Recommendationsof theEU-Japan Business Round Table
to the Leaders of the European Union and Japan
Brussels, 11 July 2017
Working Party 2
Life Sciences and Biotechnologies,
Healthcare and Well-being(Final Version)

Working Party Leaders:Mr. Hans-Dieter Hausner
President, Representative Director& Senior Bayer Representativefor Japan
Bayer Holding Ltd.

Mr. Osamu Nagayama
Chairman of the Board of Directors
President & CEO
Chugai Pharmaceutical Co., Ltd.

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List of Abbreviations
Abbreviation Meaning
ADI
ARCB
CE
CEFP
CHUIKYO
ECPA
EFPIA
EPA
ESA
EU
FQs
FSC
GCP
GDP
GLP
GMO
GMP
HTA
IEC
ISO
JIS
J-PAL
J-PMD Act
JVPA
LLPs
LS & BT
MAFF
MDD
MDR

Acceptable Daily Intake
Association of Registered Certification Bodies under J-PMD Act
Conformite Europeenne
Council on Economic and Fiscal Policy
Central Social Insurance Medical Council
European Crop Protection Association
European Federation of Pharmaceutical Industries and Associations
Economic Partnership Agreement
European Seed Association
European Union
Fluoroquinolones
Food Safety Commission
Good Clinical PracticeGood Delivery PracticeGood Laboratory Practice
Genetically Modified Organism
Good Manufacturing Practice
Health Technology Assessment
International Electro technical Commission
International Organization for Standardization
Japanese Industrial Standards
Japanese Pharmaceutical Affairs Law
Japanese Pharmaceutical and Medical Device Act
Japan Veterinary Products Association
Long-listed productsLife sciences and Biotechnologies
Ministry of Agriculture, Forestry and Fisheries
Medical Device Directive
Medical Device Regulation

MDSAP Medical Device Single Audit Program Pilot
METI
MHLW
MNC
MRA
MRL
NB
NHI
NVAL
PIC/S
PMDA
PPS
OALY
QMS
RMP
TPP
VICH
WP

Ministry of Economy, Trade and Industry
Ministry of Health Labor and Welfare
Multinational Corporation
Mutual Recognition Agreement
Maximum Residue Limits
Notified Body
National Health Insurance
National Veterinary Assay Laboratory
Pharmaceutical Inspection Convention and Pharmaceutical Cooperation Scheme
Pharmaceutical and Medical Device Agency
Plant Protection Station
Quality-adjusted life years
Quality Management System
Risk Management Plan
Trans Pacific Partnership
International Cooperation on Harmonization of TechnicalRequirements for Registration of Veterinary Medicinal ProductsWorking Party

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Introduction
Japan and the EU face many similar challenges, such as aging populations, shifting
demands for products and services, and rising costs in many aspects of the welfare
system. Life sciences and biotechnologies offer the possibility of technologies thatwill help address these challenges.
Working Party 2 focuses on the following sectors:• Healthcare (pharmaceuticals, medical devices etc)
• Life Science & Industrial Chemicals• Plant Protection & Biotechnology• Animal Health
The recommendations of WP-2 have the clear aim to improve the innovation
capabilities of both the EU and Japan through concrete action plans in life sciences
and biotechnology. The focus is on measures that will enhance efficient healthcare
practices, food technology and supply, and biotechnology.
The BRT members are grateful for the actions already taken by the EU and theJapanese governments in these fields. We hope the governments will continue
further actions for regulatory harmonisation and collaboration.
An asterisk (*) identifies “priority” recommendations.

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Recommendations from both
European and Japanese industries
HEALTHCARE
WP-2 / # 01* / EJ to EJ
Mutual Recognition Agreement for Pharmaceuticals GMP should be extended
The EU and Japan should expand their Mutual Recognition Agreement (MRA) on
Good Manufacturing Practice (GMP) to various pharmaceutical dosage forms suchas ointments, injectables, sterile forms and API, as well as biological products, inorder to avoid redundant inspections and testing.
<Recent Progress>
Good progress has been seen. In April 2016, EU and Japan agreed to expand
countries subjected by the MRA of the GMP certifications from 15 to 28 EU countries.
The EU and Japan also announced that they are considering expanding the MRA
subjects, which currently cover only no-sterile oral tablets and capsules, to othermedical products.
<Background>In 2002, the EU and Japan introduced the MRA on the GMP of medical products, but
it covered only the then 15 EU countries and its subjects were only non-sterile oral
tablets and capsules. In April 2016, the MRA was expanded to cover all the now 28
EU countries, and both the EU and Japan are considering expansion of subjects toother formulations of medical products.
In March 2017, the EU and the US announced they have agreed on MRA of the
GMP. Oral tablets, capsules, ointments, injectables, API, and biological products areincluded in this agreement. Human blood, human plasma, human tissues and organs
and veterinary immunologicals are excluded.
Despite Japan being a member of PIC/S, currently only oral solid dosage forms areincluded within the MRA between Japan and the EU and there are therefore stillmuch redundant inspection and testing of manufacturing facilities. This is not only acostly process but it also slows down the launching of new drugs in Japan, creating asignificant disadvantage for Japanese patients. In order to eliminate this problem andintegrate the EU and Japan economies more efficiently, standards and guidelines
should be harmonised and the MRA expanded. This MRA issue is one of the items of
the EPA negotiation between EU and Japan.
Prioritized items for harmonization between the EU and Japan and with international
standards:- Safety measures- Clinical development guidelines and biological preparation standards for
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WP-2 / # 02 / EJ to EJ
Mutual recognition should be improved for Medical Devices(i)Mutual recognition of quality management audit results for Medical Devices
should be established between EU and JapanThe EU and Japanese governments should establish a mutual recognition scheme
for Quality Management System (QMS) audit results. In June 2015, the Japanese
government announced it would officially join the Medical Device Single Audit
Program Pilot (MDSAP), to share QMS audit results between the United States,
Canada, Australia and Brazil. We call for a similar regulatory harmonisation approach
between the EU and Japan for lower risk medical devices, e.g. those classified as
Class II, ARCB under the Japanese Pharmaceutical and Medical Device Act (J-PMD
Act).
As a result of the implementation of the J-PMD Act in November 2014, the ISO13485
audit report is accepted for the QMS process in Japan. However, the Japaneseoriginal requirement still remains. For a real regulatory harmonization, submissionrelated formats and standards also need to be harmonized. We request a clear
direction towards a product-based and rationalized annual audit.
The EU side requests a complete harmonization by eliminating Japan’s deviations on
top of ISO13485. As a next step, mutual recognition of Medical Devices products forlower risk classes should be introduced as soon as possible. Further improvements
are desirable when introducing a new ISO revision. If the ISO revision differs per
country (for example: ISO 60601 rev2 and rev3), the workload for manufacturers isvery heavy. Therefore, the introduction schedule of new ISO standards should beharmonized, including a grace period. The EU side would also like to suggest thenecessity of disseminating information on QMS ministerial ordinances in English, forthe purpose of MDSAP rationalization of investigation pursuant to Chapter 3,
Production and Marketing.
<Recent Progress>
Some progress have been seen in this recommendation. Under the JapanesePharmaceutical and Medical Device Act (J-PMD Act), which came into force inNovember 2014, the QMS of medical devices in Japan has proceeded towards
alignment with international standards. In addition, Japan officially joined the Medical
Device Single Audit Program Pilot (MDSAP) to ensure its internationalization. These
efforts will lead to international harmonization and realisation of mutual recognition in
future.
<Background>
In June 2015, the Japanese government announced it would officially join MDSAP.
MDSAP is an international cooperation programme for quality assurance of medical
devices by the United States, Canada, Australia and Brazil as members, establishedin January 2014. Regulatory authorities of the member countries cooperatively
evaluate QMS audit agencies and share audit results among member countries.
Medical device companies normally have to get a QMS audit in each country.
However, under MDSAP a single QMS audit result will be valid among member
countries. This programme will reduce the burdens on both companies andWorking Party 2: Life Sciences and Biotechnologies, Healthcare and Well-being
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authorities. Although there are issues to be solved to implement this programme,
distribution of medical devices will be stimulated between the member countries of
MDSAP. A similar scheme between the EU and Japan should be considered.
Based on the Medical Devices Directive (MDD) of the EU and the J-PMD Act, QMS
audit results are required for each application for a license to introduce new medical
devices into the market. In Europe, the regular annual ISO audit results can be used
for all applications during the period in which the ISO audit is valid. Although Japan
has started to accept QMS audit results at a specific manufacturing site for productswith the same generic name under certain conditions, a number of RCBs still require
submitting QMS audit results for each application. Further alignment is necessary.
(ii)

There should be mutual recognition of Medical Devices product licenses

Mutual recognition of Medical Devices product licenses between the EU and Japan
should be introduced. Regulations of low risk class II devices are similar in the EU
and Japan. Therefore, mutual recognition of this category of products may berealized earlier. PMDA and MHLW should introduce mutual recognition of medical
device product licenses with low risk of class II devices by taking the difference ofclassification of medical devices between Japan and the EU into account. By
harmonizing QMS and classification it should be possible to introduce new products
within the same time frame and in one process.
The EU will pursue Medical Device Regulation (MDR), but not enough information iscommunicated to Japan. The EU should communicate with the Japanese
government about the new MDR implementation.
<Recent Progress>
There have been some improvements through the implementation of thePharmaceutical and Medical Device Act (J-PMD Act), which makes Japan accept theaudit report ISO13485 issued by the countries. The PMDA’s performance has been
improved to shorten approval times for medical devices. ISO14155 has been
accepted but we request further improvement. Based on the J-PMD Act, some ClassII and Class III products will move to “Ninsho” application. In terms of mutual
recognition, no progress has been seen.
<Background>
It should be possible to start with lower risk devices. The evaluation schemes
between the Medical Devices Directive of the EU and J-PMD Act are quite similar:- Evaluation schemes based on registered 3rd party bodies (Notified Bodies)- Essentially quite similar requirements- Based on ISO/IEC or JIS standard complianceWith these similarities, mutual recognition should be easy to implement.
(iii)

There should be mutual recognition of clinical trial results for Medical Devices

Mutual recognition of clinical trial results for the development of new Medical Devices
should be accelerated. This would make it possible to make new products available
to patients in Japan and the EU within the same timeframe and through one process,ensuring a high level of quality, while reducing the burden on manufacturers.
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At present, the standards of clinical trials in the United States, EU and Japan areseen to be almost equivalent and there are several cases where clinical trial results
are already mutually recognized between the EU and Japan. EU-Japan BRT
members request that both the EU and Japan accelerate mutual recognition ofclinical trial results by increasing the number of such cases and showing clinical trial
conductors implementing guidelines.
More specifically, Japan GCP (J-GCP) has been harmonized with ISO14155, but theEU side requests Japan to improve the actual operation of J-GCP. The clinical trials
performed in EU countries according to ISO14155 should be easily accepted and if
not accepted, an explanation with a scientific background is a must. In addition, theJapanese government should prepare a clear definition for accepting and preparing
clinical trial reports.
Furthermore, we hope for early disclosure of a clear guidance for judgment on theneed for clinical studies, conditions for acceptance, etc. in order to make the actual
operation of GCP smoother. Early disclosure of clinical trial-related guidance would
promote the entry of overseas companies to the Japanese market. Regarding theguidance for the preparation of the Clinical Evaluation Report, we request theJapanese Government to issue the guidance as early as possible.
<Recent Progress>
A certain level of progress has been seen for this recommendation. We expect that
the Japanese Government will publish guidelines for creating clinical evaluation
reports as soon as possible. In June 2016, the EU published the fourth revision of
guidance 'Clinical evaluation: A Guide for Manufacturers and Notified Bodies underDirectives 93/42/EEC and 90/385/EEC (MEDDEV 2.7/1 revision 4)'. The guidance
focuses much more on the applicability of the clinical data rather than its origin. In
general foreign clinical data is accepted in the EU for conformity assessment by
Notified Bodies if certain criteria are met, such as e.g. an analysis whether data
generated outside the EU are transferable to the EU population.
<Background>
Differences in the definition of GCP between Japan and the EU currently prevent thegeneral use of non-Japanese clinical trial results in the application for new medical
devices in Japan. However, foreign clinical trial data has been accepted in Japan asa part of the application dossier when: (i) standards for conducting medical device
clinical trials are set by the regulations of the country or region where the trial was
performed; (ii) the standards are equivalent or surpass the Japanese medical device
GCP; and (iii) the clinical trial was conducted in accordance with standards orconsidered to have an equivalent level of quality. Even in these cases, additional
data has sometimes been required with unclear reasons.
More positively, the Japanese government encourages active use of the advanceconsultation service provided by the Pharmaceuticals and Medical Devices Agency(PMDA) on individual medical device applications, to address the use of foreign
clinical trial data for the application of a device. A similar situation exists in Europe,
where there is no general ability to use Japanese clinical data but some cases whereclinical trial results acquired in Japan have been applied to the new medical device
applications in the EU.
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With regards to the procedure between the United States and Japan, mutual
recognition of clinical trial results is already being practiced under the clinical trials bycomprehensive and simultaneous processes, such as “Harmonization By Doing(HBD)” by both regulatory authorities in the United States and Japan.
PLANT PROTECTION & BIOTECHNOLOGY
WP-2 / # 03* / EJ to EJ
Acceleration and dissemination of scientific knowledge on new planttechnologies by both the governments and the private sector
The governments and the private sector should implement concrete actions in order
to increase public awareness and societal acceptance on the benefit and contributionof new technologies in the Plant Protection & Biotechnology area, including GMOs, tothe sustainable supply of safety foods. To achieve these objectives the Japaneseand European biotechnology and bio-industry associations should work closely withother sectorial organisations and their respective authorities. Specifically: Both the EU and Japan should advance and adhere to global harmonization on
GMO risk assessments, and support the Global Low Level Presence Initiative.
 Both the EU and Japan should provide legal clarity on the status of new plant
breeding techniques such as genome editing, preferably in a harmonized manner.
<Recent Progress>
No major progress has been seen for this recommendation.
<Background>
While Plant Protection & Biotechnology significantly contribute to the sustainable
food production for an ever growing population, the contribution of new technologies
has never been well recognized. Moreover, the benefit of improved quality traits onimported seeds has not been fully addressed. Considering the possible limitation of
future access on foods and feeds as a consequence of limited arable land and global
competition on limited foods, new technologies bringing higher productivity are
required.
It is therefore necessary to increase the societal acceptance of new technologies in
Plant Protection & Biotechnology, including GMOs, as an option to increase andsustain the agricultural productivity in the world through awareness-building on thebenefit of this technology to better life.
ANIMAL HEALTH
WP-2 / # 04* / EJ to EJ
There should be mutual recognition of GMP and marketing authorization for
Animal Health products
Mutual recognition of EU and Japanese marketing authorizations and recognition of
GMP certification for veterinary products is important to promote trade andWorking Party 2: Life Sciences and Biotechnologies, Healthcare and Well-being
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investment. MAFF and the European agency should accept the GMP certification of
the other party where the GMP requirements are similar or equivalent.
<Recent Progress> EU side will revise
MAFF revised regulations to issue accreditation licenses written in both Japaneseand English in December 2014. However, since then there has been no further
progress, and there remain no examples of mutual recognition at the product level.
<Background>
Overseas production facilities that are involved in manufacturing veterinary medicinal
products imported into Japan have to be accredited by MAFF even though their GMP
status is authorized by European authorities. This process involves a large amount ofadministrative work. The EU-Japan Economic Partnership Agreement should aim for
mutual recognition of European and Japanese marketing authorizatiosn for veterinary
products, starting with mutual recognition of GMP certification of veterinary medicines
where the GMP requirements are similar or equivalent.
HEALTHCARE
WP-2 / # 05 / EJ to E
Maintain the UK within the current EU regulatory and research framework on
medicines
With UK exit from the EU likely in 2019, there is a strong need to support theharmonization and continuity of EU legislation relevant for life sciences, to ensurethat patients in both the UK and the EU do not suffer reduced access to innovative
medicines. There is a particular need for harmonization and continuity around thesingle regulatory system, in order to maintain a stable EU Regulatory System andsmooth functioning of the European Medicines Agency.
It is important to maintain across the UK and EU the current research funding for life
sciences, as well as common standards in terms of intellectual property and patentrequirements, which are essential for innovative and research-based companies. In
addition, additional barriers resulting from tariffs and a reduction in free movement ofpeople should be avoided.
<Recent Progress>
New recommendation<Background>
In June 2016, the citizens of the United Kingdom voted in a referendum to leave theEuropean Union. Since then, the new British Prime Minister Theresa May and hercabinet have been working on a strategy for the so-called “Brexit”.
For the pharmaceutical industry, there is considerable uncertainty regarding theimplications of Brexit on research, development, approval and uptake of new drugs,
from both a UK and European perspective, as well as on commercial and traderelated questions.
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PLANT PROTECTION & BIOTECHNOLOGY
WP-2 / # 06 / EJ to E
Regulations governing import Maximum Residue Limits (MRLs) into the EUshould be clarified so as to allow free trade of food commodities
There is potential contradiction between REGULATION (EC) NO 396/2005, whichgoverns import MRLs, and REGULATION (EC) NO 1107/2009, which governs
market authorization of plant protection products in Europe. BRT members areconcerned that the latter regulation is influencing import MRLs, as it introduced
hazard cut-off criteria which can eliminate substances from the market. There may becases where an import MRL regulated under REGULATION (EC) NO 396/2005, isbeyond the cut-off level established under REGULATION (EC) NO 1107/2009, andsubstances which have been assessed as safe under the first regulation might bebanned by the second. The regulations should be clarified, based on sound science,
so as to facilitate free trade.
<Recent Progress>
No progress has yet been seen: decisions in Europe on import MRLs have not beenmade. An evaluation process of the pesticides legislation (Regulation (EC) No
1107/2009 and Regulation (EC) No 396/2005) is planned in 2017 and will tackle thisissue.
<Background>
In the absence of necessary import MRLs, food commodities containing the residueof the active substance are prohibited for importation even though the said substanceis approved in the exporting country and the residue does not cause any harmful
effect on human health. Excessive protection measures for food safety should be
avoided in order to facilitate international trade. The delay of review for importapproval on agricultural commodities, including the establishment of import MRLs,
may limit the access to innovative technology in exporting markets due to tradebarriers in the importing countries.
HEALTHCARE
WP-2 / # 07* / EJ to J
Reform of the pharmaceutical pricing system should provide a stable,
predictable environment that rewards innovation
The Basic Policy for “drastic” drug pricing system reform was issued by thegovernment at the end of 2016, and the Central Social Insurance Medical Council(Chuikyo) is now discussing possible changes, with implementation of the revised
system from April 2018.
The EU-Japan BRT members strongly call for this review to lead to a system whichappropriately values and rewards innovation, maintaining an incentive for companies
to develop new drugs and bring them rapidly to Japan and thereby giving Japanesepatients early access to the latest treatments.

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Specifically, the price maintenance innovation premium should be expanded to allow
all new innovative products to keep their initial price level for the duration of theirperiod of exclusivity. This strengthened reward for innovation could be funded bysavings made on non-innovative products, with annual price revision for long-listed
products (LLPs) and generics that discount from the NHL list price beyond a certain
percentage. In addition, repricing rules related to market expansion should not
become deterrents to investment.
Some form of Health Technology Assessment (HTA) is likely to be introduced. To
ensure that such a system does not become a barrier to access for patients, an open,transparent process is needed, where stakeholders such as the industry and patientgroups can contribute and share experience of HTA from European counties. Any
new system should be based on the following:- Assessment based largely or entirely on cost per QALY (quality-adjusted life
years) thresholds risks becoming a major barrier to access. Multi-criteria decision
analysis has more flexibility and hence is more appropriate.
- The number of products assessed should be limited. Japan does not yet have awell-established HTA infrastructure, so cannot assess a large number of products.
The focus should be on products with a large budget impact and in receipt of asignificant price premium.
- Any assessment should be post-launch, e.g. two years after market entry. If theassessment will be conducted before launch, the system should not hinder
patients’ access to new drugs.
<Recent Progress>
The situation has been getting worse. At the 2016 drug price revision, an
unexpected rule was suddenly introduced and prices of innovative and huge-selling
drugs were cut drastically. And in 2017, an innovative drug with large forecast sales
was hit with a price cut of 50%, based on a suddenly introduced new rule. At the endof 2016, the Cabinet issued the basic policy for the drastic drug pricing system
reforms and Chuikyo is discussing revision of the pricing system, to be introduced in2018.
<Background>
The cost of researching and developing a new drug has increased, at the same timeas the success rate of products in development has declined. According to research
at Tufts University, $2.5 billion is now necessary to launch one new drug. If
innovative drugs cannot get appropriate evaluation in their prices, it becomes difficult
to continue R&D for new drug creation and patients will lose the benefit of new
innovation.
Since highly effective but expensive drugs such as Harvoni (ledipasvir/sofosbuvir
combination tablet) and Opdivo (nivolumab) have come onto the market in the past
two years, prompting an intensification of the discussion about finding an appropriatebalance between the appropriate evaluation of innovative drugs and limited healthfinances. At the drug price revision in 2016, a new drug price cut rule, an “extra
repricing for huge seller drugs”, was suddenly introduced and prices of drugs withannual sales over 100 billion yen were drastically cut. Harvoni was one of four drugs
subject to this rule. On top of that, the price of Opdivo was unpredictably reduced byWorking Party 2: Life Sciences and Biotechnologies, Healthcare and Well-being
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50% based on a discussion at the Council on Economic and Fiscal Policy (CEFP) atthe cabinet office in 2017.
Although Chuikyo generally leads on the discussion about reimbursement policies
including drug pricing, the CEFP, a higher level of council than Chuikyo, has become
the center stage for discussions on the drug pricing system reforms recently. The
CEFP has concerns that the current drug pricing system had been unable to respondflexibly to problems that raise concerns about the sustainability of health finances,and believes that the system needed to be drastically changed. As a result, in
December 2016 the Japanese government issued its Basic Policy for drastic drug
pricing system reform, based on suggestions from experts on the council.
The Basic Policy highlights the importance of balancing “the sustainability ofuniversal healthcare” and “the promotion of innovation,” while “alleviating burdens on
people” and “improving the quality of healthcare.” Specific policy proposals include:- review of national health insurance (NHI) drugs prices four times each year, at thetiming of new drug listings, in order to swiftly respond to sales expansions beyonda certain level resulting from indication additions.
- annual drug price revision, in contrast to the current biennial revision.
- the system maintaining innovative drug prices during patent protected periods will
be fundamentally reviewed on a zero basis.
- HTA, which could not only reduce but also raise potential the NHI prices of costeffective drugs, will be fully introduced.
It is still unclear if the drastic pricing system reforms proposed by the Basic Policy
could truly realize the appropriate evaluation for innovation.
WP-2 / # 08 / EJ to J
The 14-day prescription rule for Pharmaceuticals should be abolishedJapan should abolish the 14-day prescription rule, which has been superseded bymore recent and more robust safety measures. However, although thisrecommendation was in line with the 2015 recommendation of the government’s own
Regulatory Reform Council, Chuikyo concluded that this rule is necessary and thegovernment announced rejection of this recommendation in July 2016. In April 2017,
the Regulatory Reform Council requested again to discuss this agenda at Chuikyo.
The BRT members continue to recommend abolition of this rule for better patient
access to innovative new drugs.
<Recent Progress>
No major progress has been seen for this recommendation.
<Background>
Despite the government’s policies to promote new drug development, patient accessto innovative drugs is hindered by the 14-day prescription rule, which restricts theprescription length to a maximum of 14 days for all new drugs in the first year after
their launch. In practice this means a delay of one year in patient access to drugs
which are already in extensive use abroad. The safety of new drugs in Japan is now
underpinned by the post-marketing surveillance system, and by the introduction of a
Risk Management Plan (RMP) in 2013, and hence the 14-day rule is no longer
necessary.
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WP-2 / # 09 / EJ to J
Japan should improve its environment for innovative Medical Devices(i)Japan should further sub-divide the current functional classification for Medical
Devices

Japan should further sub-divide the current functional classifications in order toimprove the reward for innovation. Currently, the various products within a functionalclass, which may have varying market prices, all have the same reimbursement price.
This results in price reductions for old products influencing the reimbursement priceof new products. In order to appropriately reward innovation in Medical Devices, thereimbursement price of new products should be set separately from the price of old
products. The reimbursement pricing system should be revised so that it is closer toa product-oriented system.
<Recent Progress>
Minor progress. At the revision of medical service fees in 2016, the functionalclassifications wer reviewed and 852 classes were set, up from 844 classes. The
exceptional rule of the functional classification remains.
<Background>
Different from pharmaceutical pricing systems, about 280,000 Medical Devices areclassified into about 900 functional classes in Japan, and one reimbursement price isthen set for one functional class, based on structure, intended use, effectiveness etc.
(ii)

Japan should abolish the foreign price reference system for Medical Devices

The foreign price reference system for Medical Devices in Japan should be abolishedbecause: (i) the average price in Japan is already only 80 per cent of foreign prices,
according to MHLW documents; and (ii) the upper limit of the price variance between
foreign countries and Japan no longer makes sense in reality.
<Recent Progress>
No major progress has been seen. At the medical service fee revision in 2016, thegovernment determined to lower the upper limit of reimbursement price variance
between foreign countries and Japan from the current level 1.5 times to 1.3 times.
<Background>
As one of a series of medical expenditure containment policies, at the medical
service fee revision in 2016 the Japanese government determined to lower the upper
limit of reimbursement price variance between foreign countries and Japan to 1.3
times so that the shrinkage of the price variance of medical devices can be achieved.
It is required that the reimbursement pricing system should be revised by considering
the special characteristics in Japan, such as the necessity to support wholesalers’
distribution costs (a very important role was played by wholesalers when disaster hit
Japan) and medical institutions because the patients are highly decentralized inJapan.
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(iii)HTA for Medical Devices should be introduced with caution

Japan should be cautious in the introduction of HTA (health technology assessment)
systems for Medical Devices, taking into account the following factors:- QALY, a sort of HTA evaluation index for pharmaceutical products, cannot beapplied for evaluation of medical devices- users’ skills and techniques of each medical device can affect the evaluation- medical devices have a shorter improvement cycle than pharmaceuticals
It is important that HTA systems do not hinder the creation of innovative products,
delay the listing for medical insurance reimbursement, or impose an excessive
burden on the industry (e.g. development of databases or human resources). Suchoutcomes would delay patient access to cutting-edge medical technologies.
<Recent Progress>
Five medical device products have been under trial assessment of cost effectivenesssince 2016. Detail method of application of the results is under discussion at
CHUIKYO.
<Background>
In April 2016, the Japanese government launched a trial HTA system that included
assessment of some Medical Devices.
PLANT PROTECTION & BIOTECHNOLOGY
WP-2 / # 10* / EJ to J
Review times for Plant Protection & Biotechnology products should beshortened
The introduction of parallel review by MAFF (Ministry of Agriculture, Forestry and
Fisheries) and the FSC (Food Safety Commission) in 2016 offers the potential for amajor improvement in the time taken to review and approve new products. The firstpriority should be to assess if the new process is working as intended in practice.
There may be other possible ways to shorten review times: Further harmonization of the dossier on human safety and acceptance ofsummaries in English.
 Opportunistic use of the evaluation results from foreign countries in order toreduce the resource burden on the Japanese authorities.
 Association and synchronization of review for domestic registration with that forimport MRLs.
 Parallel review by MHLW.
<Recent Progress>
Major progress. Parallel review by MAFF and the FSC was introduced in 2016, andhas the potential to reduce the registration process by 150 days.

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<Background>
Delivering novel and safe Plant Protection products and seeds is very important if theneeds of the growing world population for high quality foods and feeds are to be met.
While R&D-intensive companies are continuously and heavily investing in newtechnologies, the innovation will not contribute to the food production without
governmental approval. Therefore, early market access of novel Plant Protection
products is crucially important not only for R&D companies but also for farmers who
have to be competitive on their agricultural production, as well as consumers whose
living is dependent on the sustainability of food production. The delay of market
access of novel products will cause technology gaps, resulting in unnecessary
disadvantage to farmers due to the limited access to innovative products which aresafer and more effective.
If it works as planned, the new approval system should bring Japan much closer tointernational best practice, with an expected average approval time of 21 to 27
months (versus 27 to 36 months before the 2016 change). However, in the US andKorea the time taken for review is 18 to 24 months, so it may be possible to makefurther progress.

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Recommendations from European industry
HEALTHCARE
WP-2 / # 11 / E to J
Requirements for Japanese versions of the clinical trial protocol andinvestigators brochure should be relaxed
In Japan, the clinical trial protocol and investigator’s brochure is required in Japanese,and translation from English is therefore required for clinical trial notification in Japan.
This raises the cost and delays the timelines for clinical trials in Japan.
The acceptance of English-only materials for global clinical trials performed in Japan
would require further English language education of Japanese regulators. However, if
applications could be made in English-only, it would substantially accelerate theprocess and make innovative drugs available earlier to patients in Japan.
<Recent Progress>
No progress has been seen for this recommendation, but currently an English
application format is being positively discussed.
<Background>
The requirement for translation from the original English version for clinical trial
notification of global trials in Japan is considered to be a cause of delay to the start ofpatients’ enrolment in Japan.
LIFE SCIENCE & INDUSTRIAL CHEMICALSWP-2 / # 12 / E to J
English translations for issued regulations
METI (Ministry of Economy, Trade and Industry) & MHLW (Ministry of Health, Labourand Welfare) should provide English translations for issued regulations.
<Recent Progress>
This is a new recommendation.
<Background>
Currently, METI and MHLW provide English translations of issued regulations only inlimited cases. This holds true for new laws, enforcement ordinances, enforcement
regulations, official notices, guidelines and similar communication published by theministries. Consequently, to ensure regulatory compliance, companies with activities
outside Japan need to translate by themselves such regulations to be able to aligninternally with non-Japanese-speaking stakeholders. This results not only in
additional efforts in each company, but also creates a risk of differing interpretations
by each company based on their own translations.

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In other Asian countries, such as Korea, regulating authorities provide English
translations at the same time as, or shortly after, announcements in the local
language. Japan should adopt a similar approach, thereby ensuring consistentcompliance with regulations and enhancing Japan’s presence in the global
marketplace.
WP-2 / # 13 / E to J
Provide a reference to CAS numbers in regulations for Chemical substances
METI and MHLW regulations should refer to CAS numbers in addition to chemicalcompound names.
<Recent Progress>
This is a new recommendation.
<Background>
CAS provides a unique identifier for chemical substances and is nowadays used bymost companies in their internal processes to ensure regulatory compliance.
However, the regulations in Japan currently only list the names of concerned
chemical substances without indicating respective CAS numbers. These include the
Poisonous and Deleterious Substance Control Law (PDSCL), the Industrial Safety
and Health Law (ISHL) and the Pollutant Release and Transfer Register (PRTR).
As a result, in order to assess the relevance of any new regulation, each company
needs to individually map CAS numbers to the chemicals listed in publishedregulations. This results not only in additional efforts by each company, but also
induces risk of differing interpretations by each company and consequently varying
degrees of regulatory compliance.
It has become standard for authorities in the EU and US to indicate CAS numbers in
issued regulations. Also in other Asian countries, such as Korea, China and Taiwan,
regulating authorities already reference CAS numbers in their announcements.
Japan should adopt the global practice of indicating CAS numbers in issued
regulations to ensure swift and accurate internal alignment of concerned companies.
WP-2 / # 14 / E to J
Align naming requirements for product labels of chemicals with the names
used in Japanese law
MHLW should revise PDSCL labelling requirements to indicate chemicals inaccordance with the naming used in Japanese law.
<Recent Progress>
This is a new recommendation.
<Background>
Japanese law regulates chemical substances mostly by chemical group and only in
exceptional cases by specific name. Regulations such as ISHL and PRTR require
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that labels for products containing chemical substances name these substances “asregulated by the Japanese law”. However, only the PDSCL requires that labels of
products containing related chemical substances always state the specific names of
the included chemical substances. From a user perspective, it is easier to work withdescriptions such as “Organic Cyanide Compound” (chemical group name) than “2Methyl-6-oxo-1,6-dihydro-3,4'-bipyridine-5-carbonitrile” (specific name of thechemical substance). Discrepancies between naming in Japanese regulations andproduct labelling requirements creates a risk that substances are used without aclear understanding of the regulations they relate to.
Japan should renew the PDSCL so that product labels must list contained chemicals
in the naming “as regulated by the Japanese law” instead of “by specific chemical
substance name”. This would allow users to quickly assess the toxicity andregulatory relevance of the materials they handle.

(Document ends)

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