context: The State Council executive meeting on 5 July approved the ‘Implementation plan for supporting the full chain development of innovative drugs’. The meeting emphasised that developing innovative drugs is crucial for the pharmaceutical industry and public health and called for comprehensive policy support. The ageing population and expectations for healthier and longer lives will increase the demand for innovative drugs.
More innovative drugs will be approved at a faster rate in China in the coming years due to increasing demand, predicts Zuo Min 左敏 Shanghai Biomedical Frontier Industry Innovation Centre chair. Since 2015, China's biopharmaceutical sector has made significant strides
- become the world's largest exporter of raw pharmaceutical materials
- approved nearly 150 new drugs from 2018-23
However, over the past decade
- only 24 percent of globally launched new drugs were available in China
- compared to 85 percent in the US and 38 percent on average in OECD countries
- only 15 percent of global new drugs were covered by Chinese medical insurance
Zuo identifies current challenges as
- trying to benefit patients with the 140+ newly approved drugs
- ensuring innovative companies receive fair returns
- creating a positive feedback loop in the biopharmaceutical industry
- the single payment method challenges the pharmaceutical consumption market and threatens the security of the medical insurance fund
China's biopharmaceutical development is at a crossroads, a critical turning point, emphasises Zuo. He suggests that the biopharmaceutical industry has entered a winter period
- mid-2021: downturn began in biopharmaceutical investment and financing
- a series of IPO (initial public offering) failures
- investment institutions and companies have almost stopped investing in new drugs in the first half of this year due to insufficient profit expectations
- if the second half of pharmaceutical innovation is not quickly streamlined
- enthusiasm for innovation and investment from companies and institutions will greatly diminish
- recent fervour for new drug R&D will inevitably face significant obstacles
Innovative biopharmaceutical companies seek a stable and predictable policy environment for innovation, contends John Sullivan 夏文杰 Pharmaceutical Research and Manufacturing Enterprises in China chief representative. When making decisions about drug development and market entry, they primarily consider the following policies
- strong intellectual property (IP) protection for innovation
- predictable, science-based regulatory pathway for timely drug approval
- payment systems that reward innovation and enable further investment in next-generation drugs
The main issue in China is that while the number of innovative drugs is increasing, the payment methods remain too limited, relying heavily on government support, argues Yang Yue 杨悦 Tsinghua University School of Pharmacy researcher. This leads to insufficient payment capacity, which
- restricts the pricing of innovative drugs
- especially for innovative drugs for cell therapy and rare diseases
- poses challenges for supporting vulnerable groups
- e.g. elderly in long-term care, severe diseases patients
- is hard to balance in medical insurance negotiations