China Encourages Innovative Drug R&D in Revised Draft of Regulations for Implementing the Drug Administration Law

by Grace Wang May 13, 2022

On May 9, China National Medical Products Administration (NMPA) released the draft of the revised Regulations for Implementation of the Drug Administration Law (hereafter referred to as the Regulations) for public comments.

The Regulations was first issued with immediate effect in 2002, and was later revised in 2016. Compared to the 2016 revised version, the draft of the 2022 version includes 101 more articles to conform to the pharmaceutical policy reforms in the recent years and the Drug Administration Law revised in 2019. The new contents involve marketing authorization holder system, patent protection, and pharmacovigilance, whose regulations just came out in the past few years.

RELATED: China's Marketing Authorization Holder (MAH) System; China's Drug Patent Linkage System; China's Good Pharmacovigilance Practices.

Regulation Contents

Contents of the Regulations for Implementation of the Drug Administration Law

2016 Revised Version1

 Revised Draft of the 2022 Version for Consultation2

Ÿ   Chapter I: General Provisions

Ÿ   Chapter II: Administration of Drug Manufacturers

Ÿ   Chapter III: Administration of Drug Distributors

Ÿ   Chapter IV: Administration of Pharmaceuticals in Medical Institutions

Ÿ   Chapter V: Administration of Drugs

Ÿ   Chapter VI: Administration of Drug Packaging

Ÿ   Chapter VII: Administration of Drug Pricing and Advertisement

Ÿ   Chapter VIII: Supervision of Drugs

Ÿ   Chapter IX: Legal Liability

Ÿ   Chapter X: Supplementary Provisions

Ÿ   Chapter I: General Provisions

Ÿ   Chapter II: Drug Research and Registration

-      Section 1: Basic Requirements

-      Section 2: Drug Research and Development

-      Section 3: Drug Marketing Authorization

-      Section 4: Traditional Chinese Medicine Registration Administration

-      Section 5: Drug Intellectual Property Protection

Ÿ   Chapter III: Drug Marketing Authorization Holder

Ÿ   Chapter IV: Drug Manufacturing

Ÿ   Chapter V: Drug Distribution

Ÿ   Chapter VI: Pharmaceutical Administration in Medical Institutions

Ÿ   Chapter VII: Drug Supply Support

Ÿ   Chapter VIII: Supervision and Administration

Ÿ   Chapter IX: Legal Liability

Ÿ   Chapter X: Supplementary Provisions

Regulation Highlights

The Regulations embodies China's incentive policy trends, e.g., expediting drug review and approval, encouraging the development of pediatric and rare disease drugs, etc. Here are several highlights.

Pharmaceutical Innovation

China supports pharmaceutical innovation in various aspects:

Ÿ   fundamental research, applied research, and original innovation of drugs;

Ÿ   pharmaceutical innovation oriented by clinical value;

Ÿ   supporting enterprises in using advanced technical equipment to improve drug safety;

Ÿ   scientific projects, financing, credit loans, procurement, pricing, and medical insurance;

Ÿ   supporting enterprises in setting up independent and joint R&D institutions

Ÿ   cooperation between enterprises, colleges, research institutions, and medical institutions for drug research and innovation;

Ÿ   drug's intellectual property protection;

Ÿ   improving the capability of independent innovation in the pharmaceutical field.

Foreign Clinical Data

Drug applicants can use foreign clinical data in marketing authorization applications if the data is qualified. Qualified data from international multicenter clinical trials conducted in China by overseas pharmaceutical companies can be used in drug marketing authorization applications.

Pediatric Drug

For the first drug product, dosage form, and strength approved specially for pediatric patients, a market exclusivity period of no more than 12 months will be granted.

Rare Disease Drug

For a new drug approved for a rare disease, a market exclusivity period of no more than seven years will be granted if the drug applicant can ensure the supply of the approved product.

Drug Intellectual Property

-      Patent linkage: Drug applicants and MAHs should register their drug patents and patent statuses at the Patent Information Registration Platform for Drugs Marketed in China. When necessary, patent holders can file a lawsuit or request an administrative ruling to protect patents.

-      Encouraging the development of generic drugs: For the first generic drug that successfully challenges a registered patent and obtains marketing authorization, a market exclusivity period of 12 months will be granted. However, the market exclusivity will not exceed the patent expiration date of the challenged innovator drug.

-      Data protection: During the first six years from an MAH acquiring the marketing authorization, other drug applicants are not allowed to use the MAH's data for their marketing authorization unless the MAH permits the use.

Marketing Authorization Holder (MAH)

-      MAH qualification: An MAH must have a drug manufacturing license, establish independent quality management and pharmacovigilance departments, and appoint responsible persons severally for quality management, market release, and pharmacovigilance.

-      Domestic agent in China: Before a foreign drug is approved in China, the foreign drug applicant should appoint a qualified Chinese agent, whose information will be recorded in the drug marketing authorization license.

After a foreign drug is approved, the foreign drug MAH should register the Chinese agent's information at the medical products administration of the agent's province, autonomous region, or municipality directly under the Central Government. Only after the registration can the drug be marketed.

Change of Chinese agents should also be registered at the above administrations.

Drug Manufacturing

To engage in drug manufacturing activities, a company should apply for a manufacturing license.

An MAH that entrusts manufacturing to a third party should evaluate the active pharmaceutical ingredient/excipient supplier, review the annual report, audit the product change management, release the products to the market, supervise the entrusted party to fulfil obligations, and ensure that manufacturing process complies with legal requirements.

The entrusted party shall not entrust the manufacturing again to another party.

Drug Distribution

To engage in drug manufacturing activities, a company should apply for a distributor license.

If an MAH entrusts drug sales to a third party, or an MAH/supplier entrusts drug storage and transport to a third party, then the MAH/supplier should file a record at the medical products administration of the entrustee's province, autonomous region, or municipality directly under the Central Government.

The entrusted party shall not entrust the storage again to another party.

Contact BaiPharm

Contact BaiPharm to learn about more details of the Regulations. You're also welcome to send your opinions on the Regulations to zfsfgc@nmpa.gov.cn before NMPA stops collecting public comments on June 9.

Grace Wang
ChemLinked Regulatory Analyst
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