A Dizzying Course

Traffic in Shanghai is a swirling flow of cars, bicycles, motorized bicycles, and mopeds, with little braking. When an obstacle appears, vehicles swerve around it, onto the shoulder or into the oncoming lane, and everyone reacts in stride. Cars enter roundabouts at speed, joining the circle like cake batter in a mixer. Signs are posted, but the real rules of the road are unwritten. And despite all the chaos, traffic moves along rather well, though accidents do happen.

Laura Bush

Attending the recent BioManufacturing World conference in Shanghai, I noticed that China's biopharmaceutical industry has a similar feel. The industry is growing at a dizzying rate (more than 20% per year), and everyone is darting forward where they see opportunity. Meanwhile, the rules of the game are evolving.

What every Westerner wants to know is: 1) Will the Chinese industry ever meet Western quality standards? 2) Will China eventually take on a major role in worldwide biopharmaceutical manufacturing, and if so, how soon?

The answers you get depend on whom you ask, and the positions are fairly predictable. Passionate Chinese scientists and entrepreneurs are confident about their country's ability to ramp up. "Look at what we did with the Beijing Olympics," they beam. Or, "See how fast we produced an H1N1 vaccine." Western experts react with skepticism, or caution. "They have no idea how different biotech is from small-molecules," they say. Or, "The Olympics are not biologics."

The truth, I am convinced, is somewhere in between. The ambitious Chinese will find that achieving global quality levels is more difficult, and more expensive, than they thought. Western companies, on the other hand, cannot remain complacent. And as one speaker pointed out, 15 years ago, many said the barriers for entry for supplement manufacturing were too high; today, Chinese companies make 90% of the world's vitamins.

If China's biopharmaceutical industry is indeed going to rise to international levels, its national regulators will have to play a crucial role. And indeed, the SFDA appears to be willing to do that. At the conference, Zhang Hua, an inspector in Shanghai, was surprisingly frank about the quality gap. In outlining the agency's plan to roll out new GMP regulations by year end, she acknowledged that about 70% of Chinese companies will have to upgrade their operations to meet the new standards. Companies will have three years to comply, but Zhang made it clear there is no going back. "We have to increase our standards to be accepted in international bodies like PIC/S," she said.

The SFDA also has other ways to raise quality. Once several companies compete in a given product class, ensuring that market demand is met, the government can force the worst performers to remove their drugs from the market.

Also important will be the "returnees"—Chinese scientists who have worked abroad and are now going back to China, taking their understanding of quality with them. Two prominent examples are Joe Zhou, who left Amgen's process development group to found Genor BioPharma in 2007, and Scott S. Liu, who managed quality operations at UBI, BMS, and Amgen before returning to China last year to found Henlius Biopharmaceuticals. There also are Westerners getting involved, including David B. Wilson, who just formed Advanced Biologics, a joint venture with the Chinese government to develop a world-class CMO.

Unlike what happened with vitamins, I don't think biotech manufacturing will move to China wholesale, at least not soon. But it is clear to me that China is moving up in the world, and I am confident that in the next 5 to 10 years, we will indeed see some world-class operations emerge there. Everyone should get ready for the ride.

Laura Bush is the editor in chief of BioPharm International, lbush@advanstar.com