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China Regulatory and Market Access Pharmaceutical Report 2014

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China Regulatory and Market Access Pharmaceutical Report 2014 CHINA REGULATORY AND MARKET ACCESS PHARMACEUTICAL REPORT 2014 Pacific Bridge Medical 7315 Wisconsin Avenue, Suite 609E Bethesda, MD 20814 Tel: (301) 469-3400 Fax: (301) 469-3409 Email: [email protected] Copyright © 2014 Pacific Bridge Medical. All rights reserved. This content is protected by US and International copyright laws and may not be copied, reprinted, published, translated, resold, hosted, or otherwise distributed by any means without explicit permission. Disclaimer: the information contained in this report is the opinion of Pacific Bridge Medical, a subsidiary of Pacific Bridge, Inc. It is provided for general information purposes only, and does not constitute professional advice. We believe the contents to be true and accurate at the date of writing but can give no assurances or warranties regarding the accuracy, currency, or applicability of any of the contents in relation to specific situations and particular circumstances. CHINA REGULATORY AND MARKET ACCESS PHARMACEUTICAL REPORT (2013) TABLE OF CONTENTS I. China Pharmaceutical Industry Overview .......................................................5 A. Overview B. China Pharmaceutical Market Trends C. China’s Pharmaceutical Distribution System D. Brief Overview of China’s Pharmaceutical Regulations E. China Food and Drug Administration (CFDA) II. The China Healthcare System .........................................................................13 A. History of China’s Healthcare System B. Struggling Healthcare Services Sector C. 2009 Healthcare Reform D. Hospitals and Medical Resources 1. Hospitals in China 2. Current Problems in the Hospital Sector 3. Private Investment in the Hospital Sector 4. Hospital Reform E. Health Insurance in China III. Drug Registration Regulations ........................................................................21 A. Drug Registration Policy B. Classification of Drugs C. Drug Registration Applications D. Application Documents for New Drug Registration E. Technical Review Guidance for Registration Documents F. New Drug Registration Process G. Clinical Trials H. Timeframe to get an Imported Drug Approved I. OTC New Drug Registration Process J. Drug Registration Re-Examination K. Drug Registration Statistics L. Classification of Combination Drug-Device Products M. New Regulatory Changes IV. Drug Pricing Regulations ................................................................................51 A. Overview of Drug Pricing Policy B. Controls on Drug Pricing C. Reimbursement Drug Lists Copyright © 2014 Pacific Bridge Medical. 2 D. NRDL and PRDL Pricing E. Bidding and Hospital Listing V. Pharmaceutical Research and Development and Related Regulations ......63 A. China’s Research and Development Climate B. Clinical Research C. Good Clinical Practice (GCP) D. GCP-Certified Clinical Research Centers E. Good Laboratory Practice (GLP) F. Adverse Event Reporting Requirements VI. Pharmaceutical Manufacturing Regulations ...............................................69 A. Overview of Manufacturing in China B. Good Manufacturing Practice (GMP) Regulations C. GMP Certification D. Drug Manufacturing Administration E. Drug Manufacturing Certificate F. Biological Products VII. Selling Pharmaceuticals and Related Regulations .......................................77 A. WTO Agreement on Drug Sales B. Drug Sales to Hospitals C. Drug Purchasing System D. Selling Drugs in Drug Stores E. Internet Drug Sales F. Distribution Regulations 1. Current Developments in Drug Distribution 2. Drug Distribution Policy 3. Renewal of Drug Distribution Licenses G. OTC Drug Sales H. Regulations on Importing Drugs I. Drug Recalls J. Drug Safety K. Authorized Quality Person VIII. Marketing Drugs in China and Related Regulations .................................86 A. Packaging Requirements IX. Drug Advertising Regulations .........................................................................89 X. Intellectual Property Protection and Patents .................................................90 A. Intellectual Property in the China Pharmaceutical Market Copyright © 2014 Pacific Bridge Medical. 3 B. Pharmaceutical Companies Experiencing IPR Problems C. Administrative Protection (AP) XI. Setting Up your Business in China..................................................................92 XII. What Other Companies are Doing in China ................................................95 A. Joint Ventures (JV) B. Acquisitions C. Licensing XIII. Conclusion ......................................................................................................98 APPENDICES 1. Application Form for Pharmaceutical Products 2. Listing of CROs in China 3. Regulatory Specifics for Clinical Trials in China 4. Administrative Provisions for Drug Registration (translated law) 5. Registration for TCM (translated law) 6. Registration for Chemical Drugs (translated law) 7. Registration for Biological Drugs (translated law) 8. Supplemental Drug Application Registration (translated law) 9. Drug Re-Registration Application (translated law) 10. Drug Monitoring Periods 11. Application and Approval Procedures and Timeline for Imported Drugs 12. Application and Approval Procedures and Timeline for Clinical Trials 13. Listing of CFDA-affiliated organizations in China 14. Healthcare Statistics and Pharmaceutical Markets in Asia (charts) 15. The National Essential Drug List (2013): Chemical and Biological Drugs 16. The National Essential Drug List (2009): Chemical and Biological Drugs 17. National Reimbursement Drug List (2009): Western Medicines Copyright © 2014 Pacific Bridge Medical. 4 I. CHINA PHARMACEUTICAL MARKET OVERVIEW A. Overview China is one of the largest and fastest growing economies in the world today. GDP between 2008 and 2010 grew by an average of 9.7% annually. In 2012, China’s GDP growth rate was 7.8%. This was the slowest growth rate since 1999. But it was still significantly stronger than OECD countries’ average of 3.0%. China’s GDP growth is estimated to remain strong at 8.4% in 2013. China has over 1.3 billion people. This comprises 20% of the world’s population. The enormous consumer potential in China draws many foreign companies. China has become more economically open and affluent. There is a direct correlation between China’s increasing affluence and the people’s increasing healthcare standards. Many Chinese citizens are cultivating greater healthcare awareness and demanding better healthcare. As a result, China’s pharmaceutical market is booming. The pharmaceutical market has experienced an average annual growth rate of between 15% and 17% over the past decade. According to a variety of sources, China’s pharmaceutical market in 2012 was worth approximately $60 billion. The pharmaceutical market will continue to grow at an annual growth rate of 12% from 2013 to 2020. About half of all sales go to Western drugs, a third to Traditional Chinese Medicines (TCM), while the rest goes to nutraceuticals and biologics. China became the world’s third largest drug market in 2011, bigger than the UK, Italy, Canada, Spain, or Brazil. Copyright © 2014 Pacific Bridge Medical. 5 As China becomes more developed, its epidemiological profile is changing. Chinese people are eating more unhealthy Western foods, smoking more, and exercising less. Chronic diseases are on the rise in China. These diseases now account for over 75% of deaths. According to the “2011 Health Statistics Yearbook” announced by China’s Ministry of Health (MOH) on January 16, 2013, the leading causes of death are cancer (26%) and cardiovascular diseases (21%). These two diseases combined account for 47% of deaths in China. This is followed by cerebrovascular disease (20%) and respiratory illnesses (11%). Doctors are seeing more patients in their 20’s, 30’s and 40’s falling victim to cardiovascular disease. Thus, cardiovascular drugs are in very high demand. Drugs in other therapeutic categories, including respiratory, anti-inflammatory, anti-ulcer and neurological drugs are also in high demand. Chinese people are living longer, and are consuming more healthcare products to maintain healthy lifestyles. The average life expectancy in China is now 71.4, higher than the global average of 68. Despite growth in China’s urban coastal regions, the Chinese rural interior is still developing very slowly. Urban residents have much higher standards of living than rural residents. Development in China has been criticized for being too concentrated in the bigger cities. Residents of Shanghai, Guangzhou, Shenzhen, Hangzhou, Tianjin, and Beijing have much higher standards of living than citizens from smaller cities or in the rural interior. The lower standard of living in the rural areas has driven scores of rural Chinese to the urban areas since the early 1980s. An estimated 200 million people from rural areas have migrated to the cities for better work opportunities, driving urban growth. China’s distribution of healthcare resources is also extremely unequal. Although over 60% of the population lives in rural areas, only 20% of China’s healthcare resources reach the rural interior. The health care system in China is expected to change and expand over the next five years as a result of the new health care reform plan that was implemented in 2009. All levels of government invested a total of RMB 850 billion (approximately US $125 billion) between 2009 and 2011 for this reform. China aims to cover all 1.3 billion urban and rural residents with some type of basic medical insurance, improve access and standards for
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