The Life Sciences Law Review: China

Introduction

China has continued with drug and device regulatory reform to promote innovation, despite the challenges of the covid-19 pandemic. Since 2017, the government has been implementing the Opinion on Deepening the Reform of the Review and Approval System and Encouraging the Innovation of Drugs and Medical Devices (Innovation Opinion) (No. 42 of 2017), in which it established a plan to foster a research-based, innovative industry for drugs and devices.

Pursuant to the Innovation Opinion, the National Medical Products Administration (NMPA), the chief drug and device regulator, has concentrated on further defining the marketing authorisation holder (MAH) or the 'registrant' as the centre of pre- and post-market product-related regulatory obligations. In addition, China adopted expedited pathways to market for innovative products and, for drugs, a patent linkage system to protect the rights of innovative drug marketing authorisation and patent holders and provide greater certainty about patent challenges for follow-makers prior to the launch. These reforms reflect the Innovation Opinion's commitment not only to fostering innovation but also to a holistic, life cycle approach to drug and device regulation. At the same time, certain pillars of the prior system (and obstacles to innovation) for drug and device applicants remain, including certain differences in requirements between imported and domestically produced products, the lack of any implemented regulatory market exclusivity or data protection, and uncertainty with respect to clinical trial and marketing application requirements and submission practices, among others.

The sections below explore this ever-changing regulatory environment for drugs and devices, including through recent, significant amendments of the primary laws and regulations governing this area, the Drug Administration Law (DAL) (in 2019) and the Regulation for the Supervision and Administration of Medical Devices (RSAMD) (in 2021), and prospects for even further reform.

The regulatory regime

i Regulatory agencies and their jurisdiction

The NMPA is the primary pharmaceutical and medical devices regulatory agency in China. It is a subordinate bureau of the State Administration for Market Regulation (SAMR), a super-ministry that covers company registration, product and consumer protection regulation, advertising, antitrust, standardisation and intellectual property, among other areas. Previously, the China Food and Drug Administration – a stand-alone ministry – regulated this area, but the 2018 government reorganisation reshaped it into a smaller, specialised product regulator under SAMR.

The NMPA enjoys power over most aspects of pre-market approval, distribution, manufacturing, use and a substantial part of post-marketing activities. Under the current arrangement, the NMPA is organised into departments and it has affiliated centres covering different regulated products and specialised areas. The departments have responsibility for, inter alia, administration of product registrations and enforcement functions, while the affiliated centres are responsible for scientific review and recommending product approval decisions for the departments to adopt and implement. For drugs, the primary departments include the Department for Drug Registration and the Department for Drug Supervision. The affiliated centres include the Centre for Drug Evaluation (CDE) and the Centre for Drug Re-Evaluation (CDR). The CDE evaluates clinical trial and marketing authorisation applications and approves subsequent amendments and renewals. The CDR includes the National Centre for Drug Adverse Reaction Monitoring, which is also responsible for drug and device adverse event monitoring.

The NMPA similarly has registration and supervision departments for medical devices. The Centre for Medical Device Evaluation (CMDE) is the affiliated centre responsible for organising the technical evaluation of medical devices.

The NMPA relies on provincial counterparts or local medical products administrations (MPAs), which are affiliated with local 'market supervision bureaus' (also referred to as 'administrations for market regulation')2 and carry out various activities, including accepting certain drug and device applications, reviewing manufacturing and distribution licence applications for drug and device facilities, conducting on-site inspections, and collecting and testing samples.

Other government agencies also play important roles in the drug and device regulatory framework. The SAMR has a significant role in enforcing advertising and promotion and other consumer protection and fair competition and antimonopoly laws that intersect with the drug and device industries. CNIPA grants and assists with enforcement of drug patents. The National Health Commission (NHC, formerly the National Health and Family Planning Commission (NHFPC)) oversees all aspects of the medical profession and hospitals (which include NMPA-accredited clinical trial sites for drugs and devices) The National Healthcare Security Administration plays the primary role in updating a list of reimbursable drugs for government insurance plans and organising the centralised procurement of drugs and medical devices by public hospitals. For imported drugs, the China Customs Administration is involved in product-quality inspections and customs clearance.

ii Primary statutes and regulations

Unlike in the United States, there is not one law covering foods, drugs, devices and cosmetics. There is a separate law or an administrative regulation governing each of these areas. The primary statute regulating drugs (including biologics) is the DAL. The State Council has enacted one general set of implementing rules for the DAL, referred to as the DAL Implementing Regulations (DALIR).

The NMPA administers several agency rules under the DAL and the Regulations for Implementation of the DAL to govern various activities, such as development, registration, manufacturing and marketing of drugs. The core regulations governing clinical trials and small molecule drug and biologic registration are the Drug Registration Regulations (DRR).

The CDE also issues its own guidance documents related to drug development and registration, priority pathways and supplemental applications, including a number of International Council for Harmonisation of Technical Requirements for Pharmaceuticals for Human Use (ICH) guidelines.

The framework legislation for medical devices is a regulation (not a law), namely the RSAMD.3 As with drugs, the NMPA has enacted a number of implementing rules covering registration, production and distribution, and the CMDE has issued a number of guidelines.4

iii Classification

Drugs

The general structure and classification of drugs is governed by the DAL. The newly revised DAL defines 'drugs' broadly as:

any substance used for preventing, treating and diagnosing human diseases as well as purposely regulating human physiological functions with specified indications or functions, usage and dosage, including traditional Chinese medicines . . . chemical drugs and biological products.5

Once determined to be a drug, the regulatory requirements applicable to a product will be determined by its pathway and its features. The location of manufacturing inside of mainland China or outside determines the primary pathway, with different requirements for domestically manufactured drugs or imported drugs.

Under the DRR, drugs are classified into three broad categories: (1) traditional Chinese medicines and natural drugs; (2) chemical drugs; and (3) biological drugs. Certain in vitro diagnostics (IVDs) are also regulated as drugs. Within each classification, drugs are again placed into registration categories. These registration categories determine the non-clinical and clinical data and other requirements necessary for registration. Instead of including the registration categories in the DRR itself as before, the NMPA released separate registration guidelines for biologics, small molecule drugs and IVDs regulated as drugs. The categories are based on the approval status of the drug in China and abroad, whether it is an approval of a new active ingredient (versus a feature, e.g., indication), and the data package on which it is approved (i.e., full data or bioequivalence). For example, small molecule drugs:

  1. Category 1: innovative drugs that have not been marketed inside or outside of China;
  2. Category 2: drugs with improvements (i.e., to dosage form, formulation process, route of administration and indication) that have not been marketed inside or outside of China. Category 2 contains a number of different subcategories for different types of improvements, which further refine the requirements;
  3. Category 3: generics for which the originator drug is marketed abroad but not in China;
  4. Category 4: generics for which the originator drug is marketed in China; or
  5. Category 5: Drugs that are marketed abroad but not in China (category 5.1 is for originator overseas drugs and drugs with improvements and 5.2 is for generics).6

Certain types of drugs may also be subject to separate and heightened requirements or require additional special permissions. The most prominent example is now vaccines, which are subject to various requirements under the 2019 Vaccine Administration Law, but other examples are blood products, 'narcotic drugs' and 'psychotropic drugs', which are subject to, among other restrictions, stringent limits on research, manufacturing and distribution depending on their active ingredients and further classification.

Devices

Medical devices are also defined via regulation and then further sub-classified. The RSAMD defines 'medical devices' broadly as:

the instruments, equipment, appliances, in vitro diagnostic reagents and calibrators, materials and other similar or related articles directly or indirectly used with human bodies, including the computing software required. Their effectiveness is primarily achieved by physical or other similar means and not by pharmacological, immunological or metabolic means, although it may be assisted in its function by such means, the purpose of which is to achieve the following objectives: (1) diagnosis, prevention, monitoring, treatment or mitigation of diseases;
(2) diagnosis, monitoring, treatment or mitigation of injuries or the functional compensation thereof;
(3) inspection, replacement, adjustment or support of the physical structures or physiological processes;
(4) life support or sustaining;
(5) pregnancy control; and
(6) provision of information for medical or diagnostic purposes by inspecting the samples of human bodies.7

The RSAMD then defines three classes of medical devices:

Class I medical devices means medical devices with low risks, and those for which safety and effectiveness can be ensured through routine administration; Class II medical devices means medical devices with moderate risks, which must be strictly controlled and administered to ensure their safety and effectiveness; Class III medical devices means medical devices with relatively high risks, which must be strictly controlled and administered through special measures to ensure their safety and effectiveness.8

The NMPA and its relevant divisions have ultimate discretion to determine what constitutes a medical device and what class it fits into.

Applicants for a device registration may make their own determination as to classification and then submit their application to the NMPA or they can treat their device as a Class III and ask the NMPA to make adjustments.9 They can make that determination with reference to the Medical Device Classification Catalogue, which lists specific devices and their intended uses, and general rules and principles of classification. The National Institute for Food and Drug Control (NIFDC), which is another affiliated centre of NMPA, runs a process through which manufacturers can submit applications for a predetermination of device classification.

The current RSAMD and the Measures on Medical Device Registration and Filing still essentially treat a medical device as either a domestic device or an imported device (a distinction reflected in the NMPA database containing device approvals), depending on whether the finished device is manufactured inside or outside of China. If it is an imported device, the NMPA reviews and approves a registration application for Class II and Class III devices. Class I imported devices go through a record-filing (i.e., notification) system, which the NMPA also administers. For domestic devices, the review and the reviewing authority depend on the classification. Class I device manufacturers must notify municipal authorities before marketing their products; a provincial-level device regulatory authority approves Class II medical device registration applications; and the NMPA reviews and approves Class III medical device domestic registration applications.10

Most IVDs are considered medical devices. The NMPA maintains a separate body of regulations for IVD devices, including different rules on development, registration, and licence amendment and renewal.

Combination products

A combination product is defined as a 'medical product that is composed of drugs and medical devices and produced as a single entity'.11 If the primary mode of action of a product is medicinal, the CDE will review it as a drug, and consult with CMDE on the device portion. If the primary mode of action of a product is physical, the CMDE will review it as a device, and consult with CDE on the drug portion. The Standards Management Centre of NMPA will review such products and issue an opinion on the dominant mechanism of action, drug or device, and thereafter the applicant will apply according to their opinion. NMPA issues catalogues of combination product approvals, so potential applicants can review prior determinations to better understand how their application might be treated.12 CDE and CMDE must each review the non-clinical and clinical data under their jurisdiction regardless of the dominant mechanism of action.

iv Non-clinical studies

Both drugs and devices require various non-clinical and clinical testing to support marketing. If done in China (which is not always the case), non-clinical studies for drugs must comply with the NMPA Drug Good Laboratory Practice Regulations,13 and must be conducted by institutions and laboratories that have been certified by the NMPA.

Pre-trial type testing is required by NMPA, which is required before any unapproved device can be used in a clinical trial in China. As will be explained below, this testing may be done by the applicant using laboratories outside of China that follow China standards or accredited laboratories in China. The NMPA also accredits laboratories that conduct pretrial type testing for Class II and III devices.

v Clinical studies and data

Under the regulations, the default requirement for a permission to market a drug and a device in China is to conduct a clinical study or evaluation. Some devices are exempt from clinical evaluation requirements based on existing data and the safety record of predicate devices, and drug applicants can apply for an exemption from all or part of the clinical trial requirement based on existing data. For both drugs and devices, the NMPA has adopted more structured mechanisms to accept foreign data and real-world evidence to support marketing applications and supplements in China. 'Medical tourism' zones and hospitals being established in China increasingly allow unapproved drugs and devices to be used in the event of a clear clinical need by patients. Real-world data from this limited use may also be used to support later applications for national marketing of the drug or device.

NMPA may accept data from investigator sponsored studies (ISSs). China has increasingly subject these previously largely unregulated trials to additional regulation, releasing a trial version of rules in 2021 for certain pilot areas (i.e., Beijing, Shanghai, Guangdong and Hainan), with requirements and restrictions on scope, design and implementation.14

Drugs

Before a drug clinical drug trial can be initiated in China, the sponsor must submit a clinical trial application (CTA) to CDE for approval. China has implemented an 'implicit approval system' in which the applicant submits a dossier or materials and then may begin the trial according to its protocol if the CDE has not objected within 60 business days of the date of filing. There is a separate system of notifications for bioequivalence studies to support generic drugs. An old policy remains in place that the applicant for and sponsor of a trial for an imported investigational drug must be an overseas entity but the applicant must appoint an entity in China to act as an agent on the application and a local sponsor for purposes of running the trial. The sponsor may also appoint contract research organisations to assist.

Currently, for new drug trials, the NMPA may permit an umbrella review of all three phases of a trial following a pre-CTA meeting. In other cases, an application for each phase may be required.15 There are a number of other prerequisites to conduct a clinical trial in China:

Proof of foreign approval

Whereas previously prior foreign approval was required for imported drugs, that requirement has been abolished. No proof of foreign approval is required at the clinical trial stage if the drug has not yet been approved elsewhere, although proof of the approval for an overseas clinical trial may be required in the case of vaccines.16 If the drug has been approved abroad, China's drug regulations generally require submission of proof of approval in the form of a certificate of pharmaceutical product prior to submitting the CTA for an imported drug. The NMPA still generally maintains the rule that the overseas holder of the foreign approval submitted with the application in China must be the China applicant or sponsor.

Ethics committee approval

Clinical trials can be conducted only at institutions that have been inspected and accredited by the NMPA with departments that have been certified for that type of clinical investigation. The sponsor must seek review and approval of the clinical trial by a qualified ethics committee at each institution. If the institution has one, another approval by a clinical trial department or management committee may be required.

Good clinical practice compliance

Drug clinical trials intended to support registration must comply with drug good clinical practice regulations, and various other ICH and CDE guidelines. The CDE has issued a number of guidelines generally applicable to the running of clinical trials, including those on reports of suspected unexpected serious adverse drug reactions, development safety update reports and data monitoring committees.17

As will be explained below, another critical prerequisite for any clinical study involving a foreign or foreign-invested company is human genetic resource (HGR) approval.

Devices

Clinical data are typically used to establish the safety and efficacy of medical devices that are registered for marketing in China.18 If a device requires a clinical evaluation, an applicant can conduct such an evaluation either by conducting a clinical trial or by analysis of clinical literature, materials on other devices, and clinical data. The determination as to the requirements for the clinical evaluation should be made based on the unique features of the device, clinical risks and existing clinical data.19

Clinical trials of most medical devices do not require NMPA approval. However, the NMPA has issued and continuously updates a catalogue of certain high-risk Class III devices for which pre-approval of the clinical trial is required. This catalogue includes six different types of products that the NMPA deems to pose higher risks to human bodies, such as artificial heart valves and endovascular stents.20

All trials for both medical devices and IVDs must take place at hospitals and other healthcare institutions that the NMPA has accredited to conduct device trials.21 As with drugs, in 2017, the State Council amended the RSAMD to permit hospitals to qualify as clinical trial sites after completing a filing process.

While no pre-approval from the NMPA is required (unless the device is designated as a high-risk Class III device), all medical device clinical trials must be approved by the institution's ethics committee and notified to the provincial-level government where the clinical trial sponsor is located.22 Device trials must comply with medical device good clinical practices (GCPs).23 These GCPs added to the provisions on informed consent (including those on consent from children and others who lack the capacity to consent), requirements for agreements between sponsors and the site, and the coordination of multi-site trials. The GCPs provide reporting requirements for adverse events that occur during the trial. In vitro diagnostics are subject to a separate set of GCPs for their trials, which was updated in September of 2021.24

NMPA has issued guidance on the acceptance of foreign data to support device registration applications, focusing on design, human subject protections and attention to ethnic differences, and guidelines on real-world evidence for medical devices, articulating the agency's expectations for certain types of observational studies.25

Currently, devices can be exempt from conducting a pre-market clinical evaluation in the following circumstances: (1) devices for which there is an identical type of device on the market with a mature mechanism of action, design and production technology and a well-established safety record following many years of clinical use; and (2) devices that can be evaluated effectively through non-clinical data.26 Exemptions similar to (1) and (2) also exist under the revised IVD regulations.27

Biosecurity and human genetic resources

HGR regulation is an increasingly important area. All clinical research must follow procedures for approval set forth in the Human Genetic Resource Regulations (HGR Regulations), which have existed in some form since 1998.

Pursuant to the current HGR Regulations (2019), foreign companies or companies in China that are actually controlled by a foreign party (e.g., have some form of foreign investment or ex-Mainland China investor) that sponsor clinical trials in China and need to utilise human biospecimens (HGR Materials) or data associated with human biospecimens (HGR Information) must apply for approval or notification jointly with Chinese parties (e.g., a hospital or purely Chinese-owned company) from the Office of Human Genetic Resource Administration (OHGRA) within the Ministry of Science and Technology. The OHGRA approves the plan for utilising data and samples during the study. This approval or notification is required regardless of whether the foreign company is conducting genetic tests and covers any sample that contains human DNA.28 All foreign collaborators must be listed on the HGR application, including Clinical Research Organisations (CROs) and central laboratories, and any 'other entities' (foreign or Chinese) that will be involved in the trial and need to receive HGR information or samples.

OHGRA administers approval processes for the biobanking, HGR material exportation, and transfer of HGR information to non-collaborator foreign parties (i.e., the 'other entities' described above). The data transfer mechanism to send data to non-collaborators is a two-step process under which the Chinese party must upload the data to be transferred prior to transferring data associated with the samples to a third party outside of the collaboration. In the second step, the Chinese party files a form with the transferee's information, a risk assessment of their data security system, and a list of the data transferred.

The regulations on human genetic resources also require sharing of intellectual property, including patent rights to any invention arising out of the collaboration. At least rights to patentable inventions (and underlying data) arising from any exploratory aspects of the collaboration must be jointly owned. The OHGRA reviews the description of the IP sharing arrangement as part of the application and as part of its review of the agreements associated with a clinical trial to determine whether these requirements have been met and has significant discretion to delay or reject an application.

The OHGRA has vigorously enforced the HGR Regulations subjecting foreign companies to fines and debarment from conducting further clinical studies in China for several months. The OHGRA now regularly requires that companies submit self-inspection reports to attest to companies or non-compliance with HGR approval requirements,29 and the local science and technology authorities conduct site inspections to review HGR compliance documentation related to past and ongoing studies. China's legislature recently added specific HGR-related criminal violations to its Criminal Law.

In 2020, China's legislature enacted a Biosecurity Law, which covers a variety of areas, from the protection against bioterrorism and public health threats, such as infection diseases, and protection of human genetic, animal and plant resources. Thus far, there has not been much concrete implementation of the Biosecurity Law or changes to the HGR regime on this basis.

vi Named-patient and compassionate use procedures

Although the DAL created an expanded access pathway for a company sponsor to apply for an expanded access treatment programme for patients with life-threatening illnesses that otherwise cannot qualify for the trial, and it permits limited drug compounding by medical institutions for use on their own patients, these provisions do not yet have clear implementing rules.30

In the absence of a finalised compassionate use pathway, the Bo'ao medical tourism zone in Hainan Province has emerged as a place that provides earlier access to unapproved drugs and medical devices. Medical institutions can assess patients for a treatment plan in the zone and apply for importation of unapproved medicines and medical devices. The government also established the Greater Bay Area Zone in Guangdong Province for drugs and devices that have already received approval for marketing in Hong Kong and Macao. If those products would fill a clinical need in China, they can be imported and used in one hospital for one year.

vii Pre-market clearance

Drug marketing authorisations

Once development is complete, the applicant submits an application for a marketing authorisation. If the drug is made outside of China, this will be the foreign enterprise as the application and an appointed agent submitting the application. The foreign applicant will designate a domestic MAH Agent to assist it with meeting regulatory obligations in China. The MAH Agent can be held jointly liable with the MAH for all MAH obligations. As discussed above, if the drug is approved abroad, the applicant will need to present a certificate of pharmaceutical product (CPP). The name of the applicant must be the same as the holder of the CPP.

Pre-clinical and clinical data and information about manufacturing and formulation, including ingredients and packaging must be presented. With respect to the latter two items, the NMPA has implemented a platform through which active pharmaceutical ingredients, new excipient, packaging supporting material for small molecule drugs can be registered (analogous to a masterfile system). The marketing authorisation stage requires testing of products to meet specifications and potentially site verification inspections for clinical data and manufacturing (in addition to qualifying good manufacturing practice (GMP) inspections for domestic facilities).

Generic drug application

With the exception of originator drugs manufactured abroad, drugs that are not new to the world are generic drugs and go through an abbreviated process through which they establish therapeutic and quality equivalence to a reference product marketed in China or abroad. Equivalence is established either through a bioequivalence study, an in vitro study, if the drug qualifies for an exemption, or a clinical trial to show efficacy in some cases. In most cases, the reference product will be an originator product, but the NMPA will also permit an 'internationally recognised' generic product to serve as a reference product.31 The NMPA and CDE have released regulations on the selection of a reference product in the following order of priority for small molecule drugs: an originator drug that is marketed in China, a foreign originator drug that is made in China or there has been a technology transfer to China, and an originator drug that has not been imported to China.32

Like in other jurisdictions, biosimilars follow separate guidelines, including methods for research and development of similar biologic products and their stepwise characterisation and comparison to reference originator products.

Approval timelines

In 2015, the NMPA began examining what had become a huge application backlog (by some estimates over 20,000) for both drugs and devices. By 2019, the NMPA claimed that the backlog had all but disappeared as a result of methods to increase resources and expedite certain reviews.33

The total time for review, site inspection, drug sample testing and final approval of an imported drug licence, a new drug application or a generic drug application is in flux, but it can still take one to two years. Most of this time continues to be occupied by the CDE review process. The DRR provides for review of marketing applications in 200 business days, but in practice, the CDE's review can take longer.

There are also several expedited programmes, breakthrough designation, conditional approval, priority review and approval and special approval.34 There are shortened timelines of 70–130 business days for applications in these programmes.

Supplements, annual reports and renewal applications

Certain post-approval changes to a drug, whether imported or domestic, require NMPA approval of a supplemental drug application. Certain changes may require a new drug application, such as a new indication, route of administration, or change of a marketing authorisation holder. The NMPA has developed a hierarchy of major, moderate and minor changes. Depending on the degree to which the change affects the safety and effectiveness of the drug, certain changes may not require approval and may only require a record-filing or a notification in an annual report. For example, moderate alternations to the manufacturing process and changes to the labels on the drug packaging may be done by record-filing with provincial drug authorities.35 The NMPA has been working to finalise a regulation on annual drug reporting that may be finished in 2022. The annual report must include sales and marketing information, post-market research information, and risk management information, which includes a description of major, moderate and minor changes.

A drug marketing authorisation is valid for five years. Six months before expiry of the registration, the applicant must submit a renewal application to the NMPA if it is an imported drug or to the local provincial drug regulatory authority if it is a domestic drug. Renewal applications require adverse drug reaction information and may require non-interventional or Phase IV study if a condition under the original approval. The CDE must grant or deny timely renewals within six months.36

Device marketing authorisation

Some form of pre-market review and approval is required for domestic production or importation of all three classes of medical devices. Domestic and imported Class I devices must be notified to either the municipal food and drug regulatory authority where the manufacturer is located or the NMPA, if manufactured abroad, before being placed on the market. Once the applicant submits the notification, the authorities will make an 'on-the-spot' determination to issue a notification certificate, provided that the materials are complete. As with drugs, for imported devices, the applicant must appoint a regulatory agent in China.

Under the latest RSAMD, for all Class I, II and III devices, either the applicant itself or government-certified laboratories verify conformity with the device's 'technical requirements', which the applicant must formulate in advance, and applicable standards through testing.37 This testing is often referred to as registration testing.

The statutory time frame for agency decisions on the different types of devices depends on the class of the device and the type of technical review required. For Class I devices, either the municipal device regulatory authority or the NMPA (if an imported device) will make an immediate determination of the completeness of materials and, if complete, accept the notification.38 As discussed below, NMPA gives expedited consideration to certain types of devices. Medical device registration certificates are valid for five years, after which they must be renewed in a process similar to that for drugs.

Changes to certain elements of the registration require amendments or updates. As with drugs, the type of amendment and the length of review depends on whether it has a substantial effect on the safety and effectiveness of the device. Those matters with substantial effect require approval prior to implementation, while other moderate changes require only a record-filing. Some manufacturing changes can simply be accomplished according to the procedures set forth in the applicant's quality management system and reported in the relevant annual report.

viii Regulatory incentives

Chinese regulation is designed, in some respects, to encourage innovation and development and manufacturing of products for which there is a particular clinical need and value through expedited pre-market approval pathways. By contrast, effective post-approval regulatory incentives are weaker and their implementation is incomplete. China has established a system of patent protection for drugs and devices, although recent statistics show that the invalidation rate for those patents is fairly high.39

Drugs

There are no true regulatory exclusivities in China, particularly for imported drugs. The NMPA released a draft regulatory data protection regulation,40 but has done nothing since. The prior version of the DRR provided that the NMPA can set a 'new-drug monitoring period' of up to five years when it approves the manufacturing of a domestic drug that is first in its class. The monitoring period blocks commencement of development by others, but it was not available for imported drugs. Within the revised chemical drug registration categories, the monitoring period only applies to innovative new drugs and improved new drugs, which means it only applies if the drug (or its innovation) is new to the world.

Considerably more progress has been made in the area of patent linkage. In 2020, China amended the Patent Law to establish a cause of action to resolve patent disputes on pharmaceutical products prior to marketing. Article 76 of the revised Patent Law permits a lawsuit in the people's courts by the patent or other rights holder prior to the marketing of the follow-on drug to determine whether the drug that is the subject of the follow-on marketing application falls within the technical plan of patent on the approved drug.

The NMPA, the CNIPA Administration and the Supreme People's Court subsequently released three rules to implement patent linkage. The NMPA and CNIPA released a rule that provided procedures for small molecule drug and biologic MAHs to list formulation and indication patents on a platform that CDE began to operate. Generic or biosimilar makers are required to provide a statement as to relevant patents on the platform when they file their marketing applications. A Paragraph IV statement that the relevant patent is invalid or not infringed triggers the MAH's or patent holder's right to file an Article 76 action within 45 days in the Beijing Intellectual Property Court or before CNIPA (administrative adjudication). For small molecule drugs, NMPA will stay its approval of the generic drug for nine months or until the lawsuit ends, whichever is shorter. For biologics there is no stay. NMPA may approve the biosimilar, although if the suit ends in favour of the innovator before that time, the biosimilar approval will not become effective until the patent expires. The Supreme People's Court and CNIPA introduced procedural rules to govern these suits. The system was effective and implemented as of summer 2021 and the first case based on a Paragraph IV statement is currently proceeding in the courts.

Devices

The regulations for the registration of medical devices do not require patent certification or contain provisions on data or market exclusivity, and they are not covered by the aforementioned reforms. The revised Measures on Medical Device Registration and Filing in 2021 expressly state that any patent disputes will be handled under the relevant laws (i.e., the Patent Law).41 There are procedures for expedited review and approval of medical devices when they meet unmet medical needs or there is a public health emergency and the same kind of device is not marketed in China, or is marketed but is in short supply. Medical devices undergoing expedited procedures also benefit from assistance from the NMPA during development and registration.42 'Innovative devices' that have intellectual property in China, represent well-developed and cutting-edge technology, and are the first of their kind or represent a significant improvement over existing technology in China are also eligible for expedited review and approval.

ix Post-approval controls

Post-market surveillance

Drug and medical device manufacturers are obligated to establish systems to report and analyse adverse drug reactions (for drugs) (ADRs) and adverse events (for devices), and meet any conditions imposed as part of the product approval.43 In 2021, the NMPA issued and implemented detailed regulations, the Good Drug Pharmacovigilance Practices ('Good PV Rules') creating requirements for internal PV systems and personnel, PV reporting (i.e., individual and periodic adverse drug reactions) and post-market research. Notably, the Good PV Rules require reporting of both serious and non-serious ADRs. This appears to be an expansion of a prior rule that required reporting of non-serious ADRs only when the drug was under a monitoring period or an imported drug in its first license term.

For medical devices, the reporting obligations under the new regulations remain similar (albeit with different timelines for reporting), serious adverse events and group adverse events. For 'innovative devices' (those devices that have not yet been approved anywhere in the world), licence holders are required to report all adverse events for the first five years of the device licence.

MAHs are obligated to recalls of drugs and medical devices because of risks of unreasonable harm or other safety or quality issues, including when products do not meet their registered or other applicable quality standards (defined as 'defects').44 If an MAH discovers a defect, it must recall the product. If it does not do so, the government has the power to order recalls.

Transfer of licences

Although difficult in the past, the revised DAL now expressly states that the transfer of marketing authorisation is permitted, provided it is approved by the NMPA and the transferee agrees to assume obligations for safety, effectiveness and quality. The DRR also provides a marketing authorisation can be transferred between two entities after the NMPA has approved it. The NMPA issued a regulation on post-market changes to marketing authorisations that covers changes of MAHs and indicates that transfer between ex-China entities also requires that the ex-China transferee hold an approval from the relevant foreign regulatory authority, which remains the main obstacle to such transfers proceeding smoothly.45 An analogous transfer pathway exists for devices.

x Manufacturing controls

As discussed above, drugs and Class II and III device manufacturing facilities located in China must hold drug or device manufacturing licences and observe drug or device GMP. Class I device facilities submit a notification to local food and drug regulatory authorities before proceeding with production and must also be GMP compliant. GMP inspections are required prior to licensure or significant amendments to licences.

Contract manufacturers must be similarly GMP-compliant and hold the requisite manufacturing licence. In some circumstances in which the NMPA has determined that the products present heightened risk, such as in the case of psychotropic or narcotic drugs or aortic stents, contract manufacturing is not permitted.46 Vaccine MAHs must have their own manufacturing capacity and contract manufacturing is only permitted upon special approval from NMPA to meet capacity needs.47 All contract manufacturers and MAHs must execute supply and quality agreements, meeting the obligations of each.48

Ex-China manufacturers that supply drugs to China are also required to comply with GMPs for drugs or devices, as the case may be. The NMPA monitors compliance with all facilities that support the products that it licenses through inspections. Foreign inspections may be routine or for cause.

xi Advertising and promotion for drugs and devices

The local MPAs must pre-approve all drug and medical device advertising and prohibit any direct-to-consumer advertising of prescription drugs. The term 'advertising' is broadly defined under the general Advertisement Law and can include any published media that directly or indirectly introduces the product (or service). There is a joint rule that covers the procedure for seeking such approval in the place where the MAH/registrant or its domestic agent resides, and sets forth content restrictions for the different types of advertisements, including that the advertisement may not contain any content beyond that approved in the registration of the product (i.e., its label or package insert).49

Some penalties for an unapproved advertisement include hefty fines in the hundreds of thousands of dollars, immediate revocation of the advertisement approval, and rejection of any advertisement application for the subject drug for one year. Heavier penalties would apply in the event that an illegal advertisement expands the scope of the indications or primary therapeutic function, exaggerates efficacy or seriously deceives and misleads consumers and include the provincial authority suspending the sale of the subject drug within the province that has jurisdiction, and ordering the drug company to run corrections regarding the advertising concerned.

The NMPA also regulates medical representatives, who are able to engage in a quasi-promotional form of scientific information exchange referred to as academic promotion. These medical representatives are permitted to establish plans for promotion, communicate information about drugs to medical staff, assist medical personnel in the rational use of drugs (i.e., understanding their use), and collect feedback on the drugs. They are not allowed to engage in drug sales, such as collecting payment, or processing purchases and bills of sale. Medical representatives must be authorised by power of attorney or labour contract with the marketing authorisation holder to conduct their activities and must be filed with an industry association NMPA.50

xii Distributors and wholesalers

China requires a company to have a licence to engage in the retail or wholesale distribution of drugs that are manufactured by other companies. No distribution licence or other permission is required for a drug or device MAH to distribute the products for which it holds approval, provided that it is not for retail and specified distribution quality conditions are met. Both drug and device distributors must meet respective sets of good supply practices.51

Class III devices also require a distribution licence, while distributors of Class II devices must submit a notification to their local municipal governments and certain Class II devices are now exempt altogether.52 Class I device distributors do not require any licence or filing.

In 2017, China released a policy for drugs called the Two Invoice System. The aim is to curb corruption in the drug supply chains, and the system limits those supply chains to two invoices. In other words, once the product leaves the manufacturer or the manufacturer's agent, there may be only two invoices, one from the manufacturer to the distributor and one from the distributor to the end-user hospital. There are some limited exceptions to this system, such as for transfers between entities in the same corporate group or to exclusive distributors, or under some provincial rules, registration agents. Certain provinces have expanded the system to devices. There is now a one-invoice system for certain drugs that are part of centralised procurement systems in certain provinces.53

Vaccines have a special system of distribution. They may only be sold between the manufacturer and the county level Centre for Disease Prevention and Control (CDC). In the case of an imported vaccine, the ex-China MAH must appoint a general distributor in China to act in its place and sell the vaccine to the CDC.54

xiii Prescription status

The NMPA classifies drugs as prescription drugs or over-the-counter (OTC) drugs, and requires the NMPA's review and pre-approval for both. For the purposes of distribution and sale, the NMPA further classifies OTC drugs into Type A or B. Type A drugs can be sold only by pharmacies or distributors that have received drug wholesale or retail distribution licences, and Type B drugs can be sold at most retail outlets. The NMPA has not set up prescription or non-prescription classifications for medical devices, but pursuant to their approvals, some devices may only be sold to and used in medical institutions.

xiv Enforcement

Overall, the enforcement environment has become stricter. The revised DAL and RSAMD have raised penalties significantly and the NMPA and the local MPAs have come to expect significantly more sophisticated regulatory compliance systems and activities from drug and device manufacturers. The NMPA has also introduced provisions into regulations that make enforcement easier, such as requiring strict compliance and demanding recalls for non-compliance with thousands of mandatory standards.

Enforcement against violations of drug or medical device requirements is undertaken by the drug regulatory authorities at national, provincial and lower local levels, with cooperation from other government agencies such as the SAMR, NHC and the public security bureau (China's police force) at all levels of government. Routine and for-cause inspections and investigation of complaints by competitors and individual consumers are the primary means of detecting actual or suspected violations, and complaints from competitors are often the triggers for for-cause inspections. The NMPA has also adopted comprehensive regulations on unannounced inspections for drug and device manufacturers.

Penalties include administrative fines, seizure of products, disgorgement of profits, revocation of licences, and blacklisting of companies and individuals (i.e., debarment). Criminal liability can be imposed for many violations. Production or distribution of counterfeit medicines as defined by the DAL may be subject to life in prison or the death penalty if the violation causes death or especially serious harm.55

Pricing and reimbursement

China has recently begun to reform its system for drug pricing. Specifically, it has abolished the 'maximum retail price' for drugs and is now implementing a plan to permit those prices to be set more by the market and by reimbursement standards negotiated more openly by stakeholders. Prices will still be set or guided by the government for certain types of drugs, such as narcotic drugs and psychotropic drugs. For all other drugs, however, the prices may be freely set by the manufacturers, provided that they accurately reflect costs.56

For drugs that are reimbursed on China's state insurance plans (discussed below), the government still has the power to determine reimbursement rates. For patented drugs produced exclusively by one manufacturer, the price will be set through transparent negotiations between the manufacturer, government and healthcare industry representatives.

As background, most insurance is through state plans. China abandoned its universal care system in the 1980s and 1990s, with coverage in the countryside at only 14.8 percent in 1988.57 China established three government-run insurance plans that it developed for urban residents, urban sector employees and rural residents. The goal was to ensure universal coverage for the entire population. The resident plans were merged in 2016 into the Urban and Rural Resident Basic Medical Insurance, leaving only two plans. Covered drugs for these plans are included in the National Reimbursement Drug List (NRDL), which has a total of 2,800 drugs in its most recent version, which the government revised in December 2020 and will update once a year.

The National Healthcare Security Administration (NHSA) makes the decision to include a drug in the NRDL. In doing so, it will seek public comment, organise an expert review, select the drugs and vote on inclusion. It will then negotiate with drug companies for partial candidate products. From 2020, drug companies are required to apply to have their products, which meet certain conditions set forth by the NHSA, included in the NRDL.58 A total of 119 drugs were newly added in 2020, through successful negotiation of an average price cut of 50.64 per cent by the NHSA with the various drug companies.59

The NRDL is categorised into two lists. Drugs on List A are the essential drugs and are fully reimbursable in any province. Drugs on List B are only partially reimbursable under various insurance schemes at provincial level. Reimbursement rates for the drugs on the NRDL are determined by government agencies based on various factors, including cost of production, clinical need, and supply and demand. Pricing and reimbursement decisions are now taken primarily by the NHSA.

The process for admission to the NRDL has traditionally lacked clear rules and application procedures. In 2020, the NHSA finalised a rule that set forth the procedure, materials and considerations that NHSA follows in determining the entry of drugs to the NRDL.60 Under this rule, certain types of drugs, e.g., healthcare drugs and drugs that are mainly used to enhance sexual function, treat hair loss, lose weight, beautify the features, quit smoking and alcohol or otherwise, are explicitly excluded from the NRDL, and certain drugs will be directly removed from the NRDL, such as drugs whose approval certificates have been withdrawn, revoked or cancelled by drug regulatory authorities.61

There is also a public procurement system for government-run hospitals, which dispense most healthcare. For the purpose of reducing drug prices, the State Council started a pilot programme in four municipalities and seven cities that requires centralised procurement through a bidding or negotiation process of certain selected drugs for which the generic drugs have proven their therapeutic and quality equivalence to corresponding reference products.62 The winning product, normally the one with the lowest price offered, will take 60 to 70 per cent of the volume of such type of product purchased by state-owned hospitals for the following year. The pilot programme continued to evolve and was later expanded to the entire country with the winning products taking 50 to 80 per cent of the market share in state-owned hospitals (depending on how many products won the bidding). Although currently this centralised procurement programme does not apply to new drugs with valid patents, Wuhan is conducting a pilot programme to expand it to those drugs as well.63

By contrast, the private commercial insurance sector is smaller.64 For example, the government has been trying to promote critical disease insurance for individuals who have exceeded their coverage level under the state plans. Individuals with qualifying diseases that obtained critical disease coverage would be eligible for 50 per cent reimbursement under those plans. The government has encouraged the commercial insurance sector to play a strong role in providing this type of coverage.65

Administrative and judicial remedies

Administrative and judicial remedies are available in China to appeal agency decisions and redress illegal government practices. Administrative regulations are rarely challenged in the courts for alleged defects in the underlying authority or rule-making procedures because China's Administrative Litigation Law prohibits 'abstract' challenges of this sort to the validity of administrative rules. Most efforts to formally challenge the NMPA focus on challenging concrete NMPA administrative decisions instead. Processes are available for both administrative reconsideration and judicial review of administrative decisions, but it may be difficult to win cases in court in the absence of a clear violation by the agency of laws, regulations or its own rules.

i Administrative reconsideration

When an applicant is not satisfied with a government agency's decision, the applicant may file an administrative reconsideration request for review by either the government agency itself or its supervising ministry or department.66 To file an administrative reconsideration request challenging a NMPA decision, the applicant must have legal standing to do so. The complaint must name the respondent and the specific decision the applicant is challenging.67

A special division within the NMPA is responsible for handling administrative reconsideration requests (the Administrative Reconsideration Office (ARO)) to challenge decisions made by the NPMA itself or its local offices. For complex cases and cases involving a challenge to underlying laws or regulations, the Administrative Reconsideration Committee (ARC), which consists of the commissioner and deputy commissioners of the NMPA and ranks higher than the ARO, will hear the case. The applicant can appeal an ARO or ARC decision to the State Council, whose decision is final, without the availability of judicial review.

The DRR contains a new dispute resolution mechanism related to drug applications. When an applicant disagrees with the CDE's rejection of its application, it may submit its opinion within 15 business days of the rejection. The CDE will evaluate the applicant's opinion and provide a decision. If the applicant still disagrees with CDE's comprehensive evaluation conclusion, the CDE will organise an expert committee within 50 business days to review the conclusions and make a final decision.68 If at any time during the registration period the applicant believes that a decision has not been objective or impartial, the applicant can file a complaint to the entity involved or its acceptance and complaint centre, which will handle that complaint according to internal procedures. Applicants have access to standard administrative reconsideration and litigation procedures thereafter.

ii Judicial lawsuit

If an applicant decides not to appeal the ARO or ARC's decision to the State Council, it may bring a judicial lawsuit in the People's Court against the ARO.69 If the People's Court finds that any of the following conditions are met, then the administrative act must be annulled or partially annulled, or the defendant must be ordered to take another alternative administrative act.70

Financial relationships with prescribers and payers

China has enacted laws and regulations to prohibit bribery, kickbacks or other inappropriate financial relationships or sponsorship. The revised DAL itself contains these provisions, and penalties for violations could include revocation of the drug or medical device approvals, civil fines and criminal penalties. In addition, the SAMR administers the Anti-Unfair Competition Law and regulations against commercial bribery. Bribery cases may also be handled through the criminal justice system. Scrutiny of these activities has grown substantially in the past few years since the government launched anti-bribery investigations of foreign drug manufacturers.71

Scrutiny in this area continues to be significant and regulatory reform is continuing. In late 2014, the NHC issued measures on clinical research projects at medical and other health institutions, which, among other things, called for stronger clinical research and ethics committee management of these projects, and guidelines for financial management intended to prohibit payments directly to investigators.72

To further control improper incentives given by the drug industry to Chinese hospitals, in 2015, the NHC released regulations further circumscribing donations to healthcare institutions, emphasising that all such donations must have an acceptable charitable purpose and that charities (all donations must flow through approved charities) must conduct a thorough review of the donor and the plan for the donation itself.73

Special liability or compensation systems

Patients have rights to compensation for harm caused by drugs and devices pursuant to the newly enacted Civil Code, and provisions in other laws, such as the Consumer Protection Law, the Product Quality Law and the Regulations on Medical Disputes. The newly revised DAL adopts a principle of joint liability common to other areas of Chinese law under which a patient can bring suit against the MAH, the manufacturer, the distributor or the hospital and those entities must accept responsibility and defend the suit regardless of fault. They can later be indemnified by the true responsible party.

Footnotes

1 John Balzano is a partner at Covington & Burling LLP. This chapter is based on the 'China' chapter in previous editions of The Life Sciences Law Review, which was authored by John Balzano and Andrew Shaoyu Chen. Kexin Yang also contributed to the research and footnotes of this chapter. The author also wishes to thank Aaron Gu for his contribution to the chapter.

2 While varying from year to year, the local drug agencies and affiliated organisations at provinces and municipalities have a total approximate headcount of 80,000 (direct and affiliated).

3 The Regulations for the Supervision and Administration of Medical Devices (State Council 2021), available at https://www.nmpa.gov.cn/xxgk/fgwj/flxzhfg/20210319202057136.html.

4 These regulations cover in vitro diagnostic reagents (IVDs), but IVDs are regulated separately under a specialised set of implementing regulations. Throughout this chapter, references to medical devices refer to non-IVD devices, unless otherwise indicated.

5 Article 2 of the DAL. Translation provided by LexisNexis.

7 Article 103 of the RSAMD. This is an edited version of the translation available on www.chinalawinfo.com.

8 Article 6 of the RSAMD.

9 Article 23 of the RSAMD.

10 Article 8 of the Measures on Medical Device Registration and Filing (SAMR No. 47 2021), available at http://gkml.samr.gov.cn/nsjg/fgs/202108/t20210831_334228.html.

11 Notice on Matters Related to the Registration of Drug-Device Combination Products (No. 52 NMPA 2021), available at https://www.nmpa.gov.cn/xxgk/ggtg/qtggtg/20210727154135199.html.

12 CFDA Notice on Tissue Engineered Medical Products and Related Application Requirements (CFDA 2007), available at https://www.nmpa.gov.cn/xxgk/ggtg/qtggtg/20071218120001912.html.

13 Good Laboratory Practice Regulations (CFDA 2017), available at https://www.nmpa.gov.cn/directory/web/nmpa/xxgk/fgwj/bmgzh/20170802160401550.html.

15 See, e.g., Procedure for the Review of Breakthrough Therapeutic Drugs (Trial); Procedures for the Review and Approval of Conditional Marketing Approval of Drugs (Trial); Procedures for the Priority Review and Approval of Marketing Approval of Drugs (Trial) (NMPA No. 82) available at: https://www.nmpa.gov.cn/xxgk/ggtg/qtggtg/20200708151701834.html.

16 Guidelines on the Acceptance and Examination of Registration of Biological Products, available at
https://www.nmpa.gov.cn/xxgk/ggtg/qtggtg/20201016145016178.html.

18 Article 24 of the RSAMD.

19 Article 25 of the RSAMD.

20 Notice on Issuing the Catalogue of Class III Medical Devices that are Required to Conduct Clinical Trials (NMPA 2020), available at www.nmpa.gov.cn/directory/web/nmpa/ylqx/ylqxggtg/ylqxqtgg/20200918103742111.html.

21 Article 26 of the RSAMD.

22 ibid.

23 Good Clinical Practices for Medical Device Clinical Trials (CFDA No. 25 2016), available at
https://www.nmpa.gov.cn/directory/web/nmpa/xxgk/fgwj/bmgzh/20160323141701747.html; The Inspection Items and Judgement Principles for Clinical Trials for Medical Devices available at
https://www.nmpa.gov.cn/xxgk/fgwj/gzwj/gzwjylqx/20181128142501830.html.

25 Technical Guidelines for Clinical Evaluation of Medical Devices Using Real-World Data (NMPA 2020), available at www.nmpa.gov.cn/xxgk/ggtg/qtggtg/20201126090030150.html.

26 Article 24 of the RSAMD.

27 Article 37 of the Measures on the Registration of In Vitro Diagnostic Reagents (2021), available at
https://gkml.samr.gov.cn/nsjg/fgs/202108/t20210831_334232.html.

28 Tentative Measures on the Management of Human Genetic Resources (State Council General Office 1998), available at http://www.most.gov.cn/kjzc/gjkjzc/kjtjybz/201308/P020130823579540624649.pdf.

29 Notice of the General Office of the Ministry of Science and Technology on Carrying out Special Inspections on the Administrative License Administration of Human Genetic Resources, available at
www.gov.cn/zhengce/zhengceku/2020-01/02/content_5466025.htm.

30 Article 76 of the DAL.

31 Opinion on Developing Therapeutic and Quality Equivalence Evaluation for Generic Drugs (State Council General Office No. 8 of 2016), available at www.gov.cn/zhengce/content/2016-03/05/content_5049364.htm.

32 Procedure for Section and Determination of Reference Product for Chemical Generics (NMPA 2019), available at www.nmpa.gov.cn/xxgk/ggtg/qtggtg/20190328162401710.html.

33 2018 Annual Report on Drug Evaluation (CDE 2 July 2019), available at https://www.cde.org.cn/main/news/viewInfoCommon/3a4925c8270f851ef57d78b3b8dbe14d.

34 Notice on Several Questions of Policy Related to Drug Registration Evaluation and Approval (CFDA 2015), available at https://www.nmpa.gov.cn/directory/web/nmpa/xxgk/ggtg/qtggtg/20151111120001229.html.

35 Article 80 of the DRR.

36 Decision on Adjusting the Procedures Related to Part of the Examination and Approval of Certain Drug Administrative Matters (CFDA 2017), available at www.nmpa.gov.cn/WS04/CL2174/300692.html.

37 Article 14 of the RSAMD.

38 Notice on Several Matters Related to Class I Medical Device Notification (CFDA 2014), available at https://www.nmpa.gov.cn/xxgk/fgwj/gzwj/gzwjylqx/20140915151901858.html.

39 'Over 75% Patents are Invalidated? New Drug Research and Development is Afraid to Fall into the Paradox of Chine Style Innovation', Zhouhuang Lu, China Intellectual Property Magazine, Issue 137, available at www.phirda.com/artilce_18053.html?cId=1.

40 Draft on the Implementing Measures for the Protection of Trial Data of Drugs (for Interim Implementation) (NMPA 2018), available at https://www.nmpa.gov.cn/directory/web/nmpa/xxgk/zhqyj/zhqyjyp/20180426171801468.html.

41 Article 67 of the Measures on Medical Device Registration and Filing.

42 Articles 2 to 5 of the Procedures for Emergency Review and Approval of Medical Devices (NMPA 2021), available at https://www.nmpa.gov.cn/xxgk/ggtg/gtggtg/20211230171343117.html.

43 See, e.g., Articles 28 to 30, 76, 83 and 84 of the DRR, and Article 62 of the RSAMD (requires manufacturer to establish device adverse event reporting system).

44 The Measures on the Administration of Drug Recalls were promulgated in 2007, and the Measures on the Administration of Medical Device Recalls (Interim) were promulgated in 2011 and amended in 2017.

46 Article 12 of the Regulations on the Supervision and Administration of Drug Contract Manufacturing (CFDA No. 36 2014), available at https://www.nmpa.gov.cn/directory/web/nmpa/xxgk/ggtg/qtggtg/20140814110901422.html.

47 Article 22 of the VAL.

49 Interim Measures for the Administration of Censorship of Advertisements on Drugs, Medical Devices, Dietary Supplements and Formula Foods for Special Medical Purposes (SAMR 2019), available at
http://www.gov.cn/gongbao/content/2020/content_5488918.htm.

50 Medical Representative Record-Filing Management Regulation (Trial Provisions) (NMPA 2020), available at www.nmpa.gov.cn/xxgk/ggtg/qtggtg/20200930163955170.html.

51 Article 66 of Medical Device Good Supply Practices (CFDA 2014), available at https://www.nmpa.gov.cn/directory/web/nmpa/xxgk/ggtg/qtggtg/20141212120001527.html.

52 Articles 41 of the RSAMD.

53 www.gov.cn:8080/xinwen/2019-11/18/content_5453082.htm.

54 Chapter 4 of the VAL.

55 Article 141 of the Criminal Law of the People's Republic of China.

56 Circular Concerning Opinions on Advancing the Drug Pricing Reform (NDRC 2015), available at
http://www.gov.cn/gongbao/content/2015/content_2901386.htm.

57 1988 Economic and Social Development Statistics (Nat'l Bureau of Statistics 2002), available at
http://www.stats.gov.cn/tjsj/tjgb/ndtjgb/qgndtjgb/200203/t20020331_30001.html.

58 ibid.

59 Explanation on the 'Notice on Substitute of Negotiated Drugs in 2020 National Essential Medical Insurance, Work Injury Insurance and Derivative Insurance Drugs Catalogue', available at
http://www.nhsa.gov.cn/art/2020/12/28/art_38_4219.html.

60 Interim Measures for the Administration of Use of Drugs Covered by the Basic Medical Insurance (NHSA 2020), available at www.nhsa.gov.cn/art/2020/7/31/art_37_3387.html.

61 ibid.

62 Circular of the General Office of the State Council on Issuing the Pilot Program for Conducting Centralised Drug Procurement and Use by the State (State Council 2019), available at www.nhsa.gov.cn/art/2019/1/17/art_37_482.html.

64 Several Opinions on Accelerating the Development of the Modern Insurance Service Industry (State Council 2014), available at http://www.gov.cn/xinwen/2014-08/13/content_2734444.htm.

65 Opinions on the Full Implementation of the Critical Disease Insurance Program for Urban and Rural Residents (State Council 2015), available at http://www.gov.cn/zhengce/content/2015-08/02/content_10041.htm.

66 Administrative Reconsideration Law (NPC 2017), available at www.npc.gov.cn/npc/c30834/201709/ff2f2aadd940478999f6ef01d4daeeb7.shtml.

67 Administrative Reconsideration Measures of the CFDA (CFDA 2013), available at www.nmpa.gov.cn/WS04/CL2077/300657.html.

68 Article 90 of the DRR.

69 Article 44 of the Administrative Litigation Law (NPC 2017), available at www.npc.gov.cn/npc/xinwen/2017-06/29/content_2024894.htm.

70 Article 70 of the Administrative Litigation Law; see also Article 6 of the Provisions of the Supreme People's Court on Several Issues Concerning the Hearing of Administrative Cases of International Trade (SPC 2002), available at http://dcj.mofcom.gov.cn/article/zcfb/cp/200504/20050400079036.shtml. Similar interpretations can be found in Provisions of the Supreme People's Court on Several Issues Concerning the Application of Laws in the Hearing of Anti-Dumping Administrative Cases (SPC 2002), available at http://dcj.mofcom.gov.cn/article/zcfb/cq/200504/20050400059794.shtml, and Provisions of the Supreme People's Court on Several Issues Concerning the Application of Laws in the Hearing of Countervailing Administrative Cases (SPC 2002), available at http://dcj.mofcom.gov.cn/article/zcfb/cn/200504/20050400072112.shtml.

71 Notice on Improving the Medical Health-Care Workstyle and Establishing the Nine Prohibitions (NHFPC 2013), available at http://law.pharmnet.com.cn/laws/detail_2553.html.

72 Administrative Measures on the Development of Clinical Research Projects at Medical Health Institutions (NHFPC 2014), available at http://www.nhc.gov.cn/yzygj/s3593g/201410/9bd03858c3aa41ed8aed17467645fb68.shtml.

73 Administrative Measures on Accepting Donations for Public Welfare by Healthcare Entities (for Trial Implementation) (NHFPC 2015), available at www.nhc.gov.cn/caiwusi/s3573/201510/761f2a9e36f74c1e9f00849f8de61f49.shtml.

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