Cover Story: China Set to Ease Controls on Genetic Resources to Plug Biotech Innovation Gap

China is set to relax its decade-long regulations on human genetic resources due to concerns from the industry and academia that stringent rules are stifling innovation, particularly in the biotech sector, which is essential for developing new medicines for diseases like cancer and diabetes [para. 1]. The National Health Commission (NHC) is leading the reform to revise the rules for using and managing these resources to streamline administrative processes, enhance regulatory efficiency, and rejuvenate scientific research and the biopharmaceutical industry [para. 2].

Human genetic resources include genetic materials like organs, tissues, and cells, and are fundamental for drug and therapy research critical for public health and national biosecurity [para. 3]. Unshackling these resources is perceived as essential for China to stay competitive in the global biotech and new drug development race [para. 4]. The Chinese pharmaceutical market accounted for just 8.1% of global sales in 2022 compared to 52.3% in the U.S. and Canada, with significantly lower R&D spending [para. 5]. In biologics, China's market was around $6.2 billion in 2019, far less than the $118 billion in the U.S. [para. 6].

Despite significant growth in the life sciences sector, China still has work to align with global leaders, although its innovative drug market is expected to grow from $20 billion in 2022 to $50 billion in 2028 [para. 7]. China's R&D spending growth rate outpaced that of the U.S. and Europe between 2018-2022 [para. 8].

Current regulations require lengthy approval processes for the collection and use of human biological materials, which hinder the rapid development required in the drug industry [9,10]. New drugs need to complete three phases of clinical trials, each requiring approvals. Although a 2015 reform reduced the new drug review time to about three months, an additional review of human genetic resources remains a bottleneck [para. 13].

The stringent regulations are particularly challenging for businesses collaborating with overseas partners on data sharing, slowing innovation [para. 15]. The tightened supervision over the last decade has added about three months to the approval time compared to other countries, complicating international cooperation in genetic research [para. 18]. This regulatory burden deters foreign investment and involvement of foreign-trained scientists in the Chinese biotech industry [para. 20].

The NHC began reform efforts by transferring supervision of human genetic resources from the Ministry of Science and Technology to the NHC and terminating the 25-year-old Genetic Resources Office [para. 35]. Detailed discussions with industry representatives have resulted in a consensus on deregulation, focusing on pragmatic supervision [para. 45].

Key proposals include raising the project size threshold for administrative approval, clarifying the definition of "foreign entities" to ease compliance challenges, and revising overlapping regulatory provisions to optimize the application process [para. 48-52]. These revisions aim to enhance regulatory precision, efficiency, and scientific integrity [para. 54]. However, deeper legal reforms are necessary to fundamentally change the supervisory approach [para. 56].

Recent guidelines issued in 2023 have reduced some of the regulatory burdens, significantly improving review times for companies [para. 61]. However, academic research also faces constraints due to imprecise definitions and stringent standards [para. 65].

Domestically, challenges arise from "data islands" that impede information sharing crucial for the digital economy. Experts recommend combining robust regulations with national research institution support, as seen in countries like the UK and U.S., to facilitate data sharing for public good [para. 85].

Globally, regulating human genetic resources remains complex, influenced by geopolitical and economic factors. Countries are actively formulating policies to oversee these resources, emphasizing a balance between security and efficient data use for economic and scientific advancement [para. 92-96].

Historically, China has been open to international collaboration in genetic research, participating in major global projects like the Human Genome Project, the International HapMap Project, and the 1000 Genomes Project, which aimed to catalog human genetic variations [para. 105-109].