China’s registration fees for drugs, devices seeing a drastic rise

HONG KONG – Biotech and medtech companies operating in China now have to pay more attention to the cost of regulatory approvals after the national regulator drastically raised registration application fees for both clinical trials and marketing approvals.

“This will give the CFDA more evaluation resources to speed up the reviewing process as well as raise the threshold for drug developing,” said Fiona Cheng, director of Genor Biopharma Co. Ltd.’s preclinical, clinical and registration department.

“The raise of the registration fee is a huge change for China,” Xu Chao, managing director at the Germany branch of Chinese medical device service company Osmunda, told BioWorld Asia. “The registration fee for medical devices used to be nothing.”

In a recently published public note, the CFDA changed all registration fees for pharmaceuticals and medical devices. The Chinese regulatory body said the charging standards for the industry were too low and hadn’t been updated since 1995 and that companies should pay for the costs of the reviewing process rather than relying on taxpayers. After the adjustment, for example, the price of a novel drug registration is still only 5.2 percent of what the FDA is charging.

“Compared with countries such as the U.S., China’s registration fee was very low,” said Cheng. “It was only a few thousand RMB. . . . ¥192,000 is still relatively cheap.”

The fee adds up to $31,000.

“When companies have to consider the cost of application, the not-so-serious ones will be taken out,” said Cheng. “The extra resources can be used for the CFDA’s own research to help pharmaceutical companies at a mutual position like the U.S. FDA is doing.”

“This actually could be good news for innovative drug developers,” said Osmunda’s Xu. “Because it filters the industry and makes the true innovators stand out over time.”

Under the new rules, Chinese novel drugmakers are required to pay ¥192,000 (US$31,000) for clinical trial approvals and ¥432,000 or marketing approval. Registrations of drugs that don’t need clinical trial support will cost ¥183,600, while registrations of drugs that do need such support will cost ¥318,000.

Provincial finance departments will decide the prices of class II medical device registration applications for domestic companies, but the CFDA has set class III medical device registration fees at ¥153,600 for the initial registration. Foreign companies, however, will have to pay nearly double of what Chinese drugmakers pay, making it more expensive for drug and medical device makers that are looking at the Chinese market.

For pharmaceuticals, foreign companies will have to pay ¥376,000 and ¥593,900 for clinical trial or marketing approvals. Foreign medical device companies need to pay ¥210,900 and ¥308,800 for class II and III medical device registration.

Biopharmaceutical companies used to able to apply for clinical trial and marketing approvals at a cost of a few thousand RMB, but even then they had to use caution.

“Biopharmaceutical developers would never apply for regulatory approvals just for the sake of it,” said Genor’s Cheng. “The threshold for this sector is already very high.

“For companies that were applying for dozens of approvals in the past, this could be a big amount of money,” she added. “Plus, if the drug development doesn’t yield any result, they won’t break even for the regulatory costs.”

For small to micro enterprises in China doing medical innovation, the CFDA has set up a preferential policy of waiving registration fees and supplementary application fees for phase II and III trial supplement application fee. Products that fit into that category are natural medicines for the treatment of AIDS and malignant tumors that are currently not available in China; novel chemical and novel therapeutic biological drugs that are not available inside and outside of China; and novel vaccines that are not available in any markets. But whether a company’s product is highly innovative or not is still for the CFDA to decide.

“Some big companies may come up with small spin-offs to focus on innovative technologies so they can register for free,” said Xu. “But the cost of establishing a new company is also sizable.”

Although the prices are set, the detailed rules and regulations for the implementation of the new charging system are still trial versions as the CFDA keeps the door open for further changes.

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