The Opportunity in China


China has emerged as the second-largest pharmaceutical market in the world, where a growing patient population, significant unmet medical needs, new regulatory reforms and expanding reimbursement are driving demand for high quality, innovative medicines.

Patient Population

China has the world’s largest number of patients across most therapeutic areas, which is primarily attributable to the large and aging population, changing life-style and environmental factors. According to Frost & Sullivan, there were 4.4 million new cancer patients in China in 2019, with a projected increase to 5.7 million in 2030. In comparison, cancer incidence in the U.S. was 1.8 million in 2019 with anticipated growth to 2.2 million in 2030. In the case of IgA Nephropathy, an orphan indication in the U.S. and Europe, the incidence in China was over 2 million in 2019. The large and growing patient population in China not only represents an attractive commercial market for innovative medicines, it also allows us to rapidly advance our product candidates through clinical trials and deliver them to patients.

Regulatory Reforms

In recent years, China has introduced a series of new regulations and policies which aim to accelerate the review and approval process for innovative drugs. As a result, more advanced and effective treatments are expected to enter the China market at an expedited pace. The chart below summarizes the key changes.

Reforming Clinical Trial Management

Before

Requiring lengthy approval for clinical trial applications (12-18 months)

Now

Implied clinical trial application ("CTA") approval (60 days)

Accepting clinical trial data generated abroad

Accelerating Review and Approval

Before

Lengthy review and approval process

Active pharmaceutical ingredients ("APIs") and formulations are approved separately

Now

Fast track and priority review of drugs addressing unmet needs, e.g. oncology therapies

Enabling conditional approval based on surrogate endpoints for drugs addressing unmet clinical needs, e.g. oncology therapies

Linked approval of formulation and API, excipients and packaging

Leveraging electronic common technical document ("eCTD") for NDA review

Realizing Global Application

Before

A drug must be in a Phase II or Phase III clinical study or has received marketing authorization abroad before it can begin an international multi-center trial ("IMCT") in China

Now

Accepting foreign clinical data

Removing restrictions on clinical trials and registrations for imported drugs


Expanding Reimbursement

Starting in 2017, the number of innovative medicines included in China’s national reimbursement drug list (NRDL) began to increase substantially. 36 innovative and patented drugs were incorporated into the NRDL in July 2017. 17 oncology drugs were added to the NRDL in October 2018, and 97 drugs were added in November 2019, 22 of which were oncology drugs. This expansion of NRDL coverage significantly increases the market opportunity for innovative drugs, since inclusion into the NRDL typically results in a much higher sales volume and significant sales growth along with a negotiated discount in price. The period between NDA approval and inclusion in the NRDL has also shortened considerably since 2017.

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