China: A Medical Device Update; South Korean Firm Breaks Into U.S. Orthopedic Market

In the past few years, medical devices increasingly have become a top focus for government officials in China. The Chinese government is pushing further creation and development of new medical devices as a vital research area. Due to rising population needs, the Chinese medical device market is growing rapidly and new growth opportunities for foreign manufacturers are expected to increase.

To many high-level government officials, including Premier Wen Jiabao, head of China’s government, the continued and aggressive development of new domestically made medical devices is considered as important as the development of new pharmaceuticals. Because of this greater government emphasis, government funding toward medical device research and product development is expected to grow. The Chinese government hopes that by increasing funding for medical devices, China will be able to rival the biomedical research of the United States, Japan and Korea. Private Chinese investors also are taking note of the importance of medical devices and are expected to invest more in the industry.

The increase of Chinese interest in medical devices can be seen in the case of drug-eluting stents (DES). Six years ago, more than 90 percent of China’s DES market was controlled by foreign medical device companies. Now, local Chinese DES companies make up 75 percent of China’s drug-eluting stent market. Foreign control of the Chinese DES manufacturing market has decreased significantly. Currently, imported DES products still have an edge over local Chinese DES products because the quality is better. However, they’re considerably more expensive. Local DES products cost only 65 percent of foreign DES products. Also, with the push toward more medical device research, the quality of local Chinese DES products is improving quickly.

With the increased interest in medical devices by China’s State Food and Drug Administration (SFDA), the regulatory landscape for medical devices in China will continue to evolve. In the past few months, this has resulted in several changes in regulations for medical devices.

SFDA Personnel Changes
The Chinese SFDA recently underwent significant and notable personnel changes. The former chief of the agency, Ming Li Shao, stepped down and Yin Li became the group’s new head on Feb. 20. Li came to the position with substantial expertise in the Chinese government and the Chinese health industry. Li obtained his medical degree at the University of Shandong in 1988. Afterward, he worked as an inspector for various Chinese government organizations, such as the Research Bureau of the State Council and the State Administration of Foreign Experts Affairs. In 2002, he served as a public healthcare consultant at Harvard University and worked as a representative of China in the World Health Organization. Since 2006, he has worked in several different positions at the Ministry of Health (MOH). His main responsibilities at the MOH included food safety, drug safety, drug distribution and supply management, infectious diseases and public health emergencies, and healthcare reforms.

In other personnel news, Ming Li Shao—having reached retirement age—stepped down as vice minister of the SFDA Right now, there are not many senior people who want to be associated with the SFDA due to its spotty history—corruption, for example—and the complex dynamics of the industry. No other replacements have been made. The three original vice ministers, Zhen Wu, Xuping Li and Zhenjia Bian, are still in place at the SFDA.

Clinical Trial Requirement Changes
In the future, most Class III medical devices and some Class II medical devices will need to have local clinical studies for approval.

In late November last year, however, the SFDA simplified the requirements for specific Class II medical devices in its “Notice for Clinical Trial Waiver Concerning Certain Class II Devices.” There were 21 different kinds of Class II devices that became eligible for waiver of local clinical trials. These
devices include: basic surgical instruments, medical electrical devices, equipment for sterilization, and devices for general examination. The SFDA aims to use this waiver to regulate the registration of Class II devices more stringently while still allowing an expedited approval for select product types.

Medical device companies applying for the waiver for Class II devices are required to submit comparison data that shows their new product’s similarity with a product already on the approved list for China. The comparison data must include: information on functional mechanisms, product materials, structural composition, primary technical performance indicators, methods of sterilization (if applicable), expected uses, and whether the products are intended for household use. It is important to note that companies should consult the SFDA or provincial authorities when preparing the comparison data for the application.

New Adverse Event Requirements
The SFDA also recently has issued new adverse event requirements for medical devices. The “Tentative Guidance for the Monitory of Adverse Device Events” released on Sept. 16 last year briefly outlines the process for reporting and monitoring adverse events that medical device distributors, manufacturers and suppliers should follow.

The new adverse event requirements establish timeframes for adverse event reporting. Companies must notify the SFDA about mass medical device emergencies within 24 hours, suspicious deaths submitted within five working days, and serious injury that may lead to death within 15 days. Following the report, manufacturers must conduct an internal investigation and submit a report to the SFDA within 20 working days. All adverse event reports must include the SFDA’s “Medical Device Adverse Event Reporting Form.”

Also required are yearly summary reports of the previous year’s medical device adverse events. The deadline for submission of summary reports for the previous year is the end of January for manufacturers of Class II and III medical devices. Manufacturers must use the “Annual Summary Medical Device Adverse Event Reporting Form.” For Class I medical device manufacturers, annual reports do not need to be submitted to the SFDA, but they must have the reports in their records.

Manufacturers of all devices will be required to create central monitoring systems that include a product tracing system and formal archives for recording and monitoring adverse events. The company’s staff also must be trained in the correct procedure to monitor and report adverse events. Device manufacturers must establish internal standard operating procedures for mass medical device adverse event reporting, detecting, investigating and evaluating.

Ames Gross is president and founder of Pacific Bridge Medical, a Bethesda, Md.-based consulting firm that helps medical companies doing business in the Asia market (www.pacificbridgemedical.com). A recognized national and international leader in the Asian medical markets, he founded in 1988 Pacific Bridge Medical, which has helped hundreds of medical companies with business development and regulatory issues in Asia.