In addition to enjoying a rich culture and history, TCM is also a billion-dollar market that offers some surprising opportunities for Western medical and consumer brands.

What is TCM and how big is the market?

TCM is an alternative medicine practice that combines a range of remedies and physical treatments, with a history dating back more than 2,000 years.

Among the many kinds of TCM treatments on offer, herbal medicine is both popular and accessible. Pharmacies and online shops sell a wide range of prepared herbal remedies – some prescription only, some over-the-counter – that come in forms such as drops, tablets or granules, many of which are mixed with water to form a drink or soup.

In terms of physical therapies, acupuncture, a technique involving inserting thin needles into specific body points to balance energy flows, is widely practised, as is cupping therapy, characterised by creating suction on the skin to improve blood circulation and promote healing, which has also gained international popularity (especially since telltale cupping marks have been seen on the backs of professional athletes like Michael Phelps and Hollywood stars like Gwyneth Paltrow).

TCM doctors may also prescribe specific diets, such as avoiding meat or spicy food.

TCM coexists with Western medicine in China, complementing and contrasting with it. In hospitals across China, TCM is offered alongside Western medical services, and patients often combine both types of treatments to avail comprehensive healthcare, since TCM is said to be grounded in the principles of balance and identifying the root causes of conditions rather than treating the symptoms.

Due to this broad range of treatment options and cultural backdrop, the TCM market in China is huge. According to some reports, in 2019, the total volume of TCM commodity imports and exports in China was worth US$ 6.174 billion (£5.028 billion). TCM products are thought to account for around 40% of drug sales in China.

Moreover, in recent years, it has experienced unprecedented growth, fuelled by an ageing population, health fears around the Covid-19 pandemic, and rising support for Chinese culture and made-in-China products (often referred to as the ‘guochao’ movement).

The most valuable company in the TCM market is Yunnan Baiyao, which has a market cap of over RMB 91.42 billion (£10.2 billion). Other major companies include Beijing Tongrentang and Guangzhou Baiyunshan.

TCM Market challenges

Despite its size, the TCM market is not without its challenges. Regulatory hurdles, quality control issues and international scepticism are significant impediments. Standardising TCM practices and products for quality and safety assurance is a primary concern for the Chinese government. Furthermore, scientific validation of TCM principles and methods, compatibility with Western medicine protocols, and global acceptance and integration are ongoing challenges.

How Western brands can navigate the TCM market

A market that is so inherently entwined with Chinese culture and history may seem like one that is difficult to access for Western brands. But for those that understand its cultural, historical, and social intricacies, the opportunities are there.

In recent years, collaborative approaches that respect and integrate TCM’s essence while introducing trendy products or formats have proven very popular with Chinese consumers.

In sum, any Western brand considering the TCM market needs to consider the following principles:

1. Integration: Combining Western technologies and TCM principles to offer hybrid solutions that actually meet patient needs.
2. Education: Educating the market on the benefits of Western medicine, while being receptive to the values and benefits of TCM.
3. Partnership: Collaborating with established TCM brands to co-create products and services that are culturally sensitive and globally competitive.
4. Innovation: Infusing Western medicine with innovations that are compatible with TCM’s holistic, personalised, and preventive focus.

The TCM market in China is a dynamic and evolving entity. Western brands venturing into China’s medical market have the opportunity to create uniquely cross-cultural, multi-dimensional medical solutions by approaching TCM with respect and openness. As the health concerns of China’s ageing population grow, there will be opportunities for Western brands to penetrate this market.

The post Exploring the Traditional Chinese Medicine Market in China appeared first on Focus - China Britain Business Council.

The size of the Chinese healthcare industry is second only to the US, reaching a value of RMB 7.82 trillion in 2019. British medical device manufacturers have traditionally taken a cautious approach to the China market due to IP concerns, competition risks and fear about language and cultural barriers. But the market opportunity is huge for those who strategically structure their approach, instead of treating the market like another non-core area and delegating all activities to their distributor.

This article introduces the key steps manufacturers should take to help their medical device get approved by the China regulator by being seen as safe and effective for China sales.

Step 1: Determine the approval pathway for your device for China

There are three broad pathways to get your medical device approved for sale into China:

1. Standard approval process with the National Medical Products Administration (NMPA)
2. Fast-track (also known as “green channel”) approval pathways
3. Alternative pathways via sales to special areas within Greater China – the Greater Bay Area or Hainan Island Pilot Zone – that may enable easier registration via subsequent standard or fast-track approval processes.

The three main approval pathways to register a medical device in China

The vast majority of imported medical devices will seek to apply via the standard pathway to NMPA in Beijing. To do this, products should first have home country approval. For higher-risk devices (class II or III – see below for more information about classification), approval in China will probably require a detailed clinical evaluation report to be prepared or a clinical trial in China to be undertaken.

For “fast-track” pathways, only the newly introduced “Innovative” approval pathway allows devices without home country approvals to submit for China approval. Success in such applications requires a China patent, as well as evidence that the product is a first of its kind for application into China.

Other fast-track (also known as “green-channel”) approval pathways in China include priority review or emergency approval applications. Emergency approvals are reserved for special situations like the Covid-19 pandemic, and specific categories or types of devices will be announced by the NMPA as eligible for application. Once approved for emergency use, subsequent renewals will require the standard full documentation similar to standard applications.

The alternative pathways of the Hainan Pilot Zone and the Greater Bay Area are frameworks enabling companies with home country approvals to sell in limited circumstances. This can aid the collection of real-world data on China populations, which can reduce eventual China clinical trial requirements for subsequent NMPA standard or “fast-track” applications.

Step 2: Classify the device into the appropriate risk class and establish whether China clinical trials are required

Your medical device will need to be registered in your home market before you can apply for China marketing approval, subject to the exceptions explained above.

The risk classification in your home country jurisdiction will often be similar to China’s three risk classes, with class I being the lowest risk and class III being the highest risk (although not necessarily equivalent). According to the NMPA, the degree of risk is assessed based on “the intended purpose, structural characteristics, pattern of use, status of use as well as whether the device is body contacting.” China tends to be more conservative than other countries and so risk classification can be up-classified depending on the type of device.

There is an extensive risk classification catalogue which is sufficient to determine the appropriate class for most medical devices, but according to your author’s experience, in roughly 5% of cases it is necessary to apply directly to the regulator for a determination.

How to classify a medical device in China

If your product is a class I medical device then it will go through a simple filing process in China. If it is a class II or class III product, then it must go through a registration process which means there is a review of the product documentation by the NMPA prior to marketing approvals.

Class II and III device applications will need to be exempt from clinical trials, rely on predicate device data or be supported by clinical trial data (see Figure 3 for whether a clinical trial may be required).

For companies that are unclear about whether China clinical trials are required, Cisema recommends preparing a feasibility study of the pathways and data available.

Step 3: Understanding the key steps for filing and registration

The filing process for class I is relatively straightforward and consists of a dossier preparation stage followed by submission to NMPA. This is represented in Figure 4 below. The total timeline is usually around 2-4 months.

Filing process for class I submissions in China

For class II and III medical devices, the registration process is longer and more rigorous. First, there is the documentation stage, including drafting of the product technical requirements (PTR), which is a key technical protocol outlining the local testing specifications and relevant China standards. Then follows local testing of product samples in China – a mandatory requirement – following by clinical evaluation drafting or clinical trials, before submission of the dossier to NMPA for review and approval.

In certain cases, a class II or III product may be expressly exempt from clinical trials in China. In such cases, a simplified clinical evaluation report or even no CER at all will be required.

Timeline of China registration of class II & III medical devices

Step 4: Select your local China representative

In parallel with the registration process, manufacturers will need to carefully consider the identity of their local authorised representative – more accurately known as the NMPA Legal Agent. Like the EU and US, applicants must be represented by a local China entity for the purposes of submission and approval in China.

Importing manufacturers have three options: distributor, local subsidiary or service provider. The distributor option is often the default, but manufacturers should be cautious of potential IP risks (a lot of production information needs to be provided to the NMPA Legal Agent as part of the application process – and the dossier must be submitted by the agent) as well as for flexibility and regulatory expertise following marketing approvals. The NMPA Legal Agent will be involved in the first import of the product for each new distributor named, so flexibility will be limited for such a huge market if there is one master distributor who in effect needs to approve the others.

Also, NMPA has increasingly moved to a whole of lifetime perspective rather than point-of-time approvals. This means there will continue to be ongoing updates and requirements during the product’s lifetime even after marketing approvals are obtained. A typical list of your NMPA Legal Agent’s services should cover adverse events and recall management, labelling and regulatory mandatory updates, standards updates, periodic reporting and more.

Unless manufacturers want to make a substantial investment in their own subsidiary in China, a better option is to nominate an independent service provider who has deep regulatory expertise and fewer conflicts of interest.

In summary, UK manufacturers should think strategically about their China medical device registrations but not be swayed by hearsay or general fears. Registration of your device in China is realistic and achievable with the right approach and investment. Only then can China’s vast market potential be realised.

The post How to get your medical device approved for sale in China appeared first on Focus - China Britain Business Council.

We are always learning as China is rapidly evolving. As new challenges and opportunities continually drive AstraZeneca’s objective to reshape healthcare in China, one important aspect we have learned is to lead change in tandem with our partners.

While we continue to focus on understanding and tackling the critical unmet health needs in China, recent positive changes in the regulatory environment have likewise enabled accelerated review of new medicines that address these needs. One such example is Tagrisso (osimertinib), a new medicine for patients with lung cancer that is available today in 75 countries worldwide. It was the first new medicine to be approved through China’s new Priority Review Pathway and is a great example of how the Chinese Government is improving access to key treatments for patients in China.

Today we are the second-largest MNC in the Chinese pharmaceutical sector, with more than USD $750 million invested in extensive research and development (R&D), manufacturing and commercial operations networks. Our commitment to be in “in China for China” has continued since entering the country 25 years ago in 1993, and we’re still learning and evolving in how we deliver on that commitment for patients and in partnership with local Government.

An ageing population and rising income levels have seen China’s healthcare industry grown rapidly, how has this influenced your China strategy?

There are significant unmet health needs in China, within a large and ageing population with increasing affluence and demand for quality healthcare. AstraZeneca has paid close attention to aligning with and supporting key government strategies in China, and therefore the Healthy China 2030 policy (establishing health as a national priority with the need for innovative solutions to increase patient access to healthcare), and the Made in China 2025 policy (representing China’s efforts to develop a modern, innovative economy) have significantly influenced our strategy – innovation, expansion and partnership to address China’s unmet medical needs. AstraZeneca will continue to invest in developing its business as part of China’s pharmaceutical industry ecosystem.

You have a major R&D centre in Shanghai, what made you choose China as a location?

As part of AstraZeneca’s global business strategy, we have increased our proximity to bioscience clusters by co-locating skills, knowledge and capabilities around three strategic R&D centres in Sweden, the UK, and the USA, as well as laboratories in California, Boston, Osaka, and Shanghai. Our strategic choice of China as a location for a major R&D centre allows us to both contribute to the development of China’s local pharmaceutical innovation ecosystem and to deliver medicines that address unmet medical needs more effectively and efficiently. We are currently developing several innovative molecules locally that have the potential to be approved in China before any other market globally.

How important is the China region to your global growth strategy?

We continue to see strong sales growth in China and we expect this trend to continue with innovative medicines playing a key role in future growth. The economy is moving more to one based on innovation. The Government is working hard to facilitate and accelerate the approval of new medicines. And China is fast becoming integrated into the global network for regulatory approval and the development of new pharmaceutical products.

Added to this, our product portfolio and pipeline investments aim to help address the critical unmet health needs in China, plus a hugely talented local team and significant presence with capabilities across the value chain. We are also encouraged by the Government’s strong commitment to improving access to innovative medicines for patients in China, while the China FDA continues to improve processes and support bringing new medicines to the market. It is very encouraging across the board for AstraZeneca in China.

Which partners are you working within China and how have you found them?

Through our “in China for China” strategy we are committed to working with the Chinese government at municipal, provincial and national levels to realise our ambitious and shared agenda, to which end AstraZeneca has made every effort to build local partnerships. We are encouraged by recent policy developments including accelerating the innovative drug review and approval process to facilitate faster patient access to medicines, and implementing a pilot on reimbursement negotiation to increase the affordability of innovative medicines.

We also work closely with provincial and municipal government partners, which include Shanghai and Pudong, which support AstraZeneca’s headquarters and new drug discovery centre. In Jiangsu Province, we work with Nanjing, Wuxi, and Taizhou on innovative R&D centres, manufacturing sites, and new scientific partnerships. With support from the Wuxi Government, in 2017, we established an innovative joint venture with the State Development Investment Corporation, which will enable us to accelerate R&D in China and more effectively deliver medicines to local patients. A collaboration with FibroGen will hopefully allow us to deliver roxadustat, an innovative medicine for patients with anaemia in chronic kidney disease, first in China.

There are significant unmet health needs in China, within a large and ageing population with increasing affluence and demand for quality healthcare

With Tencent, we’re looking at security and addressing counterfeiting by tracking medicines at the patient level through a pilot that will run in the next 12-18 months. With Alibaba, we have started work in diabetes, delivering customised messages to patients. Ultimately to change how patients are treated for the better and ensure product supply is secure.

What are the key things to be aware of when working in China?

The significant opportunities for partnership and the integration of updated processes, in particular where driven by new technologies. We continue to learn how digital health technologies can help to create new future for patients in China, evidenced by our strategic digital partnership with the government to develop “Internet of Things” (IOT)-based healthcare solutions. This is one example of how AstraZeneca can help to advance ideas and processes sustainably, which is possible as we have built the right culture.

We also welcome the commitment made by government to support the protection of intellectual property, which is fundamental for the industry. It means China is a good place to do innovation and to invest in healthcare.

You are attending this month’s Oncology Congress. Can you tell us about your role at the Congress?

It presents an excellent opportunity for AstraZeneca to join with academic and industry experts from the UK and China to tackle the global challenge posed by cancer. Premier Li’s recent announcement of reduction of tariffs on imported anti-cancer drugs to zero, a follow-up to his original comments on this matter at the Two Sessions in March of this year, represents China’s commitment to increasing the supply of cancer drugs for patients. AstraZeneca is encouraged by these developments and believe events such as the China UK Oncology Congress represent important events to collaborate with all stakeholders to help China in its fight against cancer.

The post Leon Wang, AstraZeneca’s Executive Vice-President for International and President of China, discusses China’s healthcare industry appeared first on Focus - China Britain Business Council.