Monday, July 15, 2024

China’s Health Technology Assessment and Pharmaceutical Innovation Drive Global Health Progress

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Health technology assessment (HTA) has played a key role in price negotiations for medicines seeking coverage under China’s national Social Health Insurance program. However, past health technology assessment appraisals have revealed a lack of national consensus on various issues relating to economic evaluation, with a particular focus on three key areas: willingness-to-pay (WTP) thresholds, pricing models for multi-indication medicines, and comparator selection principles.

In 2015, China introduced its Healthy China plan and implemented institutional adjustments to better ensure the health of its aging population. Guided by the Healthy China initiative and the Innovation-driven Development Strategy, China’s pharmaceutical innovation has reached new heights. In 2023, the Central Economic Work Conference emphasized economic development and proposed an inclusive market, boosting market players’ confidence and enhancing policy consistency. On March, the term “innovative drug” appeared in the Government Work Report for the first time, further elevating the importance of the pharmaceutical industry.

The reform of China’s regulatory system, initiated in 2015, significantly improved drug reviews and approvals. The Drug Administration Law announced in 2019 reinforced the system from a legal perspective, laying the groundwork for a full lifecycle drug review system. In 2020, the National Medical Products Administration (NMPA) established an accelerated review channel for innovative drugs through priority review and conditional approvals, greatly enhancing review efficiency.

China’s Rapid Progress in Drug Registration and Innovation in 2022

In 2022, the overall completion rate of drug registration applications was 99.80%, and the completion rate for new drug applications (NDA) and new foreign-origin drugs urgently needed in clinical settings was 98.59% and 100%, respectively. From an international perspective, China’s review and approval efficiency is approaching that of the United States, with the average time gap for product review and approval narrowing to about 100 natural days over the past two years.

Developing innovative drugs involves significant investment and high risk, necessitating robust intellectual property protection. China’s drug patent protection began in 1992 and has seen significant improvements with the new revision of the Patent Law and supporting regulatory documents. In 2017, China proposed creating a drug patent linkage system. With the implementation of the fourth revision of the Patent Law in June 2021, various supporting systems were issued, including the Measures for the Implementation of the Mechanism for Early Settlement of Drug Patent Disputes, formally establishing China’s drug patent linkage system.

According to the Nature Index, China’s basic research and development (R&D) capabilities in life sciences and medical research have rapidly increased, second only to the United States. The number of top life sciences and medical research institutions in China grew significantly from 2015 to 2023. Among the top ten global state-of-the-art technology fields, China accounts for an average of 4.3 out of the top 20 R&D institutions globally.

Chinese pharmaceutical companies have entered the fast lane of innovative R&D, catalyzed by accelerated reviews, approvals, and the capital market. The rate of contribution to the global research and development pipeline by Chinese firms increased from 4% in 2013 to 28% in 2023, surpassing Europe and second only to the United States. The quality of innovative research and development in China is also high, with the NMPA’s Centre for Food and Drug Inspection completing 215 clinical trial inspections for new drug registrations in 2022, achieving a pass rate of 99.07%. According to Food and Drug Administration (FDA) inspection statistics, China has a higher pass rate in both manufacturing and clinical trial inspections than the United States.

Health Technology Assessment

Health Technology Assessment Drives China’s Global Integration in Pharmaceutical Standards and Innovation

Since joining the International Council for Harmonisation of Technical Requirements for Pharmaceuticals for Human Use (ICH) in 2017, China has fully adopted ICH guidelines, achieving a 100% conversion rate. In manufacturing standards, China applied for the Pharmaceutical Inspection Co-operation Scheme (PIC/S) in 2023, marking a major step towards internationalization in pharmaceutical manufacturing. The number of international multi-regional clinical trials conducted by Chinese firms increased 8.5 times over five years to 110 by 2022, covering over 50 countries. This internationalization has led to new highs in licensing deals and recognition of China’s pharmaceutical innovation capabilities.

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Pharmaceutical innovation is typically driven by marginal revolutions, with small biotech organizations exploring new technologies and targets. Large companies often seek cooperation through mergers and acquisitions (M&A) after biotech companies make research and development progress. The internationalization of China’s R&D standards has led to greater cooperation and participation in global research and development. Chinese contract research organizations (CROs) provide high-quality R&D services for global pharmaceutical innovation at competitive costs. The BioSecure Act in the United States, while restrictive to China’s contract research industry, highlights the significance of Chinese innovation.

Global cooperation extends beyond research and development to mutual support in the pharmaceutical market. Many multinationals have seen increasing revenue from the Chinese market, with higher growth rates than the global market. The Chinese government, guided by national strategies, is committed to promoting global pharmaceutical innovation. China’s pharmaceutical innovation not only meets domestic patient needs but also contributes significantly to global health. The Chinese government and life sciences companies are making joint efforts to promote pharmaceutical innovation, advocating for a balanced global development partnership to enhance humanity’s common interests.

 

Resource: Pharma Board Room, June 24, 2024

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