September 2024
Series Articles of the Regenerative Medicine Dual Legislation (3) – The Impact of the Regenerative Medicine Dual Acts on the Therapy and Drug Development of Rare Diseases
Compared to common diseases with a larger number of patients, the number of patients suffering from rare diseases (hereinafter referred to as the “rare disease patients”) is too small for pharmaceutical developers to have sufficient incentives to conduct research and development of drugs for rare diseases (hereinafter referred to as the “orphan drugs”). As a result, rare disease patients often lack access to available medications. Regarding the orphan drugs that have already been developed, it is noted that it takes too long to include them in the National Health Insurance (hereinafter referred to as the “NHI”) coverage, and that the reimbursement rate for new orphan drugs through NHI is relatively low
[1]
, making it difficult for rare disease patients to afford, which jeopardizes the accessibility to effective drugs under Taiwan’s current system Additionally, even though the rare disease patients have the financial means and are willing to try emerging therapies, the safety and effectiveness of such therapies are still questionable due to information asymmetry. Furthermore, there are unclear qualifications of the institutions and the related participants involved and could lead rare disease patients to deplete their financial resources without obtaining effective therapies.
The known causes of most rare diseases are genetic defects primarily due to congenital or mutated genes, which is the reason why gene therapies capable of repairing genetic defects has long been considered one of the potential therapies for rare diseases. In June 2024, Taiwan passed the “Regenerative Medicine Act” and the “Regenerative Medicine Product Regulations” (hereinafter collectively referred to as the “Regenerative Medicine Dual Acts”), which formally established a legal framework at law level for regenerative medical technologies and pharmaceuticals, including the gene therapies. This article focuses on the potential impact of the enactment of the Regenerative Medicine Dual Acts on rare diseases therapies and the development of orphan drugs.
1. Regenerative Medicine Act will open the door to more therapy options for rare disease patients.
Before Regenerative Medicine Dual Acts came into effect, if rare disease patients intended to undergo regenerative medical therapies, they were limited to some specific cell therapies regulated through the “Regulations Governing the Application or Use of Specific Medical Techniques or Examinations, and Medical Devices” (hereinafter referred to as the “Special Regulation”) or the Compassionate Use provisions under Article 3-1 of the “Regulations on Human Trials”. As a result, they were unable to access more diverse and personalized cell or gene therapy options at an earlier stage.
However, after the enactment of the Regenerative Medicine Act, the therapy options have increased since regenerative medical technologies involve the use of genes, cells and their derivatives to treat, repair or replace human cells, tissues and organs. Additionally, according to Article 8 of the Regenerative Medicine Act, when a medical institution intends to implement regenerative medical technologies for treating life-threatening or severely disabling diseases for which suitable drugs, medical devices, or medical technologies are not available domestically, the institution may apply for approval from the Ministry of Health and Welfare (hereinafter referred to as the “MoHW”) to be exempted from completing clinical trials on a case-by-case basis. Therefore, if a specific rare disease meets specific conditions for exemption from clinical trials under Article 8 of the Regenerative Medicine Act, the patients could receive emerging therapies at an earlier stage. However, the specific conditions, the application process, the limitation on the number of cases, ethical standards, and other compliance matters of the case-by-case approval are still pending announcement by the MoHW.
2. The Conditional Approval System for regenerative medicine product under the Regenerative Medicine Product Regulations will accelerate the regenerative medicine products’ launch into the market, creating greater incentives for the research and development of orphan drugs.
Although the Regenerative Medicine Product Regulations follows the regulations of the Pharmaceutical Affairs Act by requiring pharmaceutical companies to apply for inspection and registration and to obtain a drug permit license before manufacturing or importing regenerative medicine products, the complex and lengthy drug approval process often does not meet the urgent medical needs of the patients. For rare diseases patients, every second counts in their battle against illness, and they are constantly racing against time.
To address the urgent medical needs of the patients and ensure their rights and interests to access regenerative medicine products as quickly as possible, the Regenerative Medicine Product Regulations includes an exception provision. For life-threatening or severely disabling diseases, if the regenerative medicine product has completed Phase II clinical trials and its risk and benefits review demonstrates safety and preliminary efficacy, it can be granted a conditional approval. This allows pharmaceutical companies to obtain a provisional drug permit license [2] , which is expected to enhance patients’ access to medications sooner and provide more diverse therapy options. This also provides incentives for investors in the biotech and pharmaceutical industry by accelerating the launch of regenerative medicine products into the market.
According to the global distribution statistics of cell and gene therapy clinical trials in 2023, the number of clinical trials for rare diseases, including rare cancers and genetic disorders, significantly exceeds that for solid tumors with over 740 ongoing clinical trials for rare diseases [3] . Therefore, if the ongoing or planned clinical trials for rare diseases can successfully align with the Conditional Approval System, this legislation could greatly create incentives for the biotech and pharmaceutical industry to invest in the development of orphan drugs.
For example, a domestic company in Taiwan has reportedly completed Phase II clinical trials of a stem cell new drug for Spinocerebellar Ataxia in Taiwan and Japan. If the Regenerative Medicine Product Regulations facilitates the company’s obtaining a provisional drug permit license in Taiwan, it could become a case study of allogeneic cell new drugs being applied to the therapy of rare diseases. [4]
3. Only the medical institutions are authorized to implement regenerative medicine technologies, and with government oversight, the quality of execution can be ensured.
According to reports, the rare disease patients have been forced to seek therapies abroad due to inadequate domestic regulations in the past, therefore exposed to significant risks. [5]
Since regenerative medicine is a cutting-edge biomedical technology, it takes consideration of the associated risks and therapeutic benefits before the medical institutions implement regenerative medicine technologies or use regenerative medicine products. It requires substantial qualifications and technical capabilities and should involve a rigorous approval and registration management system. Therefore, after the enactment of the Regenerative Medicine Act, only medical institutions are authorized to implement regenerative medicine technologies [6] , and medical institutions must obtain approval from the MoHW before the implementation of regenerative medicine technologies or using regenerative medicine products [7] . With comprehensive regulatory framework established under the Regenerative Medicine Dual Acts, it is believed that rare diseases patients, who lack expertise in the medical field, will have added protection when undergoing the emerging regenerative medicine therapies.
4. Incentives for research and development of rare diseases therapies
Before the enactment of the Regenerative Medicine Act, the Taiwanese government had established regulations such as the “Regulations governing Reward and Subsidy for Rare Disease Prevention and Treatment Work”and the “Regulations governing Reward for Rare Disease Drug Supply, Manufacturing, Research and Development”, which provided incentives or subsidies for research related to rare disease drugs or therapies.
After the enactment of the Regenerative Medicine Act, it is further explicitly stipulated that the MoHW must formulate and regularly review policies and plans for the development of regenerative medicine. Additionally, the MoHW or other central competent authorities are authorized to reward or subsidize research and development in regenerative medicine [8] . It is expected that these rewards or subsidies will effectively encourage the relevant industry to shift their focus towards research and development in regenerative medicine technologies or regenerative medicine products for rare diseases.
5. Summary
In recent years, advancements in regenerative medicine have offered a glimmer of hope for patients with hard-to-treat diseases. With the enactment of the Regenerative Medicine Dual Acts, Taiwan has more comprehensive regulations and management system for regenerative medicine. However, the high cost of regenerative medicine poses a significant challenge. Even though new therapies become available, many rare diseases patients find themselves unable to afford it due to the financial strain of long-term illness on both individuals and families, which ultimately prevents them from receiving necessary therapies.
In light of this, out firm strongly recommend and look forward to the introduction of a Public-Private-Patient Partnership (the “4P” model) during the enactment of the Regenerative Medicine Dual Acts and the related secondary legislations. This model involves collaboration among the government, biotech and pharmaceutical enterprises and rare diseases patients. The aim of this model is to enable early participation of rare disease patients in the development stages of regenerative medicine for rare diseases, such as providing genetic samples to assist early-stage development of drugs in exchange for early involvement in clinical trials or accessing regenerative medicine therapies at more affordable prices. In return, the government could offer expedited workflow in processes such as drug approval process and NHI coverage process for therapies or drugs derived from this collaboration. This model is expected to benefit the rights and interests of the rare disease patients and facilitate the development of the biotech and pharmaceutical industry, thereby establishing a legal framework that better aligns with the interests and needs of all participants in the regenerative medicine industry chain, ultimately fostering the development of Taiwan's regenerative medicine industry.
Since 1999, our firm has been actively promoting the establishment of the Taiwan Foundation for Rare Disorders. Our managing partner, Dr. Chung-Teh Lee, has served as the foundation's founding chairman and assisted in the legislation of the “Rare Disease and Orphan Drug Act” in 2000. In light of recent developments in regenerative medicine, which targets rare diseases, our firm will continue to monitor the impact of the “Regenerative Medicine Act”, the “Regenerative Medicine Product Regulations” and the related secondary legislations on the research and development of rare disease therapies and drugs. Our firm expects that the new legal framework will lead to improvements in the environment for rare disease therapy and drug development, drug approval process and its inclusion in NHI coverage.
[1] Taiwan Foundation for Rare Diseases (2023), 'Recommendations for Innovative Treatments and Drug Coverage for Rare Diseases,' pps 27-30. ('Recommendations for Innovative Treatments and Drug Coverage for Rare Diseases' download link: https://www.tfrd.org.tw/tfrd/assets/uploads/library_b1/66/tfrd_20231109142545.pdf); The Journalist (新新聞), 'Review of Rare Disease Medications for Nearly 30 Months: Patient Groups Urge Acceleration of Coverage in the NHI and Optimization of Health Technology Assessment Processes,' https://new7.storm.mg/article/4934810 (last visited on September 17, 2024).
[2] Articles 6, 9, and 10 of the Regenerative Medicine Product Regulations.
[3] Wang Yi-Ting, 2023 Review of the Cell and Gene Therapy Industry, https://www.moea.gov.tw/MNS/doit/industrytech/IndustryTech.aspx?menu_id=13545&it_id=528 (last visited on September 17, 2024).
[4] United News Network, 'Benefiting from Regenerative Medicine Dual Acts, Steminent’s Cell Therapy New Drug Expected to Be the First Treatment for Rare Diseases,' http://udn.com/news/story/7238/8009996 (last visited on September 17, 2024).
[5] China Times, 'Critical Rare Diseases Find New Hope: Regenerative Medicine Dual Acts Passed on Third Reading,' https://www.chinatimes.com/newspapers/20240605000440-260114?chdtv (last visited on September 17, 2024).
[6] Articles 11 and 28 of the Regenerative Medicine Act.
[7] Articles 12 and 30 of the Regenerative Medicine Act.
[8] Article 4, Paragraphs 2 and 3, and Article 10 of the Regenerative Medicine Act.
The known causes of most rare diseases are genetic defects primarily due to congenital or mutated genes, which is the reason why gene therapies capable of repairing genetic defects has long been considered one of the potential therapies for rare diseases. In June 2024, Taiwan passed the “Regenerative Medicine Act” and the “Regenerative Medicine Product Regulations” (hereinafter collectively referred to as the “Regenerative Medicine Dual Acts”), which formally established a legal framework at law level for regenerative medical technologies and pharmaceuticals, including the gene therapies. This article focuses on the potential impact of the enactment of the Regenerative Medicine Dual Acts on rare diseases therapies and the development of orphan drugs.
1. Regenerative Medicine Act will open the door to more therapy options for rare disease patients.
Before Regenerative Medicine Dual Acts came into effect, if rare disease patients intended to undergo regenerative medical therapies, they were limited to some specific cell therapies regulated through the “Regulations Governing the Application or Use of Specific Medical Techniques or Examinations, and Medical Devices” (hereinafter referred to as the “Special Regulation”) or the Compassionate Use provisions under Article 3-1 of the “Regulations on Human Trials”. As a result, they were unable to access more diverse and personalized cell or gene therapy options at an earlier stage.
However, after the enactment of the Regenerative Medicine Act, the therapy options have increased since regenerative medical technologies involve the use of genes, cells and their derivatives to treat, repair or replace human cells, tissues and organs. Additionally, according to Article 8 of the Regenerative Medicine Act, when a medical institution intends to implement regenerative medical technologies for treating life-threatening or severely disabling diseases for which suitable drugs, medical devices, or medical technologies are not available domestically, the institution may apply for approval from the Ministry of Health and Welfare (hereinafter referred to as the “MoHW”) to be exempted from completing clinical trials on a case-by-case basis. Therefore, if a specific rare disease meets specific conditions for exemption from clinical trials under Article 8 of the Regenerative Medicine Act, the patients could receive emerging therapies at an earlier stage. However, the specific conditions, the application process, the limitation on the number of cases, ethical standards, and other compliance matters of the case-by-case approval are still pending announcement by the MoHW.
2. The Conditional Approval System for regenerative medicine product under the Regenerative Medicine Product Regulations will accelerate the regenerative medicine products’ launch into the market, creating greater incentives for the research and development of orphan drugs.
Although the Regenerative Medicine Product Regulations follows the regulations of the Pharmaceutical Affairs Act by requiring pharmaceutical companies to apply for inspection and registration and to obtain a drug permit license before manufacturing or importing regenerative medicine products, the complex and lengthy drug approval process often does not meet the urgent medical needs of the patients. For rare diseases patients, every second counts in their battle against illness, and they are constantly racing against time.
To address the urgent medical needs of the patients and ensure their rights and interests to access regenerative medicine products as quickly as possible, the Regenerative Medicine Product Regulations includes an exception provision. For life-threatening or severely disabling diseases, if the regenerative medicine product has completed Phase II clinical trials and its risk and benefits review demonstrates safety and preliminary efficacy, it can be granted a conditional approval. This allows pharmaceutical companies to obtain a provisional drug permit license [2] , which is expected to enhance patients’ access to medications sooner and provide more diverse therapy options. This also provides incentives for investors in the biotech and pharmaceutical industry by accelerating the launch of regenerative medicine products into the market.
According to the global distribution statistics of cell and gene therapy clinical trials in 2023, the number of clinical trials for rare diseases, including rare cancers and genetic disorders, significantly exceeds that for solid tumors with over 740 ongoing clinical trials for rare diseases [3] . Therefore, if the ongoing or planned clinical trials for rare diseases can successfully align with the Conditional Approval System, this legislation could greatly create incentives for the biotech and pharmaceutical industry to invest in the development of orphan drugs.
For example, a domestic company in Taiwan has reportedly completed Phase II clinical trials of a stem cell new drug for Spinocerebellar Ataxia in Taiwan and Japan. If the Regenerative Medicine Product Regulations facilitates the company’s obtaining a provisional drug permit license in Taiwan, it could become a case study of allogeneic cell new drugs being applied to the therapy of rare diseases. [4]
3. Only the medical institutions are authorized to implement regenerative medicine technologies, and with government oversight, the quality of execution can be ensured.
According to reports, the rare disease patients have been forced to seek therapies abroad due to inadequate domestic regulations in the past, therefore exposed to significant risks. [5]
Since regenerative medicine is a cutting-edge biomedical technology, it takes consideration of the associated risks and therapeutic benefits before the medical institutions implement regenerative medicine technologies or use regenerative medicine products. It requires substantial qualifications and technical capabilities and should involve a rigorous approval and registration management system. Therefore, after the enactment of the Regenerative Medicine Act, only medical institutions are authorized to implement regenerative medicine technologies [6] , and medical institutions must obtain approval from the MoHW before the implementation of regenerative medicine technologies or using regenerative medicine products [7] . With comprehensive regulatory framework established under the Regenerative Medicine Dual Acts, it is believed that rare diseases patients, who lack expertise in the medical field, will have added protection when undergoing the emerging regenerative medicine therapies.
4. Incentives for research and development of rare diseases therapies
Before the enactment of the Regenerative Medicine Act, the Taiwanese government had established regulations such as the “Regulations governing Reward and Subsidy for Rare Disease Prevention and Treatment Work”and the “Regulations governing Reward for Rare Disease Drug Supply, Manufacturing, Research and Development”, which provided incentives or subsidies for research related to rare disease drugs or therapies.
After the enactment of the Regenerative Medicine Act, it is further explicitly stipulated that the MoHW must formulate and regularly review policies and plans for the development of regenerative medicine. Additionally, the MoHW or other central competent authorities are authorized to reward or subsidize research and development in regenerative medicine [8] . It is expected that these rewards or subsidies will effectively encourage the relevant industry to shift their focus towards research and development in regenerative medicine technologies or regenerative medicine products for rare diseases.
5. Summary
In recent years, advancements in regenerative medicine have offered a glimmer of hope for patients with hard-to-treat diseases. With the enactment of the Regenerative Medicine Dual Acts, Taiwan has more comprehensive regulations and management system for regenerative medicine. However, the high cost of regenerative medicine poses a significant challenge. Even though new therapies become available, many rare diseases patients find themselves unable to afford it due to the financial strain of long-term illness on both individuals and families, which ultimately prevents them from receiving necessary therapies.
In light of this, out firm strongly recommend and look forward to the introduction of a Public-Private-Patient Partnership (the “4P” model) during the enactment of the Regenerative Medicine Dual Acts and the related secondary legislations. This model involves collaboration among the government, biotech and pharmaceutical enterprises and rare diseases patients. The aim of this model is to enable early participation of rare disease patients in the development stages of regenerative medicine for rare diseases, such as providing genetic samples to assist early-stage development of drugs in exchange for early involvement in clinical trials or accessing regenerative medicine therapies at more affordable prices. In return, the government could offer expedited workflow in processes such as drug approval process and NHI coverage process for therapies or drugs derived from this collaboration. This model is expected to benefit the rights and interests of the rare disease patients and facilitate the development of the biotech and pharmaceutical industry, thereby establishing a legal framework that better aligns with the interests and needs of all participants in the regenerative medicine industry chain, ultimately fostering the development of Taiwan's regenerative medicine industry.
Since 1999, our firm has been actively promoting the establishment of the Taiwan Foundation for Rare Disorders. Our managing partner, Dr. Chung-Teh Lee, has served as the foundation's founding chairman and assisted in the legislation of the “Rare Disease and Orphan Drug Act” in 2000. In light of recent developments in regenerative medicine, which targets rare diseases, our firm will continue to monitor the impact of the “Regenerative Medicine Act”, the “Regenerative Medicine Product Regulations” and the related secondary legislations on the research and development of rare disease therapies and drugs. Our firm expects that the new legal framework will lead to improvements in the environment for rare disease therapy and drug development, drug approval process and its inclusion in NHI coverage.
[1] Taiwan Foundation for Rare Diseases (2023), 'Recommendations for Innovative Treatments and Drug Coverage for Rare Diseases,' pps 27-30. ('Recommendations for Innovative Treatments and Drug Coverage for Rare Diseases' download link: https://www.tfrd.org.tw/tfrd/assets/uploads/library_b1/66/tfrd_20231109142545.pdf); The Journalist (新新聞), 'Review of Rare Disease Medications for Nearly 30 Months: Patient Groups Urge Acceleration of Coverage in the NHI and Optimization of Health Technology Assessment Processes,' https://new7.storm.mg/article/4934810 (last visited on September 17, 2024).
[2] Articles 6, 9, and 10 of the Regenerative Medicine Product Regulations.
[3] Wang Yi-Ting, 2023 Review of the Cell and Gene Therapy Industry, https://www.moea.gov.tw/MNS/doit/industrytech/IndustryTech.aspx?menu_id=13545&it_id=528 (last visited on September 17, 2024).
[4] United News Network, 'Benefiting from Regenerative Medicine Dual Acts, Steminent’s Cell Therapy New Drug Expected to Be the First Treatment for Rare Diseases,' http://udn.com/news/story/7238/8009996 (last visited on September 17, 2024).
[5] China Times, 'Critical Rare Diseases Find New Hope: Regenerative Medicine Dual Acts Passed on Third Reading,' https://www.chinatimes.com/newspapers/20240605000440-260114?chdtv (last visited on September 17, 2024).
[6] Articles 11 and 28 of the Regenerative Medicine Act.
[7] Articles 12 and 30 of the Regenerative Medicine Act.
[8] Article 4, Paragraphs 2 and 3, and Article 10 of the Regenerative Medicine Act.
Related Articles
Series Articles of the Regenerative Medicine Dual Legislation (4) – Draft Announcement of Certain Subsidiary Regulations Under the Regenerative Medicinal Products Act (Taiwan) Series Articles of the Regenerative Medicine Dual Legislation (1) – Taiwan's Legislative Yuan Passed the Regenerative Medicine Dual Legislation Series Articles of the Regenerative Medicine Dual Legislation (2) – Analysis of the Conditional Approval System for Regenerative Medicine Product
