
The focus of the previous
post on this blog is on the role China plays in the strategy of ROI3, Inc. In doing some research for the post, I found some notes that I took while attending an event at The Bureau of Asian Research (NBR) on March 15, 2013 entitled "
China's Evolving Health Industry Investments"
featuring Jiankang (Jack) Zhang, PATH’s China
Country Program Leader. While the event occurred eight months ago, there are a few points that remain relevant and worth sharing in this post. [Photo of Jack Zhang: PATH/Mike Wang]
Program for Appropriate
Technology in Health (PATH)
"PATH's mission is to improve the health of people around the
world by advancing technologies, strengthening systems, and encouraging healthy
behaviors," according to its
website. The Seattle, Wash.-based international
nonprofit organization, which was founded in 1977, says that it "transforms
global health through innovation. We take an entrepreneurial approach to
developing and delivering high-impact, low-cost solutions, from lifesaving
vaccines and devices to collaborative programs with communities. Through our
work in more than 70 countries, PATH and our partners empower people to achieve
their full potential."
In 2011, according
to its
Consolidated Financial Statements, PATH's total revenue was $283,838,000. Their funding derives from
foundations; the United States government; other governments, other nonprofit
organizations, and multilateral agencies such as the World Health Organization
(WHO); individuals; and interest from investments 75.5 million people worldwide
benefited from PATH's work in 2011 including 4.8 million mothers, newborns, and
infants; 8.3 million children and adolescents; and 5.4 million people living
with HIV/AIDS or tuberculosis.
Specific to China, PATH, since 1979, "has worked with
Chinese government agencies, nongovernmental organizations, research
institutes, and manufacturers to improve health. Our team in China has focused
particularly on addressing reproductive health and infectious diseases." Coordinated from the organization's office in Beijing since 2003, PATH's
strategy for success includes:
- Developing and expanding
public-private partnership models for health product development that take
into account health needs, the best interests of donors, PATH's core
competencies, the interests of Chinese public agencies, and synergies with
Chinese public and private companies;
- Identifying opportunities
vertically and horizontally to build on this model to meet the multiple
health needs of vulnerable populations in and outside of China; and
- Promoting global access
and supply of affordable, accessible, and sustainable health products in
China, and through China to other low-resource settings.
PATH in China explains
how "PATH views collaboration as the key to providing innovative, sustainable,
affordable, and culturally appropriate health solutions for low-resource
settings. We conduct rigorous monitoring and evaluation to ensure the efficiency
and effectiveness of our work. PATH's strategy in China includes:
- Developing and expanding
public-private product development partnerships that align with donor
interests, PATH’s core competencies, the interests of China’s public
health agencies, and the needs and perspectives of Chinese companies;
- Identifying opportunities
to build on these partnerships to meet multiple health needs of vulnerable
populations inside and outside of China; and
- Promoting sustainable
access to supplies of affordable health products in China and through
China to other low-resource settings.
PATH's specific initiatives in China include work in vaccine
research, development, and introduction; Woman's Condom product development and
promotion; and new diagnostic tools for tuberculosis (TB). A sampling of PATH's
projects includes the advancing rotavirus vaccine development; assessing
Chinese vaccine manufacturers, the Japanese Encephalitis project; polio vaccine
development and scale-up project (PVD); Protection Options for Women (POW); the
tuberculosis new diagnostic demonstration project; the Woman's Condom project;
and the Safe Water Project.
"China's Evolving
Health Industry Investments"
As PATH's country program leader in China,
Jiankang (Jack) Zhang is responsible for program
development, project management, office management, and liaising with local and
international collaborators, including local health authorities, public and
private institutions, and other nongovernmental organizations in China.
During his presentation,
Mr. Zhang said that the Chinese government is encouraging more private
investments in the pharmaceutical and biotechnology sectors. He noted, however,
intellectual property protection remains a significant concern by private
enterprises, particularly companies based outside of China.
In Mr. Zhang's interview with NBR's Claire Topal and Karuna
Luthra on May 25, 2011 entitled "
A Pivotal Moment for China and Vaccine Manufacturing," it is noted, "The World Health Organization (WHO)
announced on March 1, 2011, that the national regulatory authority of China—the State
Food and Drug Administration (SFDA), along with affiliated institutions—now
meets WHO indicators for a functional vaccine regulatory system. This means
that Chinese-made vaccines are now eligible to apply for WHO pre-qualification."
WHO
prequalification ensures that vaccines used in national immunization services
in different countries are safe and effective for target populations at the
recommended schedules, and that they meet particular operational
specifications.
During the 2011 interview, Mr. Zhang said, "WHO's clearance
opens the door for [Chinese vaccine manufacturers] to apply for WHO vaccine
pre-qualification—a regulatory status that opens the door for United Nations
agencies and governments to begin ordering the vaccine— with the aim of becoming
eligible for vaccine procurement by the United Nations Children’s Fund
(UNICEF)."
Responding to a question, during the 2011 interview, on the implications of the
announcement for China's role as an international partner in global health, Mr. Zhang explained, "The Chinese health authority
considers the WHO clearance a significant step in China's efforts to contribute
to global health, notably to African countries where China has already donated
to infrastructure, health systems, and anti-malaria treatment and control
programs. The addition of vaccines to this portfolio is truly exciting for the
Chinese government."
However, according to Mr. Zhang, "Obtaining a WHO pre-qualification certificate is
complex and can be difficult to maintain. Ultimately, in my opinion, the
biggest challenge for China won't be in building infrastructure, but instead in
sustaining the commitment of public agencies and encouraging manufacturing
executives to strictly comply with WHO requirements and the new Good
Manufacturing Practice code."
The new Good Manufacturing Practice (GMP) code,
adopted by the SFDA and effective March 1, 2011, aligns with WHO GMP standards,
containing stricter requirements for the production of pharmaceuticals
(including vaccines). The SFDA has asked that all newly-built pharmaceutical
manufacturing enterprises should comply with the new GMP code. Existing
factories, which produce sterile drugs, including blood products, vaccines, and
injections, are mandated to reach the new code before the end of 2013. The
deadline for other plants is Dec 31, 2015. Companies that cannot meet the new
requirements before these deadlines will be forbidden from continuing to
produce drugs. See SDA website, www.sda.gov.cn/WS01/CL0844/59017.html.

While Chinese
companies may apply for WHO pre-qualification to manufacture vaccines for the
African market, Mr. Zhang remarked during his presentation on March 15th
that most vaccines used in Africa are manufactured in India. Despite the
lack of Chinese-manufactured vaccines in Africa, he emphasized that the
4th International Roundable on China-Africa Healthcare Cooperation, which is scheduled for May 2013 in Gaborone,
Botswana, will attract senior
government officials and company executives from China and throughout Africa
alike. (The World Bank published an
article on December 10, 2009 about the initial China-Africa Healthcare Roundtable that was held in Beijing from December 4-5, 2009. This
article by UNAIDS dated May 7, 2013 provides a summary of the aforementioned conference held in Botswana.) (Photo: UNAIDS)
Upon the conclusion of Mr. Zhang's presentation, I asked for an update on how
China's vaccine manufacturers were complying with WHO requirements including
the GMP. He replied that while
Chinese-made vaccines are now eligible to apply for WHO pre-qualification,
not a single manufacturer has yet be approved for pre-qualification.
While polio was
eradicated in China, Mr. Zhang noted tuberculosis remains a problem. PATH
produced a document,
Collaborating to Control Tuberculosis, about its work to combat TB in China that says, "China
has the most MDR-TB (management of multi-drug resistant TB) cases in the world
and the second largest number of overall TB cases. The World Health
Organization classifies China as a high-burden country. There are an estimated
120,000 new cases of MDR-TB each year in China, accounting for 24 percent of
the global total."
Furthermore,
according to the TB document, "With funding from the Bill & Melinda Gates
Foundation, PATH is responding to the challenge. In collaboration with the
Foundation for Innovative New Diagnostics and the Hong Kong Supranational
Reference Laboratory, PATH assists the Chinese National TB Reference Laboratory
with determining the operational feasibility, cost-effectiveness, and impact of
new TB diagnostics in order to help the Chinese Ministry of Health decide
whether to introduce and scale up these technologies."
Regarding
his organization's operations in China, Mr. Zhang remarked that "PATH does not consider
China a recipient, but a partner."
Aaron Rose is a board member, corporate advisor, and co-founder of great companies. He also serves as the editor of GT Perspectives, an online forum focused on turning perspective into opportunity.