China FDA Reforms Encourage Western Companies to Manufacture in China

December 10, 2015
BioPharm International Editors

Changes in China’s Food and Drug Administration (cFDA) drug development and commercialization policies make it easier for multinationals and CMOs to manufacture in China for in-country use, reports CMO and consultant PaizaBio.

China’s Food and Drug Administration (cFDA) published long-anticipated reforms designed to accelerate the regulatory review of new drugs and expand options for manufacturing those approved, reported PaizaBio, a company focused on helping western-based pharmaceutical companies manufacture drugs in China for the Chinese market. The new policies went into effect December 1.

The reforms represent major changes in China’s drug development and commercialization policies, addressing critical areas, such as accelerating the high-volume backlog of drugs awaiting review and approval by the cFDA and fostering domestic clinical drug development and manufacturing to international technical and quality standards, said PaizaBio in a Dec. 9, 2015 press release.

Streamlining the review of innovative new drugs is a top priority of the cFDA. The new regulatory policy significantly expands the types of drugs that may qualify for a streamlined review process via the Fast Track or green approval pathway and redefines what qualifies as a new drug. Prior to the policy change, the Fast Track regulatory approval pathway was limited to novel drugs not approved for use anywhere in the world or drugs addressing areas of critical and high unmet medical need. 

PaizaBio says the following drug categories stand to benefit from China’s redefined Fast Track regulatory approval pathway:

  • Pediatric/geriatric drugs

  • Drugs sponsored by national science and technology related grants

  • Drugs to treat diseases or conditions prevalent in China

  • Foreign innovative drugs manufactured locally in China

  • Foreign drugs manufactured at an US-FDA or EU-EMA qualified plant under review by the respective regulatory authorities (FDA/EMEA) for concurrent marketing authorizations

  • Innovative drugs using advanced technology, using innovative treatment protocols or having significant clinical benefit.

Fast Track approval will be permitted if a drug falls in one of these categories, and a clinical trial application is submitted three years prior to the date of patent expiration or the marketing authorization application is submitted one year prior to the date of patent expiration.

The new policies also seek to clarify what constitutes a “new” drug. The cFDA now defines new drugs as only those pharmaceutical products that have never been marketed anywhere in the world or those that represent an improved form of the new drug. Generic drugs are defined as pharmaceutical products that are consistent with the reference or originator drug in terms of quality or efficacy. The cFDA plans to introduce a classification system, which address these new definitional categories. To facilitate clinical development of new drugs in China, the cFDA clinical trial application process will be streamlined; a single umbrella approval will replace the current system requiring approval at each phase of a trial.

Historically, only China-based drug manufacturers could apply for approval to market new drugs in China. Drug research organizations without large scale manufacturing capabilities were required to transfer new drug innovations to a manufacturer that would then become the Marketing Authorization Holder (MAH). This mandatory transferal of marketing rights created a disincentive for innovation and commercialization by research-based organizations at a time when China is focusing on building a more innovation-driven economy. The new policy now enables research-based organizations to commercialize their innovations while retaining marketing rights. As part of this development, China is launching a pilot MAH program in ten Chinese provinces allowing research-based organizations and individuals to outsource drug manufacturing to a contract manufacturing organization (CMO), while retaining marketing authorization status on approved drugs.

China’s policy changes have the potential to significantly impact the global clinical development and manufacturing strategies of multinational pharmaceutical companies operating in China, said Stuart Rose, founder and CEO of PaizaBio, in the press release. “With 1.4 billion people, China represents the largest drug market in the world. Yet western pharmaceutical companies have only a small foothold. This is largely because China is a complicated environment for western companies in which to operate. These new policies reflect China’s growing willingness to engage multinationals in their drug development initiatives and allow contract manufacturing of new drugs in China for the Chinese market.”

Source: PaizaBio