Japan
Regulatory, Pricing and Reimbursement Overview · Preclinical and Clinical
Trial Requirements · Marketing, Manufacturing, Packaging and Labeling
Advertising · Traditional Medicines and OTC Products · Product Liability· Patents and Trademarks · Regulatory Reforms · Cannabinoid Drugs,
Medicinal Cannabis and Opioid Drugs · Orphan Drugs and Rare Diseases ·Localization · Biosimilars and Biologics

JapanThe Pharma Legal Handbook answers
essential questions about this environment
for pharmaceuticals in Japan.
It is a must have for any company operatingin the country or looking to enter the market.
Prepared in association with Nishimura &Asahi, Japan’s largest international law firm,
it should answer any questions linked toRegulation, Pricing, Clinical and Preclinical
Trials, Marketing, Manufacturing, Trademarks
and Patents.

Japan’s Largest International Law Firm:
Nishimura & Asahi is Japan’s largest law firm, covering all aspects of domestic and international business and corporate activity. The firm has over
750 Japanese and foreign lawyers — employing more than 900 support
staff, including tax accountants, patent attorneys, senior Japanese andforeign business support professionals, and paralegals.
*including Associate and Alliance offices

The Highest Global Standards:
Many attorneys and staff at the firm speak other foreign languages and haveadvanced international law degrees and bar admissions — with experience
working at top global law firms. Nishimura & Asahi has also established strong
professional relationships with the most eminent law firms worldwide, enabling
the firm to focus on international corporate and financial transactions, advisingboth Japanese and foreign clients to the highest international standards.
Cutting-Edge Business Issues:
We work with the most prominent Japanese and global corporations, to findnovel solutions for its industries’ most innovative changes and disruptive
challenges.
Commitment To Excellence:
Through the enhancement of professional and organisational synergies —a result of the firm’s expansion — an unprecedented level of client service
is made possible in highly specialised and complex areas of commercial
law. Nishimura & Asahi understands its clients’ growing needs and its
fully integrated team of lawyers and professional staff are proud to sharethe same fundamental philosophy: An uncompromising commitment toexcellence.
International Presence:With the continued expansion of our international presence and clientele,
we have four domestic and 14 overseas offices. Through our domestic andglobal networks, we are ideally placed to provide clients with a borderless
one-stop service, from Japan to the world.

PharmaBoardroom is not responsible for any mistakes contained within
this publication. For specific advice on any legal issue, please contact aqualified professional.
Copyright: All rights reserved. No part of this publication maybe reproduced inany form or by any means, whether electronic, mechanical or otherwise including
photocopying, recording or any information storage or retrieval system without
prior written consent of PharmaBoardroom. While every attempt is made toensure the accuracy of the information contained in this report, neither Focus
Reports nor the authors accept any liabilities for errors and omissions. Opinions
expressed in this report are not necessarily those of the authors.
* THIS REPORT WAS ORIGINALLY PUBLISHED IN JULY 2019 AND THE
INFORMATION CONTAINED WITHIN IS SUBJECT TO CHANGE.
** LAST UPDATE: AUGUST 2020

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THE PHARMA LEGAL HANDBOOK JAPANMain Areas of Practice:
M&A, Corporate, Finance, Real Estate, Restructuring & Insolvency, Dispute
Resolution, Intellectual Property, Corporate Crisis Management, Competition
Law/Antitrust Law, Tax, Employment/Labour, Consumer Law, International
Trade, Wealth Management, Public Interest Activities, Natural Resources& Energy, Agri-Food, IT/Media/Entertainment, Life Sciences/Healthcare,Technology, Digital Transformation (DX)/Digital Innovation.

Nishimura & Asahi
Otemon Tower
1-1-2 Otemachi
Chiyoda-ku
Tokyo 100-8124
Japan

Tel: +81 3 6250 6200
Fax: +81 3 6250 7200
Email: info@nishimura.com
Web: https://www.nishimura.com/en

MARKETING, MANUFACTURING, PACKAGING & LABELING, ADVERTISINGTHE AUTHORSMARIKOMIMURAHARUHIABE

Mariko Mimura is an Of Counsel of Nishimura & Asahi. She rejoined Nishimura& Asahi in 2018 and serves as leading counsel for the Life Science and Healthcare
practice group of N&A.
Before rejoining N&A, she was the Vice President, General Counsel and Board
Member of GlaxoSmithKline K.K., leading Legal, Compliance, Government Affairs,
Public Policy and Patient Advocacy from 2015.
From 2010 to 2015, she was a Director, Country General Counsel, and the Headof Legal/Intellectual Property Department, at Novartis Holding Japan K.K., and has
managed the legal affairs and IP of all the Novartis Group Companies in Japan,
including Novartis Pharma K.K. Her responsibilities as an in-house counsel in theNovartis Group spanned a wide array of work, from general corporate legal affairs
to M&A and IP litigation.
She held tenure as a Corporate Officer and General Counsel at GE Healthcare
Japan Corporation (manufacture and sale of medical devices and Bio products) from2005 to 2009, taking on responsibility for legal affairs, IP and compliance acrossthe board. She has also assumed the position of General Counsel of Asia Pacific tooversee legal affairs and compliance in the APAC region. Furthermore, Mariko was
appointed as an outside statutory auditor at Nihon Medi-Physics Co., Ltd. (manufacture and sale of pharmaceutical products), an affiliate of GE Healthcare Japan,
continuing to hold the position until she left GE Group in 2009.
Following registration with the Japanese Bar Association in 1992, Mariko joined
Nishimura & Partners (currently Nishimura & Asahi) in 1995, with expertise inintellectual property, entertainment,
general corporate, bankruptcy, and civil rehabilitation. During her tenure at
Nishimura & Partners, she was seconded to Gibson, Dunn & Crutcher LLP, a US
law firm, as well as working at a US medical device company as Vice President &General Counsel. After returning to Nishimura & Partners, she became a partnerin 2003 and served until she became an in-house counsel of GE Healthcare Japan
Corporation until 2005.
She leads N&A Life Science and Healthcare Practice Team, which recently published a book detailing a Japanese law designed to secure the quality, efficacy, andsafety of pharmaceutical, quasi-pharmaceutical, cosmetic products and other medical stuff. This book provides basic and detailed explanations of these matters, as well
as a minute description of relevant laws and regulations, ministry notifications andindustry rules, making it one of the most comprehensive and aspirational illustration of pharmaceutical affairs in Japan to date. She was the editors’ representative forthis book and was responsible for its overall supervision based on her accumulated
experience in this area.
Thus, she is an in-house counsel pioneer in the Japanese healthcare industry.
She was selected as one of the top 100 Corporate Counsel in Asia Pacific in the GC
Powerlist of the Legal 500 in 2014.
In 2019, she received an award as a Corporate and M&A lawyer by Best Lawyers®
10th Edition of The Best Lawyers in Japan (2020).

He works as an associate at Nishimura & Asahi (N&A), practicing in the areas ofGeneral Corporate, Crisis Management (compliance and investigation of white-collar crimes), Antitrust, Mergers and Acquisitions, Life Science, Entertainment andLitigation among others.
He is also a member of N&A Life Science and Healthcare Practice Team, where
he engages in a wide variety of legal activities, such as conducting investigations into
manufacturing errors at pharmaceutical companies. He is also involved in M&A cases
dealing with pharmaceutical and cosmetic products.
N&A Life Science and Healthcare Practice Team recently published a book detailing a Japanese law designed to secure the quality, efficacy, and safety of pharmaceutical,
quasi-pharmaceutical, cosmetic products and other medical stuff. In this volume, as amember of the practice team, he took charge of the chapters on quasi-pharmaceutical,
cosmetic products and regenerative medicine and other products.
He obtained his LL.M. (Master of Laws) from University of California, Berkeley,
School of Law in 2021, Juris Doctor degree from the University of Tokyo, Graduate
Schools for Law and Politics in 2013, and Bachelor of Laws from Kyoto University
in 2011. Since September 2021, he has belonged to Technology, Media andTelecommunications Law LL.M. (Master of Laws) at Queen Mary, University of
London, for the study and research of the following areas of law: Life science law(protection and regulation of medicines with patent-related matters); International
copyright law; Digital piracy law; Entertainment law (video game law, fashion law
and esports law); Animal law; Media reputation law (defamation and privacy); andE-commerce regulations.

TAKESHIYAMAMOTO

Takeshi is an associate at Nishimura & Asahi (N&A), where he has handled various
domestic and cross-border corporate scandals, business regulation matters mainly
related to manufacturing, infrastructure, telecommunications, and healthcare business sectors and the casino industry.
He also has rich experience in Japanese pharmaceutical industry cases, such as
handling whistleblower hotlines for pharmaceutical company employees and handling corporate scandal cases involving advertising regulations for pharmaceuticalcompanies.
He graduated in 2014 from the University of Tokyo with a bachelor’s degree in law
and was admitted to the Japanese bar in 2017.

THE PHARMA LEGAL HANDBOOK JAPAN — 3

MARKETING, MANUFACTURING, PACKAGING & LABELING, ADVERTISINGCONTENTS

01
02
03
04
05
06
07
08
09
10
11

REGULATORY, PRICING, AND REIMBURSEMENTOVERVIEW

Page 6

PRECLINICAL AND CLINICAL TRIAL REQUIREMENTS
Page 11

MARKETING, MANUFACTURING, PACKAGING
AND LABELING, ADVERTISING
TRADITIONAL MEDICINES AND OVER-THE-COUNTERPRODUCTS

Page 15

Page 21

PRODUCT LIABILITY
Page 25

PATENTS AND TRADEMARKS
Page 28

REGULATORY REFORMS
Page 33

CANNABINOID DRUGS, MEDICINAL CANNABIS ANDOPIOID DRUGSPage 35

ORPHAN DRUGS AND RARE DISEASES
Page 42

LOCALIZATION
Page 46

BIOSIMILARS AND BIOLOGICS
Page 50

THE PHARMA LEGAL HANDBOOK JAPAN

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01

REGULATORY, PRICING, AND
REIMBURSEMENT OVERVIEW

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THE PHARMA LEGAL HANDBOOK JAPANREGULATORY, PRICING, AND REIMBURSEMENT OVERVIEW

1. What are the regulatory authorities withjurisdiction over drugs, biologicals, andmedical devices in your country?
2. What is the regulatory framework for theauthorization, pricing, and reimbursement ofdrugs, biologicals, and medical devices?

8. How is compliance with regulation monitored
and evaluated? Is the regulatory regime
comparable with the U.S. Food and Drug
Administration or the European Medicines Agency
expectations and requirements?
9. What is the potential range of penalties fornoncompliance?

3. What are the steps to obtaining
authorization to develop, test, and market a
product?

10. Is there a national healthcare system? If so, how
is it administered and funded?

4. What are the approximate fees for eachauthorization?

11. How does the government (or public) healthcare
system function with private sector healthcare?

5. For how long are marketing
authorizations/registrations valid? Howare marketing authorizations/registrations
renewed?

12. Are prices of drugs and devices regulated and, if
so, how?
13. How are drugs and devices used by patients paidfor? What roles do public and private payers play?

6. How does the authorization process
differ between brand-name products andgeneric products? Are there differences for
local manufacturers versus foreign-owned
manufacturers?
7. How are combination products (drug +drug, drug + biologic, drug + device, biologic+ device, drug + biologic + device) regulated?

14. Who dispenses drugs and devices to patientsand how are those dispensers compensated?
15. What are the professional and legal
responsibilities of those who dispense drugs anddevices? What role do they play in providing
patient care, information, and safety?

THE PHARMA LEGAL HANDBOOK JAPAN

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01

REGULATORY, PRICING, AND
REIMBURSEMENT OVERVIEW

1. What are the regulatory
authorities with jurisdiction overdrugs, biologicals, and medical
devices in your country?

The Ministry of Health, Labour and Welfare (the “MHLW”) and thePharmaceuticals and Medical Devices Agency (the “PMDA”).

2. What is the regulatory
framework for the authorization,
pricing, and reimbursement ofdrugs, biologicals, and medical
devices?

Authorization is governed by the Pharmaceuticals and Medical Devices Law(the “PMD Act”) of Japan.
Pricing of drugs and biologicals is governed by the National Health
Insurance. Drug Pricing Standards are established by the MHLW under the
Health Insurance Act. The method of calculation of drug pricing and theprice of each drug are announced by the MHLW after consultation with theCentral Social Insurance Medical Council.
Pricing of medical devices is included in the Medical Fee, which is alsoestablished by the MHLW under the Health Insurance Act, and the calculation method and price thereof are announced by the MHLW after consultation with the Central Social Insurance Medical Council.
Reimbursement is governed by the Health Insurance Act.

3. What are the steps to
obtaining authorization todevelop, test, and market a
product?

To develop and test a product, it is necessary to obtain a manufacturing/marketing business license, depending on the type of business.
To market a product, in addition to the above, the license holder mustobtain marketing authorization for each such product.

4. What are the approximate
fees for each authorization?

The fee for a manufacturing/marketing license varies depending on the typeof license, but is approximately 100,000 to 150,000 yen. The fee for marketing authorization for each product varies depending on the product.

5. For how long are marketing
authorizations/registrations
valid? How are marketing authorizations/registrations renewed?

Manufacturing/marketing licenses are valid for five years, and the license
holder must renew the relevant license(s) every five years. Marketing authorizations are valid until and unless withdrawn by the government for appropriate reasons or abandoned by the authorization holder, both of which arerare.

6. How does the authorization
process differ between brandname products and genericproducts? Are there differences
for local manufacturers versus
foreign-owned manufacturers?

Clinical trial data is required to obtain authorization for brand-name products. Normally, product creators spend more than 10 years from basic researchto obtaining authorization.
For generic products, only stability tests and bioequivalence tests are
required, as opposed to clinical trials. Thus, generic products can obtain
authorization in a short time, normally 2 years from the start of testing.

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THE PHARMA LEGAL HANDBOOK JAPANREGULATORY, PRICING, AND REIMBURSEMENT OVERVIEW

Currently, applications for authorization of generic products are accepted
only twice a year, in February and August.
7. How are combination
products (drug + drug, drug +biologic, drug + device, biologic+ device, drug + biologic +device) regulated?

Basically, the same rules apply to combination products. To ensure the safety of combination products, the single drugs used in combination products
must be in the market for one year or more, with exceptions for some special
combination products (such as HIV drugs).

8. How is compliance withregulations monitored andevaluated? Is the regulatory
regime comparable with the U.S.
Food and Drug Administration or
the European Medicines Agency
expectations and requirements?

Compliance with regulations is monitored and evaluated by the PMDA andthe local government of each prefecture. Basically, compliance with regulations is harmonized with the FDA and EMA.

9. What is the potential range ofpenalties for noncompliance?

Potential penalties include suspension of part or all of a business, cancellationof authorizations, or up to 3 years imprisonment or a fine of up to 3 million
yen or both, depending on the type of noncompliance/misconduct.

10. Is there a national
healthcare system? If so, how is
it administered and funded?

There is a national healthcare system. Japan’s universal insurance systembegan with introduction of the Health Insurance Act in 1961. This system
ensures that all people’s healthcare costs are covered by public insurance andthat people have free access to any healthcare provider. People have to pay
insurance fees to the health insurance program they join, and then, when theindividual goes to a healthcare provider, the cost is covered by the National
Health Insurance (other than a portion the individual patient must pay). The
portion an individual must pay varies from 10% to 30% depending on theindividual’s age; in addition, if an individual’s total payments exceed a certain
amount, which is decided based on his or her income, the residual amount iscovered by the National Health Insurance.
People have an obligation to join a health insurance program. Company
employees join the health insurance program their employer has joined. Most
other people join the national health insurance program, although there arealso several special insurance programs such as the public employee union
program.
The national healthcare system is funded primarily by insurance fees paidby the program members. For example, a company employee has an obligation to pay half of his/her insurance fee to the insurance program; the other half is paid by the employer. However, current healthcare costs are far
beyond the total of insurance fees. Thus, there is an added public expense.
Most recently, approximately one half of the total healthcare costs was covered by insurance fees, approximately 40% was covered as a public expense,
and approximately 10% was covered by individual payment by the patients.

THE PHARMA LEGAL HANDBOOK JAPAN—9REGULATORY, PRICING, AND REIMBURSEMENT OVERVIEW

11. How does the government(or public) healthcare system
function with private sector
healthcare?

Most of the hospitals in Japan belong to the private sector (approximately 80%).
The basic functions of public sector and private sector hospitals are the same,but public sector providers have special missions, such as providing healthcare
in remote places where no other hospitals exist, assisting patients as a safety
net, and providing advanced healthcare based on advanced research and study.

12. Are prices of drugs anddevices regulated and, if so,
how?

Prices of drugs and devices are regulated under the Health Insurance Act.
Pricing of drugs and biologicals is governed by the National Health
Insurance Drug Pricing Standard which is regulated by the MHLW underthe Health Insurance Act. The methods of calculation of drug pricing and theprices for each drug are announced by the MHLW after consultation with theCentral Social Insurance Medical Council.
The pricing of medical devices is included in the Medical Fee, which is also
regulated by the MHLW under the Health Insurance Act, and the calculation
methods and prices thereof are announced by the MHLW after consultation
with the Central Social Insurance Medical Council.

13. How are the drugs anddevices used by patients paidfor? What roles do public andprivate payers play?

Drugs and devices prescribed by doctors and used by patients are coveredby the National Health Insurance, other than the portion individual patients
must pay under the Health Insurance Act.

14. Who dispenses drugs anddevices to patients and how arethose dispensers compensated?

Doctors prescribe the drugs and pharmacies dispense the drugs to patients.
When a pharmacy dispenses a prescribed drug, the patient has to pay a portion of the total cost, and the other portion is reimbursed to the pharmacy by
the National Health Insurance payer.
The cost of devices used by doctors for patients is reimbursed to the doctor
by the National Health Insurance payer. Patients only pay the hospital a portion of the doctor fees, including service fees.

15. What are the professional
and legal responsibilities of
those who dispense drugs anddevices? What role do theyplay in providing patient care,information, and safety?

Under the Health Insurance Act, a doctor must register as an insurance doctor. Only registered insurance doctors can prescribe drugs and dispensedevices covered under the national insurance system.
Also, only a pharmacy that is designated as an insurance pharmacy underthe Health Insurance Act can dispense drugs.
Insurance doctors and insurance pharmacies have obligations under the
Health Insurance Act, and non-compliance may result in cancellation of theirlicenses.

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THE PHARMA LEGAL HANDBOOK JAPAN