CDE released “Guidelines of Clinical Value-Oriented Clinical Development for Anti-tumor Drugs (Draft for Comments)” on July 2, 2021, Source: CDE website
Surprisingly, what would normally be regarded as a common technical guideline triggered a big dip in pharmaceutical stocks in China two days later — especially in stocks related to innovative drug developers.
According to Securities Times, China’s national financial newspaper, by the end of the day, Tigermed, Medicilon and other CRO's stocks fell more than 10%. Innovative drug companies such as Fosun Pharmaceuticals, and Chipscreen Biosciences fell more than 5%. The Hong Kong market also fell sharply, with the Hang Seng Healthcare Index plunging 5%. Stocks such as Fosun Pharmaceuticals, WuXi Biologicals, and GenScript fell more than 8%.
This is partially attributable inflated valuations of some public pharmaceutical companies. But the other main takeaway from this market reaction is that China's regulatory bodies are raising the bar on the development of cancer drugs.
Market interpretation: Say NO to Me-too drugs
Two clauses in the Guidelines document addressing randomized controlled trials (RCT) are widely believed to be what triggered this market panic.
The docuement states that when choosing control drugs, the sponsors should provide test subjects the best possible treatments available, rather than those of uncertain safety and efficacy, or those that havel already been replaced by superior drugs.
On the other hand, the main objective of innovative drug development should be to provide the better treatments to the patients. When a non-optimal treatment is selected as a control therapy in the study, even if the results meet the pre-defined study objectives, it does not demonstrate that the experimental drugs can meet the actual clincial needs of the patients, nor is it proven to be of any value to patients.
The stock market's response indicates that market players believe the purpose of this Guidelines is to curb the flooding of me-too drugs into the market. Also known as follow-on drugs, these are drugs that are structurally similar to existing drugs and serve the same purpose.
In China, biopharmaceutical companies like to develop drugs with same mechanism for a certain period of time. For example, there are eight PD-1/L1 monoclonal antibody therapies in the market and at least another 80 in clinical development.
According to the Securities Times, one market interpretation of the Guidelines document is, in the future, head-to-head study results should be submitted with the best support care (BSC) when filing a New Drug Application (NDA) to prove the experimental drug surpasses the BSC.
Others believe that the Guidelines document set a higher bar for me-too and me-better drugs. As a result, related R&D outsourcing service providers like CROs would see a reduction in orders.
The document is the implementation of international practice in China
PharmaDJ believes that the stock market has over-interpreted this document.
The background section of the document said, the International Council for Harmonisation of Technical Requirements for Pharmaceuticals for Human Use (ICH) adopted the Reflection Papers on Patient-Focused Drug Development (PFDD) in November 2020 and released it for public comment from December 7, 2020 to March 7, 2021. The Reflection Papers are an important reference in the document. They're cited first at the end of the document.
ICH Reflection Paper on PFDD, the reference file of the document, Source: ICH website
On June 3, China’s NMPA was re-elected as a member of the ICH Management Committee. One month before, Zhou Siyuan, the Deputy Director of CDE, who is also Head of ICH China Office said at the Drug Information Association (DIA) China Annual Meeting that China is actively working on implementing relevant guidelines after joining the ICH Management Committee.
Now, oncology is the hot field in drug development. Therefore, the CDE wants to guide clincial development through the document, emphasis the concept of clincial value-oriented, and implement the ICH PFDD guidelines through the document.
The concept of clinical value-oriented development is, in fact, nothing new. It has already appeared in the regulations in China. In the revised Drug Registration Management Measures and The Administrative Measures on Supervision of Pharmaceutical Manufacturing, clincial value-oriented development was emphasis in innovative drug R&D as well as related support systems like expediting review and approvals.
Last month, Zhao Jianzhong, deputy director of the second clinical department of chemical drugs of the CDE, pointed out in an article that clinical value-oriented innovation and R&D are always core issues for clincial development and evaluation.
Specifically, the CDE document offers recommendations for the industry on how to apply clinical value-oriented development in project identification and clinical trial design. It covers a variety of aspects such as combination therapies, predictive biomarkers, drug safety, trial subjects, dose selection, the selection of special populations such as the elderly and children, various types of study designs, endpoint selection, and patient participation.
The document does not address specific methods
The market responses are mainly related to the specific clinical design approaches, especially the choice of reference drugs when conducting RCTs. A number of questions are being asked, for example: What is meant by BSCs? Which drugs should be selected as the control drugs? Is it necessary to demonstrate the superior efficacy of the experimental drugs over the control drugs?
However, these special questions are not the contents of the document, nor is it a gold standard for the development of cancer drugs. In the document's background section, it is clearly stated that this guideline does not include a discussion of specific methodologies. It also advises that when designing and conducting studies using the guideline to also refer to the Good Clinical Practices (GCP), and othe relevant guidelines already published by the ICH and NMPA.
The guideline only provides some suggestions. To innovative drug developers, the significance of the document is that it becomes a general consensus that drug development should be focused on patient needs and oriented by clinical value. When it comes to R&D decisions, they must pay more attention to clinical needs in addition to the conventional market expectations, time and financial investment.
In his article, Zhao also mentions that clinical benefit is fundamental. If the clinical efficacy of a drug is significantly improved, this will be the key consideration in the evaluation process. If a new drug only can improve safety, its priority will be lowered. Other benefits such as improved ease of use and compliance will be lower priorities.
In evaluating efficacy, there are also different levels of priorities, Zhao wrote. Survival data, for instance, is the highest priority. Clinical function improvement is a lower priority. Other clinical benefits may be lower still.
Zhao also points out that biopharmacetical companies have low interest in developing drugs that treat chronic diseases with high mortality rates, like cardiovascular and cerebrovascular diseases, or chronic respiratory diseases due to the R&D challenges and low success rates. Therefore very few drugs are approved. Perhaps drug companies can balance the commercial value and clinical value by first pursuing rapid approvals for treating rare patient groups, and then expanding labels to more common diseases.