Global Pharma’s R&D Re-Balancing

Wednesday, February 18, 2015

Earlier this week, in Michael Woodhead’s superb blog China Medical News, he wrote about “major problems with ‘serious’ research clinical trails carried out in China.” Michael points to a JAMA article and then proceeds to elaborate:

“the FDA found serious problems with the Chinese clinical trials of apixaban, a novel anticoagulant. At one site the FDA concluded that patient records had been altered. When they investigated further the FDA inspectors declared that data from 23 other Chinese clinical trial sites was suspect and should be excluded from their evaluation of apixaban (Eliquis). We often hear that western pharma companies are shifting their R&D from the US and Europe to China. It may be cheaper but with reports like this you have to wonder if it is worth it in the long run.”

This is not the first set of concerns that have been voiced about clinical trials and other pharma-specific R&D endeavors underway in China. Lost in the last two years during all the commotion about GSK’s corruption problems in China was the company’s other problem in its clinical trial group, which resulted in the 2013 firing of its research chief.

These problems all take place against the backdrop of a major re-balancing of where pharmaceutical R&D budgets are being spent globally. Almost every major pharmaceutical multinational has made announcements of planned investments in their own R&D capacity in the China market. These investments reflect simple realities: China’s appetite for innovative medicines means that more R&D inevitably can and will be done inside its own borders. This inevitability has been made all the more certain as China has focused on the development of a domestic life science sector as one of its focus areas, a decision reflected in the most recent Twelfth Five Year Plan.

What to make of these problems, and the re-balancing of where pharma MNCs spend their R&D budgets, are the more interesting questions. Quick work should be made of two tropes: that these problems are somehow illustrative of the unique problems of doing innovative R&D of any sort in China, and that this sort of re-balancing is inherently bad for the countries who currently enjoy dominant positions economically by serving as the global workforce for where bench science takes place. Of all topics international trade policy touches on, public health should be one of those that certainly is not a zero-sum game.

China’s aspiration to develop its own domestic pharmaceutical sector has twin goals. Yes, there is an economic development goal that smacks into long-held points of contention between the so-called “Washington” and “Beijing” models, with the latter focused on a more explicit sort of favoritism and command-driven national economic development model than the American approach. But more important (and more likely to be successful) than China’s economic development goals are the country’s public health goals, which explain a large part of the country’s desire to have domestic R&D capabilities to ensure that innovative therapies are being developed and commercialized specifically for China. Step into the middle of where these two goals intersect, the infrastructure within which pharmaceutical clinical trials occur, and no one should be surprised that problems have presented themselves. In fact, these sorts of problems coming to the surface are necessary and, if Chinese officials and MNC businesses respond accordingly, these can also benefit industry, government and ultimately patients.

Source: Forbes (link opens in a new window)

Education, Health Care