Economic Stagnation and the Relaxing of Pharmaceutical Regulations in Japan

Despite the social hardships, economic stagnation has been a catalyst in Japan for the relaxation of regulatory control in the pharmaceutical industry. In the 1980s and early 1990s, the Japanese government restricted the entry of foreign drugs in order to assist local drug manufacturers and also due to “cultural prejudice.†Foreign drug makers were forced to comply with restrictive regulations and costly requirements. However, the country’s economic difficulties have forced the government to allow a more open regulatory environment in order to attract foreign investments.

In 1998 the Japanese government took a major step in relaxing the pharmaceutical registration process by allowing companies to use data from clinical trials conducted abroad to apply for drug approval in Japan. For example, Pfizer received approval in April 2002 for their migraine drug, Relpax ™ (eletriptan) through the submission of clinical data from abroad as well as bridging studies. Previously, data from clinical trials performed abroad were not admissible for pharmaceutical registration and foreign drug manufacturers were often forced to re-conduct clinical trials in Japan with Japanese subjects.

The Japanese government has also placed more emphasis in passing approvals for more effective drugs. In the past, Japanese physicians and drug manufacturers were more concerned about drug safety and the minimization of side effects rather than the efficacy of drugs. Thus, doctors often prescribed drugs that produced little results and patients followed their doctor’s orders since the government was footing the bill. However, with tighter purse strings, the government is now looking to pass more effective drugs. For example, Japan is now the first country to allow the marketing of the controversial cancer drug, Iressa ™, by Britain’s AstraZeneca PLC.

Besides government efforts, the Japanese people are also contributing to greater openness in the pharmaceutical industry. With more information regarding foreign drugs, the Japanese people are lobbying their government to approve pharmaceuticals from abroad. Thus, foreign pharmaceuticals are being approved in Japan at a faster rate than 5-10 years ago. In 1990, 51% of new chemical entities approved were foreign in origin, however, by 2000, this figure had increased to 74%.