It is several times now that Jon Pilcher has made specific reference to China with respect to licensing of trofinetide in Rett syndrome. It’s probably fair to assume that a Chinese licensing deal will swiftly follow if Phase 3 results are successful.
Within the space of just a few years, the orphan drug landscape has altered significantly in China.
Following the formation in 2016 of the Expert Committee of Rare Disease Treatment and Support under the National Health Commission, the China National Drug Administration (CNDA) proposed 10 year exclusivity for new rare disease drugs in 2017.
In May 2018, a first Rare Disease List was jointly published by the new NHC, along with the CNDA and several other agencies. Rett syndrome was not included in this list of just 121 diseases. However, in a Procedure of Developing the Rare Disease List protocol which was released the same month, a future pathway for adding more diseases to the list was outlined.
The protocol listed the following four criteria for rare disease designation:
The disease has a low prevalence or incidence in China and other countries.
The disease significantly impacts the patient and his or her family.
There is a clear method of diagnosis.
The disease is treatable and intervention is feasible and economically accessible. Alternatively, there is no currently available treatment but the disease is being investigated under a government-funded research program.
Hence, although not listed in China's first Rare Disease List, there is a pathway for Rett syndrome to be added.
In June 2018, a further incentive for orphan drug development was provided when the Chinese State Council issued an opinion that the CNDA should review applications for orphan drugs and drugs for unmet medical needs within 3 and 6 months, respectively. Not only did this add a clear review timeline to the orphan drug regulatory pathway, but it also significantly accelerated approvals.
The following month, in-licensing of orphan drugs from foreign companies was encouraged when the CDNA issued a final guidance that a rare disease drug can gain approval in China with overseas clinical data, regardless of whether the drug has been approved in other countries or not. This means it is potentially possible to file applications for new orphan products simultaneously in China and other regions. Even if there are potential ethnic differences with regard to safety and efficacy, an orphan drug can still gain conditional approval with post-approval commitments to assess efficacy and safety in the Chinese patient population.
Finally, in March 2019, in a further move to encourage orphan drug development, the Chinese State Council announced that the value-added tax rate for 21 drugs and four APIs for rare diseases would be reduced from 16% to just 3%.
The Chinese government’s fast-paced incentivization of orphan drug development and commercialisation has already made an impact, with a record number of orphan drug approvals issued in China last year. Rare disease in-licensing deals are also growing in popularity, with several announced just this month.
Chinese companies with a rare disease focus are attracting investment. A leading Chinese rare disease pharma, CANbridge Pharmaceuticals, managed to raise US$141 million last year to expand its orphan disease pipeline through internal development and external partnerships. The company recently received marketing approval in China for its leading rare disease candidate, a drug for Hunter syndrome which it licensed from Korean pharma, GC Pharma. Unfortunately, as with other Chinese in-licensed orphan drug deals, the deal value was undisclosed.
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