HONG KONG – Major legislative changes in Japan could help stem cell developers enter the market, which is the second largest in the world.

Japan’s National Legislature, or Diet, reformed the laws related to drugs and medical technologies at the end of November, passing the new Pharmaceuticals and Medical Devices Act (PMDA).

The PMDA enhances safety control measures, introduces new regulations over regenerative medicine as a unique catalog and serves as the new name for the Pharmaceutical Affairs Law Reform Act, which was first introduced in 1960 and last amended in 2006.

Regenerative medicine is a key focus of the new PMDA, which provides for a new fast-track process for therapies to speed up research and approvals process. Guidance on how the new legislation will be regulated and enforced is expected through 2014.

Although the new legislation covers the gamut of pharmaceutical, biologic, healthcare and medical device industries, providers of stem cell therapies could be the biggest beneficiaries. Following the approval, several regenerative medical companies quickly announced they would take steps to enter the market.

Mesoblast Ltd., of Melbourne, Australia, (ASX:MSB; USOTC:MBLTY), a producer of regenerative medicine products, said Japan has put stem cell products in a unique category as long as they show sufficient safety during Phase II trials. That could shave years and millions of dollars of the cost of entering the second most mature market in the world.

The company recently said it intends to establish strategic partnerships for its suite of products to facilitate earlier Japanese regulatory approvals and commercial launches.

Cytori Therapeutics Inc., of San Diego, a developer of cell therapies for cardiovascular and renal diseases, and diabetes, also nodded to the importance of the legislation but remained more conservative.

“While we are still assessing the implications of this new legislation on our operations in Japan, we believe this legislation to be an important development since more than half of Cytori’s global revenue has been generated in Japan,” said Cytori’s CEO Christopher Calhoun.

Cytori is already entrenched in Asia. In early November Cytori disclosed a potential $531 million deal with Chinese firm Lorem Vascular to commercialize Cytori cell therapy in the cardiovascular, renal and diabetes markets in China, Hong Kong, Malaysia, Singapore and Australia. (See BioWorld Today, Nov. 6, 2013.)

The new legislation may be one of the achievements of Abenomics, the push by Japan’s Prime Ministry Shinzo Abe to boost the economy. The government has committed to support stem cell research over the next decade with an injection of $1.17 billion.

The push also includes effort to speed up access to the market.

Japan’s need to speed up the introduction of new medical technologies derives not just from a desire to boost economic growth but also from practical healthcare needs.

A rapidly aging population has been burdening the country’s healthcare system and spending has been rising. One avenue the government is pursuing is to foster new medical technologies.

The market for regenerative medicine in Japan is expected to grow rapidly through this decade and the next, according to economy ministry figures. The market was worth ¥26 billion (US$252 million) in 2012 but is expected to grow to ¥1.6 trillion (US$15 billion) by 2030.

Japan may be the second largest pharmaceutical market in the world and home to a sophisticated biotechnology industry but regulations have not always kept up with global markets.

The Japanese Pharmaceutical and Food Safety Bureau has been struggling to shorten a drug lag, a situation in which drug and medical devices that are already in use in the U.S. and Europe cannot be marketed in Japan because they have not yet been domestically approved.

The government is approaching this problem through multiple avenues, including a plan to create a Japanese version of National Institute of Health, a biomedical research center under the U.S government.

“We will create a unified foundation and integrate data from clinical studies and clinical trials performed both domestically and abroad, engaging pharmaceuticals manufacturers, medical devices manufacturers, and hospitals in an integrated manner,” said Abe. //

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