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Chinese Pharma & Biotech Press Review - N° 278

Feb
22
2013

Pharma and Biotech Press Review

HEADLINES

To begin with Universal Medica wishes you all a Happy Chinese New Year.

This week, we have had some 2012 results from the Ministry of Health as well as some SFDA moves to tackle distribution issues. They are planning to make changes to lower down the number of distributors, increasing their quality and intend to implement electronic monitoring all along the supply chain by 2016. So expect some news of distributors M&A in the coming months.

Meanwhile, we have Amgen willing to enter the market, stem cells research advances in Japan and still a very active medical device market. Have a nice read!

FOCUS

  • Celgene got SFDA’s approval for Revlimid
  • Chinese Guideline to Forbid Doctors’ Incomes Linked to Medical Expenses
  • SFDA: Newly-revised Rugulations on Drug Quality Monitoring : Electronic Monitoring During the Medication Manufacturing Process
  • Dyax and Cvie Therapeutics partner for Kalbitor’s commercialization in China, HK and Macau
  • Medtronic Rides Emerging Markets Growth to Strong Quarter
  • Amgen to Use Partnerships and M&A Strategies to Acess the Chinese Market

Healthcare News

Chinese Guideline to Forbid Doctors’ Incomes Linked to Medical Expenses
(新华网, 2013-02-20)
The Chinese government has released a guideline on its basic medicine system forbidding hospitals from linking doctors’ incomes with their patients’ medicine and medical exam expenses.
In fact, in China some hospitals adjust doctors’ salary depending on the revenues earned through medication sales and exam fees, creating greater economic burdens for patients in some cases.
The guideline, released by the health and reform office under the State Council, or China’s cabinet, is intended to consolidate and improve the basic medicine system and offer solutions for problems related to local-level healthcare.
Additionally, this guideline calls for efforts to train medical staff on the proper use of basic medicine, and also encourages non-governmental local medical institutions to use medications that are on the basic medicine list.
Moreover, this guideline aims to implement quality inspections for basic medicine and electronic monitoring during the medication manufacturing process. It also asks for inspection results to be released to the public regularly.

SFDA : Newly-revised Rugulations on Drug Quality Monitoring : Electronic Monitoring During the Medication Manufacturing Process
(Fiercepharma, 2013-02-19)
The State Food and Drug Administration (SFDA) has released a newly-revised regulation on Good Supply Practices (GSP) for drugs, urging greater risk-control abilities for drug distributors during the circulation stage.
According to Li Guoqing, a senior SFDA official, the article 187 of the GSP regulation stipulates detailed quality management standards for both wholesalers and retailers.
This revision of the GSP contains improvements related to purchase channels, storage temperatures, the keeping of receipts and other documents, cold-chain management and transportation. For example, according to these rules, invoices must be issued for drug procurement and the transportation of drugs must be accompanied by matching document records. Moreover, concerning transportation conducted by third-party groups, consigners should first review their transfer capacities and sign liability agreements in case the quality of the drugs cannot be maintained during the transportation process. These rules also define requirements concerning the storage and transfer of cold-chain drug products, with detailed stipulations on temperature monitoring, tracking and product checks upon reception.
These revised GSP regulations will take effect on June 1st, however, according to SFDA, related drug enterprises will have a three-year transition period to adjust to the new rules.
The companies not able to comply with these rules after 2016 will be banned from selling drugs.

14,000 Counterfeit Drug Cases have been Cracked by the Chinese Authorities in 2012
(中国网, 2013-02-20)
The State Food and Drug Administration and the Ministry of Public Security counted some 14,000 cases involving making and selling of counterfeit drugs, which represents an amount of more than RMB 16 billion.
Many of these cases included international trades and internet and television selling.
“The main pattern for these counterfeit drug cases involves underground manufacturing, online advertisements and express delivery. Their criminal method is becoming more technology-driven, group-based and covert,” the statement said.
The government plans to intensify efforts to crack down on counterfeiting.

98% of the Chinese Rural Population Covered by Medical Insurance
(人民日报, 2013-02-21)
A total of 805 million people, which represents 98% of the rural population, were covered by the rural medical insurance system by the end of 2012.
Under the new rural cooperative medical program, health funding for each countryside resident reached RMB 300 (48 U.S. dollars) last year.
According to Ministry of Health statistics, 1.5 billion people have received medical fee reimbursement through the program in 2012.
Hospital expenses added up to 24% of the annual per capita income.
Over 80% of rural areas have promoted payment method reforms. Moreover, measures have been taken to guarantee treatments for critical illnesses, with 990,000 patients receiving reimbursement for the treatment of serious diseases, according to the ministry.
The medical insurance system should also be enhanced to fully guarantee treatment for 20 serious diseases, such as child leukemia.

Pharmaceutical Industry

Celgene got SFDA’s approval for Revlimid
(BioSpectrum, 2013-02-12)
The Chinese State Food and Drug Administration (SFDA) gave its approval to Celgene for the registration of Revlimid (lenalidomide) in China. This approval was based on the safety and efficacy results in patients with relapsed or refractory multiple myeloma that have been proven through several phase III pivotal randomized international clinical trials.
Actually, the SFDA and Celgene are looking forward to making Revlimid available to patients in China as soon as late in the second quarter of 2013. Results from a large, phase II bridging study (MM-021) of lenalidomide and low-dose dexamethasone in 159 Chinese patients, who had relapsed or refractory multiple myeloma, also supported the submission and approval.
Celgene has received full approval for Revlimid from the SFDA including an Import Drug License for the use of Revlimid (lenalidomide) in combination with dexamethasone as a treatment for patients with relapsed or refractory multiple myeloma who have received at least one prior therapy.
As a matter of fact multiple myeloma is the second most commonly diagnosed blood cancer. According to the International Myeloma Foundation 750,000 people are estimated to suffer from multiple myeloma worldwide.
Revlimid will be made available only through a proprietary distribution program developed by Celgene. The company is working to supply Revlimid to the Chinese market as soon as possible. Certain standard government processes must be followed prior to launch.

Dyax and Cvie Therapeutics partner for Kalbitor’s commercialization in China, HK and Macau
(investor.dyax.com, 2013-02-08)
Dyax and Cvie Therapeutics (a subsidiary of Lee’s Pharmaceutical Holdings) have announced a strategic partnership for the development and commercialization of Kalbitor (ecallantide) in the treatment of hereditary angioedema (HAE) and other angioedema indications in China, Hong Kong and Macau.
Under the terms of this exclusive license agreement, Dyax will get an upfront payment and is eligible to receive future development, regulatory and sales milestones. Dyax is also eligible to receive royalty on net product sales.
Whereas CVie is responsible for all costs associated with development, regulatory activities, and the commercialization of Kalbitor in China, Hong Kong and Macau. Moreover, CVie will purchase the product from Dyax on a cost-plus basis for commercial supply.
Mr. Gustav Christensen, president and chief executive officer of Dyax said: “If approved, Kalbitor would become the first novel therapy available for HAE in China, where presently only steroids are used. We are pleased to have secured a new partnership for Kalbitor in this region and look forward to working with CVie toward its commercialization.”
Dr Benjamin Li, chief executive officer of CVie, added “As a novel therapeutic for acute HAE attacks, we anticipate that Kalbitor will allow us to provide a far more comprehensive disease management solution than is currently offered to HAE patients in China.”

China Shenghuo Pharmaceutical recieved proposal from Lan’s Int’l Medicine Investment Co.
(China Shenghuo Pharmaceutical Holdings, Inc, 2013-02-15)
China Shenghuo Pharmaceutical Holdings, Inc. announced that its Board of Directors received a preliminary, non-binding proposal from Lan’s Int’l Medicine Investment Co., Limited (LIMI), in which LIMI proposed China Shenghuo Pharmaceutical to go private through a transaction that will cash out the public shareholders of the company at a price of $0.15 per share, to be funded by LIMI if necessary. LIMI currently owns approximately 77.3% of the company’s outstanding common stock.
China Shenghuo is primarily engaged in the research, development, manufacture, and marketing of Sanchi-based medicinal and pharmaceutical, nutritional supplement and cosmetic products. Through its subsidiary, Kunming Shenghuo Pharmaceutical (Group) Co., Ltd., it owns thirty SFDA (State Food and Drug Administration) approved medicines, including the flagship product Xuesaitong Soft Capsules.
The Company’s Board of Directors formed a special committee of three independent directors: Jason Yuanxin Zhang, Yunhong Guan and Xiaobo Sun to evaluate LIMI’s proposal. The Special Committee has chosen Dorsey & Whitney LLP as legal advisor and National Securities Corporation as its independent financial advisor to assist it in the evaluation of the LIMI proposal.
No decision has been made by the Special Committee yet.

OxOnc to partner with Pfizer for a Xalkori phase III trial in China, Taiwan, Japan and South Korea
(Topix.com, 2013-02-11)
OxOnc Development LLP, an American company specialized in oncology. They have just signed a co-development agreement with Pfizer to conduct a Phase III clinical trial of a Pfizer cancer drug Xalkori® (crizotinib) in China, Taiwan, Japan and South Korea. This drug will be tested in patients with advanced Non-Small Cell Lung Cancer (NSCLC) with a ROS1 gene rearrangement (ROS1-positive). The drug is already approved in the US, Europe, China and Japan for NSCLC patients with the ALK genetic variation.

Luye Pharma Completed Phase II Trial of Cardiovascular TCM in the US
(BioPortfolio, 2013-02-18)
Luye Pharma Group, a leading specialty pharmaceutical company based on research and development based in Beijing, Nanjing, Yantai ,Sichuan and Singapore, has reported that Xuezhikang, a Traditional Chinese Medicine (TCM), used to lower cholesterol, proved its effectiveness in a US Phase II clinical trial.
According to the company, the drug “significantly” lowered low-density lipoprotein cholesterol while elevating beneficial high-density lipoprotein cholesterol.
Therefor, Xuezhikang is the only TCM included in the National Basic List as a treatment for blood lipids.

Tensys Medical Enters into Exclusive Agreement with Zhejiang Shanshi Medical Device for the Distribution of T-Line in China, Hong Kong & Taiwan :a 5-year Agreement Worth Up To $US 40 Million
(Business Wire, 2013-02-08)
Tensys Medical, Inc., a leader in the development and commercialization of continuous, non-invasive hemodynamic patient monitoring systems, has entered into a commercial agreement with Zhejiang Shanshi Medical Device CO., LTD (Shanshi) for the distribution of the company’s T-Line technology.
This agreement will allow Shanshi to market, pending final regulatory approvals, the company’s newest TL-300 throughout China, Taiwan, and Hong Kong. Under these terms the parties have agreed on cumulative orders of up to $US 40 million on a 5-year exclusive supply relationship.
“Our pre-marketing efforts have validated our belief that the T-Line can make a dramatic impact in the Asia-Pacific hemodynamic monitoring markets and Shanshi expects to begin full marketing efforts throughout China in 2013.”
Shanshi will initially target the T-line into the Chinese operating room (OR) and intensive care unit (ICU) markets. The T-Line technology platform accurately and continuously captures a patient’s beat-to-beat waveform and blood pressure in a completely non-invasive fashion, providing physicians with a stream of real-time hemodynamic data that is not possible using traditional non-invasive blood pressure devices. Avoiding the blind-time associated with a deflated or inaccurate cuff can enhance hemodynamic monitoring, which has been definitively linked to improved clinical outcomes.
Tensys Medical, Inc. is a leader in the development and commercialization of continuous, non-invasive, hemodynamic monitoring systems.

Medtronic Rides Emerging Markets Growth to Strong Quarter
(Fierce Medical Devices, 2013-02-19)
Medtronic’s CEO Omar Ishrak has said for a long time that he wants 20% of its revenue to come from emerging markets by 2016. And as a matter of a fact this medical device leading company has successfully reached $4 billion in total revenue in the last quarter, a step forward on the way to reaching its objective.
The company’s emerging markets revenue increased by 20% in the fiscal third quarter, partly thanks to a 3% sales jump that made $988 million in net earnings. Markets such as India and China now account for about 12% of Medtronic’s business, and the company aims to continue to focus on those high-growth areas.
On the emerging markets side, Medtronic has spent billions to build its presence overseas, buying Chinese orthopedics outfit Kanghui Holdings for $816 million in the fall and working to get its stents adopted in India. Kanghui is already meeting Medtronic’s performance expectations, Ishrak told investors on a conference call, and the company is preparing to jump into the Chinese structural heart market after buying a $66.2 million stake in local outfit LifeTech Scientific.
Here are a few figures of the Company:
– Revenue of $4.0 Billion, grew 4% on a Constant Currency Basis; 3% as reported
– International Revenue Grew 7% on a Constant Currency Basis; 5% as Reported
– Emerging Market Revenue Grew 21% on a Constant Currency Basis; 20% as Reported
– Non-GAAP Diluted EPS Growth of 11%; GAAP Diluted EPS Growth of 10%
– Free Cash Flow of $1.4 Billion; GAAP Cash Flow from Operations of $1.5 Billion

Chinese Divisional Patent Gives BioDiem an Additional patent Application for BDM-I while Keeping the Priority Rights from its Original Application
(BioSpectrum, 2013-02-21)
BioDiem received a grant of a Chinese divisional patent, expanding the patent position for its novel antimicrobial compound BDM-I. The parent patent was granted in China during 2010, BDM-I is a synthetic compound being developed by BioDiem as a treatment of serious infections. The divisional patent strengthens the company’s portfolio by granting BioDiem’s claims in China for BDM-I and compounds related to it chemically; for the use of BDM-I as a preventive and therapeutic compound against an array of infectious diseases. BDM-I’s effectiveness against a broad range of micro-organisms that cause serious human disease including tuberculosis, pneumonia, meningitis, malaria, sexually transmitted and many other diseases caused by bacteria, fungi and protozoa.

Biotechnologies

Amgen to Use Partnerships and M&A Strategies to Acess the Chinese Market
(WND, 2013-02-18)
Amgen plans to access the Chinese market through a combination of partnerships and M&A to gain a foothold in the country. Therefore Amgen expects and hopes to bring its own patented drugs on the China market by 2015.
Meanwhile, the company also announced it will establish a biosimilar capability that will manufacture versions of its competitors’ biologic drugs. Therefore, Amgen is currently building a plant in Singapore, which will be completed by 2017, in the plan to make these drugs.
The company expects to generate $1 billion of revenues from biosimilars in emerging market countries.

Events

China Healthcare Investment Conference in Shanghai, China on March 12-14
(Chinahic.com, 2013-02-22)
This will be the 4th edition of the Annual China Healthcare Investment Conference; it will take place in Shanghai on the 12th, 13th and 14th March 2013. Last year’s edition received 400 of the pharmaceutical industry’s most influential Chinese and global thought leaders. Leading Entrepreneurs, Investors, Government officials, legal and financial experts as well as other industry leaders in the rapidly growing China healthcare industry will attend this event.

Asia/Pacific news

Researchers in Japan move a step closer to stem cell trial with a hope of a solution for sight problems
(中国邮报, 2013-02-15)
Japanese Researchers have moved one step closer to clinical trials using adult stem cells in a therapy they hope will prove a cure for common sight problems.
The ethics committee at the Institute for Biomedical Research and Innovation in Kobe, west Japan, on Wednesday approved a trial treatment for age-related macular degeneration (AMD) using induced Pluripotent Stem (iPS) cells. The trial’s aim is to create retinal cells that can be transplanted into the eyes of patients suffering from AMD, a presently incurable disease that affects mostly middle-aged and older people and can lead to blindness.
The institute, together with the government-backed research institute Riken, “will submit an application for a clinical trial with Riken to the Health Ministry by the end of next month,” hospital official Kosuke Nagi told AFP.
If a clinical trial using iPS cells is approved, it “would be the first ever,” a health ministry official said, adding a trial using embryonic stem cells — harvested from human embryos — had been undertaken by a U.S. firm.
The ministry’s deliberation process will take a few months before approval, the official said.
Prime Minister Shinzo Abe said, last month, that his government will earmark 110 billion yen (US$1.18 billion) for research toward the clinical use of iPS cells.

Pfizer to lop off Asian Research Unit Amid Major R&D Downsizing
(Business Times, 2013-02-08)
As the drug giant, Pfizer, seeks to carve out more than $1 billion for its budget, the company has confirmed its plans to exit a clinical research operation in Singapore. The move shows that even research in the fast-growing Asia-Pacific region is subject to cutbacks.
In recent years Pfizer CEO Ian Read’s regime has been reducing R&D costs, mostly in the western countries, with the closure of programs in Sandwich, U.K., and the relocation of research away from Groton. The company revealed recently that the 2012 budget for exploring new treatments shrank to $7.8 billion from $9 billion in 2011.
The planned closure of Pfizer’s clinical research unit in Singapore comes as the company looks to chop off another $1.3 billion in R&D spending during 2013.
“This decision was made as part of Pfizer Worldwide Research & Development’s ongoing comprehensive effort to increase operational efficiencies and to create a more focused and sustainable R&D engine,” a Pfizer spokeswoman told a news service.
Indeed, New York-based Pfizer has pushed for more outsourcing of clinical research work at home and abroad.