Zhe­jiang drugs cut can­cer treat­ment’s costs

Shanghai Daily - - HANGZHOU SPECIAL - Shi Jia

The movie “Dy­ing to Sur­vive” be­came an un­ex­pected block­buster, with the third best-sell­ing movie of 2018 achiev­ing a box of­fice re­turn of nearly 3.1 bil­lion yuan (US$450.9 mil­lion).

The movie sheds light on can­cer pa­tients in China who face the dilemma of ei­ther tak­ing ex­pen­sive im­ported anti-tu­mor drugs or buy­ing smug­gled generic drugs. The generic drugs are the much cheaper “copies” of the pa­tented orig­i­nal drugs and are usu­ally al­lowed to be sold after the patent ex­pires.

An in­vest­ment re­port re­leased by UBS shows that in 2016 China was the third largest mar­ket for generic drugs. By next year the mar­ket size is ex­pected to reach a value of US$42 bil­lion, just after the United States. At present, around 95 per­cent of reg­is­tered drugs pro­duced in China are gener­ics, ac­cord­ing to Qianzhan In­dus­try Re­search In­sti­tute.

“The phar­ma­ceu­ti­cal in­dus­try is highly de­pen­dent on poli­cies. We have two ma­jor tasks fac­ing us. One is to im­prove the qual­ity of our gener­ics, the other be­ing the de­vel­op­ment of more orig­i­nal drugs, es­pe­cially those re­lated to can­cer treat­ment,” said Shao Yuan­chang, deputy di­rec­tor of Zhe­jiang Med­i­cal Prod­ucts Ad­min­is­tra­tion.

In 2012, the State Coun­cil’s 12th FiveYear Plan (2011-15) said that reg­is­tered generic drugs needed to be eval­u­ated for qual­ity and ef­fi­cacy. Those that failed the test shall not be al­lowed to be sold.

A fur­ther an­nounce­ment in 2015 stip­u­lated a work plan for the pol­icy and the eval­u­a­tion work was of­fi­cially launched in 2016 by the then China Food and Drug Ad­min­is­tra­tion, now the Na­tional Med­i­cal Prod­ucts Ad­min­is­tra­tion.

Zhe­jiang com­pa­nies were among the first to re­ceive ap­provals from the CFDA. To date, 24 types/spec­i­fi­ca­tions of generic drugs pro­duced in Zhe­jiang have passed the tests, lead­ing all other prov­inces.

Lo­cal gov­ern­ments have pushed for­ward in­cen­tives. The provin­cial gov­ern­ment awards the first three com­pa­nies pass­ing the test 3 mil­lion yuan for each drug type/spec­i­fi­ca­tion. Oth­ers may re­ceive 1 mil­lion yuan from the mu­nic­i­pal gov­ern­ment.

Rel­e­vant reg­u­la­tions also fol­low to en­sure that lo­cal hos­pi­tals have ac­cess to qual­i­fied drugs via the of­fi­cial on­line pro­cure­ment plat­form.

At the same time, com­pa­nies with the ca­pac­ity to de­velop orig­i­nal drugs are emerg­ing.

Betta Phar­ma­ceu­ti­cals, a listed com­pany founded by sev­eral PhD grad­u­ates who have re­turned from the US, pro­duced and de­vel­oped China’s first home-grown anti-can­cer tar­geted drug. The medicine re­ceived a patent in 2007 and was launched to the mar­ket as Con­mana in 2011.

It has an ap­proved ef­fi­cacy to treat pa­tients with non-small cell lung can­cer, many of whom have not re­sponded to tra­di­tional chemo­ther­apy.

“From the de­sign of the chem­i­cal com­pound in a US lab in 2002, to ap­ply­ing for a clin­i­cal trial in 2005 and to the fi­nal launch event in Au­gust 2011, the process took us 10 years,” said Ma Yong­bin, Betta’s vice pres­i­dent.

The re­search and de­vel­op­ment of pa­tented drugs has a high risk of fail­ure and needs a large and stable sup­ply of funds from be­gin­ning to end.

“By the time the drug got mer­chan­dised, the com­pany had more than 100 mil­lion yuan of deficit in the bank ac­count,” said Ma.

Since 2015, Con­mana has led in the Chi­nese mar­ket with cu­mu­la­tive sales reach­ing 5.5 bil­lion yuan, ben­e­fit­ing more than 180,000 lung can­cer pa­tients. It has also helped re­duce the cost of treat­ment for each pa­tient.

In 2011, when im­ported drugs still mo­nop­o­lized the mar­ket, the monthly cost for one pa­tient was be­tween 16,000 yuan and 20,000 yuan. In com­par­i­son, the monthly cost of tak­ing Con­mana was 11,800 yuan.

In 2017, after a price ne­go­ti­a­tion with the Min­istry of Hu­man Re­sources and So­cial Se­cu­ri­ties, Con­mana was listed in the na­tional health in­sur­ance drug cat­a­logue. The ex­pen­di­ture per month for treat­ment has been cut to around 5,700 yuan, 80 per­cent of which can be cov­ered by med­i­cal in­sur­ance.

Ma said the com­pany has over 30 new projects in dif­fer­ent stages of re­search and de­vel­op­ment.

“One of them, co­de­named X-396, which is also an in­hibitor for lung can­cer, has al­ready filed a new drug ap­pli­ca­tion in De­cem­ber 2018 and will hope­fully be ap­proved for sale not only in China but the global mar­ket as well.”

The suc­cess of Betta has en­cour­aged oth­ers and at­tracted ven­ture cap­i­tal.

Just Bio­ther­a­peu­tics is lo­cated in the core “Bio­pharma Town” of Hangzhou Eco­nomic and Tech­no­log­i­cal De­vel­op­ment Area. Since its es­tab­lish­ment in 2016, the com­pany has se­cured over US$120 mil­lion from in­vest­ment com­pa­nies in­clud­ing Te­masek, Lilly Asia Ven­tures and Taikong Group.

Its Hangzhou R&D cen­ter and man­u­fac­tur­ing fa­cil­ity went into op­er­a­tion in Jan­uary 2018, and a new clin­i­cal de­vel­op­ment cen­ter opened in Bos­ton, in the US, two months later. Glob­ally, nearly 100 sci­en­tists and en­gi­neers work for the com­pany.

“One of the main rea­sons that the com­pany was es­tab­lished is that we hope to re­duce the cost of bi­o­logic medicines, and in­crease their avail­abil­ity to more pa­tients,” said Kevin Zhuge, se­nior di­rec­tor for en­gi­neer­ing at the Hangzhou cen­ter.

By en­abling a third-gen­er­a­tion bi­o­log­ics pro­duc­tion plat­form with dis­pos­able tech­nolo­gies and in­ten­si­fied pro­cesses, the Hangzhou cen­ter is able to lower the man­u­fac­tur­ing cost of an­ti­body drugs by 30 per­cent.

“For ex­am­ple, big bio­phar­ma­ceu­ti­cal com­pa­nies may price their mon­o­clonal an­ti­bod­ies be­tween US$200 to US$300 per gram. Top com­pa­nies such as Am­gen can re­duce it to US$180. We can keep it at around US$100 now,” Zhuge said.

Mon­o­clonal an­ti­body ther­apy has a very good prospect for treat­ment in ar­eas of can­cer and au­toim­mune dis­eases.

“Our goal is to bring down the price to US$10 per gram in the next 10 years,” said Zhuge.

By the end of 2017 there were over 450 bio­phar­ma­ceu­ti­cal com­pa­nies in the eco­nomic zone, which ac­counts for 50 per­cent of the city’s gross bio­pharma in­dus­trial value. In 2018, 245 new com­pa­nies were set up in the area, ris­ing by 44.3 per­cent from a year ear­lier.

“I think the Hangzhou gov­ern­ment is very sup­port­ive of star­tups like us, both in its poli­cies and in its ser­vices,” said Chen Yan, co-founder and COO of Lynk Phar­ma­ceu­ti­cals which spe­cial­izes in the re­search and de­vel­op­ment of pa­tented drugs for can­cer and im­mune sys­tem dis­eases.

The com­pany just started op­er­a­tions in early 2018 and has al­ready re­ceived more than 1 mil­lion yuan in startup funds from the eco­nomic zone.

“Our pro­gram has been graded A-level in a pre­lim­i­nary eval­u­a­tion. Now we are ap­ply­ing for a for­mal re­view of all en­tre­pre­neur­ial pro­grams, where the top pro­grams may re­ceive a sub­sidy up to 10 mil­lion yuan,” Chen added.

A re­search en­gi­neer at work in the lab at Hangzhou Just Bio­ther­a­peu­tics

The struc­tural for­mula of Con­mana on dis­play in the R&D cen­ter of Hangzhou Betta Phar­ma­ceu­ti­cals. Con­mana is the first pa­tented drug de­vel­oped by a Chi­nese com­pany for the treat­ment of non-small cell lung can­cer.

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