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1、White PaperCHINA:AN EARLY OPPORTUNITY FOR EMERGING BIOPHARMAPositive forces in the China market make early market entry both attractive and achievableTABLE OF CONTENTSIntroduction 3Why consider China as a key market?4EBP growth opportunity:Population dynamics 4EBP growth opportunity:Improved applica
2、tion processes and pathways 4EBP growth opportunity:Access for innovation and unmet need 5EBP growth opportunity:R&D and commercial partnerships 5EBP growth opportunity:Capital and talent 6Possible challenges in entering the China market 6Implications for an EBP 7How to navigate China:key success fa
3、ctors 8Work with a big pharma partner 8Work with a distributor 8Go it alone 9Partner with a global commercial solutions provider 10Case study:Long-term strategic partnership to advance products regionally 10Case study:Hong Kong EBP evaluation of pipeline products and ROI in different markets 11Case
4、study:Chinese EBP commercializing its first gene therapy 11Conclusion 12References 13About IQVIA Biotech 14About the authors |3China was once viewed as market to enter after first launching new products in the United States and/or Europe but that is a changing mindset.There are now clinical and comm
5、ercial options available to emerging biopharmas(EBPs)that make China an attractive first launch market.With a population of more than 1.4 billion,China is now the worlds second-largest biopharmaceutical market,trailing only the United States,and is forecast to be the worlds largest within the next 1
6、0 years.The Chinese pharmaceutical market is forecast to grow at a CAGR of 4.8%(1.5%)between 2020 and 2025,reaching RMB1,289.7 billion in 2025(USD$200.2 billion)i.Though one should bear in mind that the COVID-19 pandemic has created challenges and uncertainty in understanding market trends and build
7、ing reliable forecasts globally,as well as for China.In terms of healthcare spending,this continues to outpace GDP growth:it reached 6.6%of GDP in 2018 and is expected to exceed 7.0%of GDP by the end of 2024.Efforts to constrain costs and improve efficiency are being stepped up,with short and long-t
8、erm implications for the biopharmaceutical industry i.This is the right time for biopharma companies,in particular EBPs,to create development programs that lead to market access in China,core reasons include:Disease and demographics,China is encouraging the introduction of innovative products to tre
9、at chronic diseases and diseases of the elderly.Changes in regulations to speed clinical development and market launch of innovative products.New R&D and commercialization options,some of them spawned by necessity as a result of COVID-19,that EBPs can tap to execute an entry and/or growth strategy i
10、n China.INTRODUCTIONChina is now the worlds second-largest biopharmaceutical market,trailing only the United States,and is forecast to be the worlds largest within the next 10 years.4|China:An early opportunity for Emerging BiopharmaWHY CONSIDER CHINA AS A KEY MARKET?A combination of factors has cre
11、ated a strong environment market access to China.Key among them:EBP GROWTH OPPORTUNITY:POPULATION DYNAMICSThere is a sheer size of the market and patient potential both for clinical development and commercialization.The burden of disease and exposure to risk are high:300+million men smoke and 160 mi
12、llion(both men and women)are hypertensive,most untreated.Obesity is common.More than 20%of children aged 717 years in big cities are overweight or obese ii.In addition,thanks in large part to its one-child policy established in 1979 and changed to a two-child policy in 2015,Chinas population is agin
13、g faster than almost all other countries in modern history iii.In 2050,almost 40%of Chinas population will be over 65 330 million people iv.While there is robust overall growth,as with the rest of the developing world,China is showing a growth in specialty pharmaceuticals to treat cancers and other
14、non-communicable diseases a niche that especially fits EBPs.EBP GROWTH OPPORTUNITY:IMPROVED APPLICATION PROCESSES AND PATHWAYSChinas National Medical Products Administration(NMPA),formerly the China FDA,has streamlined the trial approval process and implemented fast-track reviews and clinical trial
15、waivers for priority medicines,including orphan drugs,products for the treatment of life-threatening conditions,and products that target unmet needs.Particularly important is the opening of a new pathway for drugs to come into China through a special zone in Hainan Province vi.In late 2018,the Bo Ao
16、 Lecheng International Medical Tourism Pilot Zone in Hainan province in Southern China was created,to enable local authorities to approve special importation small amounts of unapproved chemical and biological drugs and devices(excluding vaccines)from a foreign manufacturer.Previously,only Chinas NM
17、PA had this right.Through this Pilot Zone,Hainan authorities can independently approve products that meet certain criteria a notable benefit for companies.The number of applications,for new and investigational drug is not only increasing,but includes real-world evidence being incorporated into the r
18、egulatory pathways.A significant number of clinical trials involving biosimilars have been authorized,pre-empting an anticipated surge in biosimilar approval submissions.Other improvements implemented in recent years include the introduction of drug traceability and pharmacovigilance systems as well
19、 as measures to expedite the approval of priority medicines with limited clinical trial data.China has a high population of people with diabetes,121 million,and about half of its population is categorized as pre-diabetic v.Large and rapidly aging population and growth of chronic diseasesPolicy chang
20、es to bring innovative products to market and to better manage chronic diseaseNew partnering and outsourcing options that EBPs can use to enter and expand in ChinaAvailability of capital;and a large pool of clinical and commercialization experts,many of them seasoned by work for global biopharma com
21、panies,who have returned to China to work in the EBP |5EBP GROWTH OPPORTUNITY:ACCESS FOR INNOVATION AND UNMET NEEDThere is faster National Reimbursement Drug List(NRDL)access and improved affordability for patients.The NRDL is being updated more often,with annual revisions expected,which makes it ea
22、sier for EBPs to get their innovative products on the list.Drugs for the treatment of cancer,other critical and rare diseases,and non-communicable diseases are being prioritized.A wave of biosimilar approvals is expected over the next several years,following the authorization of Chinas first full-fl
23、edged biosimilar by the NMPA in 2019.The inclusion of biosimilars in centralized volume-based procurement(VBP)tenders in the medium term will trigger a sharp decline in the price of some biologics,enabling more widespread consumption.The Chinese company Ocumension Therapeutics used new rules regardi
24、ng the use of real-world data to obtain approval for its OT-401(Fluocinolone Intravitreal Implant)product,which was included in the first batch of drug real-world study pilot list by Hainan Pilot Zone authorities.The March 2021 approval of OT-401s NDA by the NMPA was the first time a product had bee
25、n launched using only real-world study pilot data vii.6|China:An early opportunity for Emerging BiopharmaEBP GROWTH OPPORTUNITY:R&D AND COMMERCIAL PARTNERSHIPSNumerous global biopharma companies have formed R&D development partnerships or have licencing agreements with Chinese EBPs,including Novarti
26、s,Eli Lilly,Pfizer,and Bristol-Myers Squibb,among others.For example,the Chinese biopharma company BeiGene has agreements with Amgen,Celgene,and EUSA Pharma to market their oncology products in China viii.In January 2021,BeiGene out-licensed its anti-PD-1 monoclonal antibody tislelizumab to Novartis
27、 ix,and in late 2020 the Chinese company Cstone Pharmaceuticals out-licensed China rights for its anti-PD-L1 monoclonal antibody(MAb),sugemalimab,to Pfizer x.EBP GROWTH OPPORTUNITY:CAPITAL AND TALENTThere is significant access to both capital and talent,otherwise known as the synergistic rocket fuel
28、s of EBP growth.Fundraising in the EBP sector continues,especially in mainland China.The United States,Hong Kong and A-share(stock of mainland China-based companies that trade on Shanghai and Shenzhen stock exchanges)markets continue to lead,raising in 1st quarter 2021 USD$61.4 billion,almost two-th
29、irds of global initial public offering(IPO)proceeds.Healthcare and life sciences continues to be among the most active IPO market sectors(along with the industrial and technology,media and telecom sectors).Those three sectors contributed more than 75%of total funds raised in the US,Hong Kong and A-s
30、hare IPO market xi.Talent also is abundant in China,with a plethora of experienced professionals seasoned by working for multinational biopharmaceutical companies ready to support the growth of both Chinese EBPs as well as inbound EBPs seeking to gain a foothold and expand in China.POSSIBLE CHALLENG
31、ES IN ENTERING THE CHINA MARKETHowever,with opportunities also come some potential challenges.While creating more access,China is revamping its healthcare system to more efficiently deliver services and to control drug costs.Price cuts pressure by NRDL range from 9%-80%,can create challenges for glo
32、bal pricing consistency.While growing numbers of innovative drugs are gaining access to reimbursement following national price negotiations,companies are being forced to cede substantial ground on price in return for NRDL listing.This reflects the pursuit of a more strategic approach by regulators,w
33、hich has seen them pit competing products against each other.While formal health technology assessments(HTAs)are not yet a feature of the pricing and reimbursement environment,a value-based approach for inclusion in the reimbursement system is beginning to emerge.The impact of that data and the agen
34、cys capacity to evaluate it effectively remain issues of concern for the industry.Regional disparity in go-to-market,with 33 provinces and 333 cities in China,companies need to carefully consider prioritizing what cities and provinces to enter and in what order,taking into account the varied charact
35、eristics of tiered hospitals and cities.Shorter product life cycle as generic substitution has become a trend under the GQCE and volume-based procurement(VBP)environment.The era of double-digit growth for off-patent therapies is over.Challenges to clinical trials.Like elsewhere in the world,COVID-19
36、 has been both a headwind for clinical trials(patients reluctant to travel to hospitals and other trial sites,difficulty in logistics because of travel restrictions,etc.)and a spur |7for innovation to overcome these hurdles.On-time recruitment is a continuing challenge,as is access to qualified site
37、s and professionals with proven expertise in conducting clinical trials to international standards.While progress is being made,EBPs should focus on obtaining proven expertise in managing trials on time and within budget.IMPLICATIONS FOR AN EBPFirst,the market dynamics and regulatory changes have cr
38、eated an environment in which China should be considered as a first-launch market for EBPs.Second,EBPs should leverage the innovative nature of their products by proactively applying for clinically urgently needed new drug status to get the green pass ticket during registration and approval.A green
39、pass ticket refers to orphan drugs,drugs proven to have clear advantage over current standard of care,or those targeting diseases for which there is no effective treatment in China.Once listed,expedited approval is possible as overseas trial results are accepted as long as supplementary document of
40、proving no racial difference is also included.In 2020,the NMPA approved 46 drugs 28 chemical drugs and 18 biologics either for the first time ever or approved outside China but in China for the first time.Of those 31 were granted priority review because of their significant benefits over existing st
41、andards of care;their focus on high-priority diseases;vaccines to prevent and control disease;and other factors deemed worthy xii.Third,the wide array of commercial options means that multiple approaches may be considered to match an EBPs resources and strategy.Finally,getting on the NRDL is a must
42、have.Consistent global pricing,strong efficacy data,and health economics and outcomes research(HEOR)are all important and often vital in arguing for a rational price to reward EBPs product innovation.8|China:An early opportunity for Emerging BiopharmaHOW TO NAVIGATE CHINA:KEY SUCCESS FACTORSBringing
43、 new therapies to a new market is fraught with risks and challenges:changing regulations,lack of an in-house sales network on the ground,unfamiliar marketplace mechanics,and uncertainty about local laws and intellectual property,to name a few.Big pharmaceuticals and Medtech companies may have the ti
44、me and resources to establish the necessary infrastructure,relationships,but typically EBPs do not.1.WORK WITH A BIG PHARMA PARTNERLinking up with a big pharma company that has an existing infrastructure,capabilities,and networks in China can help an EBP navigate the legal and commercial landscape.S
45、hort-term considerationsPartnering with a big pharma eliminates a lot of the early entry risks and costs associated with building infrastructure and developing a team,while linking the unknown product to a well-established brand name and team.It also means a faster ramp-up of the sales cycle and usi
46、ng fewer resources compared with starting from scratch.Long-term considerations An EBP may have less influence on the sales strategy and product messaging because they rely on the partner.The bigger partners priorities often benefit its own portfolio first,which means the smaller companys product ma
47、y not have as much dedicated sales team time or the price may be lowered.This can dilute the value of the EBPs product and lower the broader value of its portfolio.The company also sacrifices the opportunity to build its local relationships,expertise,and corporate brand presence in the country,limit
48、ing its ability to expand independently in the future.2.WORK WITH A DISTRIBUTORDistributors in China have established networks and sales processes;they understand the rules and regulations.This saves an EBP the cost,effort,and resources required to build its own infrastructure.Short-term considerati
49、onsUsing a distributor will bring a product to pharmacy shelves,but with little targeted marketing or sales support,it may struggle to gain a foothold.This approach also means that EBPs will miss the opportunity to establish relationships with key opinion leaders and to execute a targeted market str
50、ategy:distributors(like other partners)have a portfolio of products to sell and may make decisions based on its portfolios needs,not individual products.Long-term considerations EBPs will need to rely on distributors to understand and adhere to Chinas rapidly changing regulations regarding product p
51、romotion,and its broader laws and regulations governing the biopharma section.When choosing this route,an EBP must do substantial due diligence to be sure the distributors strategies align with its own corporate policies,as well as local and international laws and regulations on these matter the per
52、ils of getting it wrong are enormous.There are four paths that EBPs can choose when entering a new market.These include partnering with big pharma,working with a distributor,going it alone,or partnering with a commercial solutions provider.Each of these models offers a unique set of benefits and ris
53、ks;however,choosing the approach that is right for a company will depend on its strategic |9Short-term considerationsThis model requires significant time,huge up-front investment,and a willingness to make mistakes while the business team figures out the China landscape.Dealing with all operational i
54、ssues,including training sales reps,building relationships with physicians and regulators,while confirming they have all the resources necessary to do business,and making sure they understand and have completed all licensing steps and compliance requirements,can complicate this model further.Long-te
55、rm considerations Going it alone in China can be financially beneficial as it ensures that the product will get the right marketing attention and product messaging,and that its value to the company will remain fully intact.It can also be an important step in a companys strategic plans if it is seeki
56、ng to create networks and expand its global presence while gaining a permanent foothold in Chinas vast market.3.GO IT ALONEEntering a completely new market with no experience or infrastructure in place can be a risky process.10|China:An early opportunity for Emerging Biopharma4.PARTNER WITH A GLOBAL
57、 COMMERCIAL SOLUTIONS PROVIDERThis option can allow companies to get many of the early benefits of partnering with big pharma or a distributor,along with the long-term benefits of going it alone.Short-term considerations EBPs can take advantage of the extensive local knowledge and existing infrastru
58、cture,technology,and headcount of a global commercial solutions provider long-established in China one that has established relationships with payers,providers,pharma,and patient communities.They can also benefit from support with administration,including staffing,training,HR,IT,and finance.All this
59、 can be used immediately to support a new product market strategy,providing potential to dramatically shorten the time it takes to bring that product to market.It does require some up-front investment,but in exchange,the company maintains full control of its portfolio,as well as the messaging,pricin
60、g,and go-to-market plan.The sponsoring company also has its own dedicated sales force and strategy,so that the marketing plan will not get diluted,and can adapt to accommodate any changes in the market or the product owners goals.Long-term considerations The company benefits from the ability to esta
61、blish its own roots in the community under the tutelage of the commercial solution provider team.They can also opt to take over the sales process eventually,moving headcount onto its own books,and moving forward with the market process entirely under its own banner.This form of partnership provides
62、the company with the long-term strategic advantage of going it alone while avoiding short-term mistakes,and ensures it never has to give up control of market strategy.In short,this final option can offer speed,flexibility,and risk mitigation,along with enhanced control.CASE STUDY:LONG-TERM STRATEGIC
63、 PARTNERSHIP TO ADVANCE PRODUCTS REGIONALLYSITUATION An EBP company from US aimed to build its pipeline in developing therapeutics against key kidney disease pathways in APAC markets,including China.Initiated early engagement activity and supporting operational discussion leading to study delivery w
64、ithin an accelerated timeframe.SOLUTION Developed a collaborative approach and highlighted willingness to partner with external stakeholders based on prior experience and strong networks.Study delivery was conducted by teams with extensive expertise such as IQB CVRM and IQVIA LATAM,while leveraging
65、targeted and relevant JAPAC resources.RESULTS Aligned on clinical trial needs and development for kidney disease therapeutics.Developed long-lasting partnership with extended engagement in subsequent global study delivery and programs.First study initiated in Australia.Created strong connections amo
66、ng team members which led to cross-collaboration and support in future external marketing |11CASE STUDY:HONG KONG EBP EVALUATION OF PIPELINE PRODUCTS AND ROI IN DIFFERENT MARKETSCASE STUDY:CHINESE EBP COMMERCIALIZING ITS FIRST GENE THERAPYSITUATION A Hong Kong listed EBP intended to better plan and
67、prioritize its resources for its pipeline products.Client engaged IQVIA to assess global market landscape for its IL-4R inhibitor product with targeted indications and provide a prioritization list to guide its future clinical development plan.SOLUTION Conducted research into disease epidemiology,un
68、met needs and treatment paradigm for each indication in selected key markets.Conducted competitor,market access,and pricing analysis for the target product in each indication and each key market,including forecast of future return.Compared high-level ROI for each indication and prioritize for Phase
69、II development.RESULTS Aligned on clinical trial needs and development for kidney disease therapeutics.Developed long-lasting partnership with extended engagement in subsequent global study delivery and programs.Created strong connections among team members which led to cross-collaboration and suppo
70、rt in future external marketing activities.SITUATION A leading Chinese EBP company was developing several gene therapies and planning to launch their first one in about 2 years.Client required IQVIAs guidance on preparation needs for a successful launch,optimal level of investment and headcount for
71、product commercialization,as well as gene therapy potential to support the business case for launch.SOLUTION Conducted broad market research among KOLs,physicians,payers,and patients to understand the disease,value drivers and expectations/concerns about a gene therapy.Developed a cross-functional l
72、aunch plan with defined pre-launch objectives,organizational roadmap with global/local resource needs,and incidence-based forecast for EU5 and US.RESULTS Clear understanding of market development needs to ensure successful launch of a gene therapy treatment in Europe and US.Aligned view,and Board of
73、 Director endorsement,on product potential as well as organizational capability requirements and resources build-up timeline on global and local levels.12|China:An early opportunity for Emerging BiopharmaCONCLUSION The China market is primed for EBP clinical trial development and market entry.The co
74、mbination of huge market potential,faster registration and approval pathways,faster National Reimbursement Drug List access,and growing availability of innovative commercial partners for EBPs makes this an opportune time to consider China a first launch market.However,there are challenges to be mana
75、ged and risks to be mitigated,such as pricing pressures,generic substitutions and complex go-to-market plans.To manage hurdles,EBPs should be focused on which market entry solution works for them whether going it alone,working with a big pharma company/distributor or partnering with a commercial sol
76、utions provider.Ultimately,choosing the right option,taking into the account the EBPs resources and overall strategy,will enable market entry success in C|13REFERENCES i.IQVIA Market Prognosis 2020-2024 China.September 2020.ii.The nutrition and health status of the Chinese people,Ministries of Healt
77、h and Science and Technology and the National Bureau of Statistics of the Peoples Republic of China,Beijing:State Information Office,2004.iii.China country assessment report on ageing and health,World Health Organization(WHO),February 16 2015.https:/www.who.int/publications/i/item/9789241509312 iv.C
78、hinas Aging Population Is a Major Threat to Its Future,Time.February 7,2019.https:/ May 27,2021 v.International Diabetes Federation,2017.Available from:http:/diabetesatlas.org/resources/2017-atlas.html.vi.China Launches New Product Pathways in Hainan Special Zone.Covington&Burling LLP,March 4,2019,h
79、ttps:/ vii.Occumension press release,PRNewswire,March 20,2021.viii.111,Inc.press release,PRNewsire,March 17,2021.ix.BioWorld,Jan.12,2021.Beigene inks$2.2B PD-1 deal with Novartis for cancer drug tislelizumab x.BioWorld,Oct.27,2020.Cstone inks$1.15B-plus deal with Eqrx for two immune checkpoint inhib
80、itors xi.KPMG Mainland China and Hong Kong IPO Markets,2021 Q1 Overview.https:/assets.kpmg/content/dam/kpmg/cn/pdf/en/2021/03/mainland-china-and-hong-kong-ipo-markets-2021-q1-review.pdf xii.New Drug Approval in China in 2020,PharmaBoardroom,February 19,2021.https:/ early opportunity for Emerging Bio
81、pharmaABOUT IQVIA BIOTECHIQVIA Biotech integrates clinical and commercial expertise and services to deliver flexible solutions tailored specifically for small biotech and biopharma companies.From initial planning to trial design and implementation to market launch and commercialization,IQVIA Biotech
82、 incorporates unparalleled real world evidence resources,advanced analytics and transformative technologies to drive efficiencies and innovation.IQVIA Biotech in Japan-Asia Pacific comprises of highly specialized teams that are dedicated to meet the unique needs of biotech companies in JAPAC and wor
83、ldwide.Headquartered in Singapore and with offices in 15 countries across the region,IQVIA Biotech in JAPAC offers biotech companies a truly seamless experience to efficiently conduct clinical research in the region and enter or expand in its diverse and rapidly growing |15ABOUT THE AUTHORSHOWARD CH
84、EN,Managing Principal,Head of Management Consulting,IQVIA,ChinaHoward is the Head of IQVIA Management Consulting in China,based in Shanghai.He has more than 17 years of management consulting and investment and banking experiences in the healthcare industry in the US,APAC region and China.His areas o
85、f expertise include corporate strategy,portfolio strategy,brand strategy,new product launch,market access strategy,and financial advisory and investment strategy for pharmaceutical and medical technology/device players.In recent years,he was also actively engaged in cross-border M&A and fund raising
86、 deals for various biotech clients in China.He holds an MBA degree from Nanyang Technological University in Singapore.RUTHIE BURR,Enterprise Marketing Lead,IQVIA,APACRuthie is responsible for regional enterprise marketing,go-to-market activities,and Thought Leadership at IQVIA Asia Pacific.Ruthie wo
87、rks across IQVIAs clinical and commercial solution areas,as well as IQVIA sub-brands(Consumer Health,MedTech,Technologies and Biotech).She brings strategy consulting and market research experience,having worked with leading pharmaceutical companies on market assessment,brand health and competitive l
88、andscaping projects across the region.She holds a BSc in Biomedical Sciences from The University of Warwick,UK.PEI-SZU LEE,Head of Sales,Emerging Biopharma,IQVIA,Greater ChinaPei-Szu leads the Greater China business development team,with a focus on China local emerging biopharma clinical development
89、 field.She works with cross functions to support China emerging biopharma companies in their local and global clinical development plan and strategy.She has been with IQVIA for about 10 years,with a deep involvement in both commercial and R&D clinical solutions promotion.Copyright 2021 IQVIA Biotech.All rights reserved.WP.0083-1-07.2021CONTACT US