China: New Human Genetic Resources Regulations In China

Last Updated: 23 July 2019
Article by Roy G. Zou, Andrew McGinty, Jessie J. Xie and Lu Zhou

China's New Regulations on the Administration of Chinese Human Genetic Resources: will 'China first' prevail over 'science first' in the Biotechnology Era?

On 28 May 2019, the People's Republic of China State Council promulgated the People's Republic of China Human Genetic Resources Administrative Regulations, which took effect on 1 July 2019 ("2019 Human Genetic Resource Regulations", our unofficial inhouse translation is available on request to existing or potential clients by emailing Karen Yang Karen.yang@hoganlovells.com) to replace the interim measures issued two decades ago (i.e. the Human Genetic Resources Administration Interim Measure ("Former Human Genetic Resource Regulations"). In broad terms, the 2019 Human Genetic Resources Regulations regulate the collection, preservation, utilization, and provision to third parties including the export of Chinese human genetic resources, as well as spelling out the punishments that may accompany violations of the rules. Trading in Chinese human genetic resources is expressly banned. The promulgation of the 2019 Human Genetic Resource Regulations shows the clear intent of the Chinese regulator to position Chinese human genetic resources as a national strategic resource. While biotechnology research using Chinese human genetic resources is encouraged, what runs through the 2019 Human Genetic Resources Regulations is the strong emphasis on national security and public interest considerations as the driving force of permitted activities. These are malleable concepts and are open to discretionary interpretation by the Chinese government. Foreign educational institutions, research institutions, and pharmaceutical companies whose research or clinical trials will involve the use of Chinese human genetic resources, are particularly affected by the 2019 Human Genetic Resource Regulations.

Redefined term of "human genetic resources"

The 2019 Human Genetic Resource Regulations divide human genetic resources into two subcategories, namely (i) "human genetic materials," which mean genetic materials such as organs, cells, and tissue that contain the human genes and the genome; and (ii) "human genetic information," which refers to information and data generated from human genetic resource materials.

What emerges overall is that it is during international collaboration research projects and drug/medical device clinical trials in China where the cross-border transfer of human genetic information (but not human genetic materials) is subject to a lighter regulatory touch compared with the Former Human Genetic Resource Regulations, which required prior approval from the Ministry of Science and Technology ("MOST") for the cross-border transfers of human genetic information.

National security concerns and national interests first

From Article 1 of the 2019 Human Genetic Resource Regulations, there is an emphasis on the importance of safeguarding public health, national security, and the public social interest in the protection and administration of Chinese human genetic resources, and the "national interests first" concept is reflected throughout the 2019 Human Genetic Resource Regulations. For instance, Article 8 of the 2019 Human Genetic Resource Regulations requires that the collection, preservation, utilization and export of Chinese human genetic resources must not jeopardise public health, national security and the public interest in China. Article 27 cites "the export of such materials would not jeopardise public health, national security and the public interest" as one of the main criterion for approving the export of human genetic materials as part of collaborative international scientific research using Chinese human genetic resources. Furthermore, Article 28 genetic information to foreign organizations or individuals or their controlled entities ("Foreign Entities") on such provision not jeopardising Chinese public health, national security and the public interest and makes it subject to a security review by the MOST where there may be a negative impact in addition to the record filing with MOST for the act of making such resources available to Foreign Entities. As noted above, the boundaries of "public health, national security and the social public interest" can be extremely murky, therefore it is foreseeable that regulators will have broad discretionary powers to interpret which circumstances would be deemed as impacting negatively on these, thus giving them an effective veto on such provision.

Foreign parties banned from direct collection and preservation of Chinese human genetic resources

Whilst Foreign Entities are, under Article 7, expressly prohibited from directly collecting and preserving Chinese human genetic resources, the door remains open to international scientific collaborative research projects whereby, subject to MOST approval, Foreign Entities are able to use Chinese human genetic resources (Article 22).

Article 7 of the Human Genetic Resource Regulations prohibits Foreign Entities from collecting or preserving Chinese human genetic resources; nor are they allowed to supply human genetic resources overseas. However, Foreign Entities are permitted to collaborate with Chinese research institutions, higher education institutions, medical institutions, and enterprises to utilize Chinese human genetic resources for scientific research, subject to complying with Chinese laws regulations and other provisions and obtaining prior approval from MOST. In order to obtain prior approval from MOST, such international collaboration research projects must satisfy all of the following criteria:

  • The international collaboration research project is not harmful to public health, national security, and the public interest in China;
  • Both the collaborating parties have legal person status, and have the basis and capabilities to carry out the research collaboration in question;
  • The purpose and contents of the collaborative research are clear and lawful, and will continue for a reasonable duration;
  • The research plan is reasonable;
  • The human genetic resources to be utilized come from lawful sources, and are consistent with the research contents in terms of type and quantity;
  • The research project has passed ethics review by both parties; and
  • The ownership of research achievements is clear, and there is a reasonable and clear profit distribution plan in a collaborative international scientific research project.

There is considerable discretion built into the first and fourth legs of the test in particular.

The Chinese party cannot just 'tag along for the ride'

To prevent a situation occurring whereby the Chinese party(ies) is merely engaged for the purpose of satisfying the regulatory requirements without being provided access to the core records and data of the program, Article 24 requires that the Chinese party(ies) must substantively participate in the research throughout the process and that all records and data and other such like information preserved or generated during the research must be made fully available to the Chinese party. Article 28 further provides that human genetic information generated from the international collaborative research projects may be used by both the foreign party and the Chinese party, suggesting unilateral use rights in favor of the Foreign Entities are not permitted.

Article 24 goes on to say that where a patent application is filed as a result of a collaborative international scientific research project, using Chinese human genetic resources, the application must be jointly filed by both the Chinese Entity and the Foreign Entity, and patent rights will be jointly owned by both parties. How the parties share rights to other scientific achievements arising out of such projects, including use rights, transfer rights and profit shares can be agreed contractually, but it also provides for a default division where the parties have failed to agree contractually on these matters. This confirms that unilateral granting of patent rights arising out of a crossborder scientific collaboration using Chinese human genetic resources to the Foreign Entity will not be permitted.

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