Pharmaceutical
Market entry remains difficult for many international pharmaceutical manufacturers due to China's costly, complicated, and laborious regulatory licensing requirements. International pharmaceutical firms must obtain licenses or authorizations from State Food and Drug Administration (SFDA), a government agency, before lawfully engaging in business in China.
Under the 2001 Drug Administration Law, licensing authority lies with the SFDA, and the licensing process consists of nine different steps, each of which will be briefly described below excerpted from an article by Qing Zhang.
First, a prospective pharmaceutical product manufacturer must obtain a manufacturer's license from a provincial-level branch of the SFDA by demonstrating that it has appropriate facilities, levels of staff, and other arrangements for quality control.
Second, a prospective new drug cannot be clinically tested on humans until the sponsor has submitted the data and related samples from the laboratory stages of research and convinced the SFDA to grant a clinical test certificate.
Third, a new drug certificate ("NDC") may only be obtained once the sponsor has demonstrated that its prospective new drug successfully passed laboratory and clinical tests, by which safety and efficacy are assumed. The SFDA issues the NDC after verifying this process and the data tested.
Fourth, a prospective manufacturer must also obtain a Production Permit Number from the SFDA before beginning to manufacture a new drug or other drugs regulated by national standards.
Fifth, a prospective drug wholesaler must obtain a pharmaceutical trader's license from a branch of the SFDA at the provincial level. A prospective drug retailer must do so at the county level.
Among other requirements, licensing is conditioned upon having appropriate staff, facilities, and management systems.
Sixth, before making medicinal preparations for patients, a medical organization must obtain prior approval from the Health Authority at the provincial level, as well as a dispensing permit issued by a branch of the SFDA at the same level. To ensure quality, licensing is granted depending upon the organization's facilities, management systems, and sanitation, as well as other requirements.
Seventh, drugs cannot be imported into China without a Registration Certificate for Imported Drugs ("RCID"). For a RCID to be issued, prospective importers generally must satisfy the SFDA criteria for safety and efficacy, but they may be exempt if the drug is for emergency hospital use or individual use.
Additionally, before every importation, the importer must obtain an imported drug customs clearance from an affiliate of the SFDA at the port designated for their drugs to enter China.
The 2001 Drug Administration Law no longer imposes compulsory testing on imported drugs unless they are entering China for the first time; however, a pharmaceuticals testing institute appointed by an affiliate of the SFDA will carry out selective testing on imported drugs after they enter the Chinese market.
Eighth, three kinds of pharmaceuticals-namely bio-products stipulated by the SFDA, drugs being sold for the first time in China, and other drugs stipulated by the State Council-must pass tests conducted by appointed institutes before being imported or marketed. This mandatory testing ("a test pass license") is a de facto licensing requirement.
Lastly, no over-the-counter drug can be advertised in China unless the sponsor obtains an advertising license from a branch of the SFDA at the provincial level and an advertising permit from a branch of the State Industry and Commerce Administration at the county level or above.
Only medicinal and pharmaceutical journals, jointly-authorized by the Health Authority under the State Council and the SFDA, can carry advertisements for prescription-only drugs.
Updates
1) Beginning Feb 1st, 2013, China will cut prices up to 20% for 400 drugs in the respiratory, fever and pain categories in order to make drugs more affordable and accessible. This is the fourth price increase since 2011 as part of China's Healthcare Reform. Earlier rounds of price cuts included antibiotics, anti-tumor, hormonal, and blood-related medicines in addition to drugs for the circulatory, nervous, digestive and immune systems.
Health Minister Chen Zhu told the press that healthcare was still too expensive and there was still inadequate control over the improper use of drugs. These price cuts are affecting the Chinese drugmakers who are expanding their distribution networks to offset increasing pressure on margins.
2) China continues to boost the biotech industry in order to resolve issues related to population growth, food safety, energy conservation, and environmental protection, the State Council stated.
The government plans to increase this sector's GDP output by an average annual rate of more than 20 percent from 2013 to 2015, according to the plan. The government also has ambitious plans to make its biotech sector a renowned industry by 2020 through improvements in that sector's innovation and technology intellect.
Biosimilars
China is expected to issue its first set of regulatory standards for companies developing biosimilars, according to industry experts. The country is gradually moving its pharmaceutical regulations closer to international standards, aiming to speed up drug registration, the experts added.
Biosimilars, or follow-on biologics, are drugs deemed to be similar to an originator biologic therapy. Biologic drugs are made in living organisms or their products, as opposed to traditional pharmaceutical drugs, which are made through chemical processes.
The China State Food and Drug Administration (SFDA) will release a new Drug Registration Regulation after the 18th National Congress of the Communist Party, which took place in Beijing on November 8-14, 2012.
Details of the biosimilars guidelines are currently undergoing investigation but will be finalized after the new drug registration regulation release, said Haifeng Hu, vice president, Shanghai Institute of Pharmaceutical Industry.
China's healthcare reform and critical illness insurance program, issued this year, will call for a growing demand for biologics, especially for oncology drugs. Monoclonal antibodies (mAbs) are expected to be at the forefront, said Jianhoung Tao, vice president, Southern Medicine Economic Research Institute (SMEI) of SFDA.
Domestic biosimilars have been on the market in China for 20 years, according to SMEI data. The country has approved 382 genetically engineered drugs and genetically engineered vaccines, but only 21 products are innovative and the rest are biosimilars, according to SMEI data.
Biologics and biosimilars account for 10% of the total pharmaceuticals market in China, but their recent annual growth rate has reached 32.2%, according to Deloitte data.
Medical Device
There is a huge demand to upgrade the medical devices in Chinese hospitals according to Health News, an affiliate newspaper of the Health Ministry. About 60% of all medical devices were installed before the mid-1980s, and 15% in the 1970s. This was reaffirmed at the China Med 2013 press conference.
China is expected to be the world's second largest market for medical devices, overtaking Japan in five to seven years, and be 25% of the world market by 2050, according to PharmaLive, a market research firm.
China's SFDA has reclassified 73 devices into other risk categories and removed three devices from the classification system. Products reclassified as Class III include inhaled nitrous oxide delivery systems, ultrasonic bone surgery devices, cell sorters, and spine probes. Devices no longer classified include automatic blood bag labeling machines and gauze counting detection systems.
The SFDA also released new guidelines on how foreign medical device manufacturers label and package their products, according to China-briefing.com. Companies have until April 1, 2013 to comply.
According to SFDA's guidelines entitled "Circular on Standardizing the Labels and Packaging Marks of Foreign Medical Devices," there are three main points to the guidelines:
1) Product labeling must be in Chinese (though other languages can be added). Product labeling must be attached to any and all devices, otherwise it will be prohibited from being sold or used.
2) Foreign medical device companies must develop quality control practices that comply with Chinese regulations. All documentation must ensure the safety and effectiveness of the medical device sold.
3) "The terms and technical expressions in this Circular shall have the same meaning as those provided in the "Regulations and Administrative Measures on the Registration of Medical Devices (SFDA Order No.16).'"
The Beijing Drug Administration has signed a memorandum of agreement with device maker Zimmer, thus enabling company officials to train agency staff at its Montagne subsidiary there. The training sessions will focus on strengthening the production and inspection expertise of state regulators at local device companies, to ensure the quality and safety of orthopedic devices. Zimmer employees will also receive training on Chinese laws and regulations related to the manufacture and sale of devices.
Top
|