BIO OUTSOURCING ASIA

Biopharmaceutical Outsourcing Opportunities and Challenges

SEPTEMBER 2008 VOL. 1 ISSUE 3

2

Bio Outsourcing Asia© TABLE OF CONTENTS

September 2008 Vol. 1 Issue 3

© CanBiotech Inc.

Formats: Online, Digital, and Print

Subscription: 25,000 Content:

Feature Stories, Trends and Analysis,

Case Studies, Technology Profiles, Company Profiles,

News, Events

Access: Free

UPCOMING ISSUE:

November-December 2008: Opportunities in and Challenges

Facing Malaysia

Contact the Editor at editor@canbiotech.com to

participate in this issue.

CHINA

Page 4 Outsourcing to Asia: China and India’s BioPharma

Growth Based On Home Grown Expertise

By Eric S. Langer, President, BioPlan Associates, Inc.

Page 7 China’s Intellectual Property Regime-

Cause for Concern or Optimism? By CanBiotech

Page 10

Regulatory Processes in China- Room for Improvement?

By CanBiotech

Page 11 The Drive toward Outsourcing: The State of the

Chinese Industry-Case Studies By CanBiotech

INDIA

Page 19 India Unlocking the Power of

Pharmacovigilance By Dr. Anjali Shukla, Accure Labs Pvt. Ltd., India

JAPAN

Page 22

21st INTERPHEX JAPAN, 7th INT’L BIO FORUM & BIO EXPO JAPAN, and 2nd INT’L PHARMACEUTICAL IN-

GREDIENTS EXPO & CONFERENCE: Asia’s Largest Pharmaceutical/Biotechnology Event

held in Japan!

TAIWAN

Page 24

Taiwan’s Biotechnology Plan By CanBiotech

INDUSTRY UPDATES

Page 27

BIOASIA NEWS

Page 29 UPCOMING BIOASIA EVENTS

3

4

Outsourcing to Asia: China and India’s BioPharma Growth Based On Home Grown Expertise Eric S. Langer, President, BioPlan Associates, Inc. www.bioplanassociates.com

Outsourcing has traditionally been driven by cost factors. But China and India are breaking that mould, using indigenous advantages, and home-grown expertise developed over decades to establish their competitiveness. Western de-cisions to outsource to Asia are increasingly based on strategic factors, and India and China are positioning themselves with their respective specialized expertise, and growing these seg-ments on their own terms. This, according to newly released studies, “Top 60 Biopharmaceu-tical Manufacturers in China,” and “Top 60 Bio-pharmaceutical Manufacturers in India,” by Bio-Plan Associates (www.bioplanassociates.com). The reports indicate that China’s and India’s growth are becoming increasingly attractive to investors, but for entirely different reasons, and unique to each country. To understand this paradigm, we explore both countries’ assets from different perspectives. Indian Biopharmaceutical Industry History and Outsourcing India has been involved in biopharmaceuticals since 1925 when Haffkine Institute (Plague Re-search Laboratory) began producing vaccines in Mumbai. Vaccines have since become a back-bone of the industry. Then, in 1953, Unichem began exporting hormonal products, and later on, the focus shifted toward the enzyme mar-ket, with companies such as Biocon and Ad-vanced Enzymes. Now, with strong IT experi-ence, India is pushing the bioinformatics tech-nology envelope. Outsourcing to India has thus moved in line with the region’s needs and ex-pertise. Today, for example, vaccine competence in In-dia has resulted in a local vaccine market pegged at USD$100 million and growing at more than 20% annually. India is now the larg-est producer of recombinant Hepatitis B vaccine in the world, and Serum Institute, reports to be the second largest manufacturer of vaccines, claiming that 1 of every 2 kids in the world is vaccinated by Serum’s vaccine. So it should not be a surprise that international companies involved in vaccines, such as Merck and others are establishing R&D and production

in India. Indian biopharmaceuticals today are largely confined to the areas of traditional bio-technology like fermentation and vaccines. However, with India ranking 11th in the world and 3rd in the Asia-Pacific in terms of company count with over 300 biotechnology-related firms, we expect increased attention from po-tential Western partners will be paid to these companies. These organizations are playing an integral part in outsourcing as India establishes its grass-roots, unique position in manufactur-ing, and technology. Recognizing the potential of Indian companies, several foreign companies are working with do-mestic manufacturers. For example, Acambis Plc., a UK-based vaccine developer, has a manu-facturing and marketing agreement with Bharat Biotech for its investigational vaccine against Japanese Encephalitis. Panacea Biotech is part-nering to develop a fully liquid pentavalent combination vaccine for five infectious diseases. In fact, India now exports vaccines to more than 100 countries around the world. The focus is now on obtaining a share of the underdevel-oped market, as well as supplying the World Health Organization (WHO), UNICEF, and oth-ers. Strengths in Outsourcing Today, India has established itself as a potential partner in biopharma, particularly in contract research and clinical trials, vaccine production, and IT. This fundamental expertise has devel-oped strong pharmaceutical industry ties that bode well for future integrations. It is these fu-ture relationships that are likely to become a solid base for the region’s biopharma industry. India’s biotech industry has been strengthened with support from scientific institutions such as the National Centre for Biological Sciences (NCBS), the Institute of Science (IISc), and the Centre of Cellular and Molecular Biology. The Indian Biopharma sector presents numerous opportunities in outsourcing, which come with several economical and political advantages. Political advantages include a government pol-icy that encourages 100% foreign direct invest-ment in Special Economic Zones (SEZs); exemp-tion of import duties on certain R&D equip-ments; improved patent laws; a simplified regu-latory system, and other economic advantages. Indian companies have also started venturing into areas of grass-roots R&D competence, in order to remain competitive in the vaccines seg-ment. Many institutes are researching vaccines for cholera, tuberculosis, rabies, HIV, malaria and Japanese Encephalitis. Scientists at the Na-tional Institute of Immunology (NII), New Delhi, have developed a vaccine based on the Indian strain of Japanese Encephalitis Virus (JEV), and a prototype candidate vaccine for the HIV-Subtype ‘C’ has been developed based on plas-mid DNA and MVA (Modified Vaccinia Ankara) approaches at the All India Institute of Medical Sciences (AIIMS). Several institutes have possi-bilities for the development of commercially viable technologies for the Malaria Vaccine Ini-tiative (MVI), and development of a diagnostic kit for Dengue.

This specific R&D knowledge is creating an en-gine for outsourcing and partnering. Relatively few drug candidates are coming from internal labs of large-bio/pharma. So companies like Amgen, which recently partnered with Jubilant, are seeking to access R&D and drug discovery expertise offshore. This ‘insourcing’—capturing R&D competence through investment, allows companies to develop research-based partner-ships as a way of sourcing expertise. Merck and Advinus Therapeutics (India), are collaborating at early-stages, and Indian companies such as Ranbaxy and Dr Reddy's have established ge-neric drug manufacturing, and are now compet-ing in new drug discovery. India’s widely ac-cepted chemistry skills offer services that can match global standards in some areas. Out-sourcing chemistry services partnerships include AstraZeneca-Ranbaxy and GSK-Torrent Pharma. Challenges Ahead The Indian Biopharma industry faces several challenges regarding adequate infrastructure and financial support. Financial support is re-quired for bio-entrepreneurs and trained man-power is still required, despite the 300 biotech educational and training institutes across the country. In addition, there is still an unclear regulatory environment; intellectual property protection is far from perfect; and the slow pace of integration between academic and com-mercial science still exists. For India, the near future opportunities are based on their existing expertise, and we should continue to see East-West partnerships based on these relative synergies. These partnerships, in the long-term, are likely to springboard this country to become a major force in global bio-pharma, as its economy grows. China Nineteen years have passed since the first mod-ern biotech firm, Shenzhen Kexing Biotech Co., Ltd., China’s biotech pioneer, brought the first Chinese-developed protein therapeutic (Recombinant Human Interferon a1b) to the market in the early 1990s. What followed were the fruits of nearly 200 modern biotech drug firms that to date have launched 35 domestic biotech drugs. But it is the Chinese biotech sec-tor’s innovation focus that is differentiating its outsourcing potential. Major Drivers for Innovation and Outsourcing Based on our study of the Top 60 Chinese bio-pharma companies, we predict that innovation and outsourcing services will become major drivers for China’s biotech industry over the next 5-10 years. At present, the potential for Chinese biotechs to become world-competitive has not yet been realized. Figuratively, Chinese biotech companies remain ‘diamonds in the rough.’ However, it is likely that, based on their grass-roots competences, Chinese biotech firms will become influential players in the global market. We will not be surprised if five or ten years from now, some of the Chinese compa-nies on our Top 60 directory will have become well-known names in the international biotech

5

community. Some of this growth is being driven by foreign influence and investment. AstraZeneca plans to step up outsourcing in big ways. In fact, David Brennan, chief executive, said that all active pharmaceutical ingredients would be produced externally within a decade as part of his strategy of supply chain management, quality, and security of supply. AstraZeneca plans to increase its outsourcing drastically from both China and India. Chinese Biotech Growth The first Chinese biotech companies were mostly vaccine providers, as were India’s. These Chinese organizations have a relatively long history, and, because of the domestic healthcare and vaccine needs of the world’s largest population, they tend to be much larger in size. National Serum and Vaccine Institute (NVSI), was founded in 1919. With more than 9,000 employees and worldwide revenues of $421 million in 2006, CNBG is the largest producer of vaccines and blood derivatives in China. Other vaccine providers manufacture polio, hepatitis A vaccines, and most other vaccines available world-wide. According to the SFDA, Chinese vaccine producers have marketed 49 vaccines to fight 26 infec-tious diseases, with over 1 billion doses annual output. China has be-come the world’s largest vaccine manufacturing country in terms of pro-duction scale. Outsourcing Biotech to China Western companies have not failed to recognize these competences. Sanofi-Pasteur set up an influenza vaccine facility in Shenzhen in 1996. In November 2007, the company announced it would invest 700 million RMB (US$94 million) in expanding facilities in Shenzhen, with the goal of producing seasonal influenza vaccines for the Chinese market by 2012. A number of multinational biotech players have established their pres-ence in China, lured by opportunities. Novo Nordisk, which entered the Chinese market in 1993 opened its first production facility in Tianjin in 1996. The company has dominated approximately 82% of the human in-sulin market in China for many years (compared to 52% market share in the global market), with 1.9 billion RMB ($261 million) sales in 2006. Higher-end Innovation Eli Lilly has increased R&D capacity and accelerated product develop-ment for small molecule drugs by outsourcing early-stage development work to China and India. At the same time, the company is pioneering new ways to share risks and rewards, such as its partnership with Nicholas Piramal, and with collaborations with Suven Pharmaceuticals in Hyderabad. GlaxoSmithKline (GSK) located research activities in Shanghai, China, pointing to China’s growing talent pool of scientific ex-pertise as the reason for this shift. According to a GSK press release, “We don’t want to give them the crumbs…Within five to 10 years we will be moving from ‘made in China’ to ‘discovered in China’.” The GSK invest-ment follows similar moves by Roche, Novartis, AstraZeneca, NovoNordisk, Sanofi-Aventis, and others who are investing in Chinese R&D. Despite these specific advantages, they may actually be outweighed by the general, strategic benefits of establishing in China. According to Dr. Xiaoqing Sun, Managing Director at Shanghai Genomics in China, “The real ‘grass-roots’ benefit that China offers Western biopharma compa-nies is the fact that the market in China has the potential to grow much faster than it is currently; but Western organizations have to ‘participate’ to be part of that opportunity in the future.” Changing Biotech Environment The Chinese biotech industry has established ‘critical mass’ and is now aggressively working to catch up with their foreign competitors from de-veloped countries. The government has realized the importance of bio-technology and has prioritized the biotech industry on its agenda. China has attracted many high-caliber China born biotech employees, with many years of education, research, and work experience in the West to

return to their motherland to set up or take senior positions in Chinese biotech companies. The growing number of international biotechs partnering with Chinese companies in R&D and production has provided opportunities for Chi-nese biotechs to gain world-level management know-how from their Western partners. As an emerging biopharmaceutical outsourcing hub, China is rapidly gaining importance among multinationals as part of their global strategies. In the old days (e.g., before 2002), Western companies tended to come to China for the lower cost of labour and raw materials for manufacturing. Today, what makes China attractive to foreign bio-techs looking to boost their productivity are China’s more open eco-nomic and political landscape coupled with a large biotech talent pool. Threats and Weaknesses Challenges face Chinese biotechs as they attempt to expand beyond their borders. These include a higher tax rate, increases in raw material costs, and potential government-imposed drug price cuts. In addition, the shortage of a strong, mature capital market and the use of govern-ment investments to fund biotech research also hinder the development of Chinese commercial biotechs. Chinese biotech firms need to over-come the following weaknesses before they are able to effectively com-pete in the global market: Size: In general, Chinese biotech firms remain small (except for CNGB), compared with conventional pharma companies; Financing: Most companies don’t have sufficient funds to foster intensive R&D and facility upgrading; and Management and Marketing: Many companies don’t have managers with international managerial, or marketing experiences. Summary There are inherent risks associated with outsourcing to India and China; however, based on our study of the Top-60 Chinese and Top-60 Indian biopharma companies, we predict that grass-roots competitive advan-tages in specific production systems, R&D innovation, trained work-forces, and experience in outsourcing will become major drivers for both the Chinese and Indian biotech industries over the next five to 10 years. Forward-thinking Western companies who want to participate in the growth of these Asian markets are going to need to establish a presence in the region, learn to navigate the risks, and identify the synergies that will create global advantages for them as partners. About the Author: Eric S. Langer is president and managing partner at BioPlan Associates, Inc., a biotechnology and life sciences publishing and marketing research firm established in 1989, and located in Rock-ville, MD. 301-921-9074. www.bioplanassociates.com

6

7

China’s Intellectual Property Regime- Cause for Concern or Optimism? By CanBiotech

Although the government keeps intellectual property concerns high on its agenda since its commitment to the rules of the WTO, namely the Trade-Related Aspects of Intellectual Property Rights (TRIPS), enforce-ment of intellectual property protection is still thought to be problem-atic. Consequently, while intellectual property protection is improving in China, most investors remain cautious. Patent reforms are essential to encourage entry into China, partnerships, and collaborations including outsourcing contracts, technology transfer deals, and technology licens-ing.1, 2, 3 China-based outsourcing service providers must therefore, keep intellectual property concerns in mind when partnering with Western biopharmaceutical companies. Any partnership or contract should ad-dress and alleviate the concerns that Sponsors may have regarding the protection of technology. The establishment and implementation of the intellectual property sys-tem have helped to standardize China's market order, stimulate inven-tions, promote the importation of knowledge resources, and have played an important role in China’s economic and social development. However, the quality and quantity of the self-relied intellectual property still can-not meet the demands of economic and social development; the public awareness of the importance of intellectual property is comparatively weak; the capacity of market entities to utilize intellectual property is not very strong; infringement of intellectual property is still a relatively serious problem; there are still some cases of abuse of intellectual prop-erty; the intellectual property service and support system and training for all types of intellectual property personnel lag behind its develop-ment; and the role of intellectual property in promoting economic and social development needs to be strengthened. 4 However, the third round of amendments to the PRC patent law, to be finalized, this year, is thought to be cause for optimism. The changes are expected to include amendments to the patent application process, amendments regarding legal requirements for patentability, amend-ments regarding exemptions to patent infringements, and amendments to establish a special appellate court to handle intellectual property rights (IPR) cases.5 Furthermore, the recent rise in patent application fil-ings by domestic and foreign applicants reflects increased confidence in expected patent protection and enforcement in China. 5 In 2007, China made tremendous progress in the field of intellectual property rights. Laws and regulations concerning intellectual property rights were further refined. The number of patent applications from home and abroad handled by China reached 4 million, up from 3 million in just 18 months. According to the Party Central Committee and the State Council, the national intellectual property rights strategy has now shifted from “formulation” to “implementation”, which indicates that China is now entering a new development phase. 6 In 2007, the number of patent applications received by the State Intellectual Property Office (SIPO) was 694,153, with an increase of 21.1% compared with last year; the number of PCT applications totalled 5,401 over the year and 364 international preliminary reports were is-sued. A total of 351,782 patents were granted in the year, an increase of 31.3% on the previous year; wherein, 301,632 patents were granted at home, an increase of 34.7% compared with the previous year, and 50,150 foreign patents were granted, an increase of 13.6%. 6

China’s action plan with respect to IPR protection for 2008 has as one goal the revision of laws and regulations regarding patent protection in-cluding: 1. The completion of the revisions to the Patent Law. 2. The revision of rules for implementation of the Patent Law. 3. The revision of the Regulations of Traditional Chinese Medicines. 4. The drafting of related measures for administration to coordinate with the implementation of the Measures for the Administration of Drug Reg-istration. With regard to advancing IPR protection at the business level, 17 meas-ures in total will be introduced to direct businesses in structuring their IPR regimes and boost their competency for competing on the merit of such regimes. 4 Specific tasks with respect to sectors such as biology, medicine, new materials, advanced manufacturing, new energy, environ-mental protection, and modern agriculture include the development of advanced development plans according to the nation’s strategic needs and the acquisition of a group of patents in these core areas of technol-ogy to support the development of China’s high technology industries. 7 References: 1) Chervenak, Matthew. An emerging biotech giant. The China Business Review. May-June 2005. 2) Santini, Laura. Drug companies look to China for cheap R&D. The Wall Street Journal. November 2004. 3) Hepeng, Jia. Pharmaceutical giants outsourcing R&D. China Business Weekly. September 2004. 4) China's Action Plan on IPR Protection 2008. State Intellectual Property Office. March 2008. 5) Langer, Eric. China Today: Intellectual Property Protection in China: Does it Warrant Worry? Biopharm International. May 2007. 6) China's Intellectual Property Protection in 2007. State Intellectual Property Office. April 2008. 7) Outline of the National Intellectual Property Strategy. State Council of the People's Republic of China. June 2008.

8

9

Regulatory Processes in China- Room for Improvement? By CanBiotech

Experts indicate that the approval process takes from five to eight years in China, in contrast to an average of eight to ten years in the U.S. 1 De-spite the shorter timeframe, the approval process is similar to that of the U.S. and includes Investigational New Drug (IND) applications as well as three phases of clinical trials. These advantages are being used effec-tively by contract research organizations and regulatory specialists. Since the market demand (including ability to pay) for biotechnology drugs is insufficient in China alone, and the fact that some Chinese con-sumers perceive that only Western drugs are developed at international standards, high international compliance is necessary for Chinese com-panies to increase local demand. Public relations firms may serve as good partners to change this perception among Chinese consumers. In-dustry stakeholders believe that in the future, Chinese companies will be more strategically competitive in their work at both the Chinese and in-ternational standards levels. The Chinese State Food and Drug Admini-stration (SFDA) has further taken on the role of enabling innovative drugs to reach the market and plays an indirect role to control the status of intellectual property associated with drugs submitted for approval. Failure to provide evidence of patent status on a drug application may still result in the approval of a drug, but denial of a manufacturing per-mit. 1 The support of outsourcing service providers familiar with the regulatory process can enable Western and Chinese biopharmaceutical companies to successfully navigate the process. There are signs that the SFDA is trying to accelerate the approval process of innovative medicines as part of their commitment to research and de-velopment of innovative drugs. As well, the SFDA has increased its ef-forts to promote Good Clinical Practice (GCP) by releasing standard rules in 2003 and 2004 and introducing compulsory GCP training requirements in 2004. 2 But despite the attempt to harmonize clinical trial standards, analysts indicate that it remains to be seen whether or not the U.S. Food and Drug Administration (FDA) or the European Medicines Agency (EMEA) will accept clinical data from trials based in China. 2 Regulatory specialists knowledgeable about GCP standards, international clinical standards, and regulatory submissions will therefore be critical as the industry matures. As of 2007, China's SFDA issued long-awaited regulations on drug regis-tration that (1) increased requirements for drug safety; (2) integrated supervision resources and clarified responsibilities; and (3) enhanced drug evaluation and approval standards. 3 China announced a new five-year plan to tighten food and drug safety and to contain illegal activities in production and the sale of pharmaceuticals. To implement the new regulations, China established a four-level drug administration and inspection system involving 3,509 institutions. The SFDA also enacted new regulations on drug oversight, including new regulations covering exhibitions, channels, cold chain transportation, quality, and other measures. And as an example of a working system, the government revoked 353 licenses for therapeutics for various reasons, including quality, and rejected 3,049 applications for new drugs from August 2006 through February 2007. 3 China's SFDA also issued new GLP standards. As of January 2007, all new

drug safety evaluations must be conducted in GLP-accredited laborato-ries. Only 23 laboratories in China are GLP certified. 3 China today is a $10-$13 billion pharmaceutical market, which puts it in the top 10 worldwide, with plenty of room for growth (estimated growth rate 25% per year). 4 While Americans spend an average of more than $500 on prescription drugs annually, the Chinese spend just $6. The mar-ket is growing at double-digit rates and is likely to be the world’s third largest, after the U.S. and Japan. 4,5,6 Hence, great opportunities exist to treat the Chinese consumer. The Western biopharmaceutical industry is noticing the advantages of accessing these patients earlier in the drug discovery and development process including: running clinical trials in China, manufacturing in China, and increasingly conducting drug discov-ery research to address the specific health needs of the Chinese popula-tion. Partnerships with Chinese outsourcing service providers and Chinese biopharmaceutical companies will be essential as the West taps into this market. With the growth of the middle class in urban centers, the demand for higher education has similarly increased. 5 In response, Chinese leaders have made a serious investment in higher learning academies that will train the type of people that will be employed in the outsourcing sector. It is anticipated that this large research talent pool will soon have the technological knowledge and skills to meet the outsourcing needs of the Western biopharmaceutical industry. Given the relatively low wages as-sociated with this talent pool, China has become a viable competitor to India as an outsourcing service provider. References: 1) Louët, Sabine. Can China bring its own pipeline to the market? Nature Biotechnology. December 2004. 2) Hepeng, Jia. China beckons to clinical trial sponsors. Nature Biotech-nology. July 2005. 3) Langer, Eric. China as a Biopharmaceutical Powerhouse: Just a Matter of Time. Biopharm International. December 2007. 4) Gardner, Jack. Outsourcing in Drug Discovery 2nd Edition. A Kalorama Information Market Intelligence Report. January 2006. 5) Furniss, Todd. China: The next big wave in offshore outsourcing. Out-sourcing Asia. June 2003. 6) Einhorn, Bruce, P. Magnusson, A. Barrett, and K. Capell. Go east, big pharma. Business Week. December 2004.

10

11

The Drive toward Outsourcing: The State of the Chinese Industry-Case Studies By CanBiotech

Greater complexity in drug discovery, develop-ment, and regulatory processes is encouraging the view that outsourcing is the means to easily and cost-effectively gain access to specialized resources, technology and expertise. In this sec-tion we discuss outsourcing opportunities along the biopharmaceutical value chain. Selected company case studies are used in this section to specifically illustrate the current state of the Chinese industry. CASE STUDIES I: Contract Research (CRO) Specialized resources and expertise will be re-quired to enable for the rapid screening of leads against properly validated targets and to discard failing compounds during the preclinical or Phase I stage where risk and cost can be man-aged. CROs or preclinical service providers that can complete studies more effectively than Sponsor companies should take advantage of this need to “kill fast, kill early” and ensure that the most promising compounds are advanced into a company's pipeline. The need to reach a global market will also encourage partnering with international CROs with local presence in new markets such as China and India, to enable companies to pursue approvals in parallel in these countries, and to maximize their profit potential. International patient recruitment, particularly when based on pharmacogenomic data, will provide new opportunities for CROs that distinguish themselves as being interna-tionally focused. China, with the largest population in Asia, is conducting the greatest number of trials in this region. Phase II through IV studies are being conducted in areas such as: oncology, hepatitis B, cardiovascular, endocrine and anti-inflammatory diseases, as well as diabetes, and metabolic diseases. [1] Interestingly, it is ex-pected that the Chinese biotechnology sector will also benefit through the provision of con-tract research outsourcing services to foreign biopharmaceutical companies to finance the development of locally developed drugs. [2] The Danish Centre for Clinical and Basic Re-search (CCBR) announced in July of 2005 its in-tention to establish a clinical research center

and an international clinical testing laboratory in Beijing. With a $10 million budget, this is the first clinical laboratory that is independent from hospitals in China. Until recently, only major state-run hospitals have been authorized to per-form clinical trials in China. It is expected that with more independent clinical trial providers, biotechnology companies can avoid the limita-tions of certain hospitals designing clinical trials and the poor coordination between different hospitals. CCBR opted for China over other countries in Asia because of better medical and transportation infrastructures, as well as easier access to patients. [3]

AstraZeneca opened a Clinical Research Unit-East Asia (ACRU-EA) in Shanghai in 2002. The unit was the first clinical research center from an international pharmaceutical company span-ning East Asia (Mainland China, Hong Kong, Tai-wan, and Korea). With its establishment, Astra-Zeneca became the first international pharma-ceutical company in China to localize not only manufacturing and sales and marketing func-tions, but also an R&D center overseeing East Asia clinical research and development. The research center seeks to develop closer re-lations with Chinese health institutions and or-ganizations. The significant number of high quality medical talent available in Shanghai was the reason that AstraZeneca chose to locate the center there. Employing 1,000 staff members in 2002, Astra-Zeneca China operation began around 100 years ago. Its Wuxi manufacturing Center opened in 2001 with an investment of $100 million. This represented the company’s largest investment in Asia, and one of the largest investments in China by a multinational pharmaceutical com-pany. [4] Since opening the clinical trial center in Shanghai, AstraZeneca has conducted tests on 50,000 patients.

In November of 2004, Novartis and Shanghai Institute of Materia Medica (SIMM) at the Chi-nese Academy of Sciences, signed an agreement to extend joint research to develop natural compounds herbs to 2007. [5] Novartis has been bringing experts from Europe to establish centers in hospitals with good clini-cal practice to enable the company to conduct clinical trials in China. As of November 2004, the company had 800 patients in trial and expects the number to rise to 3,000. Given the need to access large numbers of patients in clinical tri-als, companies such as Novartis view China as a strategic component of global clinical trials. China’s population of 1.3 billion provides a strong base for clinical trials of almost all new drugs. [6]

Pfizer Inc. is spending $175 million on establish-ing a new regional headquarters in Shanghai. Although the office will oversee existing manu-facturing and marketing operations, Pfizer said late 2004 it also is considering building its own R&D center in China. As of 2003, Pfizer offered 40 innovative prod-ucts in China and another 13 new drugs are planned to be introduced to Chinese consumers within five years. Hence, the need for a clinical trial center in Shanghai. “China's clinical trial center will not only be concerned with develop-ing drugs for local approval, but will also be part of Pfizer's global R&D (research and develop-ment) network,” said Allan Gabor, chairman and general manager of Pfizer Pharmaceuticals Ltd China. Pfizer is the second multinational pharmaceuti-cal company to set up a clinical trial center in China, following in the footsteps of Astra-Zeneca. [7]

Quintiles Transnational Corp. announced in 2005 that Quintiles Laboratories Asia (QLAB Asia) had amended its existing agreement with Peking Union Medical College Hospital (PUMCH) to enhance central laboratory services in China. The new amended agreement enhances ser-vices for customers by allowing Quintiles central laboratory (QLAB) facilities in China to operate under the same standardized processes, con-trols, and reporting mechanisms as other QLAB

Centre for Clinical and Basic Research

Location: Beijing Founded: 2005

Target Area: Clinical Research, Clinical

Testing

AstraZeneca China

Location: Shanghai Founded: 2002

Target Area: Clinical Research

Novartis China

Location: Beijing Founded: 2004

Target Area: Clinical Trials

Pfizer Inc.

Location: Shanghai Founded: 2004

Quintiles Laboratories Asia

Location: Beijing Founded: 2005

Services Offered: Central Laboratory Services

12

13

facilities. Quintiles operates the largest and most comprehensive central lab testing facility in Asia at its Singapore base and has been pro-viding central lab services in China under the initial agreement with PUMCH signed in Octo-ber 2003. Anand Tharmaratnam, M.D., CEO of Quintiles Southeast Asia and QLAB Asia, said: “The new agreement represents true growth and quality standardization of our Asia central lab service. It consolidates our position as the most compre-hensive central lab group in Asia and very nicely complements our clinical business, which is the largest pharmaceutical development group in Asia.” Alan Ong, Vice President and General Manager, QLAB Asia, said of the enhanced services: “QLAB Asia performed nearly a million tests in 2004, of which 400,000 tests were for China trials. We are excited that our new enhanced services will now allow our customers to participate in the growth of clinical trials in Asia, freed from the problems and difficulties of exporting blood samples out of China.” *8+

Bridge Pharmaceutical Inc. is a contract re-search organization spun out of SRI Interna-tional in 2004. This company opened a 100,000 square foot facility in December of 2005 in the Beijing Zhongguancun Life Science Park. The fa-cility provides preclinical research including ani-mal testing for Western clients, meeting U.S. regulatory standards both for laboratory experi-ments and animal testing. The central goal is to provide lower costing but compliant research services to both U.S. and E.U. clients. As evi-dence, earlier in 2005 the company received FDA clearance for clinical studies for two drug candidates. According to the company, this was the first instance of the FDA approving clinical trials based on preclinical data generated en-tirely in China. [9]

Shanghai Genomics was founded in August 2001 by returning overseas biotech veterans, Drs. Ying Luo and Jun Wu, with funding from two prestigious Chinese venture capital funds, Shanghai Venture Capital Company and Shang-hai Zhangjiang Hi-Tech Park Corp. The company mission is to develop novel therapeutic prod-ucts for fibrosis, infectious disease, cancer, and

new biomaterials for drug release. Aiming to become a major player in the frag-mented Chinese pharmaceutical industry, Shanghai Genomics has built an integrated drug discovery platform. The company’s technology platform includes signalling pathway mapping, gene expression profile studies, protein expres-sion and purification, animal modeling, medici-nal chemistry, and bioinformatics. The company leverages this highly efficient and low-cost plat-form to provide collaboration/contract research services for its international partners. Research reagents generated by this platform, such as recombinant proteins and antibodies, are also very useful tools for partner research. [10]

Starvax is one of a handful of Chinese biotech-nology companies trying to convince Western drug companies that scientific research can be easily outsourced. Starvax, in turn, is typical of a new breed of Chinese biotechnology companies run by entrepreneurial Chinese returnees. Though Starvax's chief scientist is eager to start several proprietary research projects, he under-stands cash flow for the first few years will come through contract work. The company cur-rently is conducting toxicology, pharmacology, and animal studies for several drug companies under “pay-as-you-go” agreements. *11, 12+ Starvax's major coup to date has been a part-nership with Mologen Inc., a German biotech-nology company that has a colon cancer drug undergoing clinical trials in Europe. Starvax has licensed the drug for China and East Asia and has expanded research on the compound to see if it might work against other forms of cancer. [12] Rather than spending on expanded R&D in Europe, Mologen is having Starvax conduct the preliminary screening. CASE STUDIES II: Early Drug Discovery Industry experts claim that while traditionally most outsourcing partnerships have involved the later stages of drug development-Phase I, II or III, early drug discovery partnerships are on the rise. The market for outsourced drug discov-ery in 2005 was $4 U.S.D. billion, and is pro-jected to grow at a 15% rate to reach $7 billion U.S.D. in 2009 according to Kalorama Informa-tion. [1, 13] Improving the drug discovery proc-ess should improve the hit-to-lead conversion, expand the number of high quality compounds that do enter the preclinical and clinical stages, and result in the early elimination of com-pounds that are likely to fail. To assist companies in their early drug discovery process are service providers that can screen through and test compounds against the large numbers of targets now available. These service

providers are able to better master new discov-ery techniques and tools that can overwhelm even the largest of biopharmaceutical compa-nies. With the advantage that discovery work can be conducted faster and cheaper through such outsourcing service providers, it is no longer a question of whether or not to out-source discovery work, but a question of finding the right partners. [4] China’s pipeline in 2004 included 139 drugs; 60 of these drug candidates were biologics. [2] The emergence of this pipeline, given that China has traditionally only produced generics, is the re-sult of the central and provincial governments’ efforts to support the biotechnology industry by funding both research and the early stage of product development as well as enabling better intellectual property protection. [2] New drug development focuses on the following areas: gene therapy, antibodies, and traditional Chi-nese medicine (TCM) modernization. [14] It is anticipated that early discovery service provid-ers that specialize in these technological arenas will be strategically positioned to partner with Western biopharmaceutical companies seeking investment opportunities in China and looking to partners familiar with local technology and market needs. Analysts also believe that the modernization of traditional Chinese medicines, the development of high-throughput screening, and other drug discovery technologies will pro-vide China with a competitive advantage in new drug discovery. [14]

In 2003, Eli Lilly opened its research laboratory building in the Zhangjiang New and Hi-TechTechnological Park in Shanghai's Pudong New District. The multinational pharmaceutical company set up the 4,000 square meters Eli Lilly Research Laboratory in cooperation with its Chi-nese partner Shanghai ChemExplorer, a chemi-cal research company. Lilly provides funding and technical support; its Chinese partner is respon-sible for organizing teams of researchers and experts and implementing scientific research plans. [15] Shanghai ChemExplorer provides in vivo ADME services, in vitro assays (solubility, metabolic stability), and toxicology services. [13] Shanghai Bio-Explorer Inc. the sister company to Shanghai ChemExplorer, was started in 2002 and is in Shanghai Research Park between the DuPont and Roche facilities. Shanghai Bio-Explorer provides ADME services and conducts animal studies. [13] Roche announced in 2004 the opening of Roche R&D (China) Ltd at the Shanghai Zhangjiang Hi-Tech Park to help celebrate the 10th anniver-sary of Shanghai Roche Pharmaceutical Ltd. Roche's drug innovation center is its 5th global

Bridge Pharmaceuticals Inc.

Location: Beijing Founded: 2004

Shanghai Genomics Inc.

Location: Shanghai Founded: 2001

Services Offered: Contract Research

Starvax Inc.

Location: Beijing Founded: 2003

Services Offered: Toxicology, Pharmacology, Animal Studies

Eli Lilly and Company

Location: Shanghai Founded: 2003

Target Area: Research Partnership with Shanghai ChemExplorer

14

pharmaceutical R&D facility in addition to such facilities in the U.S. and Europe. It is the first in Asia. [16]

At Roche's new Shanghai operation, scientists will focus on medicinal chemistry and the screening of compounds demonstrating prom-ise as antiviral or cancer treatments. The group will cooperate with the drug giant's other re-search centers in Basel, Switzerland, and Nutley, New Jersey. “There is very good chemistry done in China,” says Jonathan Knowles, the company's global head of research. The labora-tory also should help Roche establish strong ties with Chinese authorities, something that could prove valuable as the company seeks to expand operations in China, as well as explore new mar-ket opportunities there. [17] After the R&D center gains more experience within the next five years, it will become more active in participating in Roche's global projects according to Roche Pharmaceuticals Shanghai Ltd General Manager Antonio Chow. These may include projects of special concern to China, such as AIDS and hepatitis B. Traditional Chi-nese medicine will also be a key area of re-search in the future, according to Andreas Tschirky, who has been responsible for Roche's R&D in China for the last few years. Roche is collaborating with the Chinese National Ge-nome Centres in Shanghai and Beijing on epide-miology studies into genetic predispositions to conditions such as diabetes and Alzheimer's dis-ease. [16] Roche has been active in China for the last dec-ade in diagnostics and pharmaceuticals. It is one of the leading suppliers of prescription medi-cines in China. The Roche Group employs a total of 1,200 people in Hong Kong and Shanghai.

Servier, France’s largest independent drug com-pany, established the Servier (Beijing) Pharma-ceutical Research & Development Company Ltd in 2001. The new company, a wholly owned Servier Group subsidiary, participates in all the group’s research activities and is actively in-volved in new therapies sourced from the Chinese pharmacopoeia. “In the research field,” states Paul Vanhoutte, Group Vice-President of R&D and Chairman of the new company, “the company's mission will be not only to adminis-ter the new collaborative agreements we have entered into with Chinese university depart-ments and scientific institutes, but also to su-

pervise the setting up of joint units with both institutions...” The new Servier Center has two purposes: one is to accelerate the discovery - on a partnership basis - of new compounds native to traditional Chinese medicine, especially for diabetes, can-cer, and cerebral aging; the other is to incorpo-rate China into the international clinical devel-opment program of Servier Research com-pounds through the establishment of Servier's 12th world International Center for Therapeutic Research (ICTR). [18] CASE STUDIES III: Contract Manufacturing (CMO) Many biotechnology and pharmaceutical com-panies, both small and large, are increasingly relying on third party contract manufacturers to develop their biopharmaceutical products. Given the significant capital investment and po-tential high operating costs, contract manufac-turing has become a viable option to keep costs low and ensure a rapid time to market for prod-ucts. Outsourcing partnerships can include the use of contract manufacturers to conduct all activities from preclinical development to com-mercial manufacturing or the use of contractors to manufacture material for specific phases of clinical development or for commercial devel-opment. Domestic consumption levels and recognition of China as a supplier base for active pharmaceuti-cal ingredients (APIs) and intermediates have further attracted the attention of global phar-maceutical and biotechnology companies. [19] The Chinese fine chemicals industry has tradi-tionally focused on basic building blocks and commodity types of active ingredients. How-ever, Chinese fine chemical companies are in-creasingly moving into more complex areas of this sector providing early phase development services and custom synthesis. Industry experts indicate that large biopharmaceutical compa-nies are planning to substantially increase their share of fine chemicals outsourcing to both China and India. This share was expected to reach 20 to 30% by 2006-2007. Just as the fine chemicals service industry is evolving in China, large biopharmaceutical companies will not only source basic building blocks or APIs, but also the more advanced intermediates as well as early phase development services. [19] To meet capacity demand, pharmaceutical and biotechnology companies are using an inte-grated strategy that involves in-house manufac-turing capacity development and the develop-ment of long-term partnerships with contract manufacturers. Using this strategy, companies can prioritize which products are targets for in-house manufacturing and which products are targets for outsourced manufacturing. Some companies may opt to build capacity for clinical trial product manufacturing and then outsource commercial manufacturing. Other companies without the capacity to build may have to rely entirely on outsourcing biomanufacturing ser-vices. Capacity development is key to ensure that products do not end up on the shelf be-cause of lack of production and to ensure the financial growth of biotechnology and pharma-

ceutical companies as they progress from late-clinical trials, to production, and then to the market. [20, 21] As the biomanufacturing industry develops, contractors will be in a position to fully utilize their manufacturing capacities serving multiple customers, with lower overhead costs for all customers. The development of new expertise and use of new technologies will increase effi-ciencies and lower costs for such customers. Future contract manufacturers will develop a one-stop shopping facility, including large facili-ties with economies of scale, cost-effective sup-plier agreements based on volume purchases, and flexible processes to meet increases and decreases in demand. New technologies will include the use of transgenics, better produc-tion processes for mammalian cell culture, as well as microbial fermentation. According to government statistics, China’s bio-logics market exceeded $2.5 billion in 2004 and is growing at a rate of 13% per year. [2] This market is primarily dominated by generic manu-facturers. Most players are small domestic play-ers that compete on price and tend to have ex-cess manufacturing capacity. With excess capac-ity and compressed margins, Chinese biophar-maceutical manufacturers are ideal to partner with or acquire. [14]

Shanghai-based WuXi PharmaTech Co., Ltd. of-fers global biopharmaceutical companies di-verse outsourcing services in combinatorial, me-dicinal, synthetic chemistry, and manufacturing. WuXi PharmaTech's rapidly expanding line of services ranges from early stage discovery chemistry through lead optimization chemistry, all the way to process research and develop-ment, and bulk manufacture of active pharma-ceutical ingredients. With the addition of a new GMP plant at Jinshan in Shanghai, the company has further increased its bulk production capac-ity to meet rapidly growing customer demand. WuXi PharmaTech's strong capabilities enable the company to provide a broad spectrum of integrated development services from milligram quantities to metric ton scaled active pharma-ceutical ingredients, intermediates, and raw materials. Currently, WuXi PharmaTech's client list includes over 60 leading drug discovery companies including a majority of the world's largest pharmaceutical companies. [22] For example, TargeGen of San Diego, is develop-ing small-molecule drugs for treating cardiovas-cular disease and has shifted chemical screening of various compounds to Shanghai's WuXi Phar-maTech Co. “We pay WuXi to do research on our compounds and then use the results for fur-ther development in the U.S.”, says Enterprise Partners' Drew Senyei, a venture-capitalist in-

Servier Beijing

Location: Beijing Founded: 2001

Target Area: Drug Discovery

Wuxi PharmaTech Co. Ltd.

Location: Shanghai Founded: 2000

Services Offered: Combinatorial, medicinal,

synthetic chemistry, and manufacturing

Roche China Ltd.

Location: Shanghai Founded: 2004

Target Area: Medicinal Chemistry

15

vestor in TargeGen. Through companies such as WuXi, Western drug companies will soon be able to conduct complex animal testing in China. [17] CASE STUDIES IV: Regulation and Marketing Regulation: Changes brought about by the United States Food and Drug Administration (FDA) and the International Conference on Har-monization (ICH) have created challenges for companies in keeping up with federal regula-tions and guidelines regarding drug regulation and submission data requirements. These chal-lenges are encouraging companies to seek part-ners that can assist them with regulatory sub-missions. Small companies are particularly look-ing to contract this work lacking the resources to handle the regulatory work—let alone keep-ing up with new federal regulations and guide-lines. With the ICH attempting to develop con-sistency among regulatory documentation sub-mitted to authorities in the U.S., Europe, and Japan, the streamlining of regulatory processes, and a movement toward electronic submis-sions, regulatory specialists may be the best partners to monitor and then implement these changes for their clients. [23] Consequently, ser-vice providers that provide a breadth of services should be sought. The best partners will be committed to maintaining current knowledge of the changes in Chinese regulatory standards including submission processes, guidance docu-ments, and global efforts at harmonization. Marketing: Biopharmaceutical companies need to be perceived as trusted sources of informa-tion as they recruit patients for clinical trials, seek approval for drugs, and then launch drugs onto the market. Public confidence in the reli-ability of clinical data and the information pro-vided by the industry can be affected by how

information is com-municated to the public, who provides this information, and when that informa-tion is provided. Given that the public is undecided about the goals of the in-dustry as aiding and enabling medicine or simply putting profits before patients, in-formation dissemina-

tion during the development cycle is key to the success of products on the market. The right public relations (PR) service provider can assist a biopharmaceutical company in the evaluation of potential partners given a com-pany's objectives and can develop a strong me-dia and public outreach campaign. A public rela-tions company with a strong reputation and broad experience in advocacy relationship de-velopment should be selected. These PR firms should maximize communication opportunities during clinical trials, patient re-cruitment, drug approval, and then drug launch. A climate of anticipation of a new drug should be fostered well in advance of the launch. Public

relations firms can share scientific knowledge about the drug with the medical community and advocacy groups, thereby increasing the understanding of a product's potential. As the drug gains market approval, PR firms are partners that can augment a client’s marketing and sales efforts. At this point, building brand loyalty becomes critical. The establishment of a connection to the consumer and his/her needs will enable a product to gain market exclusivity; this is particularly important in the face of me-too competition. An understanding of consumer attitude to health and nutrition, preventative medicines, drug therapy, and disease manage-ment is necessary to create a strong connection with the patient during the launch campaign. The experienced PR firm will also be able to identify and select the best media channels and outreach mechanisms given the target market. Varying media channels as a function of type of patient can provide greater impact, particularly when it is possible to segment a drug's market into different groups e.g. young and old. China’s healthcare system is also rapidly chang-ing to enable better access for consumers once drugs are approved. From 1978-2004, China’s health care sector expanded at 17.4% CAGR. [24] Drug distribution has traditionally been highly regulated with hospitals prescribing as many expensive drugs as possible to generate revenues. However, increasingly hospitals are being privatized, allowing the state to divest itself of inefficient and low-quality assets in the healthcare system. The pressure from market competition, meanwhile, will compel the re-maining public hospitals to improve their own standards of service and efficiency. [25] Having joined the World Trade Organization (WTO), China will lower tariffs on biopharma-ceutical products and lift restrictions on foreign distributors and retailers. As most biopharma-ceutical giants establish a marketing presence in China, opportunities exist for direct distribution to reach consumers rapidly and effectively. [24] Here, contract sales organizations can help Western biopharmaceutical companies better understand how to reach Chinese consumers. Contract sales organizations retain full-time and part-time sales representatives and can target multiple audiences to increase a product's per-ceived value and encourage sales. Through part-nerships with PR and communication firms, such contract sales organizations can not only provide sales support, but also medical educa-tion, public relations, event planning, and mar-keting for biopharmaceutical clients. These partners can bring varied experience, wider reach, and better contact with the Chinese pub-lic and Chinese medical community at a cost effective price. References: 1) Dolan, Kerry A. The drug research war. Forbes. May 2004. 2) Louët, Sabine. Can China bring its own pipe-line to the market? Nature Biotechnology. December 2004.

3) Hepeng, Jia. China beckons to clinical trial sponsors. Nature Biotechnology. July 2005. 4) AstraZeneca opens East Asia clinical research centre in Shanghai. http://astrazeneca.com. November 2002. 5) Novartis’ China ambitions. Business Week. November 2004. 6) Yan, Hu. Drug firms bolster R&D facilities. China Daily. November 2004. 7) Shanghai to get new Pfizer clinical trial cen-tre. China Daily. November 2003. 8) Quintiles Laboratories Asia enhances services in China. PR Newswire. June 2005. 9) Levine, Daniel S. Building a bridge to bio-outsourcing. San Francisco Times. November 2005. 10) Shanghai Genomics. www.shanghaigenomics.com. 11) Hundley, Kris. China’s lure, and its challenge. St. Petersburg Times. September 2005. 12) Santini, Laura. Birth of a biotech industry: Western drug makers outsource R&D to scientists in Shanghai and Beijing. The Wall Street Journal. November 2004. 13) Gardner, Jack. Outsourcing in Drug Discov-ery 2nd Edition. A Kalorama Information Market Intelligence Report. January 2006. 14) Chervenak, Matthew. An emerging biotech giant. The China Business Review. May-June 2005. 15) Eli Lilly, Chinese partner set up research lab in Shanghai. People’s Daily Online. October 2003. 16) Weihua, Chen. Roche sets up R&D centre in Shanghai. China Daily. January 2004. 17) Santini, Laura. Drug companies look to China for cheap R&D. The Wall Street Journal. November 2004. 18) Servier opens a drug production center for the Chinese market near Beijing. www.servier. Com. 19) Opportunities for European pharmaceutical and biotechnology companies in Indian and Chinese markets. Pharmaceutical News. March 2005. 20) Outsourcing-The pharmaceutical industry’s strategy of choice for managing risk and rapid change. Business Briefings Ltd.: Pharma Out-sourcing. INTERPHEX 2004. 21) Budd, Steven K. In or out: Outsourcing in today’s biopharmaceutical industry. Business Briefings Ltd.: Pharma Outsourcing. January 2004. 22) WuXi PharmaTech added to prestigious Deloitte technology fast 500 Asia Pacific. WallStreetReporter. November 2004. 23) Regulatory submissions and global harmoni-zation. CanBiotech BioMed Outsourcing Report. December 2003. 24) A sober look at China. Burrill & Company Presentation. China Access Forums. 2005. 25) Lipson, Roberta. Investing in China’s hospi-tal. The China Business Review. November- December 2004.

16

17

India Unlocking the power of Pharmacovigilance

Written by Dr. Anjali Shukla, Accure Labs Pvt. Ltd., India

No drug is completely safe. Drugs may contrib-ute to 5-10% of all hospital admissions. Approxi-mately 10-20% of all inpatients may suffer a se-rious adverse drug reaction (ADR) in hospital. Some ADRs lead to death, and also may contrib-ute 5-10% of hospital costs. Therefore, the monitoring of the adverse effects of drugs be-comes crucial for Good Medical Practice. There-fore, the pharmaceutical industry has entered a new era of Pharmacovigilance (PV). Pharmacovigilance provides comprehensive, risk-based, flexible solutions for the manage-ment of product safety, risk, and patient health during the entire lifecycle of a medicinal prod-uct.

Pharmacovigilance =

Phase I safety considerations +

Safety strategy +

Clinical Trial Safety +

Risk Management Planning +

Post marketing Surveillance +

Signal Detection +

Pharmacovigilance System Description A series of high profile safety concerns, like withdrawal of certain drugs and the link be-tween antidepressants and suicidal thoughts in children over the last 2 years, has made drug safety a major issue for governments, regula-tory authorities and pharmaceutical companies. Hence, pharmaceutical companies are highly emphasizing pharmacovigilance in the wake of product recalls, “black box” warnings, and litiga-tion. An inventory of legislative requirements has been enforced during the last few years in the ICH regions, naturally emphasizing the early stages of a new drug's life cycle. Pharmacovigi-lance planning has by now become a substan-tive issue for the long term success of any drug on the market, as malfunction of pharmacovigi-lance systems and communication channels may lead to license retraction. Modern instant communication channels rightly position manu-facturers and marketers of medicinal drugs and medical devices to report adverse drug reac-tions immediately to their competent authori-ties. Present-day legislation requires from the liable manufacturer to inform concerned authorities rapidly about serious Adverse Drug Reactions (ADR) and other drug safety related events that

are occurring during the developmental and marketing periods of a drug, such as Suspected Unexpected Serious Adverse Reaction (SUSAR) in clinical development or other immediately reporting events in later stages of a drug's life-cycle. Failures in compliance with these requirements could make the difference between keeping your drug on the market and being forced to withdraw it. Therefore, early planning of your pharmacovigilance strategy is essential to the success of pharmaceutical products. How is it difficult to operate PV in-house in companies? Pharmacovigilance involves proficient individu-als, from registered nurses to specialist doctors who are performing relatively clerical functions, such as sifting through data and probing case reports; but despite the clerical nature of the work, it requires such a high level of compe-tency that a company must pay lavishly for it if the work is done domestically. The requirements, and the stakes, of this kind of work continue to rise. Each new drug is put un-der dissection, aggravated by negative media coverage. The volume of events to be reviewed and addressed is going up at an phenomenal rate, and so is the cost. How do companies reduce the cost of PV? The era of outsourcing has enabled pharma companies to hire third party vendors to per-form non-core processes at lower cost and higher quality. Outsourcing of the pharma-covigilance process provides a cost effective so-lution, especially for small and medium sized pharmaceutical companies. This would avoid the high upfront investments and fixed over-head costs connected with setting up an in house drug safety system. Above and beyond meeting the regulatory requirements, outsourc-ing would allow immediate participation in the efficiencies provided through the looming im-plementation of electronic SAE reporting. Even if a pharmaceutical company decides to develop their own drug safety group in house over time, often there is need for external ad-vice and possibly provisional coverage until the team gets up to speed. What are the benefits of outsourcing PV? The most important benefits for an outsourcing solution are the ease of managing certain peaks and new demands, and the reduced cost for da-tabase infrastructure and license cost for soft-ware programs. These key benefits allow a firm to keep the internal headcount low, as negligi-ble corporate infrastructure is required. Usually the pharmacovigilance provider lacks the specific product knowledge, and so an effec-tive transfer of drug information data is neces-sary. This can be facilitated when liaising with a structurally competent partner who is able to assimilate the necessary product knowledge easily—for example, with a comprehensive

training programme and regular interactions with the core product team of the pharmaceuti-cal firm. Until recently, the outsourcing of pharmacovigi-lance responsibilities and activities fell far be-hind the comfort zone of pharmaceutical com-panies, as drug safety has traditionally been an independent entity in those companies. Moreover, this field opens to unfamiliar grounds of difficult legal ramifications requiring high levels of inter disciplinary know-how. All the same, as legislation and regulatory bodies are increasingly demanding more and more functions and tools to detect and to respond to safety concerns with any drug, the benefits of pharmacovigilance outsourcing become more evident. The first significant pharmacovigilance out-sourcing deal in the industry was the Bristol-Myers Squibb agreement with Accenture, in which the work is being done in India. Who are the providers of PV outsourcing ser-vices? As pharmacovigilance is a relatively new func-tion in terms of outsourcing, there are not a large number of providers presently able to do the work. In essence, there are two classes of providers capable of moving tactically: Contract Research Organizations (CROs):

These companies are focused on drug develop-ment and managing trials through their various steps and processes, and so are well suited to step up and address pharmacovigilance. These cover Quintiles, Covance, and MDS Pharma Services. Business Process Outsourcing (BPO): These include those organizations particularly based entirely in India. Examples are Cap Gem-ini, Tata Consultancy Services, Infosys, and Keane. Why is India considered the most obvious choice? India is well known for delivering high quality IT and IT-related services, and now India is becom-ing a hub for offshore outsourcing of pharma-covigilance activities and responsibilities. India-based operations have tremendous lan-

Contract Research Organizations (CROs)

Business Process Outsourcing (BPO)

These companies are focused on drug de-velopment and man-aging trials through their various steps and processes, and so are well suited to step up and address pharmacovigilance. These cover Quintiles, Covance, and MDS Pharma Services.

These include those organizations based entirely in India. Examples are Cap Gemini, Tata Consul-tancy Services, Info-sys, and Keane.

18

19

guage skills, superb education, and a large number of doctors who are looking for higher-dollar work in a related field. Here’s one more in-stance in which what is considered in India to be expensive, high-dollar work is, by U.S. standards, inexpensive. While pharmacovigilance can be performed in offshore locations other than India, India’s stability makes it the most appealing locale, as proved by the Bristol-Myers Squibb deal. The nature of this work makes it a con-servative, risk-management function where extreme care and caution are essential. SWOT ANALYSIS OF INDIA AS AN OUTSOURCING DESTINATION FOR PHARMACOVIGILANCE

What should a company assess when selecting a service provider? In making a selection of a service provider, more emphasis must be placed on the levels of training each provides to its people, scalability, and the comparative rates of turnover. For these reasons, pharmaceuti-cal companies are making much more use of outside resources as they craft agreements with service providers, build their governance organiza-tions, and manage the agreement over time. Outside advisors with ex-pertise in the market, the nature of the work, and the legal aspects of the relationships are being used extensively both by pharmaceutical or-ganizations and service providers. Some companies first achieve a comfort level in outsourcing and then deal directly with their existing providers or additional providers to ex-pand agreements. However, pharmaceutical companies, even those who outsource heavily in other areas, still feel they are walking on new ground when it comes to pharmacovigilance outsourcing. Why companies are afraid of hiring servicing providers or outsourcing PV? This is due to fear of the legal ramifications if the outsourcing partner 'gets it wrong', and a reluctance to be the first to adopt the outsourcing model. It was also a reflection of the limited choice of both service pro-viders and scope of services available at the time. But today's marketplace offers a wide range of pharmacovigilance ser-vices provided by both large and small companies. These may form part of a suite of services offered by CROs, be the core business of specialist companies, or form part of the expertise available through the growing network of freelance individuals, many of whom are former pharmaceu-tical company employees. This growth in the services available for pharmacovigilance outsourcing has been driven by the annual increase in the volume of data generated both in terms of number of individual adverse event case reports and contributing organizations. This has prompted both the regulatory au-thorities and the pharmaceutical industry to seek more efficient meth-ods of processing product adverse event data with the goal of both im-proving public safety and reducing the cost overhead for marketing and

support of pharmaceutical products worldwide. Why outsourcing PV is beneficial? Outsourcing allows pharmaceutical companies to focus attention where it is needed most i.e. a proactive, not reactive approach that ensures drug performance and overall safety. They gain access to specific exper-tise and place responsibility upon the supplier to meet the cost of items such as coding dictionaries. Regulatory Authorities are becoming more sophisticated by including electronic reporting, MedDRA coding and reporting and 21 CFR Part 11 compliance. These pressures are felt more keenly in companies with low case volumes who are unable to justify a full time pharmacovigilance specialist. Software licenses and system operation can be expensive: System maintenance, management, and validation are expensive non-core activities for a pharmacovigilance department. IT support staff in many small and medium-sized companies are either unable or under sig-nificant pressure to provide complete service to their users. All said and done, let the outsourced provider bear the cost of the initial license, software upgrades, system management, and the management of whole of the product safety reporting requirements. India poised to become destination of choice for outsourcing pharma-covigilance Currently, India is poised to become the destination of choice for the outsourcing activities along the entire value chain of drug safety. The outsourcing of pharmacovigilance is a trend that is clearly gaining mo-mentum, as pharmaceutical companies reach deeper into their business processes to reduce costs and enhance performance. As BPO organiza-tions make every effort in these types of deals, and CROs endeavour to compete with BPOs on equal footing, both types of provider organiza-tions will enhance their operations with the right people.

STRENGTHS (S) 1. Large talent pool of life sciences graduates. 1. Cost advantage, as labour costs are 1/7th of those in US or Europe. 2. Rapidly developing wired communications. 3. Stable business environment.

WEAKNESSES (W) 1. Comparatively new concept. 2. Imprecise documentation sys-tem. 3. Non-adherence to time sched-ules and secrecy modalities.

OPPORTUNITIES (O) 1. Vendors can take advantage of the influx of talent through ‘reverse brain-drain’, i.e. Indian graduates who have worked abroad and are now returning in large numbers. 2. Pharmacovigilance is a rapidly evolving field.

THREATS (T) 1. Expected load. 2. Level of capabilities. 3. Organization structure. 4. Key decision-making proc-esses. 5. Little understanding of the intricacies of global regulatory requirements.

20

Asia’s Largest Pharmaceutical/Biotechnology Event held in Japan!

On July 2 (Wed) – 4 (Fri), Asia’s largest show in the Pharmaceutical/ Biotechnology industry, 21st INTERPHEX JAPAN, 7th INT’L BIO FORUM & BIO EXPO JAPAN, and 2nd INT’L PHARMACEUTICAL INGREDIENTS EXPO & CONFERENCE was grandly held with the record number of 1334 exhibi-tors and 55,202 visitors. At the show venue, many scenes were wit-nessed where exhibitors and visitors did concrete business meetings dur-ing the show. The three exhibitions are a must visit for professionals within the pharmaceutical, bio, and cosmetic manufacturers industry, as this is the one and only event throughout Japan where you can see the upstream to downstream of this industry.

RFID/Barcode Fair NEW! RFID/Barcode Fair was newly launched inside Pharma Pack 2008, due to the high demand of RFID (Radio Frequency Identification), which is a sys-tem for controlling products. One of the leading printing companies, Dai Nippon Printing Co., Ltd. introduced a product specialized for the phar-maceutical industry market. Pharma IT Solutions Expo This expo gathers all IT solutions specialized for pharmaceutical indus-tries. Companies gathers products concerning IT solutions, such as mo-bile and new services for medical representatives. Companies such as Nomura Research Institute Ltd., Matsushita Electric Works Information Systems Co., Ltd, and TIS INC. gathered in this area. Pharma Sourcing This area is the largest event in Japan specialized in outsourcing of phar-maceutical manufacturing. Large companies such as Nipro Corp., Fujiya-kuhin Co., Ltd Toyama Plant, and Taiyo Pharmaceutical Industry Co., Ltd. gathered in this area. From overseas, companies such as Patheon Inc., a company based in Canada, also exhibited here.

Bio-Imaging Zone This area, consisting of companies dealing with microscopes, cameras, image processing systems/software, and microscope peripheral equip-ments, especially attracted attention. Companies such as Olympus Corp. brought in new products including a system for live cell imagines in incu-bator, which allows you to check and analyze the cell image.

Genetic Testing & Diagnostics 2008 NEW! The development of genetic testing technology is striking, as the applica-tion of this business is rapidly growing with its realization of low-cost and the improvement of inspection accuracy efficiency. Under these circum-stances, Genetic Testing & Diagnostics 2008 was newly launched this year as the Japan’s one and only event. From disorder such as cancer, to beauty business such as diet, the expansion of the business is anticipated for the genetic testing and diagnostics technology. PHARMA PARTNERING Due to the high demand of the alliance/partnering of pharmaceutical companies, venture companies, and venture capitals, the partnering fo-rum was held concurrently within BIO EXPO JAPAN. Some of the leading companies, such as Eli Lilly and Company and Merck & Co., Inc., White-house Station, N.J., U.S.A/Banyu Pharmaceutical Co., Ltd. delivered pres-entations to visitors interested in alliance/partnering. Various meetings were held where pharmaceutical companies and visitors discussed the possibilities of partnering. Growing Demand of API 2008 Due to the amendment of the Pharmaceutical Law—in enforcement next April, pharmaceutical chemists will no longer need to sell drugs. Instead, second-class drug dealings will take place. From this change, places such as convenience stores, drug stores, and super markets will be able to handle products with only second-class drug dealers present. Therefore, the needs of pharmaceutical ingredients are emerging, as more selling points are in existence. Under these circumstances, API 2008 is actively in application, with visitors in search of suppliers and for serious business meetings held within the exhibition area. Highlights of the Exhibitors A great deal of new companies exhibited this year for the first time, such as Roche Diagnostics K.K, Nippon-Soda Co., Ltd, Asahi Kasei Fibers Corpo-ration, Fuso Chemical Co., Ltd, Yamaha Motor Co., Ltd. and more. In addition, many companies brought in new products, which are striking since new products in the pharmaceutical industry companies do not ap-pear so often. This proves the market is in high demands for the suppli-ers; hence the exhibition will be in greater needs in the coming future.

INTERPHEX JAPAN is an international exhibition and conference for pharmaceutical, cosmetic and detergent R&D and manufacturing tech-nology. The exhibition consists of various zones as the following; Steril-izing Equipment & Clean Room Zone, Plant Engineering Zone, Supplies/Transfer Zones, Materials Process Zone, Process Inspection/Testing Equipment Zone, and Laboratory Measurement/Analysis Equipment Zone.

In 2008, Factory Facility & Equipment Zone and Bioprocess/Biopharma Manufacturing Technology Zone were newly established inside INTER-PHEX JAPAN, along with Pharma RFID/Barcode Fair, Pharma & Cosmetic Packaging/ Container Fair which was held within Pharma Pack 2008.

Welcoming its 7th year, INT’L BIO FORUM & BIO EXPO JAPAN holds an established position as the Asia’s largest bio event. With the newly launched Genetic Testing & Diagnostics 2008, which is the one and only exhibition specialized in genetic testing and diagnostics in Japan, the show attracted specialists and professionals from home and abroad more than ever.

INT’L BIO FORUM & BIO EXPO JAPAN consisted not only of specific zone layout, in addition, BIO VENTURE FORUM, ACADEMIC FORUM, and PHARMA PATNERING were held concurrently within the exhibition. Overall, this show is not only about business meetings to discuss about purchasing and selling the products, but also an indispensible place to announce the latest achievement, alliance/partnering for pharmaceuti-cal companies and ventures, and for networking.

The following are some of the zones and forums which especially at-tracted attention.

21

Conferences and Seminars One of the other events attracting attention every year is the conference held inside the conference hall next to the exhibition. This year, some of the world’s top leaders came to speak within the 3 days, with 9,960 at-tendees gathering to catch up on the latest trends, cutting-edge tech-nologies, and companies’ strategies. Some of the seminars are described below. Future Prospects of the Japanese Pharmaceutical Industry and Tips for Further Development Challenges Associated with Globalization of a Japanese Pharma Company -Globalization of the Value Chain Functions- President & CEO, Daiichi Sankyo Co., Ltd. Mr. Takashi Shoda Abstract: Pharmaceutical corporations engaging in drug-discovery need

strategic management and strengthening of global value chain from R&D through sales for successful global manage-ment. The speaker offered real life examples of his company and discussed topics such as the pharmaceutical process technology that bridges R&D and manufacturing. Business Expansion Strategy of NOVARTIS in Japan and the

World Market President & CEO, Novartis Pharma K.K. Mr. Hiroyuki Mitani Abstract: Pharmaceutical companies are asked for a drastic strategic shift in response to the rapid change in the global pharmaceutical industry.

While the Japanese ethical drug market is experiencing drug price revisions and diffusion of generics, the managements are now facing a decision about their future strategies for business expansion. The speech provided an outlook of the current world and Ja-pan market, and presented a global strategy for Novartis

Pharma. The Emerging Era of Genomic/Cell Medication and Innovative Pharma-ceutical Development -Convergence and Co-development of the US, Europe and Asia- Systems Science will Transform Both Biology and Medicine President, Institute for Systems Biology, Dr. Leroy Hood

Abstract: A systems approach to biology and disease is trans-forming how we understand the deep mechanism of biology and medicine. These systems approaches coupled with emerging measurement and visualization technologies and new computational and mathematical tools will propel medi-cine from its current reactive state to one that is predictive,

personalized, preventive and participatory. Perspectives of Personalized Medicine President, Baylor Research Institute Dr. Michael Ramsay

Abstract: In the next 10 years, the practice of medicine will change more than it has in the last 50 years. Outstanding bio-medical discoveries resulting from the study of the immune system and the mapping of the human genome together

with advances in information technology, are converging to create the vision of personalized health care. Enhanced screening and profiling technology will allow individuals to make choices about their health

management with insight into quality and safety. Investing in Innovation: Biocon’s Focus on Novel Biopharmaceuticals Chief Operating Officer, Biocon Ltd. Dr. Arun Chandavarkar

Abstract: Biocon entered the bio-pharmaceutical space in 1999 with microbial fermentation derived generic APIs. It soon expanded its capabilities to large volume recombinant proteins like human insulin. Biocon has partnered with many

early stage discovery companies to develop novel biological products in diabetes, oncology, and immunology. This differentiated approach at-tempts to leverage the scientific and engineering talent base in India to develop best-in-class products for global markets while minimizing the financial strain on the healthcare delivery system. The Challenges of Leadership in the Cycle of Innovation and Competition Advisor to the Board of Directors (Former President & CEO), Teva Pharmaceutical industries Ltd./Chairman, Given Imaging, Ltd

Abstract: Has the pharmaceutical industry begun to fall short on its promise to improve quality of life and make drugs more widely accessible? What role does generics play in the cycle of innovation and competition?

Now and Future of Process Development -Key Technologies Underlying Pharmaceutical Development- Innovation Leaders who Connect up Drug Discovery with Drug Produc-tion -Science for Actualization into Business & Process Chemistry for Medi-cine Production- Senior Advisor, Discovery & Development Research Headquarters of Ja-pan, Eisai Co., Ltd, Mr. Shigeru Soda

Abstract: The pharmaceutical industry holds growth poten-tial as a core industry in many countries because it contrib-utes to the health and welfare of humanity. Pharmaceutical process chemistry, positioned between drug discovery and production, is a “business actualization” science, where po-tential drug compounds are translated into pharmaceutical

products. In this lecture, the challenges and possibilities in pharmaceuti-cal process chemistry were illustrated as the “hub technology” that links drug discovery and production. Hopes for API Manufacturer from the Generics’ Viewpoints Director, Drug Development Labs., OHARA Pharmaceutical Co., Ltd. Dr. Koji Kagara

Abstract: With the national policy incentive, the generic in-dustry has moved closer to the center stage of the pharma-ceutical industry. A majority of generic companies used to outsource bulk drug from bulk manufacturers. However, since the revision of the Pharmaceutical Law, generic manu-

facturers have been obligated to meet additional requirements. The speaker discussed his expectations toward bulk drug manufacturers from his perspective as a generic drug manufacturer. For full information on the seminar, please visit the below website. http://www.interphex.jp/ipj/english/conference2008/ http://www.bio-expo.jp/bio/english/conference2008/

22

Taiwan’s Biotechnology Plan By CanBiotech

Taiwan’s objective is to achieve the same kind of success and global standing in biotechnology as it has in the development and production of electronic, information technology, computer, and semiconductor prod-ucts.1 Frost & Sullivan indicates that the industry generated revenue worth US$947 million in 2003. This is expected to reach US$1.9 billion in 2010. 2 According to a survey conducted by the Taiwan Institute of Economic Research, Taiwan currently has around 6,100 people involved in biotech R&D and an average of 1,800 students are expected to graduate annually with biotech-related training. 2 Taiwan’s biotech industry currently consists of a number of medium-sized companies, biotech start-ups, and contract research organizations (CROs). Multinational pharmaceutical firms and CROs have been explor-ing Asian sites for clinical studies. Hence, the existence of a well-developed scientific and medical infrastructure in Taiwan has promoted the growth of a number of Taiwanese CROs. 3 Taiwan’s strengths are due to a combination of existing conditions and deliberate planning on the part of the government and include: Existing expertise in high technology, easily transferred to biotech-

nology; Strategic location; close to China and straddling Northeast and

Southeast Asia; Strong legal framework; A highly educated workforce; World-class research facilities; Abundant capital and Asia’s most vibrant venture capital industry; Herbal medicine knowledge and experience. Interestingly, many manufacturers of Western pharmaceuticals in Taiwan are also producing Chinese medicinal ingredients and formula-tions. Similarly, many new biotech start-ups are conducting research on the modern medical uses of traditional Chinese herbs and medicines. 1 Government Policy In 2002, the government allocated US$495 million to bioscience research and development, approximately 29% of the total national science budget and an increase of 46% over the previous year’s allocation of US$339 million. 1 The funds were allocated as follows: 30.4% to the R&D budget of the National Science Council, 20.4% to the Department of Health, 16.1% to the Ministry of Economic Affairs, 21.6% to the Council of Agriculture, and 11.5% to Academia Sinica. 1 Industry, institutions, and government bodies all follow developmental guidelines as set forth in the Promotion Plan for the Biotechnology In-dustry. This document is a road map defining national industry goals and clearly detailing the corresponding action steps required to get there. In compiling the Promotion Plan, Taiwan’s strengths and capabilities were examined. Four major goals are established in this document: To establish Taiwan as the center for genomic research and devel-

opment in Asia. To establish Taiwan as the leading location for human clinical trials

in Asia. To establish Taiwan as a worldwide subtropical floriculture center. To establish the most vibrant biotech-focused venture capital in-

dustry in Asia. 1 In addition, the Promotion Plan set the following growth goals: US$4.5 billion in new biotech/pharmaceutical industry investment

by 2010. By 2010 at least 18 international-standard biotech companies are

to be established in Taiwan, being either fully locally owned, or mixed local-overseas ownership joint ventures or collaborations. 1

Supporting Programs and Infrastructure Life-science focused national development programs initiated by the government include: The National Research Program for Genomic Medicine, The National Science and Technology Program for Agricultural Bio-

technology and, The National Science and Technology Program for Biotechnology

and Pharmaceuticals. Of these, the National Research Program for Genomic Medicine is the most recent, and is a major part of Taiwan's goal to become the Asian center for genomic research. The National Science and Technology Program for Agricultural Biotech-nology is devoted to research in seven major fields: floriculture and orna-mental plants, plant protection, aquaculture, livestock vaccines, plant genetic improvement and modification, environmental protection, and medicinal plants. 1 The National Science and Technology Program for Biotechnology and Pharmaceuticals focuses on the development of new drugs, herbal medi-cine, and on biochip technologies and analysis methodologies. 1 The government has committed to spending $4.48 billion on biotechnol-ogy by 2010 and has created an infrastructure consisting of three com-ponents 3: Basic Research: Academia Sinica is a complex of government-funded re-search institutes of which seven are in the biological sciences. Applied Research and Technology Transfer: Three major technology de-velopment institutes (TDI) have been created to commercialize scientific discoveries and transfer technology to local companies: The Development Center for Biotechnology, The Pharmaceutical Industry Technology and Development Center

and, The Industrial Technology Research Institute. Science Parks: Creation of biotech industrial parks, including the Hsinchu Biomedical Park and the Agricultural Biotech Park. 3 The government in Taiwan is further keen on establishing biotech parks with unique features. “Our vision is to create a National Biotechnology Park with a total investment up to $900 million in the building of the park. The Ministry of National Defense will make 25 hectares of its prop-erty at the Military 202 Armament Factory in Nankang available for the establishment of a biotech science park,” stated Mr Chen Shui-bian, President of Taiwan at the BioBusiness Asia 2007 summit in Taipei. 4 The President further stated that, “The National Science Council will in-vest $400 million to plan the layout for the park’s biomedical compound, and will be in charge of the construction of the park’s basic infrastructure and education center. At the same time, the Academia Sinica, on its part, will invest around $500 million to build the park’s research and develop-ment center and clinical laboratories, and introduce research on new pharmaceuticals and special biotech disciplines, such as translational medicine and genomic medicine.” 4 The President also pointed that it was planning on building two more

23

communities of leading biotech enterprises. One community is to be lo-cated in the Hsinchu Biomedical Science Park—with the objective of at-tracting major biotech companies, vaccine manufacturers, pharmaceuti-cal companies, electronic and telecommunications-based medical equip-ment manufacturers, and animal laboratories. The other community will be located in the Kaohsiung Science Park, which is part of the Southern Taiwan Science Park—with the objective of attracting manufacturers of dental and orthopedic equipment, scalpels, and microelectromechanical systems. 4 Opportunities and Challenges With its large pool of bioscientists and high-tech talent, an impressive medical research base including world-class research institutions, its en-trepreneurial culture, and the commitment of the government to the industry, opportunities are abound in Taiwan. Furthermore, its proximity to mainland China, the language, ethnic, and business connections be-tween the two countries, should encourage investors to include Taiwan as part of their strategy to entering China. In its effort to carve out a niche, Taiwan is also emphasising a local approach, by pairing biotech-nology with traditional Chinese medicine or by giving biomedical re-search priority to regionally significant diseases. Therefore, on its own, Taiwan is a sound investment location. With ascension to the World Trade Organization (WTO) in 2002, Taiwan has gained increased expo-sure to international practices such as the WTO dispute resolution proce-dures. However, one critical problem for Taiwan is the increasing need for trained personnel. Educated Chinese living abroad link the country's re-searchers with colleagues in the US and mainland China. This community has provided an important network for information exchange, research collaboration, and business opportunities in Taiwan. As a consequence of the increased demand for technology transfer, there is specifically a focus on the recruitment of top-level managers and

scientists, the import of innovative research equipment, and develop-ment of partnerships with biotechnology advanced countries. However, several concerns regarding the management of personnel need to be addressed before a wide-scale recruitment effort is undertaken. References: 1) www.biotecheast.com, 2005. 2) www.biotech.frost.com, 2005. 3) Yuan, Robert. Asian Biotech: Taiwan Seeks Successful Business Mod-els. Genetic Engineering and Biotechnology News. April 1 2006. 4) Kulkarni, Narayan. Taiwan to develop $900 mn biotech park. BioSpec-trum. September 1 2007.

24

REGULATORY NEWS BY BIOPLAN ASSOCIATES FDA announces permanent office in Beijing -US FDA announced plans to open a 13-member branch office in the US Embassy in Beijing. This will be the first foreign-located branch for the agency. The main priority for the new office will be to prevent China-related safety problems before they happen or become widespread. Source: US FDA site, Sept. 2008 New responsibilities and structure for SFDA -The Chinese government re-leased a state council document granting new responsibilities and an inter-nal structure for the State Food and Drug Administration (SFDA). The SFDA will now be a vice-ministry level agency governed by the Ministry of Health. Changes include state institutions now controlling technical evalua-tion of drugs and medical devices. New responsibilities include formulating policies for safety regulations of drugs and medical devices, and develop-ing and implementing quality control guidelines on R&D, production, distri-bution and applications of drugs and medical devices. Source: China SFDA website, Sept. 2008

BIOBUSINESS NEWS BY BIOPLAN ASSOCIATES Merck KGaA to increase investments in pharma sector in China -Merck KGaA CEO Dr. Marl-Ludwig Kley announced plans for Merck KGaA to in-crease investments in the pharmaceutical sector in China. The company hopes that Merck Serono, the pharma arm of Merck KGaA, will become one of the leading 15 pharma companies in China by 2012. In order to be cost effective, the company plans on adjusting its pricing of chemical and life science products. Currently, more than half of Merck KGaA's chemical business revenues come from Asia, including China, Taiwan, Japan, and South Korea. Merck's oncology drug Erbitux has exceeded over 70% growth in China—one of the ten largest global markets of the drug. Source: Pharma China Sept. 9, 2008 Chinese govt. to transform pharma industry into super power by 2020 -The Chinese government released a grant application guide that includes goals for major drug innovations for the 11th Five Year Plan period (2006-2010.) New goals set for the local pharma industry include development of 30 new innovative drugs targeting ten disease areas including diabetes, oncology, and the cardiovascular system. Plan goals also include establish-ing up to ten new national drug R&D comprehensive platforms and up to 20 new drug R&D incubators. The government proposed changes for the largely generic pharma industry will occur in three phases to be completed by 2020. Source: Various Sources, Sept. 9, 2008

CANADA AND INDIA ANNOUNCE NEW JOINT SCIENCE AND TECHNOLOGY INITIATIVES The Honourable David Emerson, Minister of Foreign Affairs and International Trade and Minister for the Pacific Gateway and the Vancouver-Whistler Olympics, and the Honourable Kapil Sibal, India’s Union Minister of Science & Technology and Earth Sciences, recently announced the launch of 10 new Canada-India science and technol-ogy (S&T) joint initiatives worth $17 million. “Our government understands the importance of establishing inter-national research partners and the critical role science and technol-ogy play in the new economy,” said Minister Emerson. “These joint projects will enhance the collaboration between our scientists and commercialize their discoveries.” Eight of the initiatives are joint research and development projects, and two are partnership-development activities. The Canadian por-tion of both projects and partnerships is funded through the International Science and Technology Partnerships Program and is delivered by International Science and Technology Partnerships Canada (ISTPCanada)—an arm’s-length organization. “International Science and Technology Partnerships Canada’s mission is to build productive partnerships and today’s announcement is the result of close collaboration between officials in Canada and India,” added Henri Rothschild, President and Chief Executive Officer of ISTPCanada. “We are grateful that both governments have made science and tech-nology a priority, and we know that these agreements will benefit business-to-business relations and, ultimately, overall economic, trade, and political relations. These projects form the basis of the net-working opportunities that lead to strong research linkages with high potential for commercial success.” The joint activities will lead to an increase of commercially viable re-search and development initiatives, and will assist in the organization of scientific seminars, conferences, and workshops. Canada and India S&T relations have made good progress at the federal, provincial, academic and private-sector levels since the sign-ing of an overarching agreement on science and technology coopera-tion in November 2005. In addition to India, Canada has S&T agree-ments with five other countries and the European Union. The S&T agreement with India is now one of the most active partner-ships between the two countries. Areas of cooperation under the Agreement include biotechnology, health research, medical devices, nanoscience and nanomedicine, sustainable and alternate energy and environmental technologies, information and communications tech-nology, and earth sciences and disaster management. In March 2008, aerospace, biopharmaceuticals, photonics and synchrotron science were added to the list. For further information contact: Lynn Meahan Press Secretary Office of the Minister of Foreign Affairs and International Trade and Minister for the Pacific Gateway and the Vancouver-Whistler Olympics 613-992-7332 Trade Media Relations Office Foreign Affairs and International Trade Canada 613-996-2000 www.international.gc.ca/index.aspx

CENTRE FOR PROTEOMIC AND GENOMIC RESEARCH AND CAPITALBIO CORPORATION TO COLLABORATE IN THE FIELD OF GENOMIC MEDICINE AND BIOMARKER DISCOVERY The Centre for Proteomic & Genomic Research (CPGR), a South African Government sponsored, not for profit, core technology facility in Cape Town, South Africa, and CapitalBio (CB), a leading biotech company in Beijing, China, announce that they are entering into a mutual agreement in the field of Genomic Medicine and Biomarker Discovery. Under the agreement, CB will grant CPGR access to its complete microarray assay platform, including bio-chip readers, together with a range of proprietary DNA microarrays. In return, CPGR will form a reference centre for CB microarray applications in Southern Africa, including custom-designed applications for tuberculosis (TB) strain typ-ing and drug resistance testing. “The association between CapitalBio and the CPGR represents a major step forward in our efforts to bring better diagnos-tics to the emerging and developing lands in Africa” said Professor Jing Cheng, CEO of CapitalBio. “CapitalBio has worked closely with the National Tuberculo-sis Reference Laboratory of the China Center for Disease Control and Preven-tion to provide assays of international relevance, and we see enormous po-tential for the worldwide use of this technology to bring effective diagnostics to TB sufferers.” For further information contact: Dr. Reinhard Hiller Managing Director reinhard.hiller@cpgr.org.za www.cpgr.org.za

25

26

CHINA TRIALS 2008: Global Clinical Development Summit Crowne Plaza Century Park- Shanghai, China 09/11/2008 - 11/11/2008 http://www.chinatrialsevent.com/ CHINA TRIALS 2008 is the new annual meeting place to network with hun-dreds of global emerging biotech and big pharma companies and discuss how integrating China into your global clinical development strategy can help bring innovative new therapies to market faster and more cost-effectively. And with a speaking faculty of over 50 clinical experts, it will by far be the most comprehensive event on the topic in 2008.

Contact Information: Lychee Group Jon E. Liong jon.liong@lycheegroup.com

2nd Annual Vaccines Asia 2008 Beijing, China 10/11/2008 - 13/11/2008 http://www.ibc-asia.com/vaccines IBC’s 2nd Annual Vaccine Asia 2008 will enable you to pinpoint and iden-tify opportunities and market needs, explore Asian diseases, and get up-dates on latest breakthroughs in vaccine R&Ds. The world’s leading or-ganizations will share with you the latest advancements in viral studies and their strategic approaches to win the race to bring in the next block-buster vaccine to market.

Contact Information: Email: register@ibcasia.com.sg Tel: +65 6514 3180 Fax: +65 6733 5087

bioLOGIC India 2008 Marriott Hyderabad, India 17/11/2008 - 20/11/2008 http://www.terrapinn.com/2008/bioindia/ Specially tailored to meet the explicit needs of both Indian and Inter-national biopharmaceutical professionals, bioLOGIC India 2008 brings together a mixed portfolio of biopharmaceutical business leaders, manufacturers, CMOs, service, and technology providers from across the globe to discuss partnership opportunities and best practices in biologics development and manufacturing.

Contact Information: Haslinda Haniffa Tel: (65) 6322 2702 Fax: (65) 6223 3554 haslinda.haniffa@terrapinn.com

DIA's 3rd Annual Conference on Drug Discovery and Clinical Development in India Mumbai, India 07/12/2008 - 10/12/2008 http://www.diahome.org/ This conference will continue to serve as an international and neutral forum to address current solid scientific research in India pertaining to global development of drugs and biologics. Global participation from leading thought leaders and experts across the pharmaceutical, acade-mia and regulatory agencies will convene to present drug discovery, global clinical research, and scientific working groups. Keynote lec-tures, workshops, and parallel discussion will highlight the conference.

Contact Information: Leena Amanna Leena.Amanna@diaindia.org