Text/ Zhao Tianyu Ling Xin
Editor / Wang Xiao
Photo/ Unsplash
In 2022, there are not many options in front of China's innovative drugs, and the news is mixed.
On March 8, the U.S. Securities and Exchange Commission (SEC) added five U.S.-listed Chinese companies to an interim list at risk of delisting, three of which are Innovative Pharmaceuticals.
This is not a final decision, and the companies could provide evidence to the SEC by March 29 that they should not be on the list.
Although the storm is not for biopharmaceuticals, nor does it mean that these companies will really be removed from the NASDAQ exchange by the SEC, in the capital market, the field of innovative drugs that have recently declined in recognition is even worse. On March 11, the market value of the three companies involved, whether in the United States, Hong Kong stocks, or A shares, shrank; the Hang Seng Healthcare Index of Hong Kong stocks, which fell by more than 6% at one point, slowly recovered in the afternoon and finally closed down by 2.23%.
BeiGene believes that the provisional list is an administrative measure taken by the SEC; Zaiding Pharmaceutical expects that as more companies submit their annual reports, more companies will be included in the tentative list in the future.
In response to the matter in the early morning of March 11, the China Securities Regulatory Commission (CSRC) said that it has always adhered to the spirit of openness and cooperation and is willing to solve the problem of inspection and investigation of relevant firms by US regulatory authorities through regulatory cooperation, which is also in line with international practice.
Not only are there fluctuations in the capital market, but innovative pharmaceutical companies have also encountered many ups and downs in their business.
At the end of February, one of Legendary Biologics' CAR-T cell immunotherapy was approved for marketing by the U.S. Food and Drug Administration (FDA), which seemed to alleviate part of the frustration of the industry — after all, at the beginning of the month, the FDA's oncology drug advisory committee voted 14:1 for Innovent Biologics' cancer drug PD-1, and 14 votes were against. "Clinical trials in a single country are a step backwards." One dissenting expert put it this way: Companies shouldn't experiment in just one country. The committee recommends another clinical trial for multiracial populations in the United States.
The key meeting of Cinda Biotech's "breakthrough" in the United States is at midnight Beijing time, for its own future, but also for the future of the industry, many people sleepless all night.
Meng Bayi, who has been practicing in the pharmaceutical field for many years, has served in the New York City Government and is familiar with the Sino-American innovative drug environment; Shen Nanpeng, founding and managing partner of Sequoia China, has invested in WuXi AppTec and Zaiding Pharmaceutical, as a member of the National Committee of the Chinese People's Political Consultative Conference, this year's National "Two Sessions" He submitted a proposal of "Taking Clinical Value as the Guide and Improving the Ability of Drug Innovation".
Both of them are closely concerned about the fate and future of China's innovative drugs, focusing on five key questions, "Finance and Economics" interviewed Meng Bayi, Shen Nanpeng also made an answer in the proposal.
Q1: What is the crux of China's innovative drugs?
Meng Bayi: Really doing first-in-class, breakthrough drugs is always a matter for a few companies and a few people, and the same is true in China. Transforming China's entire pharmaceutical industry into an innovative pharmaceutical industry is unrealistic and illogical.
At present, China has not yet reached the point where it can transform the pharmaceutical industry as a whole into an innovative pharmaceutical industry, and the timing, technology and funds are not mature enough.
Shen Nanpeng: The innovation path of drug discovery is insufficient, and how to make good use of the existing achievement knowledge and new technologies in the transformation of achievements still needs to be strengthened.
At present, innovation is more concentrated on the target of easy-to-use drugs, and there are still vast new drug targets and disease fields that can be used as source innovation: on the one hand, a large number of basic research achievements have been accumulated worldwide in the past few decades, but only a very small number of them have finally been transformed into drugs; on the other hand, marine medicines and plant medicines are also important sources of future ready-to-use drugs, but the current development is limited.
Q2: Is the new drug a real way out or a false proposition?
Meng Bayi: Even if new drugs go to sea, they may not be able to make money. Since 1980, of all the new drugs approved by the US FDA, only about 20% can be returned, and 80% do not make money and end up losing money.
Let's be clear that first-in-class drugs are two completely different concepts from commercially successful "blockbuster" drugs that sell for more than $1 billion. The first-in-class can only prove your breakthrough in this therapeutic field; only when it sells for more than $1 billion can the drug be said to be a combination of scientific and commercial success.
If China's innovative drugs are to take root in the U.S. pharmaceutical market, they must produce several "blockbuster" drugs — even one is not enough, there must be several. This is not just made in the laboratory, but sold in the market, whether it can be sold into a "blockbuster" drug, not in the Chinese pharmaceutical companies themselves to organize the business team, but in the degree of cooperation between the enterprise and the American business giants.
Photo/unsplash
Generally speaking, the commercial ability of the 20% profitable new drugs is more critical.
Obtaining FDA approval is still the only option for New Chinese drugs to go overseas, because FDA standards, procedures and corresponding certifications are almost the standards of the world. Even though many countries have their own drug regulatory laws, it has to be admitted that most of them imitate the FDA's drug regulatory laws, and even some countries directly follow the FDA's standards, and a drug can only be sold in these countries after FDA approval. Bypassing the FDA, the global market is actually very limited, and the price will not be too high.
Shen Nanpeng: At present, there are more and more domestic innovative drugs in China and foreign and international multi-center clinical trials, but the challenges of going to sea are also very large: such as the transformation of new innovative ideas from China to the world, the high cost of overseas registered clinical trials and sales, and the cost of head-to-head trials; the medical dissemination and medication habits in the European and American markets are different from those in China, and the product penetration of domestic innovative drugs and the establishment of doctor-patient trust take time.
It is suggested that for emerging countries that have not yet joined the ICH (International Human Drug Registration Technology Coordination Council) but have a large market capacity, it is recommended that the drug regulatory department explore the possibility of coordinating the interoperability and certification of clinical trial data, reduce the economic time cost of enterprise entry, and provide regulatory and policy support in promoting multi-center clinical research ethics collaborative review, facilitating customs clearance of R&D articles, and training talents familiar with European and American regulatory systems and ICH standards.
Q3: What is the most important thing for China's innovative pharmaceutical companies?
Meng Bayi: What is most needed at the moment is not first-in-class drugs, not breakthrough drugs, what China needs is really high-quality generic drugs, as well as high-quality me-too drugs, to meet the needs of the vast majority of China's 1.4 billion people. Because from a global perspective, the drugs that really meet people's daily medical needs are mainly generic drugs, rather than relying on innovative drugs.
Shen Nanpeng: At present, drug research and development still has practical problems such as chasing hot spots, insufficient innovation paths, and low efficiency of R&D capital input and output, so enterprises need to re-establish an overall R&D strategy around disease-oriented and clinical value-oriented, and at the same time think about how to use existing achievement knowledge and new technologies to promote the transformation of achievements.
Q4: What is the future of China's innovative pharmaceutical enterprises? What do they need to do?
Meng Bayi: On the whole, the profits created by the innovative drugs themselves are far from meeting the needs of innovative drugs for research and development investment, so the innovative drug industry has changed from product manufacturing to the field of capital operation, and the innovative drug itself is not how much income the drug can create, but how much capital investment can be attracted, so that the company can run and the research and development continues, which is the key.
So this field is hierarchical: first-in-class, a small number of companies with R & D capabilities, capital continues to bless, they may hope to follow the US FDA standards, with global goals, to try to go to sea.
As for most companies, bio-similar, me-too, me-better companies, they need to focus on China's unmet clinical needs, not going to sea.
Shen Nanpeng: Drug research and development chase hot spots, how to develop strategies around the disease still needs to be "made up": The current new drug research and development in the mainland mainly through the path of "following", "changing" and "buying", focusing on the innovation level that has been found to be verified and the research and development failure rate is low, although it is a reasonable model to solve the accessibility of drugs, but it is easy to appear the same target drug piling up, research and development funds input and output efficiency and other deficiencies.
Enabling patients to obtain effective treatment earlier and faster, positioning new indications, etc. is also an important direction of innovation, which requires the drug development goal to be converted from drugs to patients, and to provide a more scientific and reasonable overall design of research and development strategies around the disease.
Q5: What are the recommendations for new drug development in China?
Meng Bayi: Sink your heart and focus on the local market of 1.4 billion people in China. If a large number of first-in-class drugs and breakthrough drugs can be made in the local market, and indeed some unmet clinical needs in China can be solved, then the markets in the United States, Europe, Japan and even the world will also accept this drug.
So don't rush to sea, don't rush to participate in international competition. My advice is to innovate according to U.S. FDA standards to meet the unmet needs of China's 1.4 billion people.
Shen Nanpeng: Suggestion 1: First, increase funding for basic research on drug innovation and optimize the supporting environment for drug research and development. For example, clinical trial conditions and capability evaluations are included in the level review of medical institutions, priority is given to clinical resources for new targets/drugs around the world, and enterprises and doctors are promoted to establish data sharing to promote drug research and development.
Recommendation two, tighten the time window for followers, and strengthen guidance to promote drug research and development. For example, according to the dynamics of domestic and foreign regulatory approvals, further accelerate the updating of clinical guidelines, tighten the time window for followers, and encourage pharmaceutical companies to improve their project approval and clinical research capabilities.