ARTICLE
9 January 2025

China Announces Major Policy Incentives For Life Sciences Companies

RG
Ropes & Gray LLP

Contributor

Ropes & Gray is a preeminent global law firm with approximately 1,400 lawyers and legal professionals serving clients in major centers of business, finance, technology and government. The firm has offices in New York, Washington, D.C., Boston, Chicago, San Francisco, Silicon Valley, London, Hong Kong, Shanghai, Tokyo and Seoul.
On December 30, 2024, China's State Council published a series of policy incentives in Circular No. 53 to stimulate the transformation of the country's life sciences industry.
China Food, Drugs, Healthcare, Life Sciences

On December 30, 2024, China's State Council published a series of policy incentives in Circular No. 53 to stimulate the transformation of the country's life sciences industry. In 2017, a similar round of structural overhauls laid the foundation for biopharmaceutical and medtech innovation in China. The current round of changes aims to eliminate existing regulatory hurdles that hinder market access of innovative drugs and devices. The key policy incentives include:

  1. Regulatory data protection and marketing exclusivity will be made available for selected pharmaceutical products. Regulatory data protection will cover undisclosed clinical study data and CMC data that are generated by marketing authorization applicants independently. Orphan drugs, pediatric drugs, first-to-market generics, and exclusive TCM products will be entitled to a specific period of marketing exclusivity.
  2. Foreign marketing authorization holders will be permitted to use their manufacturing facilities in China or outsource manufacturing activities to Chinese contract manufacturing organizations to produce their drug products that are approved as imported products. Pre-approval commercial batches will be permitted for importation for sale in China.
  3. Selected provinces will launch a pilot program to shorten the approval timeline for clinical trial authorizations from 60 working days to 30 working days and for supplemental applications from 200 working days to 60 working days. The lead time for mandatory testing of seasonal flu vaccines will be shortened from 60 working days to 45 working days or less.
  4. The manufacturing of innovative or urgently needed biologics does not need to be end-to-end in one location. The manufacturing site of drug substance can be in a different location from the manufacturing site of drug products.
  5. Medical robots, brain-computer interface equipment, radioactive equipment, medical imaging equipment, innovative TCM equipment, and high-end implantable devices will be eligible for fast-track approvals.
  6. Reimbursement standards of new drugs will be assessed based on pharmacological and clinical value (as opposed of health economics only). Commercial health insurance and supplemental patient benefits programs offered by individual provincial governments will be included in addition to the Basic Medical Insurance scheme to improve affordability of innovative drugs.

These changes, once implemented, will provide a more favorable environment for R&D-based life sciences companies.

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