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What’s New for the MAH in China?

By Jianqing Chang, Vice President of Drug Regulatory Policy, Tigermed Co., Ltd.
April 2020


After the pilot program in ten provinces and municipal cities for three years, the MAH system becomes one of the twelve chapters of the revised Drug Administration Law, which was put into effect since December 1, 2019. The legislation of MAH system does not only indicate the successful pilot but also initiate the inevitable trend for the introduction national wide. The aim is to encourage drug innovation, ensure the MAH to fulfill the drug lifecycle responsibilities, reduce low level repetitive production facilities and homogeneous competition, and optimize resources allocation.

To support the implementation of the Drug Administration Law, both Drug Registration Regulation and Drug Manufacturing Surveillance Regulation were issued on March 30, 2020 and will be valid from July 1, 2020. The MAH may have more options for the business strategy, meanwhile, more legal responsibilities are endowed.

In addition to review drug safety, efficacy and quality, the drug authorities will examine the capabilities of quality management, risk control and liability compensation of the applicant. Once all criteria are met, the marketing authorization will be granted. After obtaining the Drug Registration Certificate, the applicant shall become the MAH.

For the MAH, the followings are the key elements building the capabilities of quality management, risk control and liability compensation.


Quality Management

The MAH shall be responsible for non-clinical study, clinical trial, manufacturing and distribution, post-marketing surveillance, monitoring, reporting and handling of adverse drug reactions. The legal representative and the principal responsible person of the MAH shall take the full responsibilities for the quality of the drug products. The MAH shall establish a drug quality assurance system, and appoint specialized personnel to take charge drug quality management independently. Meanwhile, the MAH shall conduct the audit on the quality management system of their entrusted drug manufacturing enterprise and drug distribution enterprise on a regular basis, and supervise the entrusted enterprises to ensure their continuous capability on the quality assurance and quality control.

The MAH can either produce drug products by themselves or entrust a drug manufacturing enterprise for production. The MAH shall entrust a qualified drug manufacturing enterprise. According to the guideline to be issued by NMPA, an entrustment agreement and a quality agreement shall be signed between the MAH and the drug manufacturing enterprises. The MAH and the entrusted manufacturing enterprise should perform their obligations under the agreement strictly. The entrusted enterprise is not allowed to entrust another third party to produce the entrusted drug.

The MAH shall establish a marketing release procedure, to conduct the inspection of drug product released by the manufacturing enterprise, and the drug product can be released only after signed off by the authorized qualified person.

The MAH may either distribute drug product by themselves or entrust a drug distributor for distribution. The MAH engaged in drug retail activities shall obtain a drug distribution license. Undertaking of drug distribution activities shall meet the following criteria, 1) having legally qualified pharmacist or other drug technician; 2) having business premises, equipment, warehousing facilities and hygiene environment corresponding to the drug distribution; 3) having the quality management units or personnel corresponding to the drug distribution; and 4) having rules and system to ensure drug quality, and comply with the requirements of Good Supply Practice.

The MAH may entrust a third party to store and transport the drug product. An assessment should be made on the entrusted party’s capabilities of the quality assurance and risk management. An entrustment agreement should be signed with the entrusted party to specify the drug quality responsibilities, operation procedures and other aspects. The entrusted party shall be supervised by the MAH.

The MAH shall establish and operate the drug quality traceability system, to guarantee the traceability of drug product. In accordance with the regulations, the MAH shall establish an annual report system, to report annually to the drug authorities about the drug production and the distribution, the post-marketing studies, and the risk management.


Risk Prevention and Control

The MAH shall formulate post-marketing risk management plan, take the initiative to carry out drug post-marketing surveillance, to further confirm the safety, efficacy and quality controllability of the drugs, and strengthen continuous management of drugs marketed. For drugs with conditional approval granted, the MAH shall adopt the corresponding risk management plan, and complete the relevant study within the stipulated period.

Variations in the drug manufacturing process shall be subject to administration by classifications in accordance with the risks and impact on drug safety, efficacy and quality controllability. Major variations shall be subject to approval, other minor or moderate variations shall be subject to filing or reporting to the drug authorities. The MAH shall conduct the comprehensive evaluation and validation of the variations with impact on drug safety, efficacy and quality controllability.

The MAH shall conduct adverse reactions monitoring of marketed drug, take the initiative to collect, track and analyze information on the suspected adverse drug reactions, and adopt risk control measures for drugs with risks identified in a timely manner.

For the drugs have quality issues or other potential safety concerns, the MAH shall stop selling immediately, notify the relevant drug distributors and medical institutions to stop sales and use, recall sold drugs, promptly announce recall information, forthwith stop manufacturing where necessary, and report drug recall and handling situation to the drug authorities and the health authorities.


Liability Compensation

The MAH shall bear compensation liability for violating the provisions of the Drug Administration Law and causing damages to users of their drugs.

Victims who suffer damages due to drug quality issues may seek compensation from the MAH and the drug manufacturer, and may also seek compensation from the drug distributor or medical institution. Upon receipt of compensation claim from a victim, the entity shall compensate first; after the first compensation, it may seek recovery on the compensation pursuant to the law.

For manufacturing fake drugs or inferior drugs or engaging in sale or use of fake drugs or inferior drugs knowingly, in addition to seeking compensation, the victims or their immediate family members may also seek indemnity.


The legal representative and the principal of a drug MAH shall take full responsibilities for drug quality.

  1. Appoint a dedicated quality responsible person to undertake responsibilities for drug quality management independently;
  2. Appoint a dedicated qualified person to fulfill responsibilities for drug marketing release independently;
  3. Supervise normal operation of the quality management system;
  4. Regularly carry out quality system audits of drug production related activities of related parties including drug manufacturers and suppliers to ensure persistent regulatory compliance;
  5. Fulfill variation management responsibilities according to technical requirements;
  6. Carry out quality assessment of contracted distributors and communicate with users’ organizations;
  7. Cooperate with drug regulatory authorities in extension inspection of the MAH and the concerned parties;
  8. In case of major safety events related to drug quality, report and carry out risk management in a timely manner according to the MAH’s risk management plan to ensure risks are controlled in time;
  9. Take other responsibilities specified by laws and regulations.


The legal representative and principal of a drug manufacturer shall take full responsibilities for drug production of the company in all aspects.

  1. Appoint a qualified dedicated person who is independently in charge of drug quality management, supervising the GMP implementation, ensuring suitable in-process control and quality control to guarantee the compliance of drugs with national drug standards and drug registration specifications;
  2. Appoint a qualified dedicated person to be responsible for the drug release;
  3. Supervise the daily operation of the quality management system and guarantee the in-process control and quality control, and authenticity of records and data;
  4. In case of major safety events related to drug quality, report them in time and take risk management according to the risk management plan formulated by the manufacturer to ensure that the risks are timely controlled;
  5. Take other responsibilities specified by laws and regulations.


Manufacturers of raw material, excipients, packaging materials and container in direct contact with drug products that have been approved or passed bundling review shall take their respective responsibilities.

  1. Comply with the GMP formulated by NMPA;
  2. Comply with the relevant requirements on bundling evaluation, review and approval;
  3. Ensure the continuous compliance of the quality assurance system, accept quality auditing of the MAH and supervisory inspection or extension inspection by drug regulatory authorities;
  4. The entrusted company shall not entrust another third party to produce the entrusted drugs;
  5. The manufacturers with raw material that are approved or have passed bundling review shall generally manufacture on their own and not be allowed to entrust to other party for production.


Following the drug GMP certification is abolished, companies shall no longer expect the quality management endorsement from the authorities. Instead of, site inspection is enhanced by referring to the common practice of other major markets.

For making the regulatory decision, how to evaluate the above capabilities of the drug registration applicant. It becomes one of the hot topics among the industry colleagues.

With the new policy in place, the MAH shall take the full responsibilities for the entire drug lifecycle. Relying on their own capabilities of quality management, risk prevention and control and liability compensation, the MAH shall firmly adhere to the bottom line of drug quality and safety, and pursue the high standard of drug development so as to ensure the safe use of the drug by the patients and to realize the social responsibilities as the drug enterprise at the end.