses respond to these challenges? Overseas and multinational pharmaceutical companies need to know the answers to operate buiness smoothly in the Chinese market.

 

What are big challenges and how affect business in China?

 

In China, there are two kinds of strategies for application of imported drug registration. The first one is that overseas and multinational pharmaceutical manufacturers conduct the international multi-center clinical trials in China for application of imported drug registration. When the international multi-center clinical trials for imported drug finished, and the application of imported drug registration pass through the examination and approval of Chinese FDA, imported drug will be granted marketing authorization in China, and is marketed on Chinese market. This is so called as pathway of Multi-Regional Clinical Trials (MRCT). The another is that the overseas and multinational pharmaceutical manufacturers must submit the application for imported drug registration to Chinese FDA, approval of clinical trial for imported drug firstly granted by Chinese FDA, and then conduct the separate clinical trial for imported drug in China. When the separate clinical trial for imported drug in China finished, the clinical trial results and the application of imported drug registration pass through the examination and approval of the Chinese FDA, imported drug will be granted marketing authorization in China, and the imported drug to be marketed on Chinese market. This is so called as pathway for application of imported drug registration, also called as “two applications, two approvals” for application of imported drug registration.

However, Chinese Drug Registration Rules (“DRR”) did not stipulate that the international multi-center clinical trials in China is compulsory condition for application of imported drug registration, also did not stipulate that the data from Multi-Regional Clinical Trials outside China can be used directly as a basis of application for imported drug marketing registration. The vague governance on approval for clinical trials and application of imported drug registration left a loophole. In the past decade, some multinational pharmaceutical companies used directly data from Multi-center Regional Trials outside China as a basis of application for imported drug marketing registration for review at the discretion of Chinese FDA  to speed up entry into Chinese drug market. They were allowed to sell those drugs in China after two steps. First, they were required to get permission to conduct international clinical trials. Then, they submitted data from Multi-Regional Clinical Trials outside China (rather than a local trial that is conducted exclusively within China) for review and got approval to start selling their products in China in a single final step.

How many Chinese patients have been ensured to enroll into a Multi-Regional Clinical Trial outside China? Some drugs of Multi-Regional Clinical Trials that do not involve with trial sites in China may affect Chinese patients differently, because of the discrepancy of race and ethnicity. Only the international multi-center clinical trials including adequate numbers of Chinese patients can support to approval of application of imported drug registration. Thus, October of 2013, applications for imported drug registration based on the data from Multi-Regional Clinical Trials outside China submitted by some multinational pharmaceutical companies in China encountered re-review. In March 2014, P&D-Base Pharmaceutical Association Committee (RDPAC), one non-profit organization constituted of 39 multinational pharmaceutical companies in China is subordinate to China Association of Enterprises With Foreign Investment, communicated with Chinese FDA. The multinational pharmaceutical companies encountered re-review were informed that the data from Multi-Regional Clinical Trials outside China complying with the requirements of approval for clinical trial, Chinese FDA would agree to multinational pharmaceutical companies use the data from Multi-Regional Clinical Trials outside China to make the application of clinical trials for imported drug registration. The so called a single final step was split into two parts, with companies asked to submit data once for what is called a clinical trial approval and afterwards request final permission to sell. Multinational pharmaceutical companies operating in China have already felt the sting of tighter regulation enforcement after aggressive investigations pursued allegations of bribery and corruption that resulted in substantial penalties.

Thus, momentarily, voice of “China FDA Review Of Multi-Regional Clinical Trials May Throw Up Domestic Roadblock”, “ Now, an extra layer has been added to the drug approval process, specifically for international companies, and that means delays of perhaps as long as two years for approvals to come through for drugs to be marketed in China, which will be challenge for international companies”, “It is hard to understand from an international perspective that a practice implemented for 12 years was suddenly changed, without notice or a transition period” is spreading over the mass media on the Internet, ( such as on Bloomberg, Think Advisor, Pharm Asia News and so on) . The query and controvery is continued.

 

Indeed, Chinese FDA begins to implement the tighter regulation enforcement. This is first time in history, Chinese FDA officially issued a guidance on international multi-center clinical trials of drugs in China on January 30, 2015, it has been begun to be implemented on March 1, 2015. Now, Chinese FDA expects to see overseas and multinational pharmaceutical companies conducting international multi-center clinical trials of drugs in China. The Guidance stipulates that for those international multi-center clinical trial data used for application of drug registration in China, the international multi-center clinical trials of drugs must at least involve two countries, including China, and should refer the requirements of this Guidance.

 

The Guidance also imposes additional requirements: First, the overseas applicant must conduct a holistic evaluation of the global clinical trial dataset and a trending analysis of the data from trial subjects in Asia and China. When analyzing the Chinese clinical trial data, specifically, the overseas applicant should evaluate whether the enrolled Chinese trial subjects are representative of the relevant patient population in Chinese medical practice. Second, the overseas applicant must ascertain whether the Chinese trial subject sample size sufficiently supports the conclusion that the trial drug is safe and effective for Chinese patients, and whether the Chinese trial subject sample size meets the statistical requirements and the relevant laws and regulations’ requirements. Third, the overseas applicant must adhere to internationally accepted GCP principles and ethical standards. They must also allow the Chinese FDA to inspect the trial sites from time to time, which can be any of the onshore or offshore sites involved in the international multi-center clinical trials.

 

How do you Respond to Challenges?

 

Over the past decade, overseas and multinational pharmaceutical companies witnessed that China's strategic position in the chains of global drug markets has become increasingly rise, so the multinational pharmaceutical companies have established many R&D centers in Chinese territory. China’s healthcare market is indispensable for overseas and multinational pharmaceutical companies. In light of current climate, the judicious attitude responding to challenges is to positively be in compliance with the latest Chinese regulations.

 

The overseas and multinational pharmaceutical companies and their senior executive officers engaging in regulatory affairs must have a comprehensive and thorough knowledge of the latest Chinese regulations. Only with the macro strategic vision and the forward-looking insights can help overseas and multinational companies to seize the initiative and reduce the risks. For example, for the drug development at starting point, may apply for international multi-center clinical trials in China, let Chinese clinical trial sites join into the global multi-center clinical trials or multi-regional clinical trials, doing so, it can shorten 3 to 4 years than that of pathway for application of imported drug registration. For the drugs of multi-regional clinical trials have been finished, if taking the imported drug approval pathway is viewed as too cumbersome, the overseas and multinational pharmaceutical manufacturers can consider to seek the Chinese partners, because the local pharmaceutical companies within China might find a smoother and possibly faster road to approvals. If overseas and multinational pharmaceutical manufacturers license Chinese companies to participate research and trials, thus escape the additional delay. The domestic Chinese companies get a boost and the drugs come to market more quickly ---- both powerful incentives for international companies to find local partners within China.

 

In conclusion, how to grasp the opportunity to speed up approval of clinical trials and application of imported drug registration in China depends upon your skills of acquiring an essential knowledge of the latest Chinese regulations and in communication with the Chinese regulatory authorities, as well as the agent service companies, including the contract research organizations (international and domestic CROs).  The abstruse skill and profound vision remain to be grasped for overseas and multinational pharmaceutical companies.

 

Interested in more insights on the changing Chinese regulatory on pharmaceutical market? Please view the Latest Regulations on Pharmaceutical International Multi-Center Clinical Trials in China.

 

 



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