Spearheading
the Global Expansion of China's Top
Pharma & TCM Firms
把中国顶尖药品推向世界
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Spearheading
the Global Expansion of China's Top
Pharma & TCM Firms
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FREQUENTLY ASKED QUESTIONS 1. Where can I find out more about Topsun Group? You can either visit Topsun Group's website at
www.topsun.com or 2. What are the regulations governing the pharmaceutical industry in PRC?
The pharmaceutical industry in the PRC is highly regulated by the PRC government in order to protect the interest of the general public at large. The pharmaceutical regulatory regime covers a wide scope of activities in the industry, ranging from areas such as the granting of operating licenses to both manufacturers and distributors of pharmaceutical products in the PRC, to the approval system of new pharmaceutical products and the imposition of price controls on pharmaceutical products sold in the local market.
The SFDA is the authority which monitors and supervises the food and pharmaceutical industries in the PRC. Pursuant to the 关于国务院机构改革方案的决定 (Decision on Reform of the State Council’s Organization) promulgated by the National People’s Congress on 10 March 2003, the SFDA is responsible for the supervisory and administrative functions of the pharmaceutical industry in the PRC which were previously undertaken by the PRC Ministry of Public Health, the PRC State Pharmaceutical Administration Bureau and the PRC State Administration Bureau of Traditional Chinese Medicine. The principal responsibilities of the SFDA include: · The formulation and enforcement of administrative rules and policies concerning the supervision and administration of pharmaceutical and other industries; · The evaluation, regulation and approval of new drugs, generic drugs, imported drugs and traditional Chinese medicines; and · The approval of the manufacture and export or import of pharmaceutical products and medical appliances and equipment and the establishment of pharmaceutical manufacturing and distribution enterprises.
Pre-requisites for production of pharmaceutical products in the PRC Good Manufacturing Practice (“GMP”) certification GMP is a standard introduced by WHO to improve the quality of pharmaceutical production internationally. The SFDA issued the 关于实施《药品生产质量管理规范》有关规定的通知 (Notice on the Implementation of Quality Control on drug production) in August 1999, which requires pharmaceutical manufacturing enterprises in the PRC to apply for GMP certification, which is valid for a term of five years with renewal subject to reassessment. GMP involves various requirements with respect to the manufacturing of pharmaceutical products such as the standards for production facilities and equipment, raw materials and production management, quality control as well as sales and return of products and handling of complaints from customers. In October 2003, the SFDA issued the 关于全面加快监督实施药品GMP 工作进程的通知 (Notice on Expedition of the Implementation of Pharmaceutical GMP standards), requiring all pharmaceutical manufacturing enterprises which had not obtained GMP certification by 30 June 2004 to cease manufacturing pharmaceutical products.
Drug Manufacturing Certificate According to the Drug Administration Law of the PRC, any pharmaceutical manufacturing enterprise must first obtain a drug manufacturing certificate issued by the SFDA of the province, autonomous region or directly administered municipality where such enterprise is located before it can be engaged in the production of pharmaceutical products in the PRC. A drug manufacturing certificate is valid for a term of five years and is renewable subject to reassessment. Before a drug manufacturing certificate is issued, a pharmaceutical manufacturer has to meet the following requirements of: · Employing legally qualified pharmaceutical and engineering professionals, and the required qualified technical personnel; · Having suitable premises and facilities, and the required hygienic operating conditions required for drug manufacturing; · Having the necessary personnel and testing equipment capable to operate the quality control procedures at the required standard; and · Adopting internal rules and regulations to ensure the quality of drugs.
A pharmaceutical manufacturing enterprise is also required to obtain a business license from the Administration of Industry and Commerce after it has been granted a drug manufacturing certificate. The Drug Administration Law requires, with the exception of the processing of certain Chinese drugs, the production processes of all pharmaceutical products to be in conformity with the national drug standards and approved by the SFDA. NO pharmaceutical products that do not meet the national drug standards can be released.
Pre-requisite for conducting clinical research on pharmaceutical products in the PRC According to the 药品研究机构登记备案管理办法（试行）(Measures (Interim) of Registration and Record of Pharmaceutical Research Institutions) promulgated by the SFDA in October 1999, all institutions engaged in research for the purpose of clinical trials, production, and trading of pharmaceutical products in the PRC are required to be registered and recorded with the SFDA and the relevant provincial pharmaceutical regulatory authorities. Pharmaceutical research institutions have to meet the following requirements of: · Having qualified professionals to conduct research with the supervisor holding a relevant bachelor’s degree or higher qualification; · Installing suitable apparatus and equipment to conduct research; and · Operating premises suitable to conduct the research which, for medical institutions and hospitals engaged in clinical trials, requires the number of beds to not be less than 500. For specialized medical intuitions, the number of beds may be less than 500. Furthermore, pursuant to the 药品临床试验管理规范 (Regulations on Clinical Trials Standards (GCP)) issued by the SFDA in September 1999, all relevant parties involved in a clinical trial shall comply with GCP, a standard which concerns the rights and safety of the clinical trial subject and the quality of the data collected from a clinical trial. GCP sets out requirements of a clinic researcher’s experience and various conditions of a clinical research institution. However, as the Latest Practicable Date, the SFDA had not introduced a GCP certification system.
Approval and categorization of new pharmaceutical products The SFDA examines and approves all new pharmaceutical products in the PRC. The development of new pharmaceutical products is currently governed by the药品研究机构登记备案管理办法（试行）(Administrative Measures (interim) on Registration of Pharmaceutical Products) (the “Registration Measures”) promulgated by the SFDA in 2002. To obtain the production permit for a new medicine, which has to be issued by the SFDA before the new pharmaceutical product can be commercially produced and sold in the PRC, each new drug developer is required to undertake a two-stage application procedure, being an application to obtain a clinical study permit for conducting clinical trials; and thereafter, on completion of clinical trials, an application for manufacture and marketing of the new pharmaceutical product. In each of these 2 application stages, an applicant for pharmaceutical products other than those in imported pharmaceutical products must first file its application with the provincial branch of the SFDA for preliminary review and then to the SFDA for final approval; for imported pharmaceutical products, an applicant is required to file to the SFDA for direct approval.
Approval of new pharmaceutical products A clinical study permit is required before a new pharmaceutical product may undergo clinical trials. An application for pharmaceutical products other than those in Category I, accompanied by reports containing pre-clinical trials data, is required to be submitted to the provincial SFDA for initial evaluation and to the state SFDA for further assessment and review. If it is satisfied with its evaluation, the state SGFA will issue the clinical study permit. Clinical trials may then be conducted in a recognized medical institution. Applicants are generally required to complete the first three phases of the four-phase clinical trial, which respectively covers a preliminary pharmacological and human safety drug test, a preliminary assessment of the medical functions of the new drug, a final assessment of the new drug and an application test of the new drug after being launched into the market. When the applicant has completed the required clinical trials, it may apply to the SFDA through the provincial branch of the SFDA for a Certificate of New Medicine. At the same time, raw materials used for the preparation of the standard form of the new pharmaceutical product will be submitted to 中国药品生物制品检定所 (the National Institute for Control of Pharmaceutical & Biological Products) for analysis. Upon satisfactory overall examination by the SGFA, the certificate of new medicine will be issued by the SFDA. With this certificate and a valid Drug Manufacturing Certificate, the SFDA will issue a production permit for the new pharmaceutical product when the relevant requirements of the production conditions are fulfilled. The same application procedure applies to the approval of new Category I pharmaceutical products except that an applicant is required to file directly with the state SFDA for assessment.
Categorization of pharmaceutical products Subsequent to 1 December 2002, under the Registration Measures, chemical pharmaceutical products are classified into the following six categories for approval and regulatory purposes: Category I: pharmaceutical products which have not been previously approved for sale in the PRC and overseas Category II: pharmaceutical products which have altered the method of application of a similar pharmaceutical product and have not yet been sold in the PRC and overseas Category III: pharmaceutical products which have been sold overseas but have not yet been sold to the PRC Category IV: pharmaceutical products which have changed the acidity and alkalinity of similar pharmaceutical products in the PRC but have not changed the basic raw materials and preparation Category V: pharmaceutical products which have altered the method of application but not the preparation of a similar pharmaceutical product in the PRC Category VI: pharmaceutical raw materials or preparation already in compliance with the national drug standard
Products of Categories I to V are generally referred to as new pharmaceutical products, whereas those of Category VI as reproduction pharmaceutical products. In addition, pharmaceutical products can be further classified as follows: · Prescription medicines and OTC medicines based on type, specification, curative effect, dosage and methods of administration. Prescription medicines must be purchased and consumed under the prescription of a doctor, while OTC medicines can be directly purchased without a prescription. · Pharmaceutical products subject to price control and those free from any price control. · Pharmaceutical products subject to price control and those few from any price control. · Chemical medicines, biochemical medicines and traditional Chinese medicines.
All pharmaceutical products which are produced or sold in the PRC must be registered and bear a registration number assigned by the SFDA, with the exception of Chinese herbs and traditional Chinese medicines in soluble tablet form. Furthermore, the SFDA will not accept applications for new pharmaceutical product registrations from pharmaceutical product research institutions which are not registered and recorded with the SFDA and the relevant provincial pharmaceutical regulatory authorities. Protection of new pharmaceutical products Successful applicants for registration of new pharmaceutical products enjoy a probationary protection period, usually for a period of up to five years depending on the category of the pharmaceutical product during which other pharmaceutical manufacturers will be prohibited from manufacturing the same pharmaceutical product. In addition, approved new pharmaceutical products can also be protected by patent laws in the PRC. Further details are provided below.
Subsequent to the re-definition of new pharmaceutical products as those that have not been previously “sold” in the PRC, the SFDA issued the 关于《中华人民共和国药品管理法实施条例》实施前已批准生产和临床研究的新药的保护期的通知 (Notice on Protection Period of New Medicines Approved to Produce and Conduct Clinical Trials Prior to Implementation of the Regulations for Implementation of the Drug Administration Law of the PRC) which sets out details regarding the protection periods of approved new pharmaceutical products as summarized in the table below.
The PRC patent law grants further protection to certain pharmaceutical technologies by way of patents which are national rights enforceable by patent holders to prevent others from exploiting commercially patent holders’ inventions without their permission. Under the PRC patent law, only the original inventor of an invention and the legal transferee of the invention are eligible to apply for patent rights. The basic requirements for patentability include patentable subject matter, industrial applicability or utility and novelty (which refers to new invention that has not been discplosed to the public prior to the patent application date). In general, patent rights can last for up to 20 years from the patent application date. There are no renewal options for registered patents. Under the Patent Co-operation Treaty, to which China acceded on 1 January 1994, there is a high degree of international co-operation in patent rights applications. The Patent Co-operation Treaty makes it possible for patent applicants in one country to seek patent protection for an invention simultaneously in a number of other member countries by filing a single application.
Regulations governing the import of pharmaceutical products into the PRC Provincial SFDA are responsible for the control of imported pharmaceutical products into their respective administrative areas and the PRC has a registration system for imported pharmaceutical products. The …. (Certificate of Registration of Imported Medicine) must be obtained before any foreign pharmaceutical manufacturers or agents are permiteted to import any bio-pharmaceutical products, pharmaceutical products which are to be sold in the PRC for the first time, and any other pharmaceutical products as specified by the State Council for sales in the PRC market. 医药产品注册证 (Certificate of Registration of Medicine) must also be obtained before any pharmaceutical products can be imported from Hong Kong, Macao and Taiwan into the PRC. According to the 《关于设立中外合资对外贸易公司暂行办法》（商务部令(2003) 年第一号）(Interim Regulation on the Establishment of Chinese-Foreign Joint Venture Foreign Trading Company), before 11 December 2003, joint venture trading companies established by Chinese and foreigners were not permitted in the PRC where the equity capital provided by the Chinese investor was less than 51%. According to the 《关于设立中外合资对外贸易公司暂行办法》（补充规定 (2003) 年第十号） (Supplementary Provisions on Interim Regulation on the Establishment of Chinese-Foreign Joint Venture Foreign Trading Company), with effect from 1 January 2004, trading companies established by means of joint venture, cooperative or solely funded enterprise by Chinese and service providers from Hong Kong and/or Macao were permitted within the mainland of the PRC. According to the former Foreign Trade Law of the PRC (which was adopted on 12 May 1994, effective as of 1 July 1994 and abolished as of 1 July 2004), enterprises engaged in foreign trade involving the import and export of goods or technologies must apply for 中华人民共和国进口企业资格证书 (Certificate for Import and Export Enterprises in the PRC). However, in accordance with the Article 9 of the revised Foreign Trade Law of the PRC (which was adopted on 6 April 2004 and effective as of 1 July 2004,) as of 1 July 2004, enterprises engaged in foreign trade involving the import and export of goods or technologies have to register with the authority responsiblie for foreign trade under the State Council or its authorized bodies unless exempted by the relevant laws, regulations and the authority responsible for foreign trade under the State Council. This means that foreign trade enterprises are no longer required to obtain or renew their 中华人民共和国进口企业资格证书 (Certificate for Import and Export Enterprises in the PRC) after 1 July 2004. According to Article 14 of the 《对外贸易经营者备案登记办法》（商务部2004年第14号令）(Registration Rule for Foreign Trade Enterprises), foreign trade enterprises which have obtained the relevant qualifications prior to 1 July 2004 have the right to continue business within the original approved business scope and are not required to register with relevant government authorities. If the foreign trade enterprises, which obtained their relevant qualifications prior to 1 July 2004, want to register voluntarily (for example, to expand their scope of business), their existing operations will not be affected during this transition period.
Regulations on environmental control Pharmaceutical manufacturing enterprises in the PRC must comply with environmental laws and regulations stipulated by the State and provincial environmental protection authorities. Those laws and regulations comprise provisions in respect of the prevention and treatment of sewage and exhaust fumes, and the prevention of industrial pollution. Under the environmental regulations in the PRC, pharmaceutical manufacturing enterprises are required to apply for the relevant certificates from the local environmental protection authority.
Price control on pharmaceutical products Certain pharmaceutical products are subject to price controls in the PRC pursuant to the 国家计委关于改革药品价格管理的意见 (Opinions on the Reform of Price Controls on Pharmaceutical Products) issued by the State Development and Reform Commission on 20 July 2000. Those pharmaceutical products are listed in the 国家基本医疗保险和工伤保险药品目录 (National Basic Medical Treatment and Insurance and Medicine for Work Injury Insurance Catalogue) and a few special pharmaceutical products, the trading of which result in the creation of monopolies (including certain psychotropic, anesthetic, immune and family planning pharmaceutical products). Price controls are specified by the State and provincial price administration authorities with respect to the retail price of the products covered by price controls. When formulating price ceilings of pharmaceutical products, government authorities take into account factors such as demand and supply in the market, public affordability and profitability of drug suppliers. Since 1999, the State Development and Reform Commission has adjusted the price level of pharmaceutical products sold in the PRC at regular intervals.
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