8 July - Sept 2021BUSINESSMANAGEMENTREVIEW.COMCHALLENGES AND OPPORTUNITIES OF CHINESE CRO/CMO INDUSTRYBy Dr. Jim Li, CEO, Sundia MediTech Company, LtdSince 2015, Chinese NMPA has carried out a series reforms in drug approval process and produced a number of policies, such as requirement of GCE (Generics Consistency Evaluation) in generic drug approval, establishment of MAH system, joining ICH, automatic approval of IND application within 60 days. The implementation of these new policies has brought fundamental changes to the Chinese pharma industry. As the new policies encourage the new drug discovery and development, while raised bar for generic drug approval, the hot money poured into new drug research, generic drug companies are forced to look for ways out of the difficult situation. As major work force in drug R&D, CROs and CMOs in China are benefiting from the situation on one hand, but also face challenges. We would like to discuss those challenges and opportunities in the article. Following is the list of changes caused by the new policies and opportunities for CROs/CMOs1. Due to the new requirement of GCE (Generics Consistency Evaluation) in the generic drug approval process, followed by "4+7" (4 directly controlled municipalities by central government + 7 major cities) group purchase policy, which is considered the first stage of national purchase of drugs to lower the cost of medicine. Because of severe competition and price control, Pharma industry in China is undergoing reshuffling process and many of 6000 existing Chinese pharmaceutical companies will eventually disappear. Some of these generic drug companies are forced to start new drug research and development, which creates business opportunities for the CROs and CMOs. 2. Joining ICH, implementation of MAH (Marketing Authorization Holder) policy, automatic approval of IND in 60 days and a series of new policies to speed up the drug approval process have stimulated broad interest in new drug discovery and development. 3. The new drug research related business is booming and government/private capitals are pouring in. In addition to the huge number of start-up companies, the leading generic drug producers in China are also making large investment in research and development of new drugs. As the result, the number of IND application in China manifests an explosive increase in recent years.4. Most of those start-up companies adopt virtual operation model and taking the advantage of CROs/CMOs who has the capabilities and capacities in drug discovery and development and doing so in an effective and economical way. OPENIONIN MY
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