Politics, Policy & Law

Prepping for China’s IP law with Jones Day’s Tony Chen: a BioCentury podcast

Chen on how to navigate China’s ‘Hatch-Waxman’ ahead of critical Aug. 3 deadline 

Tony Chen from Jones Day Shanghai discusses how companies can navigate China’s ‘Hatch-Waxman’ ahead of critical Aug. 3 deadline. 

The clock is winding down on a major deadline for innovators with approved drugs to list patents in China’s “Orange Book” under a new IP law. In a “BioCentury This Week” Special Report podcast, Tony Chen from Jones Day Shanghai joins BioCentury to discuss what Western and China biotechs must do to protect their patents in China.

For the past decade, China has been working to create a system that incentivizes innovation while keeping medicine affordable for the Chinese population. The initiative takes its lead from 1984’s Hatch Waxman Act, which is widely recognized as a key law that has propelled the growth of the modern biopharma industry in the U.S. and beyond.

While the new law has been dubbed China’s Hatch-Waxman Act, there are major differences between the two regimes. The China law, for example, applies to both small molecules and biologics, and innovators can challenge generic filers in either a special IP court or administratively via the China National Intellectual Property Administration.

Key elements of the new IP regime in China are patent linkage, which allows originators of new small molecule and biologics to seek judicial or administrative intervention before approval of generic drugs or biosimilars, and patent term extension, which allows innovators to restore up to five years of patent life lost due to delay caused by the marketing approval and patent examination process.

China amended its patent law on Oct. 17, 2020, and introduced patent linkage and patent term extension to strengthen protection of biopharma innovation. At the time, Chen wrote in a Guest Commentary for BioCentury, “The long-awaited changes are unlikely to provide innovators with much respite from generic challengers. If anything, the new law, which will take effect in June 2021, more likely will buttress the patent cliff China is carving to drive drug prices down.”

Chen is a partner at Jones Day in Shanghai; an advisory member of the U.S.-China IP Cooperation Dialogue, which was organized by the U.S. Chamber of Commerce and Renmin University of China; and the chairman of BayHelix, a network of senior executives in the cross border life sciences industry involving China. 

The new rules became effective June 1, with implementing measures released July 4 that set an Aug. 3 deadline for companies to file their Chinese patents in the Chinese Marketed Drug Patent Information Registration Platform launched by NMPA’s Center for Drug Evaluation (CDE). This platform is similar to the U.S. FDA’s Orange Book.

“This patent linkage system in China is shaping up to be a three-dimensional chess match,” Chen told BioCentury. “It will be very exciting.”

Before China introduced patent linkage in 2017, innovators complained that China’s FDA could approve generics and biosimilars before the innovators’ Chinese patents have expired. And there was no mechanism for innovators to take legal action to stop the launch of these generics or biosimilars before patent expiration.

Now, Chen said, the new system compels sponsors of generics and biosimilars to make “specific patent declarations vis-à-vis each and every Chinese patent the innovator has listed.” If the generics company chooses to challenge the innovator’s patent and launch its competing product before the patent expires, the innovator has 45 days to launch a lawsuit or administration challenge, which would stay NMPA approval of the generic for nine months.

Patent claims tied to hundreds of drugs have been registered in the new system already, Chen said.