China Set To Accelerate Life Science Innovation

13 July, 2017 / Articles

Rupert Murdoch famously said – to paraphrase – in coming years lots of money will be made in China, all by Chinese people. Whether Murdoch’s nostrum proves correct or not, China’s recent life science policy announcements suggest that the best science and strongest most innovative companies – regardless of country of origin – can thrive in China, the second largest market for medicine in the world. The outcome depends on China’s willingness to aggressively implement these emerging policy changes. Equally, success or failure for firms depends on how rapidly companies reshape their thinking, strategies and operating models to align with China’s future medical needs, scientific capabilities and policy objectives.

Discovering and developing new medicines is one of the most complex human challenges. To prevail, powerful new scientific insight, followed by rigorous testing is required. But equally, success depends on public policies that assure new and innovative therapies are safe, effective, accessible and affordable. Four essential policy components form the bedrock of life science innovation: (1) strong R+D infrastructure; (2) effective intellectual property protection; (3) integration in global standards of trade, IP, and drug regulation; (4) functioning markets offering sufficient reimbursement.

So, how is China doing? Over the past 10 years the central government has begun a process of revitalizing the tradition of excellence in Chinese science. Construction of new research labs and biotech parks has been accompanied by massive government investment in R+D. China’s $9.2 billion 15-year Precision Medicine Initiative launched last year aspires to map 100 million human genomes, dwarfing the Obama administration’s $215 million investment targeting 1 million patients. This has been accompanied by a sustained effort to improve the depth and quality of personnel in life sciences. At home, China produces 150,000 life science graduates annually. More than 10,000 Chinese studying or working in life sciences in the U.S. return to China annually, aggressively recruited via the private sector or government initiatives like the “Thousand Talents” Program.

Objective indicators highlight significant scientific progress. Contrary to outdated and often dismissive impressions held by some about the quality of Chinese science, today’s Chinese scientists are genuinely and correctly viewed as comparable to any in the West. China is second only to the U.S. in high quality scientific publications (Nature Index 2016) and the nation’s role grew 30% from 2012-14, while the U.S. role sank 4%. Moreover, this does not include papers authored by Chinese scientists in the U.S. or the dramatic rise in China-U.S. collaborative life science papers.

All of these initiatives represent progress. Yet on their own, these building blocks have been insufficient to push China up the league tables in the global charts on country of origin for new medicines. Domestic approvals for innovative domestic drugs average 70 per year, with most considered “me too” tweaks to established mechanisms of action. Until recently, only a handful of molecules coming from China have been licensed internationally.

The missing link – often China’s biggest challenge – remains the creation of the “innovation software” needed to accelerate development. Yet even here, progress has been steady. China began building a functioning patent system in the early 1980s; recognizing that – as in the U.S. — it takes decades for IP protection and enforcement to become part of the foundation for innovation. China extended its health insurance program nationally in 2009. While covering more than 1.3 billion people today, reimbursement remains low for the vast majority of the population outside of urban areas and is largely limited to generic drugs.

Critically, within this policy mix, the Chinese Food and Drug Administration (CFDA) has lagged behind the country’s needs. Formed in the late 1990s as a regulatory successor to the State Pharmaceutical Administration of China (SPAC), China’s FDA focused initially on putting in place a simple system to rationalize registration and supply of generic drugs to a poor population in need of basic medicines. Progress was slow, frequently interrupted by corruption and rule of law issues. In the last four years, however, CFDA has rebuilt itself and reshaped both its mission and its approach.

On this new foundation, the central government has, since January, taken focused steps to push the entire life science policy environment forward, bringing it closer to international norms. Specifically, the proposals facilitate launching clinical trials after a 60-day review vs the current 12-18 month approval process; allow use of non-Chinese data in the approval process for new drugs; adopt the U.S. and Europe model to accelerated approval for breakthrough therapies; improve intellectual property protection via data exclusivity; and facilitate contract manufacturing and product licensing by severing the link between marketing authorization and manufacturing licenses.

Crystal Lagoons is an international innovation company, founded by scientist Fernando Fischmann, which has developed a patent-protected technology that allows the construction and maintenance of unlimited-size crystal clear lagoons at very low costs.




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