China’s NMPA Proposes Medical Device Administration Law

On August 28, 2024, the National Medical Product Administration ("NMPA") in China released the draft Medical Device Administration Law ("Draft MDAL") for public comment. Comments are due on September 28, 2024.

Since 2001, the framework legislation for medical devices has been a regulation, the Medical Device Supervision and Administration Regulations ("MDSAR"), which was last amended in 2021. The Draft MDAL, if enacted by China's National People's Congress's Standing Committee, would elevate the device framework legislation to the level of a "law." Although the Draft MDAL preserves the basic structure of the MDSAR-which covers the lifecycle of medical devices, from research and development to post-market surveillance-the Draft MDAL is more comprehensive in its regulation of each stage and codifies regulatory reforms over recent years (e.g., those on custom medical devices). Some of the notable developments in the Draft MDAL are as follows:

• One of the challenges for registrants of medical devices in China is the need to comply with a long list of medical device standards, which include mandatory national standards and agency-level industrial standards. Since 2017, China's National Standardization Law has provided that industrial standards are voluntary standards. However, in practice, NMPA expects compliance with industrial standards. In contrast to the currently effective MDSAR, the Draft MDAL expressly states that industrial standards are voluntary, and it would allow companies to follow an international standard if the standard sets a higher requirement. It is unclear whether these changes would result in a change in practice by NMPA.

• Like the MDSAR, the Draft MDAL retains a distinction between imported and domestically produced products. Under current rules, key differences for imported product registration applications include the requirement to provide proof of foreign approval in the applicant's name and the requirement to appoint a domestic agent. The Draft MDAL appears to remove the first requirement for proof of foreign approval-although it is not clear whether it will be maintained in implementing rules-and it appears to increase the required credentials for domestic agents. Specifically, the agents for overseas registrants would need to have either device distribution licenses or device manufacturing licenses. The Draft MDAL also more clearly and expressly states that those agents would be jointly liable with the overseas registrant of the device.

• Different from the current MDSAR, the Draft MDAL contains a provision that would permit the transfer of medical device registrations, such as might be required after an asset sale. This is similar to the provision that China added to the Drug Administration Law in 2019. Currently, registration transfers can occur when a device registration is transferred between two qualified entities through a procedure for amendment of entity names on a registration, but this process is not specific to registration transfers.

• The Draft MDAL would codify more detailed medical device manufacturing and quality requirements, pulling certain of these from current implementing regulations on manufacturing and quality systems. Of note, the Medical Device Good Manufacturing rule is currently under revision, having not been revised since 2014; a comprehensive draft for public comment has not yet issued. It is unclear to what extent the draft rule will affect Draft MDAL.

• Many companies have obtained medical device distribution licenses (Class III devices) and/or filings (Class II) devices. The procedures for obtaining these permissions have been evolving to become simpler, but the standards that apply to these entities have been becoming more complex, including a more detailed set of Good Supply Practice Standards released in 2023. The Draft MDAL would codify some of that complexity, e.g., on record keeping and transportation requirements. The Draft MDAL also states that for distribution license renewal, which must occur every five years, entities with no administrative penalty during the previous licensed period can renew the license by providing a self-inspection report.

• The Draft MDAL contains provisions on e-commerce. These provisions include requirements pertaining to domestic e-commerce (i.e., sale of devices online with domestic registrations/filings) and cross-border e-commerce (i.e., sale of foreign-labeled devices, which may not have registrations) through special import channels. Although the current MDSAR imposes liability on e-commerce websites (i.e., platforms), which necessitates (among other things) that site operators police the compliance of devices sold on their platforms, the Draft MDAL codifies the requirement that platform operators must also make a record filing with provincial medical products administration authorities with their own credentials. The online sellers on e-commerce platforms must also notify information about the online device sales of certain class II and III devices to municipal level MPAs. On cross-border e-commerce, the Draft MDAL would add a requirement for a "domestic service provider" of imported medical devices. It is not clear how this entity's obligations would differ from the local agent that is currently required under general cross-border e-commerce rules.

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Contributors for the China & APAC Food, Drug, Device, and Cosmetics blog:

John Balzano, Julia Post, Muyun Hu, Kaixin Fan, and Kexin Yang.

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