SHANGHAI – Executives from Eli Lilly and Co., and multifunctional contract research organization (CRO) Wuxi Apptec came together at the Shangri-la Hotel Pudong to tout a strategic collaboration to develop a phase I, small-molecule drug that could treat cardiovascular (CV) patients with dyslipidemia. The deal, which first went public four months ago, was receiving an extra communications push, a sign of the changing times in China. (See BioWorld Today, Nov. 18, 2015.)

"Through synchronized development and manufacturing of the drug, we will shorten the time lag, so Chinese patients will get drugs at the same time as patients in the rest of the globe," said Ge Li, chairman and founder of Wuxi Apptec, during the opening ceremony.

When China kicked off a wave of regulatory changes last August, it was deals like this the government was hoping to encourage.

The two biggest changes were the promise of an expedited path for new drugs: "new" meaning truly new and not already approved anywhere else, and the market authorization holder license (MAH) that allowed drug developers to hand over the manufacturing of their drug to someone else in China – and save on the costly exercise of building their own commercial quantity factories.

Before those new rules, foreign drug companies – most without domestic manufacturing – opted for the imported drug license route, which was exceedingly slow.

The reforms have been praised by Chinese biotech leaders and pharma executives alike: Kerry Blanchard, senior vice president at Lilly, said he was very impressed with the speed of the CFDA transformation and called the new MAH rules "revolutionary."

While many are still uncertain what the domino effect of so many changes will mean on the ground, there is an overall optimism that things are moving in the right direction to get innovative drugs to market faster while the pathway to do so has become clearer – i.e. partnering directly with local companies.

There is clearly a great need to get drugs to patients faster. "Only 30 percent of the drugs marketed in the U.S. and in Europe have entered China, and in some cases after a decade-long lag," said Ge Li.

A new era of "strategic collaboration"

When China first opened its doors to Western companies, it exchanged market access for technology, shepherding foreign companies into tightly controlled joint ventures (JVs) with local companies. Chinese companies benefited enormously from the technology transfer that followed, enabling them to rapidly catch up to global quality standards across industries.

In the last decade of easy growth, JVs fell out of favor and foreign firms enjoyed much greater freedom to operate, and the profits racked up.

Now that growth is a lot harder to come by, China is returning to the days where foreign firms need to demonstrate their worth to China and align their messaging and goals accordingly. Pharmaceutical companies are at the forefront of that wave, finding themselves under the glare of government attention as part of an industry of strategic importance. The government remains fully dedicated to realizing its contrary heath care reform goals: lower costs, wider access and greater innovation.

Showing mastery of the message, Alfonso Zulueta, corporate senior vice president and president of emerging markets at Lilly, did not miss the opportunity to toe the line for the government representatives in the room, saying, "Lilly is firmly committed to growing our business in China and helping the country of China achieve its goals, particularly in its priorities in health care. We are making investments in innovative medicines across the country."

Global blockbuster approved in China first?

While investing in R&D centers has been a tried and true method for almost every single big pharma to grow their innovation footprint in China, it is often questioned what the country has gained from the hundreds of millions invested, other than perhaps jobs.

Strategic collaborations look far more promising for delivering new drugs to the market. Pharmas have a handful of strong Chinese partners to choose to cooperate with, and Wuxi Apptec is clearly a frontrunner. As a CRO, many global firms have worked with Wuxi Apptec for more than a decade and that trust, built over time, has been a clear advantage for them. In December, Astrazeneca plc deepened its China investments by further aligning with Wuxi Apptec. (See BioWorld Today, Dec. 18, 2016.)

That deal involved greater commitment to the existing JV between Wuxi Apptec and Astrazeneca's biologics arm, Medimmune, that was a creative workaround to China's old manufacturing rules. It also saw Astrazeneca bring its entire biologics pipeline to China, with Mark Mallon, Astrazeneca executive vice president, international, saying at the time the goal of the initiatives will be "to make us the first multinational biopharmaceutical company to create a dedicated R&D platform and manufacturing capabilities in China for local development from research through to commercialization."

In this new era of strategic cooperation, there is a race for various firsts. According to Lillly's Blanchard, the Lilly-Wuxi CV drug has a good chance to be approved in China first, even though development will start in both China and the U.S. at the same time; he points to the ease of patient enrollment in China as a key factor.

"China or the U.S.: I don't think it where it starts first is important; more important is where it finishes first," he said. "I think China might finish first for a variety of reasons." If that should happen, it would make it the first novel, global drug with blockbuster potential approved for Chinese patients before the EU or the U.S.