Proposal for the Basic Policies for Economic and Fiscal Management and Reform (Kotta-no Moken) 2020

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June 10, 2020
Japan Pharmaceutical Manufacturers Association
Chairman Joji Nakayama

To: Katsunobu Kato, Minister of Health, Labour and Welfare

The global spread of novel coronavirus infections has created a strong need for rapid research and development and stable supply of effective and safe therapeutic drugs and vaccines. In addition, the recent situation has once again brought widespread recognition that the health of the public is the foundation of a safe and secure society. The pharmaceutical industry must make further contributions not only to pandemics, but also to meeting the needs of unmet medical needs for diseases for which no cure or treatment has yet been established, and to realizing preventive and preemptive medicine through the implementation of new technologies in the Society 5.0 era, so that as many people as possible can live healthy and fulfilling lives as supporters of society. We must further contribute to the realization of preventive and preemptive medicine through the implementation of new technologies in the era of Society 5.0. We also recognize that it is extremely important to continue to provide a stable supply of necessary drugs for all other diseases.
In order to fulfill this mission as an R&D-oriented pharmaceutical industry, in addition to the efforts of the industry itself, it is imperative to clearly position the health and medical industry, which is the source of public confidence, as a key industry in Japan, and to create an environment for innovation in the life science field through further collaboration between industry, academia and government. To realize this, we propose the following

1. Creation of therapeutic drugs and vaccines against novel coronavirus infection

While it is not easy to eradicate new coronavirus infections, research and development of therapeutic drugs and vaccines is the way toward the end of the disease, and the pharmaceutical industry is committed to this and will continue its diligent efforts. The pharmaceutical industry is committed to this and will continue to work diligently. We ask that an environment be created to promote such research and development and to build a supply system.

(1) Support for drug and vaccine creation

The creation of therapeutic drugs and vaccines for novel coronavirus infection can be effectively addressed through three approaches: 1) drug repositioning, 2) vaccines, and 3) new therapeutic drugs (including blood products and unapproved drugs), and support for each of these measures is required.

(1) Early response through drug repositioning (diversion of existing drugs)

If an existing drug is found to be effective against novel coronavirus infection, drug repositioning is effective for early response because the safety of the existing drug in humans has already been confirmed and a production and supply system has already been established, enabling rapid provision to medical institutions.

  1. Since drugs are associated with various side effects, it is necessary to prepare multiple repositioning drugs rather than narrowing down to one candidate drug. It is necessary to promote R&D support for the expansion of indications for not only existing antiviral drugs but also existing drugs for the prevention of severe disease, etc.
  2. In order to streamline and activate drug repositioning, a pooled library of already approved drugs should be built, and a system should be established to allow rapid evaluation of drug efficacy in emergency situations.
  3. Since the safety of existing drugs in humans has already been confirmed, the time required for approval review can be significantly reduced. For additional indications based on drug repositioning, a system to utilize RWD should be established as soon as possible, and more expeditious approval is required.

(2) Research and development of vaccines and improvement of supply system

Even if a therapeutic drug for novel coronavirus infection is created, a vaccine is essential to dispel social unrest. In addition, production facilities must be established in Japan to ensure the supply of vaccines to the Japanese people. Specifically, the following items must be realized.

  1. Actively participate in vaccine development through international collaboration (including sharing of information and specimens necessary for R&D), receive technology transfer, etc., and establish a system for vaccine production in Japan.
  2. Establish an immediate response system for pharmaceutical companies that conduct R&D and production of vaccines necessary for national crisis management, such as for emerging and re-emerging pandemics. (Establishment of new facilities and maintenance and renewal of facilities. Or, establishment of public general-purpose facilities, etc.)
  3. Expand facilities necessary for research on infectious diseases in public institutions (including universities), and also open some of them to pharmaceutical companies. (BSL3 and 4 facilities, supercomputers, etc.)
  4. Support measures (subsidies, tax incentives, etc.) will be provided to companies that give priority to research and development of new vaccines so that Japan will be the first country in the world to begin research on vaccines using new technologies in the event of a pandemic outbreak.

3) Promote research and development of new therapeutic drugs (including blood products and unapproved drugs)

  1. In Europe and the U.S., governments are providing strong support to accelerate the development of blood products against novel coronavirus infection. Since products collected and developed in other countries are expected to be preferentially provided to patients in this country, it is necessary for the Japanese government to take the lead in establishing a system to collect, develop, and supply blood products from patients who have recovered from novel coronavirus infection and support the development and supply of blood products in Japan.
  2. It is necessary to promote research and development in the area of infectious diseases not only during a pandemic outbreak, but also during normal times, and to enhance R&D capabilities. To this end, it would be effective to provide pull-type incentives to pharmaceutical companies that conduct research and development of drugs and vaccines for infectious diseases (including drug resistance), including novel coronaviruses, etc. Pull-type incentives include (i) a reward system for obtaining marketing approval (Market Entry Rewards), including examples being considered in other countries; and (ii) a system to provide incentives to pharmaceutical companies that conduct research and development of drugs and vaccines for infectious diseases, including novel coronaviruses. Pull-type incentives could include: (i) Market Entry Rewards, (ii) a subscription system, (iii) an extended market exclusivity period applicable to other products, (iv) a guaranteed buyback system (stockpiling), and (v) a drug price pre-review system based on drug profiles. The marketability and profitability of drugs and vaccines for emerging and reemerging infectious diseases are low because it is difficult to predict when and how much will be needed, and this is a major obstacle to aggressive research and development and capital investment. In terms of directly resolving this issue, the manufacturing and marketing approval reward system and the subscription system are more desirable pull-type incentives. In addition, since pharmaceuticals are researched and developed globally, these pull-type incentive schemes must be developed in an international framework, as well as in accordance with the establishment of a system that meets the needs of each country.

(2) Establishment of a command post function to promote overall coordination for the creation of new drugs and vaccines

  1. It is necessary to establish a command post function that can centrally manage overseas collaborations and domestic efforts to speed up the creation of effective and safe therapeutics and vaccines. At the same time, it is necessary to establish a system for prompt global sharing of the latest trends in epidemiological information and strains of bacteria and viruses.
  2. In addition to financial support related to research and development and manufacturing technologies, harmonization and relaxation related to pharmaceutical regulations, such as approval and clinical evaluation guidelines, as well as collaboration and negotiation with various stakeholders, including foreign governments and research institutions, are necessary to establish a domestic production and supply system for therapeutics and vaccines in the shortest possible time.
  3. Compared to the past, research and development of infectious diseases is not as active overall, and there are few researchers in academia working on infectious diseases. As the recent pandemic has made clear, the role of infectious disease specialists is significant. It is necessary to train infectious disease specialists, including epidemiologists and those who can monitor infection trends.

(2) Responding to the challenges posed by new coronavirus infections

The world is currently in the midst of a pandemic crisis of a new type of coronavirus infection, and expectations for innovation in drug discovery are growing even higher, as people around the world are calling for the creation of new drugs and vaccines to treat the disease. On the other hand, in the research and development of pharmaceuticals, the new coronavirus infection is expected to hinder the implementation of clinical trials at medical institutions, delaying the launch of new products and potentially disrupting the global supply chain of pharmaceuticals, thereby increasing the cost of ensuring a stable supply of pharmaceuticals. Based on the recognition that pharmaceuticals and medical technologies are an important part of society's infrastructure, it is important to create an environment that supports research and development in the drug discovery and life science fields. Specifically, we request the following initiatives

(1) Promotion of R&D from a taxation perspective [See Attachment 1

The R&D tax system plays a major role in stimulating the creation of innovations originating in Japan and strengthening international competitiveness, and we strongly request that the system be maintained and expanded (total amount type) and that the procedural requirements be relaxed (OI type).

  1. As for the total tax credit, we would like to see the "10% maximum tax credit for companies whose R&D expenditures exceed 10% of net sales," which is a time-limited measure until the end of FY2020, be maintained and further expanded in FY2021 and beyond. We also request that the "deduction rate of 14%" and "additional improvement rate for companies with R&D expenditures exceeding 10% of net sales," which have been established as time-limited measures, be extended as well.
  2. For the Open Innovation (OI) type, we request that the procedural requirements be relaxed (e.g., easing of requirements for inclusion in contracts, elimination of requirements for confirmation of counterparties, and simplification of audits).

(2) How to support the pharmaceutical industry and the medical field in a contingency

The pharmaceutical industry is focusing on increasing production of supplies related to new-type coronavirus infection and on promptly working on research and development of therapeutic drugs and vaccines, as well as on ensuring a stable supply of all pharmaceutical products. In addition, the medical field is under a tremendous burden in terms of costs and labor associated with the increased response to new coronavirus infections, a situation that differs from normal times. Under these circumstances, the implementation of the mid-year revision scheduled for 2021 should be postponed to 2023 or later.

(3) Stable supply of pharmaceuticals

The global spread of the new coronavirus infection has raised concerns about the stable supply of active pharmaceutical ingredients from China and other foreign countries, etc. In 2018, the antimicrobial drug cephazolin became a supply concern due to a delay in shipments from a Chinese plant that manufactures the raw materials for the drug substance. This is an issue not only for infectious disease drugs, but for pharmaceuticals as a whole.

  1. Establish a system that allows pharmaceutical companies (manufacturers) to easily increase supply when necessary by securing multiple manufacturing routes for APIs, etc. (e.g., financial assistance, relaxation of laws and regulations (approval permission for additional manufacturing sites at an early stage), etc.)
  2. Establish a system, etc. (including government subsidies for stockpiling) that enables companies to secure raw materials, materials, etc. that society needs to continue supplying on a priority basis in the event of an emergency situation.
  3. Companies need to reduce the cost of APIs and ensure a stable supply at the same time, and the government and companies need to work together to achieve this. (e.g., setting drug prices that are not unprofitable even when APIs are produced domestically, support for stockpiling of important APIs, etc.)

3. Development of innovation infrastructure to maximize Japan's drug discovery potential (see Attachment 2)

In emergency situations such as pandemics, including new coronavirus infections, the importance of promptly creating new drugs that meet the needs has been recognized once again. In order to create and provide new drugs in response to various emergencies in Japan, it is important to establish a foundation for such creation on a daily basis. To this end, it is necessary to develop and utilize medical information infrastructure and to create an environment for research and development of fundamental technologies for drug discovery through collaboration among industry, academia, and government. Japan is one of the world's leading countries in drug discovery, with outstanding academia, medical institutions, and R&D-oriented pharmaceutical companies. In order to make the most of this environment, the following items must be addressed now. 1.

  1. Acceleration of efforts toward genome medicine
    We request that whole genome data, etc. that can be applied not only to cancer and intractable diseases, but also to other diseases such as novel coronavirus infection, be accumulated in Japan, and a system be established to enable companies to utilize the data for research and development, etc. To this end, we request that a national strategy for whole genome analysis, etc., and a promotion system responsible for its implementation, be established. In addition to genome data, it is important to collect time-series clinical information and high-quality biological samples to enable omics analysis.
  2. Advancement of basic technologies for drug discovery
    In order to increase the speed of drug development, the advancement of basic technologies for drug discovery should be further promoted through industry-academia-government collaboration. For example, with regard to cryo-electron microscopy, it is necessary to take measures for technological advancement and training of technicians. In addition, industry, academia, and government must collaborate in efforts to diversify modalities, as in the active research and development of new modalities such as nucleic acids for new coronavirus infection, and in the advancement of AI drug discovery, which is attracting attention for drug repositioning through in silico screening. In addition, industry, academia, and government must work together to promote R&D. In addition, it is important to utilize AMED funds in order to start research and development promptly or flexibly over a long period of time.
  3. Development of information infrastructure to promote utilization of real-world data on daily life and medical care
    We would like to see the establishment of an information infrastructure for daily life and medical care that can be used by companies to obtain information on diseases, including new coronavirus infection, in real time and over time. It is particularly important that this information infrastructure be structured to allow international collaboration in order to respond to a global epidemic of infectious diseases. In addition, we would like to see the necessary legislative support for the pseudonymization of personal data and the acquisition of consent electronically and in a single, comprehensive manner. Furthermore, it is important to further promote the use of real-world data as evidence for improving the efficiency of clinical trials and regulatory applications, leading to improved patient access to medicines.

Attachment 1

Attachment 1-1
Attachment 1-2
Attachment 1-3
Attachment 1-4

Attachment 2

Requests from the industry for inclusion in the Basic Policies for Economic and Fiscal Management and Reform 2020

  1. Acceleration of Genomic Medicine Initiatives
    Further accelerate efforts for genomic medicine as described in the Basic Policies for Economic and Fiscal Management and Reform and the Growth Strategy Action Plan for FY2019. Establish a system to accumulate whole genome data, etc. in Japan and promote research and development, etc. for realizing drug discovery, personalized medicine, and early diagnosis by utilizing such data from academia, companies, and other related parties. In light of the situation where other countries are taking the lead, Japan should establish a new promotion system that takes responsibility for planning and project management based on the national strategy for whole genome analysis, etc., and strongly implements the plan, and from the viewpoint of differentiation from other countries, it should promote not only genome analysis but also collection of biological samples, omics analysis, collection of rich time-series clinical information, collection of daily life data, and long-term follow-up of patients. The collection of biological samples, omics analysis, and daily life data as well as genome analysis, long-term follow-up of patients, and expansion to other diseases should be strongly implemented from the viewpoint of differentiation from other countries. At the same time, we will develop an environment for the consolidation and multi-information analysis of such information based on individuals.
  2. Advancement of Drug Discovery Platform
    In order to increase the speed of drug development, etc., the advancement of basic technologies for drug discovery will be further promoted through the effective use of industry-academia-government collaboration. Specifically, with regard to cryo-electron microscopy, for which a shared-use system is being developed, efforts will be made to promote the advancement of technology and the training of technicians. In addition to strengthening industry-academia collaboration to diversify modalities, R&D will also be promoted by strengthening public-private partnerships, including the use of AMED funds and human resource exchange. Furthermore, Japan will establish a new framework for the development of new fundamental technologies that will contribute to the advancement, efficiency, and sophistication of drug discovery research, including the elucidation of disease mechanisms and preventive and preemptive solutions, by utilizing drug delivery systems, animal models of disease, and AI in drug discovery research, as well as by developing a data-driven research environment.
  3. Establishment of information infrastructure to promote the utilization of real-world data related to daily life and medical care
    The infrastructure for life and medical information will be established as quickly as possible to enable real-time and inter-annual information on diseases such as novel coronavirus infection, and industry, academia, and government will promote its utilization to contribute to research and development in the health and medical fields and to the promotion of evidence-based medical policies. While giving consideration to the human rights of individuals, establish the infrastructure and legislation to enable real-time data collection and management using electronic medical records, pseudonymization of personal data, and concise personal data utilization such as electronic and single comprehensive consent of the individual. In the area of pharmaceuticals, in order to shorten the development period and improve efficiency, and to increase patient access to new treatments and preventive measures, the utilization of real-world data should be further promoted as evidence for streamlining clinical trials and regulatory approval applications, based on the premise of international collaboration.

For inquiries, please contact

Japan Pharmaceutical Manufacturers Association, Public Relations Department

Phone
03-3241-0374

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