In China, many patients resort to unconventional means of receiving treatment for their diseases, like going abroad or relying on surrogate shoppers. According to a New York Times article, in 2017, approximately 600,000 Chinese patients travel abroad to receive medical treatment.1 Although China's review and approval process of drugs has been significantly accelerated after years of reform, certain aspects of China's medical industry still prevent some foreign drugs from reaching the market. For instance, the government's regulation on drug's pricing, the Chinese market's complexity due to the diverse population and vast territory, and the uncertainty of competition from similar products all are able to deter small to middle-sized pharmaceutical companies from investing capitals and conducting clinical trials in China.
Things have changed a lot in recent years as the Chinese government actively engages in promoting the development of pharmaceutical industry and subsequently proposed certain policies that could potentially ameliorate this common problem. Remarkably, China has loosened up the market entry policies of drugs in several places. This article is going to introduce and analyze the cases of the Boao Lecheng International Medical Tourism Pilot Zone (Boao Pilot Zone), the Guangdong-Hong Kong-Macau Greater Bay Area (Greater Bay Area), and the Hainan Free Trade Port (Hainan FTP).
In 2013, China's State Council approved the establishment of Boao Lecheng International Medical Tourism Pilot Zone in the Hainan province. In summary, this Pilot Zone enjoys four special privileges in regards to the pharmaceutical industry2:
1. Medical technology, skilled personnel, medical equipment, and drugs are allowed to enter the Pilot Zone with special permits.
2. The Pilot Zone enjoys special operation structure, allowing foreign capitals to enter.
3. International medical organizations are allowed to host medical conferences in the Pilot Zone.
4. It is permitted to conduct clinical research of cutting-edge medical science and technology in the Pilot Zone.
Source: https://www.china-briefing.com/
The first privilege is significant, because it allows foreign drugs that are not marketed in mainland China to enter the Pilot Zone. This policy no doubt provides wider access for some of the urgently needed drugs for Chinese patients.
The Boao Pilot Zone has another name—Boao Hope City. The Pilot Zone provides multiple medical tourism-related services, including licensed medical treatment, health management, care rehabilitation, and medical cosmetology. It also gathers international and domestic cutting-edge medical sciences and technologies. China aims to attract experts and companies worldwide and develop the Boao Pilot Zone into a global center of medical services and pharmaceutical research.
In September 2019, in an effort to further specify and define the Pilot Zone's role, four Chinese ministries and agencies jointly published the Implementation Plan of Supporting the Establishment of Boao International Medical Tourism Pilot Zone.3 As the Plan stated, in addition to the previously mentioned policy of bringing urgently needed drugs to the Pilot Zone, now the medical institutions in the Pilot Zone could use the clinical Real-World Data from these drugs as part of the materials for marketing application in China. The whole marketing registration procedure of innovative new medical products could be much shorter with the application supported by clinical Real-World Data. It was yet another method adopted by the Chinese government to provide fast and prioritized application process of drugs. For more information on the Real-World Data Pilot Program, please refer to BaiPharm's earlier report here.
On June 1, 2020, the State Council issued the Master Plan for the Construction of Hainan Free Trade Port.4 On September 1, 2020, in response to the central government's vision of transforming Hainan into a FTP, Hainan's provincial government issued a reform plan that offered further preferential treatment to the Boao Pilot Zone.5 As required by the plan, the Pilot Zone established China's first ever bonded warehouse that stores overseas innovative drugs and equipment that are not yet marketed in China. The storage of drugs before they are inspected by Chinese Customs greatly improves the efficiency of importing innovative drugs from abroad. Thus, consumers don't have to wait too long for product clearance.
Moreover, in the Boao Pilot Zone, the Hainan Health Commission and the Hainan Medical Product Administration jointly established a new supervision model that covers both health-related and drug-related matters. The two agencies would cooperate, share their information, and avoid repetitive and redundant administrative procedures. This policy has largely enhanced the efficiency of drug review and approval in the Boao Pilot Zone.
As a Free Trade Port, the Hainan Province now enjoys special privileges in the medical sector. On April 8, 2021, China's National Development and Reform Commission and Ministry of Commerce issued a document, requiring to further accelerate foreign medical products’ market entry in the Hainan FTP.6 Hainan's provincial government shall:
1. Optimize the research, trial, production, and application of drugs (Traditional Chinese Medicine, chemical drugs, biological agents);
2. Encourage corporations that produce high-value medical consumables and develop innovative drugs and Chinese Medicine to settle in Hainan;
3. Ameliorate Hainan's complimentary system of innovative drug's development and financing;
4. Encourage both domestic and foreign pharmaceutical companies and medical products development institutes to conduct research and clinical trials on innovative and modified drugs. For those pharmaceutical companies who register in Hainan and whose innovative drugs have completed Phase I to Phase III clinical trials and received marketing approval in China, Hainan's medical institutions shall be able to directly use them without any further market entry requirements.
The Boao Pilot Zone and the Hainan FTP are not the only places where China is experimenting alternative ways of introducing innovative foreign drugs with faster and easier review and approval processes. Additionally, the patients in the Guangdong-Hong Kong-Macau Greater Bay Area are also witnessing major progress. As BaiPharm's article on March 29 mentioned, in the coming months, patients in Shenzhen's University of Hong Kong-Shenzhen Hospital will be able to use Hong Kong's marketed drugs that are urgently needed but not yet approved in mainland China.
The National Medical Product Administration (NMPA) will delegate its power of reviewing and approving medical devices to Guangdong's provincial government. The NMPA will also establish a branch office in the Greater Bay Area, and its duty will be to supervise and guide the local agency's work and help construct a more convenient mechanism of drug evaluation. The first batch of drugs will soon be released with prioritized review and approval procedures. In the future, more designated medical institutions in the Guangdong Province are expected to directly use and administer Hong Kong and Macau's marketed foreign drugs. This policy has opened another door for patients in urgent need of foreign drugs.
It is noticeable that in the early phase of China's attempt to ease the market entry of drugs, policies were relatively conservative. Gradually, as demand grew and the effectiveness of previous policies proved, more open and direct policies began to emerge. For example, at first, the rhetoric of the 2013 document that set up the Boao Pilot Zone only expressed its consent for making foreign drugs available. However, the 2021 Hainan FTP document illustrated the government's active encouragement to have foreign pharmaceutical companies to settle in Hainan. Government policies are leaning towards greater degrees of regional open-up.
It is believed that the Boao Pilot Zone, the Hainan FTP, and the Greater Bay Area are just the first steps of China's movement in facilitating the market access of overseas pharmaceutical products. In the future, more experimental sites and policies will be implemented to completely solve some patients' dilemma of having no available treatment. Foreign pharmaceutical companies who might have hesitated previously can now contemplate entering the Chinese market, considering the rapid market growth and the increasing number of friendly and supportive policies.
