A new regulatory deal could give Indonesia better access to new drugs and Chinese companies a greater market share in Southeast Asia’s largest market.
Under a new Memorandum of Understanding (MoU), the National Medicines Administration (NMPA) of China will work with the Indonesian Food and Pharmaceutical Authority (BPOM) to develop closer regulatory cooperation in the areas pharmaceutical and cosmetic products.
“Under the MoU, the drug regulators of the two countries will strengthen the exchange of information on laws and regulations, improve mutual understanding and advance the exchange of personnel and technology,” said Sakshi Sikka. , Senior Pharmaceuticals and Healthcare Analyst at Fitch Solutions. BioWorld.
She said the purpose of the deal, ad June 16, is to improve regulatory capacity and deepen regulatory cooperation of drugs, medical devices and cosmetics. This partnership is the result of a first meeting of the Sino-Indonesian high-level dialogue mechanism.
Fabio La Mola, partner in the Singapore office of consultancy firm LEK and the firm’s global co-head of the Asia-Pacific healthcare sector, said he believes the deal will facilitate access for Indonesia biologics and biosimilars.
“Since Indonesia introduced its universal health care system, it has seen an increase in demands for access to health care from the newly covered population,” La Mola said. BioWorld. “This resulted in significant budget pressure as most of the drugs already approved in Indonesia came from multinationals or local players with relatively lower quality standards compared to multinationals.”
He pointed out that although organic products are being launched in this Southeast Asian country, most of them are inaccessible.
“Collaboration with China will allow Indonesia to approve new generics and biosimilars of Chinese origin more quickly, relieving some of the budgetary pressures felt by the National Insurance Scheme (JKN),” La Mola said. “In addition, it will increase the capacity of the local regulatory agency BPOM when evaluating new drugs.”
China could be a key partner in the development of the Indonesian pharmaceutical industry.
“Indonesia’s healthcare system has prospered thanks to the reforms, but the country’s pharmaceutical sector faces price compression due to expensive raw materials. An expanded investment deal with China would help Indonesian drugmakers thrive and keep the country’s health mandate on track, ”Fitch’s Sikka said.
Advantage for Chinese companies too
La Mola added that the partnership is also a victory for Chinese pharmaceutical companies, as they will be able to access a large market of more than 280 million people with relative ease, and without the long waits typically reserved for foreign companies.
The deal will help Chinese companies expand their current presence in Indonesia.
“Chinese companies have been in Indonesia for some time and an increasing number of biosimilars and new drugs from China are registered in Indonesia,” La Mola said. “The COVID vaccine is probably the most recent and visible example of collaboration, which may have sparked the desire to strengthen ties. “
Indonesian state-owned company Bio Farma PT worked closely with Sinovac Biotech Ltd. to test and manufacture its COVID-19 vaccine.
It depended on supplies from three Chinese vaccine manufacturers, namely Sinovac, Sinopharm Group Co. Ltd. and Cansino Biologics Inc.
“In January 2021, China pledged to work with Indonesia to make the most populous country in Southeast Asia a regional vaccine production center and said that continued cooperation in trade and investment would fuel a rapid economic recovery for both countries after the COVID-19 pandemic, ”Sikka said.
It is unclear, however, how the new agreement will impact regulatory standards in the region. What can happen, La Mola said, is a push for greater cooperation following existing models such as the Access Consortium, which began as the Australia-Canada-Singapore-Switzerland Consortium until it be renamed in October 2020 and is a coalition of the likes. medium-sized regulatory authorities. The UK Medicines and Health Products Regulatory Authority (MHRA) became the fifth member of the consortium in January 2021.
“ASEAN has been trying to cooperate on regulatory issues for 10 years; However, the expected harmonization of regulatory approvals has not yet taken place, ”noted La Mola. “There are examples of agencies cooperating to approve drugs where various regulatory bodies work together to approve new drugs. A similar model may be closer to what is likely to set regulatory standards in the region.
“It could probably strengthen the desire of Indonesia and China to collaborate on other issues. I’m not sure other ASEAN countries will necessarily follow a similar path. ”
In terms of international standards, China joined the International Council for the Harmonization of Technical Requirements for Pharmaceuticals for Human Use (ICH) in 2017 as the eighth regulatory member.