Asia Regulatory Roundup: China’s Supreme Court Clarifies Legal Scope to Punish Trial Data Fraudsters (22 August 2017)

Regulatory NewsRegulatory News | 22 August 2017 |  By 

Welcome to our Asia Regulatory Roundup, our weekly overview of the top regulatory news in Asia.

India Fixes Price of Orthopedic Knee Implants, Tells Manufacturers to Maintain Supply

India has capped the price of orthopedic knee implants. The imposition of ceiling prices continues the National Pharmaceutical Pricing Authority’s (NPPA) push to control the cost of medical devices sold in India.

Months after setting limits on the prices of coronary stents, NPPA has set ceilings for a variety of types of device used in primary and revision knee surgeries. NPPA is allowing manufacturers of devices made from certain materials, such as titanium alloy or oxidized zirconium alloy, to charge more than their competitors that provide implants made of cobalt chromium. Yet, in percentage terms, NPPA has hit the makers of these premium devices just as hard.

The ceiling prices of all implants used in primary procedures has fallen by 65% to 69% as compared to the average maximum retail price charged previously. NPPA took a slightly softer line on devices used in follow-up surgeries. The ceiling price of implants used in these revision procedures is 59% lower than the earlier average rate.

NPPA decided on the ceiling prices after analyzing data to support the use of each type of device and the current market. The agency is allowing standard cobalt-chromium knee implants to sell for 40% more than the average landed cost. This is more than the 35% margin NPPA typically grants to drugs. NPPA granted the implants a higher margin to offer “incentives for future growth and R&D” in the nascent device sector.

The agency took a harder line on premium implants. NPPA is capping margins on these devices at 30%. The lower margin reflects NPPA’s desire to “discourage indiscriminate ‘hype’ based promotion of these clinically unproven implants.” NPPA cited multiple studies that questioned the value these devices provide over older, cheaper products to justify its hard line. 

When NPPA took a similarly hard line against makers of coronary stents, particularly providers of new devices claiming to improve over existing products, manufacturers pushed back by trying to pull out of the market. NPPA is aware from its discussions with the foreign manufacturers that dominate the knee implant market that its latest price cap is likely to be similarly poorly received  by industry.

“The multinational orthopaedic device manufacturers ... held that the prices are not unreasonable in the light of the present ‘market structure’ in India and that the ‘latest technology’ comes at a cost. They also apprehended that if any price cap was imposed, foreign manufacturers will not import new generation implants and might withdraw their ‘cutting edge’ products from the Indian market and Indian patient’s might be deprived of the ‘latest generation’ implants,” NPPA wrote.

Emboldened by its belief the latest devices offer little value over older products, NPPA decided to face down the threat of industry resistance. So far, NPPA is yet to receive any complaints about the availability of knee implants. NPPA also said the 21 hospitals in the Delhi area it has assessed have all complied with its demand to display the prices of orthopedic implants. The agency is now checking up on hospitals in other parts of the country.  

NPPA Notice, Meeting Minutes

China’s Supreme Court Clarifies Legal Scope to Punish, Imprison Trial Data Fraudsters

China’s Supreme Court has clarified the laws and punishments that apply to individuals found guilty of fabricating clinical trial data. The legal explanation clears lower courts to take a hard line on people who engage in fraudulent research activities.

Legal leaders categorized certain fraudulent research activities under the same parts of China’s criminal code that cover providing false evidence and documents. These parts of the law empower judges to impose prison sentences of up to five or 10 years, depending on the exact nature of the crime. The proposed punishments apply to fraud involving drugs and medical devices.

The legal interpretation, news of which was first reported by China Daily prior to its finalization, adds to the ways the state can go after fraudsters. Policy changes at the China Food and Drug Administration (CFDA) have equipped it to levy administrative punishments against organizations. Yet, the scope of CFDA’s powers falls short of criminal punishments for individuals. The Supreme Court’s interpretation creates a clear legal path for such criminal punishments.  

Multiple people within and outside a company could face penalties if the organization is found guilty of a crime. The legal interpretation singles out people directly responsible for the fraudulent activity as being eligible punishment. It does not stop there, though. The legal interpretation states another part of the law applies to anyone whose neglect or abuse of their duties leads to the approval of drugs and devices supported by false materials.

Court Notice (Chinese), China Daily

Australian Regulators Ready Industry for TGA Pharmacovigilance Inspection Program

The Therapeutic Goods Administration (TGA) of Australia is holding pharmacovigilance information sessions to coincide with the start of its inspection program. TGA is inviting companies affected by the Pharmacovigilance Inspection Program (PVPI) to send representatives to one of three sessions.

At the events in Sydney, Melbourne and Brisbane, TGA will go over pharmacovigilance guidelines before running through the inspection process and how companies can prepare for it. The review of the process will cover the inspection itself and the closeout procedure. TGA will take questions from attendees at the events.

The first of the events is scheduled for 1 September, the day PVPI begins. From then on, TGA will inspect the pharmacovigilance practices of sponsors of prescription drugs, over-the-counter products and complementary medicines. The agency will prioritize inspections based on the risk of noncompliance and the consequences of these failings. TGA will also conduct random inspections.

While PVPI is new, TGA test drove the idea in 2015 and 2016 when it ran a pilot program with 10 volunteer companies. The pilot identified worries about how time-consuming the process was and the difficulties of working across time zones, but nonetheless supported a wider program.

TGA Notice

TGA Defends Record of Giving Patients Access to Medicinal Cannabis Products

TGA has defended its record of granting patients access to medicinal cannabis products after a TV news show claimed excessive red tape was fostering black market sales. The regulator said low cannabis prescription levels reflect doubts about efficacy, not administrative barriers to access. 

Officials at TGA put out a statement about access to medicinal cannabis products in response to a segment on the “Lateline” TV show. The segment reported patients are buying cannabis products on the black market because of administrative obstacles to legal access.

TGA rejected this analysis. The regulator clears doctors to prescribe unregistered medicines more than 20,000 times a year under its Special Access Scheme Category B. However, it acknowledged uptake of cannabis is low. The difference between the analyses of TGA and “Lateline” is the former attributes the low number of prescriptions to the lack of safety and efficacy data on the products.

The agency is working to make sure doctors can access the data that are available through clinical guidelines. TGA will publish the first of these, in epilepsy and palliative care, by the end of 2017. 

TGA Statement

Other News:

TGA has revealed it plans to make improvements to the good manufacturing practice (GMP) clearance process. The agency is due to publish an updated GMP clearance guidance document soon. TGA Notice



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