We believe that the draft regulations will attract unscrupulous actors to China, pose unnecessary risks to patients in China, and undermine China’s historic investment in regenerative medicine.
Introduction
Are practices of regulatory brokerage and their foreseeable violence inevitable? Can they be addressed through regulation? It seems that currently available regulatory tools, rather than preventing it, are part of the problem; and rather than involving one-off decisions, its global effects suggests that the problem involves complex international relations of collaboration and competition. Top-down approaches, dominant among regulatory thinkers, tend to emphasis the vertical movement of regulatory powers from regulatory action to passive regulatees. For instance, in Chapter 1, even nuanced approaches, such as Julia Black’s, define regulation as ‘a structured process undertaken by or under the auspices of government designed to modify the behaviour of persons or entities according to defined standards’ (Black Reference Black2002). Similarly, ‘responsive regulation’, which is built on regulatory standards to incentivise, persuade and assist compliance with regulation (Baldwin and Black Reference Baldwin and Black2007), is constructed on a top-down basis. More attention for the agency of regulatees and lateral political pressures of regulation over time can uncover the international, horizontal pressures on regulatory practices.
Other approaches focus on interest groups (regulatory capture theory, Majone 1998, 2000) and neoliberal processes of outsourcing regulation (the regulatory state, Majone Reference Majone1994, Reference Majone1997). But, as we have seen, regulatory violence is the result, not so much of a particular politics but a consequence of the global spread of regulatory capitalism, including in countries that call themselves socialist, democratic or free-market economies. These theories on regulation, though shedding new insight on the various dimensions of regulation, do not capture the complexity of the global dynamics of regulatory capitalism, where not just widely valued goods, such as public health and social care, are ruthlessly commodified, including their regulation, but where regulatory systems are also in competition with one another. A global perspective that relates local institutional practices to wider organisational networks internationally allows us to see that regulation is negotiated on many levels of organisation and that their structural dynamics are place-holders of destructive forms of competition as well as creative ones. In this chapter, I show how these organisational levels are linked across time.
In the introduction of Part IV, I have already indicated that there are opportunistic and active forms of regulatory brokerage, whereby opportunistic forms are based on the discrepancies between existent regulations to forge collaborations to their advantage, while active forms involve activities directed by the desire for regulation that can improve competitive edge. Using earlier introduced and new case studies, I show how regulatory brokerage is expressed in the entrepreneurial activities of scientists and how they impact the development of regulation across time.
In the first section, I present cases of regulatory brokerage on the basis of the organisational level on which they occur (opportunistic regulatory brokerage among companies and among companies with state support; active regulatory brokerage among interest groups and regulators at home and among bilateral, international and global regulatory actors), indicating a temporal direction from lower to higher organisational forms. I hypothesise that this order of occurrence is not coincidental. Although the cases are not directly related to one another, there are political, scientific and economic reasons for this order to be meaningful, and these reasons have to do with the perception of and participation in global competition. The second section illustrates how regulatory competition leads to cascades of regulatory reforms, one country after the other. Its examination provides insight into the considerations that underpin regulatory decision-making in the context of various global regulatory constellations.
Forms of Regulatory Brokerage
I will start by discussing various forms of regulatory brokerage (see Table 8.1), suggesting that regulatory brokerage in the field of regenerative medicine over time has increasingly involved higher levels of governance. Understood together, these forms or regulatory manipulation illustrate the pressures of regulatory performance on regulatory systems and science policy-making. I will illustrate this by examining points of time along Japan’s winding trajectory of regulatory capacity building and life-science collaborations that have involved different forms of regulatory brokerage. The focus on Japan enables us to see how national, regional and global regulatory changes are not just prompted by ethical and scientific considerations. Rather, it allows us to discern a pattern of regulatory changes that link regulation to the political and economic strategies of a country. An analysis of the cases shows that there is a causal, but no inevitable, link between the various forms of regulatory brokerage.
Case 1: Informal Forms of Regulatory Brokerage
This first case indicates a basic pattern of opportunistic regulatory brokerage: by taking advantage of regulatory discrepancies, collaboration can give access to a country with less prohibitive regulation.
In Chapter 5, we saw that, despite Japan’s national ten-year project for the development of regenerative medicine, its regulation had been perceived as overly restrictive, slow and bureaucratic (also see Slingby et al. Reference Slingby, Nagao and Akabayashi2004; Nakatsuji Reference Nakatsuji2007). This friction between the stimulation of regenerative medicine and ‘restrictive’ regulation incentivised companies and scientists to go abroad and to collaborate internationally. The Indian–Japanese joint venture, the Z Centre for Regenerative Medicine (ZCRM) is another example of a case in point (Sleeboom-Faulkner and Patra Reference Sleeboom-Faulkner and Patra2011). Its founders boasted a large scientific, political and financial network in both Japan and India and organised clinical stem cell applications for a range of diseases, including spinal cord injury, cardiovascular diseases and cirrhosis of the liver and immune diseases in India. Settled in Japan and established as a cardiac surgeon at a university there, Indian-born scientist-entrepreneur Kumar (pseudonym) commuted between India and Japan to overcome regulatory boundaries. In 2005, Kumar and a group of Japanese scientists and companies set up ZCRM as a charitable company in Chennai, India, with Japanese equity. In 2008, Kumar reported that the company’s charitable goals had led to long-term profit:
We now have plans for a lot of years. We have proven that corneal limbal tissues taken from the same patients or person, cultivated by our method and reinserted into the eye, regenerates the normal cornea inside the person – on the basis of animal research. After having proven this, it can be applied. Corneal cells have some problems in common with the endothelium. If we do the research here, then we have ten years of research ahead of us, as there are various regulatory complications. The Waseda people gave us the materials and our Indian guys tried the primary culture in the laboratory. Then we did the collaboration with an institute in India. There they did the basic study and animal study in the lab in India, and the tissue engineering before application in the hospital.
Here we find that regulatory brokerage takes place by a simple strategic use of regulatory discrepancy and by avoiding regulatory violation where possible. Although differences in healthcare, wealth and scientific development between the countries played a role, the regulatory discrepancy was crucial to ZCRM’s ability to operate in India.
In India, the Department of Biotechnology (DBT) and the Indian Council of Medical Research (ICMR) had jointly developed ‘Guidelines for Stem Cell Research and Therapy’, enabling scientists to operate internationally (DBT and ICMR 2007), followed by various reforms and amendments (see Chapter 3). In this period, ZCRM avoided the need to apply for formal permission by providing stem cell isolation/expansion services to Indian hospitals (Sleeboom-Faulkner and Patra Reference Sleeboom-Faulkner and Patra2011). This enabled ZCRM to shift the responsibility for the application for permissions to collaborating hospitals. Although India’s IEC/IC guidelines permitted the use of autologous stem cells in research and treatment, protocols had to be approved and registered with the National Apex Committee for Stem Cell Research and Therapy (DBT and ICMR 2007). But, as the Committee did not function well, it opened the way for regulatory tolerance of countless of unauthorised stem cell interventions in hospitals and clinics (Tiwari and Raman Reference Tiwari and Raman2014).
Even after the introduction of the 2013 National Guidelines for Stem Cell Research, which limited permissions to research and was applied mainly by universities and state hospitals, a laissez-faire approach among clinics was tolerated (Tiwari and Desai Reference Tiwari and Desai2018). In Japan, by contrast, similar engagements by reputable universities and companies would have created a scandal. Japan’s style of regulatory boundary-making at the time viewed scientific research in terms of ‘international’ standards for ethics review and scientific applications, despite grumbles about regulation being imported from ‘the West’. This is what gave Japan its regulatory immunity.
Case 2: Regulatory Brokerage with Official Support
A second case shows how international collaborations are brokered using perceived regulatory advantages of the other country as regulatory capital with the support of state institutions.
This opportunistic form of regulatory brokerage is exemplified by the collaboration between KHI and Chulalongkorn University, forged by NEDO. The evasion of Japan’s regulation here needs to be understood in the context of Japan’s scientific and economic long-term political plans to enhance its global competitiveness in the pharmaceutical and medical equipment industries. As discussed in Chapter 6, these plans included new legislation, the ‘Highway for the Realization of regenerative Medicine’, the Japan Revitalisation Strategy and the Plan for the Promotion of Medical Research and Development (Headquarters for Healthcare Policy 2014).
NEDO, a semi-government organisation set up in 1980, was to actively promote the establishment of world-standard technology, as well as its market development. Whilst NEDO originally followed a conservative policy of adjustment to ‘world’ standards, it now adopted a more assertive role of international expansion, supported by a generative annual budget (e.g., 20.8 billion Yen [US$190m; £129m] NEDO 2015). One example of a collaborative network supported by NEDO was the 2012 collaboration described in Chapter 5, between Kawasaki Heavy Industry (KHI) in Japan with Bangkok, where NEDO has an office. KHI, which was developing an automatic cell-processing robot for stem cell applications, wanted to show that marketable products could result from clinical trials using a robotic machine. Despite the strategic policies, it regarded Japan’s regulation, however, as far too slow and restrictive.
NEDO, however, was prepared to help with KHI’s international expansion, even if its international collaboration meant that it violated the spirit of Japan’s regulation. After negotiation with various universities in Thailand, Chulalongkorn University decided to allow KHI’s robotic machine on the premises and to collaborate in a clinical trial. As we saw in Chapter 5, Chulalungkorn University could use the technological support and was conscious that the ‘generosity’ of NEDO and KHI was ‘payment’ for its regulatory capital. The parties signed a memorandum of understanding in June 2012. When asked why, the Thai scientist who had first received the Japanese delegation explained:
Especially in the beginning we have been wondering why they came to Thailand. They did not go to China, which is understandable. Political relations are not good. But they did not go to Singapore either. This is because they are potential competition. We were sceptical in the beginning. There is no such thing as a free lunch and all that. They now just want to have [Thai] FDA [Food and Drugs Administration] approval or a license.
KHI strategically chose Chulalongkorn University as a collaborative partner, being confident that it would receive permission for conducting a clinical trial using the robotic machine. Chulalongkorn University, on the other hand, accepted the collaboration because the use of advanced equipment would help it both scientifically and financially. A leading Thai scientist reflected that KHI had been too optimistic about gaining permission for a clinical trial:
The Thai government expects to maintain the high reputation of our laboratories, and no scientist here wants Thai regulation to show favouritism.
Wilipana and colleagues were adamant that what they needed was to build up their regulatory capacity to an ‘international’ level to protect their scientific boundaries and patients. One scientist said that being soft about regulation would tarnish Thailand’s scientific reputation. To what extent this means that the collaboration’s regulatory capital has not paid off is unclear, but it does raise questions about the potential use of Thai patients to prove the processing ability of robotic upscaling, and it prompts questions about the authority of state organisations to evade their own regulation.
Case 3: Brokering Regulation at Home
The next example of active regulatory brokerage in Japan involves the state’s creation of regulatory capital by ‘loosening’ what are perceived as prohibitive regulations in the home jurisdiction. Regulatory capital in such cases involves struggles among interest groups and political brokerage at home. The regulation in this case aimed to get a global competitive edge in regulatory capitalism. To many Japanese scientists engaging in industrial applications of regenerative medicine, it was clear that no industrial stimulation package would work without regulatory reform. Japan, in other words, had to create its own regulatory capital.
The Office of Medical Innovation, a cabinet-level advisory organisation set up in Japan in 2011, played an important role in the development of regulation by reducing sectionalism among the science, health and trade ministries and by bringing industry and science closer together in developing more effective intellectual property and regulatory frameworks in the field. The Japanese Society of Regenerative Medicine (JSRM) and the Forum for Innovative Regenerative Medicine (FIRM) were crucial to directing the development of regulation of the field. In this ‘triple helix’ set-up, involving the collaboration of the government, the state bureaucracy and heavy industry (Johnson Reference Johnson1982; Etzkowitz and Leydesdorff Reference Etzkowitz and Leydesdorff2000), the prominent role of Professor Teruo Okano of Tokyo Women’s Medical University, known for his innovative ‘cell-sheet’ therapy, was key. Made of human cells grown on temperature-responsive sheets, cell-sheet products were used in various clinical applications, including for heart failure, which Okano was intent to market. Professor Okano embodied the triple helix of regulation, science and industry. Being acting-head of the Office of Medical Innovation, president of JSRM, and a co-founder of FIRM, his lobbying with the government was crucial to shaping the regulatory reforms.
The JSRM, established in 2001, had been campaigning for the relaxation of Japanese government regulations concerning studies, clinical trials and clinical applications related to RM. Its 2012 ‘Yokohama Declaration’ made regenerative medicine a priority in the Cabinet Secretariat’s Five-Year Healthcare Innovation Strategy and has been instrumental in the creation of the RMA Act, the PMD Act and the RMP Act, which were approved in 2013 (JSRM Reference Begon, Harper and Townsend2016). Okano’s collaboration with Osaka University Hospital’s cardiovascular surgeon Yoshiki Sawa has been crucial to the success of CellSeed, a company set up by Okano in 2001. In 2007, Sawa announced the successful application of Okano’s cell-sheets into a patient with cardiomyopathy (Sasaki 2012; Okano et al. 2015). Sawa, president of JSRM’s board, led the publication of the Osaka Declaration (17 March 2016), which announced Japan’s role as world leader in universalising regenerative medicine and finding evidence for its safety (JSRM Reference Begon, Harper and Townsend2016). Okano and Sawa were active representatives of the companies they work closely with – CellSeed and Terumo, respectively – and had large networks, including FIRM with its 180+ large member-companies.
In 2013, a well-known leader in regenerative medicine filed complaints about Japan’s regulatory policies, which were widely shared by those interested in the commercialisation of cell products:
Sheets cannot sell in billions like molecules in drugs; we cannot do it, as they need many improvements. Only a small number can be transplanted. We require a new law for treating large numbers of patients. We have started clinical research on the cornea, the heart and the esophagus. I went to Congress many times – I had to start teaching the committee – the Diet member alliance for the promotion of regenerative medicine (‘zai seiiryo suishin giin renmei’) – in 2008, when we had this building built. In 2007, 9–10 professors had formed a study meeting. They submitted an opinion paper about autologous application. The Diet responded with the creation of the committee: they had to learn how clinical application is progressing. It took 5–6 years for the Diet and the Cabinet Office (Naikaku-fu), the three Ministries and the Legislation Office (hōseikyoku) to understand that we needed different regulation. To reach a decision on the situation took many years. Medical doctors only think of publications. I had to yell to them: ‘Patients are waiting!’ The JSRM needed to create new circumstances for regulation. Without efforts, there would be no law.
Financial inability was not the only factor that stopped scientists from taking their products through clinical trials and working with industry. It was argued that, as Japan did not have experimental spaces or ‘expanded-access related mechanisms’, such as the hospital exemption and compassionate treatment in Europe, or investigational new drugs (INDs) in the US, testing opportunities were particularly limited in Japan. Other scientists and regulators pointed out, however, that Japan’s Medical Practitioners’ Act and Advanced Medical Care gave Japanese PIs similar or more spaces to ‘test’ their products (Tsuyuki et al. Reference Tsuyuki, Yano, Watanabe, Aruga and Yamato2016).
Nevertheless, some leading scientists urged the government to concede the regulatory demands of the Yokohama Declaration. Regenerative medicine needed infrastructural support that the government alone could not supply. Industrial investment was needed for clinical trials in regenerative medicine, but industry was holding off. It was not that the Japanese market was not big enough; it was because infrastructural and regulatory conditions were unfavourable. One scientist explained in November 2013:
The government has tried to give them [life science industry] funding, but to them it’s peanuts. If they decide they are interested, they pay themselves! … How are they going to collaborate with us? Their strategy is not to take any funds from the government, as it [the government] can put restrictions on them. For instance, when companies would like to collaborate with Shimadzu or other subsidised companies, Shimadzu has to say ‘we cannot collaborate with you, as we have government funding’: ‘We have a non-disclosure agreement (NDA), we cannot show any data’, or ‘Five years later, when the NDA expires, we are willing to disclose.’ Too late!
According to this scientist, industry is willing to work in a country that ‘builds the platform and provides workable regulatory conditions’: ‘That is why they try the UK first’, he concluded (Hashigawa, 1/11/2013*).
Another reason for regulatory reforms was the Japanese government’s resolve to wean scientists from government funding. Even though its budget for science innovation was only about 10 per cent of that of the US National Institute of Health (NIH) (US$150 billion) (Sonoda, 5/11/2013*), Japan’s government hoped to lower it by attracting venture capital. At the time, the availability of venture capital in Japan was much lower than in the US and Europe (Umemura Reference Umemura2015), and it was hoped that deregulation would get Japanese and foreign companies interested in paying for clinical trials. Down-regulation, it was thought, would make them less costly and would require fewer subjects before any products would be eligible for licensing.
Apart from stimulating industrial investment into Japanese products, the plan was to attract foreign researchers and companies to test their products in Japan in the framework of Japan’s national insurance system. This would, first, strengthen Japan’s ability to organise clinical trials, second, increase the purchase of Japanese products through joint ventures and, third, increase the need for international regulators to recognise Japanese procedures and systems of permission.
As described in Chapter 6, regulatory brokerage at home led to the introduction of a tiered risk system to determine research oversight and enabled expedited marketing approval. Although the government presented the new regulations as a redemptive force, advertising its ability to safely and responsibly expedite the translation of regenerative medicine into clinical therapies for Japan’s ageing population, ministerial discussions of the new regulations emphasised its vision in terms of scientific and economic competition: attracting venture capital, global clinical firsts and the export of health care and regenerative medicine to Asia and beyond.
The regulatory reform created new regulatory capital, altering the relations between Japan and other countries, with Japan’s ‘permissive’ regulation fortifying its global competitiveness. The regulatory system, based on conditional, time-limited marketing authorisation, reduced the safety and efficacy studies required before clinical trials to mainly safety studies and presumptions about efficacy. Nevertheless, speaking of ‘deregulation’ is misleading in some respects. For all the talk among critics about Japan’s ‘deregulation’, the amount of paperwork, checks and registrations involved in applications for permissions actually expanded, not in the least because all of Japan’s stem cell clinics now require registration, and because post-marketing research requirements for high-risk (Class I) time conditionally–approved products had been increased. It was also more than apparent that Japan intended to protect its regulatory immunity, and it did so by providing the world with information of each and every step taken in the clinical trials for Class 1 treatments. Another strategy involved in the protection of its regulatory reputation was the international propagation of its regulatory feats, which is the subject of Case 5.
Case 4: International Regulatory Brokerage
A fourth form of opportunistic regulatory brokerage is also ‘reactive’: regulatory discrepancies that emerge as a result of regulatory downgrading in one country incentivise another country to use the resultant regulatory capital to negotiate new collaborations based on the combination of regulatory assets.
Regulatory brokerage at the level of the Japanese government has laid the regulatory groundwork for expanded international collaborations in the field of regenerative medicine. One political decision related to Japan’s regulatory reforms stipulated the creation of Comprehensive Special Zones for industrialisation in 2013, of which Life Innovation in Keihin Coastal Areas Comprehensive Special Zone for International Competitiveness is one example. It was set up to stimulate innovation in regenerative medicine and cell therapies (Kanagawa Prefecture 2016). These Comprehensive Special Zones play an important role in the facilitation of international collaboration.
Before the promulgation of the PMD Act in November 2014, only two products, J-Tec’s JACE and JACC (autologous cultured cartilage cells for cartilage defects and knee joints) had been approved. Shortly after, two new cell therapy products obtained approval for marketing: Heartsheet, the autologous skeletal myoblast sheets for cardiac regenerative therapy (Terumo Reference Terumo2015) mentioned in Case 3 of this chapter, obtained conditional approval in September 2015, after which Terumo started production in the Keihin Comprehensive Special Zone (Nikkei 2016), and Temcell (formerly Prochymal) – an allogeneic MSC product for graft-vs-host disease prevention was acquired by Mesoblast/JCR Pharmaceuticals (Meldrum 2014) – for which it obtained unconditional approval. Under the new RM Act, all four products were made eligible for Japan’s NIH reimbursement.
The creation of both the Comprehensive Special Zones and the eligibility for reimbursement had been designed to attract international collaborators. And, indeed, the regulatory changes in Japan led to a flurry of purchases and collaborations. Japan’s pharmaceutical and industrial sectors placed regenerative medicine high on their agendas, and industrial groups estimate the domestic market for these therapies could top ¥3 trillion by 2050 (Kahn Reference Kahn2015). Deregulation has made Japan attractive not only to Japan’s pharmaceutical and related industries – some major players include Takeda, Astellas, Sumitomo Dainippon, Fujifilm, Kyowa Kirin, Healios, Terumo and Eisai – but also to foreign companies. Interest in Japan among foreign companies exploded to such extent that one scientist referred to it as kusakariba (草刈場) or ‘cutting from the hay-meadow commons’ (Takeuchi, 5/2/2016*), implying a place from which numerous people hope to profit (for example, RepriCell 2013; Reneus 2014; Cytori 2015; Athersys 2016; Cynata Therapeutics 2016; Densford Reference Densford2016; Pluristem 2016).
Regulatory brokerage has taken on international proportions among wealthy, advanced industrial countries. The negotiations that took place in the Keihin Coastal Area Comprehensive Special Zone in Kanagawa Prefecture illustrate how the particular regulatory features of countries can be combined in international strategies. In this example, Keihin Coastal Areas tries to attract industry, with the support of FIRM. In 2017, ten companies within FIRM (Fujifilm, Astellas Pharma, Janssen Pharma, Regience, Rohto Pharmaceutical, Cell Seed, Wako Pure Chemical, Takara Bio, Tella, MediNet) formed the Regenerative Medicine Industrialization Task Force (RMIT) to establish a development centre for regenerative medicine in Kawasaki, a city central to the Keihin Coastal Area.
In early 2016, I attended the UK-JAPAN Life Innovation Symposium ‘Opportunities for UK-Japan Collaborations in Cell and Gene Therapy’ in Kawasaki. Representatives of Kanagawa/Keihin and the UK’s Cell and Gene Therapy Catapult listed the advantages of their respective science parks in a self-congratulatory dance of mutual grooming. Kanagawa/Keihin is presented as close to Haneda airport, allowing one-day round trips to Asian countries and offering ‘deregulation’, subsidies and tax advantages. Located at a distance from conglomerated areas, it allows for potentially risky R&D activities using blood or bacteria. The local government was introduced as being open to industrial applications in regenerative medicine. Kawasaki’s closeness to Tokyo Metropolitan area, with over 40 million people (‘one-third of Japan’), it was pointed out, makes for attractive access to many patients in a super-ageing society. Conveniently, it is equipped with a Life Innovation Centre (LIC) with a large hospital network counting 15 hospitals and 7,900 beds, and possibilities for integration with other advanced medical technologies. Finally, the Kanagawa Centre for Clinical Research and Strategy boasts PMDA-connections that can facilitate early clinical trial permissions. To reassure the audience of its global status, a number of memoranda of understanding were mentioned, including with Singapore, various states in the US, France, Germany, Finland, the UK and the WHO. The British counterparts showcased a similarly long list of attractions, including the Cell and Gene Therapy Catapult, government support for clinical translation in product development and the incubator in Stevenage.
One prominent British delegate from the regenerative medicine community used the Symposium as a platform for international-level regulatory brokerage: with verve, this delegate recommended the combining of aspects of the Japanese and UK regulatory systems. Identifying a considerable gap between science and patient needs, he proposed the ‘Academia, Business and Clinical approach’, whereby both Japan and the UK score high on government and public support, infrastructure and Research & Development in academia, life-science–industry collaboration, manufacturing, commercial support, cell automation and banking in business and hospitals and translational research in the clinic. However, from a regulatory point of view, the two countries differ: the regulation and reimbursement for cell and gene therapies (CGTs) – a European term for regenerative medical products – in Japan is ‘both sensible and pragmatic’; ‘in the UK it is not’. The key question, he maintained, is:
How can your and our regulation push cell therapy along the long development pathway?
Typically, the developmental pathway of medicinal products, he explained, is ten to twelve years, but venture capital funds only invest in years five to seven. The financial gap and the risk of no reimbursement by health insurers are the main problems for British industry, he argued. This and Japan’s problem of access to foreign markets could be resolved through a trick: by combining the Japanese and European systems. The problem with current international regulation, the speaker argued, is that it is inappropriate for CGTs:
The UK Medicines and Healthcare products Regulatory Agency (MHRA) are holding discussions with Japanese regulators to discuss harmonisation. Conventional regulation is an incredibly long process. It was for drugs; it has been adapted for biologicals, but it is inappropriate for CGTs. Efficacy of CGTs is incredibly high: They work! We do not need many patients to show this. We have many therapies that only need two phases. We only need proof of concept in patients: We don’t need many patients. The first in human application in a few patients is crucial. Then we need post-marketing studies.
According to the scientist, the plan involves only two steps:
There are challenges with the regulation internationally. In Japan, there are great conditions for approval; it is a big improvement compared to the UK/US. If we start a clinical trial in the EU, you start with a first-in-man in the UK; then you need to do a bridging study – six patients – to get to Japan. In Japan, you get a conditional and time-limited approval, which means you get reimbursement. It also helps clinical experience in Japan and getting economic data. The trick is to have a parallel study in Europe: It would be a randomised control study in the UK, which is much better in Europe. The advantages are, first, you get quicker approval internationally, second, you do not need to wait as long for approval [in Japan], and, third, you get higher reimbursement.
The ‘trick’ as described above provides a clear case of using regulatory discrepancy as a basis for brokering collaboration to the mutual advantage of both parties.
From the point of view of life scientists knowledgeable about various regulatory systems and aware of the importance of becoming an international player early on, this ‘trick’ is an attractive strategy and conforms entirely to formal regulatory provisions already in place in both countries’ jurisdictions. In this example of regulatory brokerage at an international level, both collaborative partners claim regulatory capital and use this to their own advantage. ‘Their own’ here means to the advantage of industry and researchers, supported by the ministries that support the collaboration. This form of national boundary-making enjoys a high level of regulatory immunity in the home country. It also displays a flexible dose of regulatory tolerance, as it embraces activities that are not covered or vetted by the home-jurisdiction as regulatory strategy. International regulatory brokerage is presented politically as redemptive for patients and industry, while misrecognising the practical realities for patients, who pay for it in the form of taxes, health and valuable time, and scientific researchers who have been forced to reckon with the commodification of science. This misrecognition of patient needs will be discussed further in the context of misrepresentation of the self in Chapter 9.
Case 5: Global Brokerage and Regulatory ‘Harmonisation’
This case of regulatory brokerage shows the importance of the global brokering of new standards for clinical trials and international agreement about regulation to international industry. Regulatory brokerage on this high organisational level bypasses the need to make multiple bilateral deals and can reconfigure the terms upon which regulation is formulated and simplify international negotiation.
Case 4 pointed at some dilemmas related to Japan’s regulatory reforms. Viewed as eroding confidence in scientific standards in regenerative medicine by international critics, including the authoritative International Society for Stem Cell Research (ISSCR) (Daley Reference Daley, Hyun, Apperley, Barker and Benvenisty2016), Japan needed to persuade the world that its regulation was up to the task of safely and effectively testing high-quality regenerative therapy products. Japan’s regulatory efficacy requirements by conditional and time-limited marketing permission differ from those of ISSCR. The ISSCR, an organisation widely (but not necessarily correctly) thought to only represent scientists from ‘Western’ elite laboratories, propagates standards of safety and ethics through its website, members and widely attended conferences. The differences between Japan’s and the ‘international’ (ISSCR) standards entail at least two major interrelated challenges for Japan: first, to prevent damage to the reputation of Japan’s regenerative medicine community, the world needs to be shown that the products licensed without internationally accepted evidence are not inferior when reaching the global market; and, second, to gain access to the global market, Japan needs international acceptance of its cell therapy products licensed in Japan.
To address these challenges, regulators and scientists have tried to gain international acknowledgement of the validity of the new Japanese regulation. They have done this by, first, persuading other governments to follow Japan’s regulatory model, which would turn Japan into a leading example; second, lobbying with global regulatory agencies, industry and scientists to involve them in discussions about regulation; and, third, pushing for international regulatory standards for cell therapy producers.
Regardless of the new ‘deregulation’, many Japanese researchers of regenerative medicine call for clear industrial standards for companies to manufacture therapies that are affordable and safe. This involves the scaling up of production and the creation of international agreement on a ‘smart’ form of cell processing – a form of process monitoring and validation, whereby raw material, process, facility and manufacturing may be variable – which in turn requires scientists to work in tune with the manufacturing process. Regulation resembling ICH guidelines, for instance, would enable the development of therapies attractive to industry. This idea now tops the agenda of the PMDA (Umeda, 27/2/2016*; Hashigawa, 4/3/2016*), and, indeed various stakeholders are working towards this purpose (JSRM 2015: 2–5).
Governmental, professional and industrial organisations – AMED, the PMDA and FIRM – work closely together to promote Japan’s regulatory system abroad and to persuade international industry and regulators of the advantages of its time-conditioned market licensing to both industry and patients. The Stem Cell Evaluation Technology Research Association, a system for the evaluation of marketing and post-marketing founded in 2011, was reorganised in 2015 under AMED and FIRM (SCETRA 2015). AMED, which had a budget of ¥121 billion (US$1.27 billion) in 2014, tasked it with improving the R&D environment. With over 330 staff, AMED negotiates the coordination and insurance of clinical trials and clinical research with Asia (Japan, China and South Korea). It also has established overseas offices in the US (Washington, DC), the UK (London) and Singapore (AMED 2016). Further, the PMDA created the ‘PMDA International Strategic Plan 2015’ to establish a Regulatory Science Centre, and the Asian Training Center for Pharmaceuticals and Medical Devices Regulatory Affairs (PMDA 2015). To discuss and propagate Japan’s regulatory system, it regularly invites regulators from other countries to its international conferences (PMDA 2016).
FIRM especially engages with global industry, and according to FIRM Chairman Yuzo Toda, the organisation ‘strives to promote Japan’s novel regulatory system to the world’ (Okano et al. 2015). It also does so in Asia through the Asia Partnership Conference of Regenerative Medicine Associations (QLifePro 2018), the MoHWL’s Japan’s International Pharmaceutical Regulatory Harmonization Strategy (MoHWL 2015) and in the West through the Alliance for Regenerative Medicine (ARM 2016), the main international organisation representing regenerative medicine and advanced therapies in the West. In March 2015, ARM announced its memorandum of understanding with Japan’s FIRM. The Alliance’s chairman, Edward Lanphier said:
Our collaboration with FIRM is an important step towards ensuring the continued growth and support of this field .… With the recent changes in Japan’s regulatory environment, FIRM is uniquely positioned as a vital partner in promoting the success of regenerative medicine and advanced therapies worldwide.
With a similar mission to accelerate research, development and commercialisation of regenerative medicine and advanced therapies products, the two organisations seek global regulatory harmonisation.
In short, regulatory brokerage on a global scale formed the extension of the national home-keeping strategy of Japan but was in line with the strategies of global industrial organisations operating along the lines of regulatory capitalism. The pressure on political jurisdictions to vie for competitive regulation may lead them to adjust regulations, which in turn may compromise the regulatory immunity of their jurisdictions.
Regulatory Cascades: Competition as Driver of Regulatory Reform
Regulatory brokerage in one jurisdiction, then, reacts to moves of regulatory brokerage in others, forming part of a cascade of regulatory adjustments. These adjustments are made in ways particular to the international and national conditions of jurisdictions, and may aim to equal or overtake others in global regulatory competitiveness.
Japan, as discussed in Chapter 6 and above, introduced the concept of conditional marketing for medical products and separate approval systems based on the risk stratification for medical services. This dual-track system created separate legislation for stem cell therapy products and medical devices and stem cell therapies offered as a treatment by individual practitioners and institutes. This section illustrates how these reforms have come about, are regarded as a competitive advantage and how other countries try to adopt them. For reasons of word space, examples of reactive forms of regulatory brokerage have to be selective, general and brief. Although it should become clear that the regulatory reforms in Japan have influenced regulation in other countries, it is just as correct to maintain that regulatory developments in the US, the EU and South Korea formed a prelude to this regulatory fugue.
United States
Various political initiatives in the US have led to regulatory reforms elsewhere in the world. For instance, principles underlying ‘Free to Choose Medicine’ (FTCM), first conceived by a free market policy group, the Illinois-based Heartland Institute (Madden Reference Madden2010: 88) were adopted in Japan’s deregulation of regenerative medicine. As explained in Chapter 7, FTCM maintains that clinical trial sponsors should be allowed to begin selling investigational products to patients on reaching mid-phase II (see Chapter 7). This scheme, which undercuts the need for developing evidence of efficacy prior to sale, found fertile ground in Japan through a Japanese translation (Madden Reference Madden2017), propagating its principles to members of the Japanese government. More widely noted among scientists, however, were the various regulatory exemptions and accelerations provided to medicinal products and biologics in the EU and the US, even though Japan’s regulatory system also afforded ample clinical research through Japan’s Medical Practitioners Act (Tsuyuki et al. Reference Tsuyuki, Yano, Watanabe, Aruga and Yamato2016). And, as discussed below, the South Korean regulatory changes were an important incentive for Japan’s regulatory overhaul.
Some years after Japan’s regulatory reform, the regulatory stances of the US and Japan had been reversed: Japan’s industrial federation FIRM tried to persuade US-based ARM of the merits of its reforms, and the California Institute for Regenerative Medicine (CIRM) hailed the FTCM-inspired Japanese system in its 2016 strategic plan: ‘Thus far the FDA does not appear to have the same commitment and motivation as Japanese regulators’ (CIRM 2015). The same year, the policy group that authored legislation leading to the REGROW-Act proposal, a bill that sought to allow regenerative medicine products onto the US market on completion of a phase II study, also justified the measure by suggesting that ‘Europe and Japan have outpaced the United States in modernising their policies to grant patient access to safe cell therapies’ (Bipartisan Policy 2016). The REGROW bill died in committee, with major opposition from patient movements (see Chapter 9). But new proposals to accelerate approvals for ‘regenerative advanced therapies’ were accepted in an amendment to the 21st Century Cures Act, allowing the introduction of a new FDA regulatory designation for ‘Regenerative Medicine Advanced Therapies.’ The FDA predicted that by 2025 it would be approving ten to twenty new cell and gene therapy products per year (Sipp and Sleeboom-Faulkner Reference Sipp and Sleeboom-Faulkner2019; US-FDA 2019).
South Korea
South Korea was perhaps the first country to give preferential regulatory treatment to stem cell products. In 2011–2012, the Korean Food and Drug Administration (KFDA) (now the Ministry for Food and Drug Safety) issued a flurry of three approvals of the world’s first stem cell–based medical products, adding a fourth in 2014 (Lee et al. Reference Lee, Han, Yoon, Lee and Lee2015). Despite these marketing authorisations, however, none of the products were reimbursed by the Korean NIH due to concerns over the weakness of efficacy data, highlighting a worrisome new role for payers as market gatekeepers of last resort. The Korean approvals attracted criticism for sacrificing quality of clinical data to expedience (Oh Reference Oh2012), as well as envy among researchers in Japan.
Subsequent regulatory reforms in Japan, however, prompted South Korea’s proposal of the ‘chongsaem [translated as ‘cutting-edge regenerative’] law’ to foster the biologics industry. This Advanced Regenerative Medicine and Biopharmaceutical Safety and Support Act was approved in August 2019, and implemented a year later. The law shortened the procedures for drug approval for innovative cell therapies and gene therapies in order to propel their market entry (Lim Reference Lim2020). But the law had become more demanding than initially planned. After an ingredient mix-up scandal involving the gene therapy drug Invossa, developed by Kolon TissueGene, new requirements for long-term follow-up health data on patients during clinical trials to monitor the efficacy and safety of investigational therapies were introduced for already approved drugs. The re-approval of stem cell therapies was required within one year, which meant that Cartistem, Hearticellgram-AMI, and Cupistem required a re-approval based on past clinical trial data (Kim and Kim Reference Kim and Kim2020). Furthermore, healthcare companies, which had formerly collected raw material cells and conducted clinical trials just on the basis of consent from a hospital and patients, now requires approval from the KFDA (Kim and Kim Reference Kim and Kim2020).
These regulatory reforms, I believe, served the need to maintain public and international confidence in the regulation of the biologics industry. Regulatory immunity is essential for South Korea’s jurisdiction to ensure that the government’s sizable investment of 595 billion won ($525.6 million) by 2030 will successfully support the country’s regenerative medicine sector.
Japan
At the time of Shinya Yamanaka’s ‘discovery’ of iPS, Japan had already identified the US as a major competitor in the race to commercialise; its streamlined approval of cell biologics made South Korea a serious contender as well (FIRM 2012). Documents of METI’s policy-making think-tank, the Research Institute of Economy, Trade and Industry (RIETI) reflected this: ‘Though Japan has surpassed South Korea in terms of R&D in the area of regenerative medicine, South Korea has been more successful at commercialization’ (Kurata and Choi Reference Kurata and Choi2012). Further illustrating its concern with regulatory competition, the report further cites the existences of a ‘tremendous regulatory disparities between Japan and other economies’, asserting that ‘the low number of market approvals is caused by the low number of clinical trials’, a deficit the authors attribute to regulatory differences (Kurata and Choi Reference Kurata and Choi2012; Sipp and Sleeboom-Faulkner Reference Sipp and Sleeboom-Faulkner2019).
As explained, the regulatory reforms were incentivised by competition and formulated using principles of freedom and choice. But according to one background narrative to the creation of the RM Act, the regulation had been necessitated by fatalities of patients treated by a Japan-based South Korean biotech company, RNL Bio. (Okura and Matsuyama Reference Okura and Matsuyama2017; PMDA 2017). The JSRM and the PMDA had argued that the unregulated marketing of unproven stem cell–based interventions had turned Japan into a ‘therapeutic haven’ for predatory foreign firms. Thus, the RM Act prescribed the registration of all medical institutions engaged in providing regenerative medicines. Unsurprisingly, the RM Act, though requiring registration of stem cell therapy providers, also created an expanded, now official, market for unsafe providers directed at numerous patients (Sipp and Okano Reference Sipp and Okano2018). This greatly enhanced unsafe provision through the seeming authorisation of registered providers and the reimbursement of their therapies.
As related in Case 5, Japan’s MoHWL has made available funding for outreach programmes aimed at ‘disseminating Japan’s model for regulating regenerative–medicine products, and fostering trust towards Japanese regulatory agencies and get Japan’s regulatory model introduced in other countries’ (also, see Cyranoski Reference Cyranoski2019), while attracting promising collaborations at the same time. One of these collaborations concerns Astro Stem, the world’s first therapy product for Alzheimer’s Disease developed by South Korean company Nature Cell. Fukuoka Trinity Clinic in Japan in March 2018 received conditional permission from Kyushu’s review board for regenerative medicine to offer interested patients Astro Stem (Sohn Reference Sohn2018). The hospital, a partner of the Biostar Research Institute, jointly run by Nature Cell and RBio, the maligned former RNL Bio, started offering their ‘therapeutic products’ in June 2021. It is the presumed regulatory immunity of Japan as a regulatory jurisdiction that now sustained the credibility of these practices. Considering the enormous support and investment by the Japanese population, growing awareness of the ambitious economic and scientific politics behind the reforms might make it hard to recover the trust upon which its regulatory immunity is based.
India
In India, the introduction of the 2017 National Guidelines for Stem Cell Research was an inter-ministerial effort to prevent the immature commercialisation of stem cell products (Lahiry Reference Lahiry, Chaudhury, Sinha and Chatterjee2019) by fortifying the 2013 regulation (ICMR-DBT 2013, 2017). Laboratories involved in research and/or cell therapies using stem cells must have a registered Institutional Committee for Stem Cell Research (IC-SCR), be approved by the National Apex Committee for Stem Cell Research and Therapy (NAC-SCRT) and follow GMP and use GLP facilities. Researchers criticised the regulation as expensive and slow, including researchers at Stempeutics, the company that played a main role in the development of the 2013 regulation (see Chapter 3). Even though in 2017 it received conditional approval for manufacturing and marketing of Stempeucel, Stempeutics’ CEO Manohar in 2020 praised Japan’s conditional market approval of stem cell products, under which its Stempeucel can be given to patients in collaboration with the Japanese company Novumcella (Expresspharma 2020).
The 2017 regulation is particularly unpopular with clinical service providers, as it only regulates clinical research applications in the context of clinical trials. Neurogen director, Alok Sharma, urged emulating the REGROW-Act of the US as well as the Japanese and Korean legislations for regenerative medicine to create more permissive regulation for medical practitioners using autologous and minimally manipulated therapies and stricter regulations for cellular therapies sold by corporations as a stem cell product (Sharma et al. Reference Sharma, Gokulchandran, Sane, Badhe and Paranjape2016: 15). But despite the strict guidelines for stem cell research and therapy, the state displayed a blatant regulatory tolerance: India has become a key destination for ‘unproven’ stem cell therapies and was openly criticised by the ISSCR in a letter from its president Sally Temple to the Department of Bio-Technology (DBT) requesting investigation (cf. ISSCR 2017; Tiwari and Desai Reference Tiwari and Desai2018).
In March 2019, following Japan and other countries, India published the New Drugs and Clinical Trial Rules, bringing all ‘more than minimally manipulated’ stem cells as well as stem cell–based products under the Drugs and Cosmetics Act of 1940 (Singh Reference Singh2018). The amended regulation both facilitates clinical trials and clinical service providers. On the one hand, it provides for the combination of phase I and II clinical trials, and it allows conditional approval of cell-based products for unmet needs, if the process or product shows demonstrable safety and efficacy characteristics (Ministry of Health and Family Welfare 2019, cited in Mathen and Sinnappah-Kang Reference Mathen and Sinnappah-Kang2020). On the other hand, clinical service providers of minimally manipulated stem cell-based therapies are able to continue their administration in patients with little oversight. Most clinics in India use autologous stem cells, which require what is controversially called minimal manipulation. Not requiring pre-marketing authorisation, similar classification used by the US FDA allows these unproven stem cell therapies to flourish. Ironically, after India had adopted American-style regulation, regulatory amendments shifted regulation towards Japan’s regulatory regime.
Taiwan
In 2018, Taiwan followed Japan in overhauling strict regulatory conditions by drafting a conditional-approval law for regenerative medicine based on Japan’s legislation. Chen and colleagues from the Taiwan Food and Drugs Administration (Taiwan FDA) and Department of Public Health justified the new design for adaptive licensing, which they had adapted from the PMDA, as follows: ‘Cell Therapy Products (CTPs) may still be developing, and their scientific data may not be sufficient by general regulations. However, for the unmet need of specific patients, CTPs can be used as a therapeutic strategy’ (Chen et al. Reference Chen2017). Tsai and associates described how Japan’s international regulatory lobbying has led to Taiwan being the first jurisdiction to adopt its framework as Special Regulation for Cell Therapy, similar to the Japanese RM Act, which came into force on 6 September 2018 (Tsai et al. Reference Tsai, Ling and Lee2020).
The background story is a redemptive one: a water park explosion in 2015 caused 510 patients to sustain burn injuries. A predicament of skin-shortage was saved by Japanese autologous cell therapy (Matsumura et al. Reference Matsumura, Harunari and Ikeda2016), calling attention to the practical use of stem cell therapy and regulatory change. But in 2013, Japanese and Taiwanese researchers had already co-hosted the Asian Cellular Therapy Organisation (ACTO) to propose the emulation of Japan’s regulatory reform, inviting the Taiwan FDA for this purpose. ACTO’s co-host and founder of the Taiwan Association for Cellular Therapy, Yao-Chan Chen, collaborating with the relevant ministries in both countries, laid the groundwork for this (Tsai et al. Reference Tsai, Ling and Lee2020). By 2020, Taiwan had approved twenty-one cell-based therapy technologies and opened its doors to regenerative medicine companies, such as J-TEC, CellSeed, Hitachi and others in the hope of importing the technology. Nevertheless, mention is made of the confusion among physicians about the effectiveness and liability of the new practice and the difficulties patients have distinguishing the effective cell therapies from others (Tsai et al. Reference Tsai, Ling and Lee2020: 1047).
In brief, Taiwan’s strict regulatory regime followed Japan’s dual-track system with time-conditioned market permission, enabling Taiwan to welcome foreign investment and collaborations.
Mainland China
The Administrative Measures for Clinical Research for Stem Cells (for Trial Implementation) issued in 2015 (CFDA 2015) were to stabilise China’s clinical translation of stem cells. Following Japan, it laid the basis for a dual-track system. On the one hand, pharmaceutical companies can obtain market authorisation for a stem cell therapy from the national Medical Products Administration (NMPA) based on evidence from clinical trials, while, on the other hand, clinical research into stem cell therapies, using GCP and qualified as safe and effective, can be used as technical evidence to support applications for market approval. But the release of the Guidance for Research and Evaluation of Cellular Therapy Products in 2017 (NMPA 2017) and China’s National Health Commission (NHC) draft for comments on the Management of Clinical Research and Transformation Applications for Somatic Cell Therapy (Draft for Comment) (NHC 2019), if implemented, could accelerate patients’ access to cell treatments through clinical applications.
These regulations would extend the dual-track system to ‘somatic cells’. Making a distinction between the phases of ‘clinical research’ and ‘clinical application’, they give hospitals free rein to charge patients for somatic cells as ‘medical practice’ if safety and efficacy are demonstrated through clinical research. According to the system, clinical providers file the applications for permission, managed by the NHC. Unlike the arrangements for stem cell applications, which are subject to more stringent controls, the hospitals carry responsibility for the practice (BIOON 2020; Wu et al. Reference Wu, Wang, Tang, Gao and Huo2020). These drafts were followed by the announcement for data-sharing and the construction of two national stem cell banks in late 2019, and the National Key Research and Development Program ‘Stem Cell and Transformation Research’ in 2020 (Zhihu 2021). Frequent references to the ‘mature regulatory mechanisms in the US, South Korea, Japan, and the EU’ (Zhihu 2021) make clear that impulses for stem cell ‘therapy’ marketing in China are inspired by regulatory competition from abroad. But as shown by the epigraph to this chapter, China nevertheless has to put up with sharp criticism from the ISSCR’s president, Doug Melton (ISSCR 2019).
Foreign investors have been keeping a close eye on this potentially huge market. Although there is a ‘Negative List’ that limits market activities of foreign stem cell investors and providers (Ministry of Commerce 2019], according to the financial-service multinational Deloitte, there is ample evidence that foreign companies can navigate regulation by ‘proactively engaging with the relevant authorities on local registration, collaborating with local companies and institutions and launching optimal clinical programs to ensure maximum speed-to-market in China. In addition, for products already launched in other markets, companies are advised to explore early-access programs to accumulate precious local data and evidence earlier’ (Xie, Wang and Ma Reference Xie and Ma2020: 25). One wonders if this form of indirect regulatory loosening does credit to all the efforts expended on the (Trial) Administrative Measures for Clinical Research for Stem Cells in 2015 (CFDA 2015; Rosemann and Sleeboom-Faulkner Reference Rosemann and Sleeboom-Faulkner2016; Chen 2017; Li et al, Reference Li, Verter, Wang and Ning2019), which was to restore confidence in China’s stem cell science and industry.
United Kingdom
The 2015 report of the Regenerative Medicine Expert Group to the House of Lords already referred to Japan’s progressive Regenerative Medicine Law and maintained that ‘a more innovative approach, informed by experience in other countries such as Japan, would be to develop a system that provides early reimbursement to companies’, including the use of an ‘innovative business model developed between industry, government and the NHS, to support the early adoption of regenerative medicines in the NHS’. This approach would ‘selects therapies for which evidence is limited, but where there is suggestive evidence of significant clinical benefit’ (Regenerative Medicine Expert Group 2015). UK stem cell scientists and companies such as Celixir view Brexit as an opportunity to accelerate the UK’s regulatory pathway (Cyranoski Reference Cyranoski2019: 485). In 2020, the UK’s Medical Research Council (MRC) jumped on the bandwagon in its decision to collaborate with Japan’s AMED by jointly supporting eight new regenerative medicine research partnerships to advance regenerative therapies (UKRI 2020).
Competitive Desire as Source of Regulatory Brokerage and Its Foreseeable Violence
In this chapter, we saw that competition is a driving force behind brokering regulatory changes and that we can discern opportunistic and active forms of regulatory brokerage. I defined opportunistic regulatory brokerage as a form of science-entrepreneurship that takes advantage of regulatory variability when negotiating collaborative scientific research. Differences between relatively permissive and prohibitive regulation are utilised to broker transnational collaboration. I described active regulatory brokerage as activities directed at manipulating regulation to gain a competitive edge, which involves various levels of state and interstate organisations. After thinking about different forms of regulatory brokerage at various levels of organisation and governance, we saw how regulation gets commodified and used as regulatory capital in negotiations. But how are the various cases linked? What the five cases have in common is that, rather than complying with regulation in terms of goals, such as safety, efficacy and ethics, regulation is commodified and utilised as capital.
There are political, scientific and economic reasons for these forms to appear in the order in which I presented them. In other words, it is possible to discern a causal logic between the ways in which the cases are linked, though this does not mean it is a necessary causal relationship. Informal forms of regulatory brokerage (Case 1) occur whenever regulatory discrepancies afford entrepreneurially minded scientists and clinicians to use it as negotiation resource. Regulatory brokerage with official support (Case 2) is based on similar collaborative initiatives that are supported by state institutions. This form of regulatory brokerage puts in doubt the integrity of the state’s jurisdiction, and plays political havoc with the values of science and the protection of patients. Active brokerage of regulation by lobbyists at home (Case 3) transcends the contradiction between the state and its subjects. In the case of Japan, as we saw, the regulatory reforms were incentivised and justified in terms of the need to get even with other countries and in terms of gaining competitive edge. Japan’s strong regulatory immunity persuaded scientists and industry from other countries that collaboration would still be advantageous. International regulatory brokerage (Case 4) is politically reactive, as it involves industry- and state players from countries with less permissive regulation that take advantage of a politically brokered regulatory discrepancy. When engaging in regulatory brokerage on a global level (Case 5), Japan and other countries were actively brokering regulation with the aim to close regulatory gaps at a global level: while encouraging more permissive regulation for the international regenerative medicine industry, it would also create the conditions for the acceptance of Japan’s new regulatory regime.
This analysis, based on the notion of competitive desire as an important driver of regulatory reform, is supported by the national discussions on regulatory trends in regenerative medicine described above. We saw that scientists and regulators are eminently aware of the comparative (dis)advantages of the regulation in other countries and that this awareness steers decisions on research collaborations, investments, government budgets and regulatory adjustments. Decision-making on regulation, however, is not the same for every regulatory jurisdiction. Those with strong regulatory immunity, such as the USA, who can (still) afford to tolerate unauthorised stem cell-provision activities when expedient, also have managed to make their regulation more accommodating without major reputational loss. Regulatory changes in South Korea, China, Thailand, and India, countries that have all suffered from relatively weak regulatory immunity, were heavily influenced by regulation in countries with strong regulatory immunity. After having attempted to build regulatory capacity, partly emulating countries with more prohibitive regulation, they found that they became much less attractive as international collaborators. Subsequently, they began to emulate elements of Japan’s time-conditioned and dual-track regulations, such as early-market access and testing through the route of clinical/hospital services.
The case of Japan shows that a country with formerly strong regulatory immunity can ‘deregulate’ by creating more regulation that specifies conditions for early sales. In the case of regenerative medicinal products developed through the PMD Act, great care was invested into safety and efficacy, though independent oversight is lax; regenerative medicine, especially autologous stem cells and differentiated autologous stem cells provided through the RM Act, do not face the same stringent conditions (Sipp and Okano Reference Sipp and Okano2018). The question arises, then, if Japan can sustain its regulatory immunity, especially if the government sets high claims on the effectiveness and transparency of regenerative medicine and its regulation. In brief, as Japan made a regulatory move envied by countries that subsequently began to emulate Japan’s regulation, the entire spectrum of regulatory immunity started to shift. But if decisions about regulatory change are largely driven by regulatory capital rather than patient needs and the quality of science, it is not just scientific evidence but also important socio-cultural values and human rights that are being bypassed: we saw that clinical interventions are offered to populations even if they are only presumed to work.
At the same time, however, we saw that in some countries trends emerge that do not centre on competitive desire but on solidarity and concern for care. Thus, in Australia, regulatory change in 2019 prohibited advertising by DTC companies through penalties and expanded the regulation to include a larger number of autologous cell products (Chapter 4). In Thailand, we saw hesitance among top scientists-cum-regulators to adjust Thailand’s regulation to serve the expectations of Japanese collaborating partners (Chapter 5). We also saw that Japan’s PMDA came to demand more evidence before giving RMP time-conditioned approvals (Chapter 6), while the country’s health-policy focus, as described in Chapter 9, has shifted in priority from high-tech solutions towards preventative health, palliative care and community self-help. In Chapter 7, we saw that international health organisations are not in favour of deregulation if this comes at the expense of patient safety, while some patient organisations advocate a shift in emphasis towards therapies that ameliorate their conditions rather than cure them; and, even in the US, as we will see in Chapter 9, the REGROW Bill that promised five-year conditional approval of regenerative medicine products. So, what does this mean for patients? To what extent, in various jurisdictions, should trust in the safety and hope on the efficacy of new regenerative medicine be valued over other forms of care and medicine? These questions are the point of departure in Chapter 9.
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