Stiff Competition for Taiwan’s Clinical Trials

Taiwan and other regional players are finding it difficult to compete on the same scale as China when it comes to hosting clinical trials.

Over the years, Taiwan has developed a strong reputation in the field of healthcare. It is now looking to leverage its advantages to position itself as a regional biomedical hub and a viable location for conducting clinical trials for promising new drugs.

The research investment represented by clinical trials is considered an effective way to increase the involvement of the world’s leading pharmaceutical companies in the local market, helping to spur development of a domestic biomedical industry. 

Taiwan’s strengths in this area include solid IPR protection, well-run hospitals, excellent health professionals, and favorable government policies, which have contributed to creating a positive infrastructure for biomedical industry startups.

Unfortunately, Taiwan seems to be losing ground to regional rivals when it comes to clinical trials. Despite being known as a reliable and cost-effective environment for such trials, it is facing stiff challenges from competitors – particularly from China.

In a presentation this August, Dr. Chern Herng-der, Distinguished Research Fellow of Taiwan’s Center for Drug Evaluation (CDE) under the Ministry of Health and Welfare, outlined the change in the competitive landscape for clinical trials in the region between 2016 and 2018. As shown in the accompanying charts, Chern’s talk to the Taiwan Society of Regulatory Affairs for Medical Products noted that of the six countries surveyed, China showed the strongest, most sustained growth in the number of clinical trials registered during that period.

China’s lead in this area is not surprising, given the enormous size of its market. Its population of 1.4 billion makes China a natural target for multinational pharmaceutical companies looking to expand operations and boost profits. In fact, China is already the world’s second largest market for pharmaceuticals after the U.S. Its growth has been bolstered by an expanding middle class, the increasing urbanization of the population, and ever greater healthcare demands as its citizens live longer and its society ages.

Despite China’s obvious advantages, many companies in previous years doubted the cost-effectiveness of conducting clinical trials there when considering the quality of the data. The country’s hospitals often fell short when it came to good clinical practice, and political interference, complex and confusing regulatory requirements, and underdeveloped medical systems made carrying out trials extremely burdensome.

In addition, the time it took to authorize clinical trials could be exceedingly long, preventing Chinese testing centers from being incorporated into the worldwide release of many drugs.

Over the past four years, however, the Chinese authorities have made it a priority to address some of these longstanding issues. The country’s drug evaluation agency continues to increase the number of personnel and drug reviewers on its staff. In addition, China has adopted a U.S.-style approach to clinical trial applications, which has decreased the time needed to authorize a trial from a year to about 60 days.

While China used to be seen merely as a location for manufacturing generic drugs, that perception is also changing. The country is now aggressively producing new or novel drugs and is involved in half of all enrolled cancer trials of CAR-T cell therapies.

The improvements in China’s regulatory system and manufacturing capacity have had a dramatic overall effect on the number of clinical trials being sponsored there, but have also impacted its regional competitors, as Chern’s figures indicate.

In Taiwan, for example, only 51 clinical trials were held in the first six months of 2019, as opposed to 172 in China during the same period.

“Attracting companies to conduct clinical trials in Taiwan is getting increasingly difficult,” Chern says. He attributes this trend to the draw of China, and notes that “unless Taiwan can improve its competitiveness through proactive, across-the-board strategies,” the island’s once-promising effort to promote clinical trials could face an uncertain future.

A fresh start

Taiwan first introduced a clinical trial system in 1993, and the quality of the trials steadily improved over the years, helped by an effectively coordinated set of relevant laws and regulations, Chern says.

Taiwan became an early regional leader, partly because China was so far behind the curve. The Taiwanese clinical trials system at that time was so successful that it served as a model for South Korea’s KoNECT (Korean National Enterprise for Clinical Trials), established in 2007. Chern notes that KoNECT did so well in applying the information gleaned from Taiwan’s experience that it eventually overtook Taiwan in the number of clinical trials conducted.

According to the Asia-Pacific contract research organization Novotech, South Korea was until recently conducting “more industry-sponsored drug studies than any other Asian country” and was one of the top 10 global clinical investigator sites.

South Korea’s stellar performance prompted Taiwan to up its game in 2011 by establishing the Taiwan Clinical Trial Consortium (TCTC) to raise standards for clinical trials and facilitate the commercialization of biomedical products.

According to TCTC’s online introduction, the organization’s goal is to become a center of excellence for new medical device clinical trials in the Asia-Pacific region and to foster the growth of Taiwan’s biomedical sector. 

“The TCTC has three primary missions,” says Director Wu Ming-shiang. These are to “reduce the duration of clinical trials based on creating advanced platforms, attract international pharmaceutical companies to conduct trials in Taiwan, and help Taiwanese biotech companies in the commercialization of new drugs and medical devices.”

Dr. Mark Horng, Bristol-Myers Squibb’s country medical lead and interim general manager, praises Taiwan’s medical infrastructure, reasonable costs, and large number of hospitals qualified to carry out clinical trials. But noting the success stories of some of Taiwan’s regional neighbors, he urges further efforts to develop the environment here for clinical trials.

Horng refers approvingly to Australia’s generous tax incentive system for clinical trials, which has proven very attractive to pharmaceutical companies. One such incentive gives companies undertaking certain R&D projects a 43.5% refundable tax credit, which can be applied to different phases of clinical trials.

He also points to South Korea’s push to become both a regional and a global leader in clinical trials. The Korea Drug Development Fund, for example, is a multi-million-dollar investment program that runs from 2011 to 2020. Under the fund, three health-related ministries are investing the equivalent of US$30 million to $60 million annually to finance a national novel drug development project.

Horng says that while Taiwan needs to face the reality that it won’t be able to compete on the same scale as China moving forward, Taiwan could nevertheless enhance its competitive edge by adopting more attractive policies for companies conducting clinical trials.

“Taiwan could take a bigger slice of the pie,” Horng says. It may never be head of the pack, he adds, but if the regional market for clinical trials continues to expand, “Taiwan’s slice of the pie will also be worth relatively more, which is a strong business proposition.”

Recognizing innovation

Boon Huey Ee, general manager of Merck Biopharma Taiwan & Hong Kong, describes herself as upbeat about Taiwan’s long-term prospects as a base for conducting clinical trials, provided more is done to ensure that Taiwan stays competitive and increases its appeal to the major pharmaceutical companies, the main drivers of investment.  

She cites a recent Biopharmaceutical Competitiveness Index survey, compiled by business consultancy Pugatch Consilium. In it, Taiwan ranked number two among “newcomer markets,” overtaking Israel and coming in behind only Singapore. Ee regards that as a strong position for Taiwan to be in, and she speaks highly of the clinical trials her company has sponsored in Taiwan.

“Taiwan has always been included in Merck’s global clinical studies,” she says. “Our experience here has been good in terms of scientific research, qualified researchers, speed of patient recruitment, and quality of the studies performed.”

Ee also emphasizes the improvements made to Taiwan’s regulatory system and IP protection over the years but says that market access and pricing are issues that still need to be overcome. “We have to ask whether the Taiwan government is doing enough to address and recognize innovation and whether it’s behind the level of competitiveness required to be a world leader,” Ee says.

She suggests some changes to improve Taiwan’s image as a good place to conduct clinical trials and to better facilitate interaction between the government and pharmaceutical companies.

One is to provide more incentives to reward innovation when new drugs are launched in Taiwan. “There are some incentives available, but these are mostly directed at local companies,” Ee says. “Those for multinational companies perhaps do exist, but they need to be better promoted and the details clarified.”

Another key step would be to get major pharmaceutical companies more involved in the rules-making process. Providing a platform for them to work with government ministries and the local biomedical industry would encourage collaboration and contribute to the development of Taiwan’s biopharma ecosystem.

CDE’s Chern says the Taiwan authorities are well aware of China’s recent gains in attracting clinical trials and intend to start making changes based on the experiences of neighboring countries. He cites four main factors determining the competitiveness of clinical trials: “quality, timeliness, cost, and market,” all of which Taiwan can excel at. Taiwan’s “scientific capabilities and excellent infrastructure” could make it a “global powerhouse in the biopharma arena,” Chern says.

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