China captivates the clinical trial sector

China is generating huge interest as a destination for outsourced clinical trials, particularly since the US consulting firm AT Kearney ranked it above India in 2007 as the most attractive, low-cost location to run clinical trials outside the US.¹ Other independent assessments have also ranked China highly.² In March 2006, the UK Trade and Investment department examined clinical trial trends in China from both a sponsor's and an outsourcing partner's perspective. Discussions with representatives of government departments, and local and foreign companies showed that the clinical trial market was maturing and was not simply based on 'hype'.³

Faiz Kermani

A prime attraction for companies seeking to conduct clinical trials in China remains the country's large population, which offers a huge pool of patients. As China represents an estimated fifth of the world's population, it is likely that major diseases found elsewhere in the world will affect a sizeable number of people. An additional consideration is the rapid rate of urbanization, which has important healthcare implications. By 2050, 600 million Chinese people are expected to move from rural areas to urban districts. At present, China has more than 660 cities and 19000 towns. By 2050, 80% of towns will have grown into small- or medium-sized cities.⁴

Rapid urbanization can transform the environment as people compete for limited natural resources and space, leading to overcrowding and poor hygiene, as well as a change in social attitudes. The growing number of trials being run in the infectious disease therapeutic area reflects this trend in urbanization; for example, approximately 25% of the patients enrolled in Novartis's ongoing chronic hepatitis B Phase III clinical trial, the GLOBE study, are from Chinese centres.⁵

Apart from patient numbers, there are other attractions for conducting clinical trials in China, including positive patient attitudes and low costs. As the majority of the population is very poor, they have extremely limited access to healthcare. For such patients, clinical trials are seen as a means to receive free medical treatment and care.

Another area that is becoming clearer to assess because of greater foreign company involvement is operational costs. Current thinking suggests that, in terms of general running costs, clinical trials can be conducted in China for approximately 10% of the equivalent cost in a Western country. More specific domestic estimates suggest that Phase I clinical trials in China are 15% of the price in the West, while Phase II trials cost 20% of the price in the West.³ These estimates are in-line with comments from the former CEO of AstraZeneca, Sir Tom McKillop, who was cited in a 2006 edition of the Wall Street Journal as stating that a major postmarketing clinical trial for two cardiovascular drugs (involving 46000 patients in 1250 hospitals in China) cost US$3 million (€1.9 million).⁶ Such a trial would be impossible to run in the West or Japan at the same low cost.

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Regulations

When companies are interested in conducting a clinical trial, they first approach the Chinese State Food and Drug Administration (SFDA), after which they may choose one of the accredited hospitals from an official list for their study. In China, only medical institutes officially certified as 'National Institutes of Pharmaceutical Clinical Trials' by the SFDA may conduct clinical trials. At present, affiliated hospitals of medical universities, some large public hospitals and specialist hospitals can obtain certification, and Chinese hospitals have also become interested in competing for clinical trials. Each major hospital has a science and education department whose task is to document their involvement in clinical research. Physicians in charge of such departments have at least 10 years' experience and undergo continuous medical education training.

The process to obtain clinical trial approval can be complex, but follows a five-step pattern:

• Contact must be made with SFDA.

• Contact must be made at local government level — often this involves simply informing the provincial SFDA office, but in special cases more formal approval is needed before proceeding further.

• Contact with qualified hospitals.

• Ethics Committee approval.

• Investigators must be sought.

One of the concerns of global sponsors is whether Chinese clinical trials can be run to International Conference on Harmonisation (ICH) good clinical practice standards — the international quality standard that ensures clinical trials involving human participants are conducted in an ethical manner. Although some local observers have suggested that China could be used in a pilot capacity for clinical trials to evaluate the potential of a product for a foreign market, the country is far more sophisticated in its clinical trial nature.

Foreign companies are showing growing confidence in using Chinese clinical data to support global clinical programmes. In 2003, Pfizer opened a clinical trial centre in Shanghai and stated that not only would this be concerned with developing drugs for local approval, but would also form part of the company's global R&D network.⁷ Similarly, since 1996 AstraZeneca has undertaken nine international multicentre clinical trials in the respiratory area in China with the involvement of more than 130 domestic hospitals and institutions. The company recently conducted clinical trials for its asthma product, TurbuHaler, in China and used the data to support the drug application overseas.⁸ The Chinese clinical work involved collaboration with professors who had worked on SARS and had valuable experience in the respiratory field. As previously mentioned, Novartis has been conducting a chronic hepatitis B clinical trial, which relies considerably on data from Chinese centres.

Since its establishment in 2003, the SFDA has worked hard to modernize China's clinical practices, organize audits and create a database of physicians certified to conduct clinical research. During 2006, the agency was badly hit by a corruption scandal, which resulted in the execution of the agency's former Head, Zheng Xiaoyu.⁹ This harsh sentence was seen by many as evidence that the country's leadership was serious in improving external perceptions of its drug approval process.

CRO environment

The increasing popularity of using China for clinical trials has encouraged the growth of the clinical research organization (CRO) sector. It has been estimated that there are 100 CROs operating in China working for both domestic and foreign pharmaceutical companies on clinical projects. A commonly held view among the Chinese CRO community is that the market is equivalent to that of the European and US CRO markets during the early 1980s. It is likely that the Chinese sector will experience rapid growth during the next decade because more companies are wanting to conduct clinical trials in the country, which will lead to more opportunities for CROs. Additionally, there may be some degree of consolidation because of competition between the different CROs. It is also possible that CROs may join up with partners in other cities to establish a stronger presence across the country, or that foreign CROs may buy local ones.

Based on SFDA data from 2005, pharmaceutical companies obtained approval for more than 4000 clinical trials in China. Approximately 30% of clinical work was believed to have been outsourced, indicating a healthy future market for CROs. Large international CROs have either entered the Chinese market by themselves or through joint ventures with Chinese CROs. Several Japanese CROs are also operating in China, some of which have direct relationships with local institutions for clinical trials. The view among Chinese CROs is that they are more cost-effective and have better relationships with the SFDA and hospitals than foreign companies. They have described foreign CROs as growing slowly, with their high costs precluding them from working with Chinese companies. In contrast, domestic CROs have both the local experience and lower operating costs to attract work from international, as well as Chinese, pharmaceutical clients.

Outlook

China's clinical trial environment is improving rapidly and the SFDA is aspiring to be a world leader in drug development by 2010. Therefore, the agency is conducting wholescale reforms of its clinical trial process and has given rise to speculation about the results of these changes;¹⁰ for example, because of improving perceptions about the quality of Chinese data, it has been suggested that the country may soon be capable of producing FDA-quality data that could be used on its own to file for investigational new drugs (INDs) in the US. If this rumour is true, it will encourage a huge influx of international sponsors to invest in clinical trials in China, as the next logical step would be for FDA, and perhaps European agencies, to allow 'all-China data' for clinical trials.

However, this seems most unlikely in the short-term, and so most companies should continue to use improving Chinese clinical data in conjunction with the data they generate in other markets to satisfy the major international regulatory agencies. Companies have much to gain from working in China, but must be cautious of over-extending themselves while the clinical trial environment continues to evolve.

References

1. In-Pharma Technologist, "China 'most attractive' offshore clinical trial location" (2007). www.in-pharmatechnologist.com

2. Advances in Biopharmaceutical Technology in China (BioPlan Associates, Rockville, MD, USA, April 2007).

3. Drug Researcher, "China lives up to ousourcing hype" (2007). www.drugresearcher.com

4. Embassy of the People's Republic of China in the United States of America, "Experts: China's Urbanization Rate Tipped to Rise. Embassy of the People's Republic of China" (2002). www.china-embassy.org

5. Novartis, "New data show telbivudine superior to lamivudine in treatment of Chinese patients with chronic hepatitis B" (2006). http://dominoext.novartis.com

6. E. Berton, "More Chinese get free drugs in clinical trials" in The Wall Street Journal (2006). http://online.wsj.com

7. China Daily, "Shanghai to get new Pfizer clinical trial centre" (2003). www.chinadaily.com.

8. AstraZeneca, "AstraZeneca and China Medical Association jointly initiate research fund for chronic respiratory diseases" (2006). http://en.astrazeneca.com.cn

9. China Daily, "Former SFDA chief executed for corruption" (2007). www.chinadaily.com.cn

10. ChinaBio Today, "Rumors: SFDA to Speed INDs/US FDA OK with China Data" (2007). www.chinabiotoday.com