China's Inspectorate Begins Enforcing New Drug GMPs Overseas

Inspections are part of a bid to raise domestic quality to global standards

China's State FDA this month will begin inspecting manufacturing facilities in the West for compliance with the GMP regulation it revised in January.

The GMP rewrite and the overseas inspections are part of a concerted effort to raise the quality of China's domestic pharmaceutical industry to global standards (Also see "China Releases New Drug GMPs; Domestic Consolidation Expected To Accelerate" - Scrip, 18 Feb, 2011.).

The overseas inspections will help China's inspectorate learn where the bar is set on quality abroad, so it can inspect its domestic industry to the same standard.

The inspections should be viewed in this context of global competition between lean Chinese drug makers striving for quality and quality multinationals striving to become lean.

At stake are industrialized-world markets that are opening up to globally sourced, commodity priced generic drugs as brands lose patents – and China's domestic market, perhaps the biggest prize of all.

An official who played a key role in China's GMP rewrite told two recent conferences about the evolution of China's quality standards and what it means for China's regulators and for industry, both domestic and multinational.

Hua Zhang is chief inspector and GMP department head for the Center of Certification and Evaluation of the Shanghai FDA, perhaps China's most important provincial drug regulatory agency. But she also has an industry background, having worked for 12 years in quality assurance, quality control and production management at the Shanghai Institute of Biological Products and China units of Johnson & Johnson, [Squibb Corp.] and Abbott Laboratories Inc.

Zhang took part in translating European Union and World Health Organization GMPs into Chinese in 2006 and 2008, and she was the main author for the part of China's latest GMP rewrite that focused on active pharmaceutical ingredients, which China regulates as drugs.

Zhang spoke on China's GMP-related initiatives Oct. 27 at the American Association of Pharmaceutical Scientists annual meeting in Washington and on Nov. 8 at the International Society of Pharmaceutical Engineering annual meeting in Dallas.

China's Emerging Inspectorate

In a "pilot trial," four groups of SFDA inspectors will fan out to four geographical areas – the U.S., Europe, South Korea and India – where they will inspect eight or 10 facilities, Zhang said.

SFDA's Certification Center for Drugs selected inspectors from provincial FDAs to form these inspection groups.

The inspections will focus on plants that produce a range of product types: oral solid dosage forms, biologics, active pharmaceutical ingredients, vaccines and sterile pharmaceutical products.

SFDA has been training inspectors for overseas inspections since 2008, Zhang told the AAPS meeting. "Now we have about 100 inspectors who can do overseas inspections. So for overseas inspections, I think SFDA is ready to do that."

The pilot will include both GMP surveillance and preapproval inspections, she noted.

She told the ISPE meeting how she believes the overseas inspections will benefit SFDA and China's domestic pharmaceutical industry.

"SFDA is developing many regulations and guidelines more internationally harmonized, and for the inspectors and the reviewers, they also need to understand those international standards and the regulations," she explained.

"So if Chinese GMP inspectors go abroad to conduct these overseas inspections, I think they can learn directly from the other pharmaceutical companies in the foreign countries, and it will help us to better understand the new GMP requirements. I think it will benefit SFDA and industry."

China's March Toward GMP Compliance

China's first GMPs, drafted in 1982, were nothing more than industry standards. Its first government GMPs came two years later, but they were not regulatory in nature. China's Ministry of Health got involved in 1988, and revised the GMPs 1992, but compliance remained voluntary.

It was not until 1998 that China made GMP compliance mandatory and established its State Drug Administration to regulate the pharmaceutical industry. That agency was later expanded to become the State Food and Drug Administration.

The 1998 revision established a basic set of enforceable requirements similar to those of the European GMP, and applied them to all pharmaceutical preparations and APIs. There were also annexes for traditional Chinese medicines and Chinese crude drugs.

The agency rolled out its GMP standards in stepwise fashion rather than try to hit all of China's 6,900 pharmaceutical companies, many of them small family operations, all at once. Instead, it gave each industry sector a deadline to pass GMP inspection or close (Also see "What Multinational Companies Need To Know About China's New GMP Regs - Webinar (Part 1 of 2)" - Scrip, 20 Jul, 2011.).

GMPs Revised And Extended

The process leading to China's latest GMP revision began in 2006, and involved the release of drafts for public comment in September and December 2009.

China's Ministry of Health approved the revision Jan. 17, effective March 1.

There is a revised set of general provisions in the document that corresponds to the basic requirements set forth in 1998. There are revised annexes for sterile pharmaceutical products, APIs, biologicals, traditional Chinese medicine preparations, as well as a new annex for blood products, which used to be covered in the biologics annex. Unchanged are annexes for radiopharmaceuticals, prepared slides of Chinese crude drugs, and medical gases.

The agency also intends to develop additional annexes. There are two non-mandatory annexes, one for parametric release and the other for excipients used for drugs. Zhang noted that SFDA approved two companies for parametric release pilot trials for terminally sterilized products.

Other annexes to be developed cover areas such as qualification and validation, computerized systems, sampling of raw materials and packing materials, and drug products used for clinical trials.

Noting that there are still gaps between China's GMPs and international GMPs, Zhang said, "We also have a plan to develop new annexes in the future."

Zhang gave a link to the formal English-language translation of China's revised drug GMPs. She cautioned that while it contains the general provisions, the translation does not include the annexes.

Challenges For China's Regulators

In her remarks at the AAPS meeting, Zhang emphasized the challenges that the new GMP regulation poses to China's regulatory agencies and industry, and she touched on the lesser challenges facing multinational companies.

The national and provincial regulatory agencies "have not enough professional inspectors to conduct new GMP inspections," she said. China's inspectorate is not sufficiently trained, and for the most part lacks industry experience, "and because of job rotation, some experienced and professional inspectors transfer to other departments," she said.

Another issue is that for the most part, China's inspectors have other job responsibilities. "For example, some inspectors come from the Institute of Food and Drug Control. They are working in the laboratory. So inspection is just their part time job."

After the Ministry of Health approved the GMP revision, SFDA announced to its inspectorates that they would have to establish quality systems and pass a capability evaluation before SFDA would allow them to conduct new GMP inspections, she said.

"We only have a very short time to establish the quality systems in our inspectorates," Zhang said. "It’s a big challenge to state and provincial FDAs in this year. Just right after the release of new GMP, SFDA organized many, many training courses for inspectors and industry."

The six new GMP sections impose requirements that are "totally new to the Chinese pharmaceutical industry," she said. "They need to learn a lot about how to establish a quality system in their companies. … The whole industry doesn’t know how to do a risk analysis and the evaluation when they do qualification and validation, or CAPA or deviation handling. They don’t know how to do it."

For this reason, there will be phased implementation of the new GMPs, much as with the 1998 GMP revision.

As of March 1, new facilities and workshops must comply from the outset. Injectables, vaccines and blood product facilities must comply by Jan. 1, 2014, while facilities for other products don't have to comply with China's revised GMPs until Jan. 1, 2016.

Challenges For MNCs

For multinational corporations, China's new GMPs should not pose too many difficulties.

"In China, we have many, many multinational companies from the United States, EU, Japan, Korea and other countries. For these companies, they must have an idea of GMP practice, because different companies just follow their policies of their headquarters as well as the local regulations."

As for companies that comply with the EU GMP requirements, "surely they can pass our GMP inspection, no big difference," she said.

She observed, however, that because Japan's GMP regulations do not require annual product reviews, many Japanese companies do not conduct them. "After the new GMP was implemented, they should start this work."

There are other aspects of China's GMPs that differ from those of other nations, although Zhang told the ISPE meeting that China's authorities have not conducted a detailed comparison with other GMPs such as FDA's.

She called attention to two aspects. The role of the qualified person in product release mirrors the EU approach, but is foreign to FDA's GMPs. And the treatment of APIs as pharmaceuticals is different than in most other countries.

But she posited a knowledge gap between China and the U.S. "I think the understanding of GMP and the practice of GMP may be a slight difference between China and the U.S. Slight difference, because in China, our pharmaceutical companies, they have not enough professional knowledge in qualification and validation and risk management. So I think the practice in these areas in U.S. companies will have better performance than our domestic manufacturers."

However, China's GMP revision could change the picture, she told the AAPS meeting. "I think if the new GMP is well-implemented in China, these [multinational] companies will face competition from domestic manufacturers. So for these companies, they need to improve their production efficiency. I think they also realize the situation. As my observation: in some companies, lean production is now widely, commonly applied."

She added that multinationals can "expect more extensive competition from China's local manufacturers, because as I know, there is a problem, a patent cliff has occurred in the western world."

Approaching Regulatory Harmony

As SFDA contemplated revising its GMP regulation, its regulatory experts were divided into two camps, and that division has persisted, Zhang told the ISPE meeting.

"Before we started to revise our new GMP, we had a lot of discussion, sometimes arguments. Some people think we should develop a Chinese characteristic GMP. And the other people expect an international harmonized GMP."

In the end, the attraction of a more harmonized approach won out, along with its promise to China's domestic pharmaceutical industry of better quality assurance, improved quality culture, access to global markets, and perhaps even transformation from manufacturing to innovation, she said.

With the new GMPs, China's pharmaceutical inspectorate is hoping to build its case for joining PIC/S, the Pharmaceutical Inspection Cooperation Scheme. Acceptance into PIC/S is an important barometer of legitimacy for emerging inspectorates like China's, and provides an opportunity to engage in the globalization of the inspection process.

[Editor's note: This story is excerpted from a larger feature that appeared in the November 2011 issue of “The Gold Sheet.”]