July - Sept 20219BUSINESSMANAGEMENTREVIEW.COMThose generic drug manufacturers who want to start new drug discovery but lacking R&D capabilities are also looking for help from CROs.5. While the demand for service is high, the CROs/CMOs are facing challenge of upgrading the capabilities and capacities. A number of CRO/CMOs went to IPO for fund raising in recent years, including Wuxi Apptech, Pharmaron, Viva, Frontage, Medicilon etc..As the result of the new development in Chinese pharma industry, CROs and CMOs in China are also facing some challenges:1. As the reform continues in NMPA, particularly after China joined the ICH, the higher standard has been accepted but detailed regulatory policies in China have not yet fully published. Therefore, the Pharma companies are reluctant to push the project ahead, particularly to set the drug development strategy.2. CROs/CMOs need to update and upgrade the hardware and software to meet higher ICH standard. This is not just limited in hardware/equipment upgrading, the addition and revision of policies and SOPs and subsequent training/implementation will also take place, which requires time and money. 3. New drug research and development requires collaboration of multiple scientific disciplines such as Biology, Medicinal Chemistry, Pharmacology, ADME, Process Chemistry, Formulation and Regulatory etc. The booming business in new drug discovery and development has created shortage in manpower of expertise, specialists and professionals. This has become a major problem cross the industry in both CROs/CMOs and pharma companies. 4. The environmental requirement and standard are becoming more and more stringent in China, the cost of the waste treatment has been tripled and quadrupled in the past a few years. Chinese has ordered all API manufacturers who are located within 1 km distance from a major river to close-down/relocate; any ones that's within 5 km of the a major river is forbidden to expand or upgrade in capacities. Some local government in well-developed area such as Jiangsu province is no longer giving out license for new API factory construction altogether. In the past five years, Chinese pharma industry has experienced tremendous impact as central government introduced a number of new policies in drug approval process. CROs/CMOs are facing challenges and opportunities. We believe the fundamental changes are good for Chinese pharma industry and are also good for the development of CROs and CMOs in China as a whole. Moving forward, we believe that Chinese pharma industry, with help from CRO and CMO, will be going through fast track next decade and will catch up with the most advanced country in the world in term of pharmaceutical research and development. BMDr. Jim Li
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