United States and China Sign Pact on Device and Drug Safety

On December 11, 2007, the U.S. Department of Health and Human Services (HHS) and China's drug and device watchdog, the State Food and Drug Administration (SFDA), signed an agreement related to the safety of drugs and medical devices being exported from China to the United States.¹ The pact was a result of recent product recalls that have heightened U.S. concern about the safety of Chinese imports. In developing the agreement, high-level HHS and FDA officials conducted four rounds of discussions with Chinese officials between May and November 2007.

Speaking at the National Press Club on December 19, 2007, HHS secretary Mike Leavitt said the general message from the United States to China was “if they want access to our consumers, they've got to produce according to our standards.” Although the agreement does not contain an immediate commitment along those lines for medical devices, it does look toward a future in which SFDA can certify exporters according to U.S. standards.

The pact can be broadly divided into two major activities: special oversight for a specified trial group of medtech products, and enhancement of overall cooperation between HHS-FDA and SFDA. This article will discuss the provisions of the agreement and what they mean in practice for the medtech industry.

Oversight of Specified Products

The products marked for special oversight are different depending on whether they are made in China or the United States. The specified China-made medtech products are intraocular lenses, cardiac pacemakers, and blood-screening diagnostic kits for HIV-AIDS and hepatitis B and C. The specified United States–made medtech products are glucose test strips and condoms.

In the agreement, SFDA has committed to register all companies making the specified products for export to the United States. Theoretically, this is already required under Chinese law, but regulatory oversight in China has been weak—and is particularly weak for products made for export only. For its part, FDA will provide SFDA with information about the specified products' manufacturing facilities, approval dossiers, recalls, warning letters, and postmarketing adverse events.

During implementation, FDA and SFDA will study one another's regulatory standards for the specified products. They will also work to upgrade Chinese standards over time, with the eventual goal of moving SFDA to a point at which it will be able to certify China-made products as compliant with U.S. standards.

The products listed above obviously make up a tiny proportion of all medtech trade between the United States and China. However, after the first year of the agreement's implementation, a working group may choose to add to or subtract from the specified products list. The main criteria for inclusion on the list will be concerns related to public health, rates of refusal at the border, counterfeiting, and deceptive labeling or promotion.

Bilateral Regulatory Cooperation

The second major goal of the new pact—interagency cooperation—covers a wide range of regulatory functions. Such functions are not limited to the few specified products, but may affect all medtech products under FDA or SFDA authority.

First, occurring at a dialogue level, there will be mutual instruction in American and Chinese practices. The agencies will provide one another with information about their laws and regulations, conduct training programs on their mutual practices, and provide other key information along these lines.

Second, occurring at the practical levels of manufacturing, distribution, and use, the pact provides for a new level of information-sharing between FDA and SFDA. The agencies will report to one another any serious health problems or deaths associated with products. If one agency finds that a dangerous shipment of products has been exported, it will report what it knows to the other within 24 hours. In addition, each agency will provide the other with a complete list of their registered drug and medtech manufacturers, along with a list of each company's products. SFDA will also give FDA a complete list of manufacturers that have been found to be out of compliance with SFDA standards.

Finally, under the new pact, there will be significant information-sharing and cooperation about inspections. SFDA will inform FDA of serious inspection problems within 10 days, and provide any inspection results requested by FDA within 30 days. In addition, either agency can ask the other to perform a surprise inspection of a specified manufacturer, and get a decision back within five days. FDA officials may also join SFDA on its physical inspections.

Conclusion

Overall, the United States–China agreement is not intended to affect the medtech industry directly, through the imposition of substantial new requirements. Instead, its goal is to incrementally improve existing oversight and cooperation. In a press briefing on December 11, 2007, a senior HHS official explained that the agreement “ target[s] our collaboration on specific products of concern so that we can help build the SFDA system and gain more confidence in that system.”

However, the broad sharing of information should make traditional due diligence even more essential for Western companies manufacturing or sourcing in China. For example, if a Chinese supplier conceals from its Western buyer that its manufacturing license has expired, this information may nevertheless become known to FDA promptly because the supplier will be included on the list of manufacturers that are no longer registered. Theoretically, inspection shortfalls and serious adverse events will also be communicated quickly between regulatory agencies. Therefore, medtech firms should be doubly careful in tracking their Chinese partners' or subsidiaries' quality and compliance status. Compliance personnel should also remain up-to-date on potential regulatory issues in both countries and be prepared to resolve them jointly.

It is possible that the agreement's provisions will never be fully implemented by the Chinese government. Strict paper requirements that are unevenly enforced are common in the Chinese medical industry, especially since the national SFDA often must rely on multiple provincial authorities to carry out its directives. The drafters of the pact seemed to recognize this factor when they outlined strict benchmarked deadlines for implementation. The level of success achieved during implementation will determine whether the level of risk to medtech businesses in China actually decreases.

Reference

1. “Agreement between the Department of Health and Human Services [HHS] of the United States of America and the State Food and Drug Administration of the People's Republic of China on the Safety of Drugs and Medical Devices” (Washington, DC: Office of Global Health Affairs, HHS, 2007); available from Internet: http://globalhealth.gov/news/agreements/ia121107a.html.

Ames Gross is president and founder of Pacific Bridge Medical (Bethesda, MD; www.pacificbridgemedical.com), an independent consulting firm dedicated to assisting medical companies in Asia. John Minot is an associate at Pacific Bridge Medical, where he works on research and writing projects.

© 2008 Canon Communications LLC

Return to MX: Issues Update.