Scope of the Pilot Program

Biotechnology

The pilot program will allow foreign-invested enterprises to engage in the development, registration, and commercialization of technologies related to human stem cells and genetic diagnosis and treatment. This is limited to certain regions, including the China (Beijing) Pilot Free Trade Zone, China (Shanghai) Pilot Free Trade Zone, China (Guangdong) Pilot Free Trade Zone, and the Hainan Free Trade Port.

Once approved, products developed within these zones will be available for use nationwide. However, foreign-invested enterprises participating in these activities must comply with relevant Chinese laws and regulations, including those related to human genetic resources management, drug clinical trials, drug registration, ethics reviews, and drug production processes.

Wholly Foreign-Owned Hospitals

The program also proposes allowing the establishment of wholly foreign-owned hospitals in certain cities, including Beijing, Tianjin, Shanghai, Nanjing, Suzhou, Fuzhou, Guangzhou, Shenzhen, and Hainan. These hospitals, however, will not include traditional Chinese medicine or involve the merger or acquisition of public hospitals. Detailed guidelines for establishing these hospitals will be provided at a later date.

Implementation and Oversight

Local authorities responsible for commerce, health, human genetic resources, and drug administration in pilot areas are expected to promote the policies outlined in the circular and offer support to foreign-invested enterprises interested in participating. Authorities are also required to monitor pilot projects, conduct risk assessments, and ensure compliance with relevant laws.

The circular stresses the importance of inter-departmental cooperation to ensure effective implementation of the pilot program. Authorities must address any challenges that arise during the pilot phase by coordinating with the Ministry of Commerce, National Health Commission, and State Food and Drug Administration.

Conclusion

This pilot program is part of a broader effort to introduce foreign investment into China’s medical sector, with the goal of promoting high-quality development and meeting public healthcare needs. Companies interested in participating should remain informed of forthcoming details regarding the establishment of wholly foreign-owned hospitals and ensure compliance with all applicable regulations.