China Life Sciences & Healthcare Monthly Update - December 2018

SAMS Consultation on Vaccine Management Law, 11 November

The State Administration for Market Supervision (“SAMS”) of the People's Republic of China (“PRC”) released the PRC Vaccine Management Law (Draft for comment) (“Draft”) on 11 November 2018. The Draft was open for public comment until 25 November.

The Draft applies to the research and development ("R&D”), manufacturing, distribution and inoculation of vaccines within the PRC. According to the Draft, vaccines are divided into two categories which will be regulated separately: 1) vaccines within the government immunity plan, which are free to citizens; and 2) vaccines outside of the government immunity plan.

The manufacturer of vaccine products must obtain market authorisation from the National Medical Products Administration (“NMPA”) before launching the product into the market. The market authorisation holders (“MAH”) should be responsible for the safety, efficacy and quality of the vaccines during the process of R&D, manufacturing and distribution.

Under the Draft, an MAH has a number of legal obligations, including but not limited to:

making sure the vaccine products and distribution data are traceable during production, storage, transportation and inoculation. Among others, the sale records should be kept for at least five years;

• reporting the quality analysis and the risk of the vaccine to the authority annually;
• buying compulsory insurance for vaccine liabilities;
• setting prices within a reasonable profit margin and price spread;
• making sure the transportation of vaccines is under cold chains; and
• collecting and reporting any adverse events

Further, the Draft imposes heavier liabilities to the MAH for non-compliance of their obligations, including but not limited to: a fine, suspension of business and cancellation of business licences, among others. In particular,

• the MAH should compensate patients for any adverse events following immunisation arising from coincidental events related to vaccines outside of the government immunity plan; for vaccines within the government immunity plan, the aforementioned duty of compensation is on the government; and
• if the MAH continues to sell its vaccine product after it is aware that the relevant vaccine is defective, patients may claim for punitive damages.

The MAH may also be exposed to criminal liabilities if it performs a criminal offence. In addition, the legal representative of the MAH and the person in charge may be prohibited from conducting any business in the pharmaceutical industry for a period of ten years up to an indefinite term.

To read the full text of the Draft (in Chinese only), please click here.

NMPA improves the priority review process for innovative medical devices, 2 November

The NMPA released the Procedures for the Special Evaluation of Innovative Medical Devices (“Procedures”) on 2 November 2018. The Procedures took effect on 1 December 2018.

Applicants can enjoy the priority review of market authorisation application as prescribed in the Procedures if they fulfil the following preconditions:

• the applicant possesses the Chinese invention patent for the core technology of the medical devices. The aforementioned patent must have been granted within the five years prior to the application or the patent application must have been published;
• the applicant has finished its preliminary research and has developed a sample of the medical products. The research data is true, complete and traceable; and
• the mechanism of the medical device should be new in China. The efficacy or safety of the medical device must provide fundamental improvement compared with other devices in the same category. The technology of the medical devices is in a leading position in the world and has significant clinical value.

If the above preconditions are fulfilled, the NMPA and inspection institutions will review the application of the relevant medical device in priority. However, the normal standards and procedures for reviewing will be applied without simplification.

To read the full text of the Procedures (in Chinese only), please click here.

NMPA publishes the registration principles for medical devices treating rare diseases, 19 October

The NMPA published the Guiding Principles to the Registration of Medical Devices for Rare Diseases Prevention and Treatment ("Guiding Principles") on 19 October 2018. The Guiding Principles prescribe certain favourable rules for the registration of medical devices for rare diseases, including exemption of clinical trial, and conditional approval.

The Guiding Principles apply to medical devices with the purpose of preventing, diagnosing and treating rare diseases. Rare diseases refer to the diseases listed on the official Rare Disease Catalogue (see the first batch of rare diseases here, both in Chinese and in English).

Medical devices can enjoy clinical trial exemption on the condition that it is sufficiently proven that the benefits for patients using such devices are significantly greater than the risks, or that the medical device can be compared with marketed medical devices in the same category.

For medical devices that have been approved for marketing outside China, applicants are permitted to use their overseas clinical trial data in accordance with the Technical Guidelines on the Acceptance of Data Derived from Overseas Clinical Trials of Medical Devices published on 10 January 2018.

Depending on the balance of the risks and benefits for patients regarding the medical device, the expected clinical application and the pre-market research, the authority may grant conditional approval, meaning:

• the use of the relevant device may be restricted to certain medical institutions;
• the benefit-risk evaluation of the medical device in clinical application should pay attention to certain content and patients shall be clearly informed of certain content before giving their consent to use such devices;
• the applicant shall conduct post-market research; and
• the authority may set out a time period by which the product must pass evaluation.

To read the full text of the Guiding Principles (in Chinese only), please click here.

Draft guidelines for naming health foods, 22 October

SAMS published the Guidelines for Naming Health Foods (Draft for comment) ("Draft") on 22 October 2018. The Draft was open for public comment before 16 November 2018. Health foods under the Draft refers to food with specific healthcare or body-regulating functions but that cannot be used for treating diseases. The four general principles for naming health food are:

1. the ‘one product one name principle,’ meaning that one applicant shall not use one single formula or name to register two or more health foods;
2. the name should reflect the true character of the product, be easy to understand, be simple and direct, and comply with Chinese language usage;
3. the name should not mislead or deceive consumers, or contain any deceptive or misleading content concerning the prevention or treatment of diseases, and
4. the name should comply with PRC laws and regulations.

The name of health foods should consist of three parts: the trade name, the general name and the attribute name. The trade name refers to the registered or unregistered trade mark in accordance with the PRC Trade Mark Law. The general name refers to the product’s main ingredient or the characteristic. The attribute name refers to the food category or dosage forms of the product.

The Draft prohibits certain words and expressions from being used in the name of health food, including but not limited to:

• false expressions, for example, using “natural” on health food that is made of synthetic ingredients;
• exaggerated words, for example, “highly effective” or “wonder effect”;
• absolute words, for example, "No.1" or “top-class”;
• express or implied expressions of disease treatment functions, for example, “prescription”, “doctor” or “anti-inflammatory”;
• the name of a person or a place;
• names of human tissues, cells or organs, for example, “brain” or “eye”; and
• any alphabet or Arabic number, except for those contained in trade marks or ingredients (for example, vitamin B1).

To read the full text of the Draft (in Chinese only), please click here.

Direct ADR reporting for marketing authorisation holders, 30 September

The NMPA published the Circular on the Direct Adverse Drug Reaction ("ADR") Reporting for Drug Marketing Authorisation Holders ("Circular") on 30 September 2018. The Circular will take effect on 1 January 2019.

Being responsible for drug safety, the MAH should establish an effective internal governance system to ensure that ADR is directly reported to the competent authority in a timely manner. In the event that the MAH entrusts a third-party agent to supervise and report ADR, the relevant legal liability should still be assumed by the MAH. The MAH for any imported drugs must appoint a representative office or legal person within the PRC to undertake the supervision, evaluation and risk control concerning the ADR for such imported drugs.

The MAH should actively collect the ADR information through various approaches. If any ADR is noticed or known, the MAH must report it within below time period:

In the event that an ADR causes death, the MAH should also submit an investigation report to the relevant provincial-level ADR administration authority.

The scope of reporting is broad. Any suspicious adverse reactions and any adverse reactions that may possibly result from the use of the related drug must be reported, including ADR caused by drug quality, overdose, off-label use and contraindications, among others.

Medical institutions may report to the MAH directly. Drug distribution companies must also report directly to the MAH. The MAH should analyse the collected ADR data and submit an annual report before 31 March every year to the provincial-level ADR administration, covering the operation of the internal ADR supervision system, risk control and post-market research during the previous year, amongst other matters.

The Circular also prescribes the liabilities of MAH for non-compliance, including but not limited to a sale suspension, warning, fine, and the revocation of drug approval.

To read the full text of the Circular (in Chinese only), please click here.