Original Title: Several Opinions of the General Office of the Hangzhou Municipal People’s Government on Accelerating the High-Quality Development of the Biopharmaceutical Industry

To the People’s Governments of All Districts, Counties (Cities), and All Departments and Directly Affiliated Units of the Municipal Government:

To fully leverage the leading role of the biopharmaceutical industry, accelerate the establishment of a biopharmaceutical innovation hub, improve the industrial ecosystem, strengthen the foundation for high-quality industrial development, and build an advanced manufacturing industrial cluster, the Municipal Government hereby issues the following opinions on accelerating the high-quality development of the city’s biopharmaceutical industry, with the approval of the Municipal Government.

I. Defining Targets, Fields, and Subjects

(1) Main Objectives. Building upon the foundation of our city’s biopharmaceutical industry, we will focus on constructing a comprehensive industrial ecosystem. We will establish a full-chain policy support system covering R&D, clinical trials, manufacturing, key resources, the industrial ecosystem, and institutional mechanisms. We will further refine the “One Core, Four Parks, and Multiple Nodes” spatial layout for the biopharmaceutical industry and implement the “156 Action Plan” for the biopharmaceutical and health industries. Through three years of concerted efforts, we aim to double the annual industrial output value of the city’s biopharmaceutical manufacturing sector.On this basis, by 2030, we aim to expand the scale of the city’s biopharmaceutical and health industries to reach the trillion-yuan level.

(2) Key Areas. This Opinion prioritizes support for pharmaceuticals, high-end medical devices, advanced pharmaceutical equipment and materials, new types of service outsourcing, digital healthcare (pharmaceuticals), and medical aesthetics.

(3) Eligible Entities. This opinion applies to enterprises, public institutions, social organizations, industry associations (or consortia), and Marketing Authorization Holders (MAHs) for pharmaceuticals (medical devices) that are legally registered within the city’s administrative jurisdiction, engage in R&D, production, services, and other business operations in biopharmaceutical-related fields, and possess independent legal person status.

II. Enhancing Innovation and R&D Capabilities

(4) Strengthening the Foundation for Innovation. Relying on key institutions to connect with national strategic platforms for pharmaceutical science and technology innovation and key laboratories of the National Medical Products Administration, we will strive to attract major national and provincial-level scientific and technological infrastructure projects and high-level national biosafety laboratories to be established in the city. We encourage key enterprises and research institutes to undertake provincial-level research and development tasks, plan a series of major scientific and technological projects, and establish several new R&D institutions with significant influence.(Lead Agencies: Municipal Science and Technology Bureau, Municipal Market Regulation Bureau; Cooperating Agencies: Municipal Development and Reform Commission, Municipal Economy and Information Technology Bureau, Municipal Health Commission)

(5) Support the R&D of Innovative Drugs. For Class 1 chemical drugs, Class 1 biological products, and Class 1 traditional Chinese medicines that have undergone Phase I, II, or III clinical trials in China, and for which the registration applicant—based in the city or approved to establish operations here—obtains approval and manufactures the product locally, financial support of up to 40% of R&D expenditures will be provided based on the stage of clinical trials, subject to review. The maximum funding per product is 6 million yuan, 12 million yuan, and 30 million yuan, respectively(including reductions in local clinical trial costs). (Lead Agencies: Municipal Science and Technology Bureau, Municipal Health Commission, Municipal Market Regulation Bureau; Cooperating Agencies: Municipal Bureau of Economy and Information Technology, Municipal Finance Bureau)

(6) Support for the R&D of Modified New Drugs.For Category 2 chemical drugs, Category 2 biological products, and Category 2 traditional Chinese medicines that have undergone Phase I, II, or III clinical trials in China, and for which the registration applicant—based in this city or approved to establish operations here—has obtained approval and commenced production in this city, funding support of up to 30% of R&D expenditures will be provided based on the different stages of clinical trials, subject to review. The maximum funding per product is 3 million yuan, 6 million yuan, and 12 million yuan, respectively (including local clinical trial fee reductions).

For Class 3 chemical drugs, Class 3 biological products, and traditional Chinese medicine compound preparations based on ancient classic formulas that have undergone Phase II or Phase III clinical trials in China, and for which the registration applicant has obtained approval and is manufacturing in this city or has agreed to establish operations here, funding support of up to 20% of R&D expenditures will be provided based on the different stages of clinical trials following review. The maximum funding per product is 3 million yuan, 6 million yuan, and 12 million yuan, respectively (including reductions in local clinical trial costs).For the re-development of marketed innovative drugs produced in this city that result in new indications, funding of up to 2 million yuan per product will be provided on a merit-based selection basis (including exemptions from local clinical trial fees). (Lead Agencies: Municipal Science and Technology Bureau, Municipal Health Commission, Municipal Market Regulation Bureau; Cooperating Agencies: Municipal Bureau of Economy and Information Technology, Municipal Finance Bureau)

(7) Support for Medical Device R&D. For medical devices that have entered the National Special Review Procedure for Innovative Medical Devices or the Priority Review Procedure for Medical Devices, and that have obtained a medical device registration certificate for the first time and are manufactured in this city, financial support of up to 40% of R&D investment, with a maximum of 6 million yuan per product, will be provided upon review (including reductions in local clinical trial costs).For innovative Class II and Class III medical devices that have obtained a medical device registration certificate and are manufactured in this city, financial support of up to 20% of R&D investment, with a maximum of 2 million yuan and 4 million yuan per product respectively, will be provided upon review (including exemptions from local clinical trial fees). (Lead Agencies: Municipal Science and Technology Bureau, Municipal Health Commission, Municipal Market Regulation Bureau; Cooperating Agencies: Municipal Bureau of Economy and Information Technology, Municipal Finance Bureau)

(8) Enhancing the Internationalization of Innovation. For pharmaceuticals that have obtained approval for the first time from the U.S. Food and Drug Administration (FDA), the European Medicines Agency (EMA), the Pharmaceuticals and Medical Devices Agency (PMDA) of Japan, or similar agencies, and have secured overseas marketing authorization and achieved sales in relevant foreign markets, a grant of up to 1 million yuan will be provided for each product.For products that have already obtained a domestic Class III medical device registration certificate, a grant of up to 500,000 yuan will be provided for each product that secures market access approval from the FDA, EMA, PMDA, or similar authorities for the first time and achieves sales in relevant foreign markets. The cumulative annual support for each enterprise shall not exceed 5 million yuan. (Lead Agency: Municipal Bureau of Economy and Information Technology; Cooperating Agencies: Municipal Finance Bureau, Municipal Commerce Bureau, Municipal Market Regulation Bureau, Qianjiang Customs)

III. Improving the Application of Clinical Research

(9) Establish a collaborative ethics review mechanism. Establish a city-wide clinical research ethics review alliance system to promote multi-center clinical research ethics review collaboration. Explore the establishment of a mutual recognition system for multi-center clinical research ethics review results. Standardize information collection criteria for clinical biobanks within the city to facilitate sample sharing. (Lead Agency: Municipal Health Commission; Cooperating Agencies: Municipal Bureau of Economy and Information Technology)

(10) Strengthen Incentives for the Commercialization of Clinical Research Outcomes. Support medical institutions in conducting clinical research and commercializing research outcomes. Recognized research wards may be exempted from evaluations based on hospital metrics such as average length of stay, bed turnover rate, bed occupancy rate, and the Diagnosis-Related Groups (DRGs) payment system.For personnel who make significant contributions to clinical research and the translation of research outcomes, allow one-time cash rewards for the commercialization of scientific and technological achievements to be included in the unit’s total annual wage fund, but exclude them from the total performance-based wage quota for public institutions. (Lead Agency: Municipal Health Commission; Cooperating Agencies: Municipal Science and Technology Bureau, Municipal Finance Bureau, Municipal Human Resources and Social Security Bureau, Municipal Medical Security Bureau)

(11) Enhance the capacity for medical-enterprise integration and innovation. Establish a mechanism for medical-enterprise collaboration, encouraging medical institutions to jointly conduct clinical application research with enterprises and R&D institutions through a “challenge-based” approach. Support medical institutions in building clinical research-oriented hospitals, jointly establishing technology transfer platforms, and designating on-site clinical research centers.Encourage medical institutions to commission local enterprises to conduct R&D and production activities through Contract Research Organizations (CROs), Contract Manufacturing Organizations (CMOs), or Contract Development and Manufacturing Organizations (CDMOs), thereby strengthening the development and commercialization of in-house pharmaceutical preparations. (Lead Agency: Municipal Health Commission; Cooperating Agencies: Municipal Bureau of Economy and Information Technology, Municipal Science and Technology Bureau, Municipal Medical Security Bureau)

(12) Support the application of Hangzhou-produced pharmaceuticals and medical devices. Medical institutions in the city that procure the first unit (set) of medical devices recognized by relevant provincial and municipal authorities will receive a reward equivalent to 20% of the procurement amount, with a maximum annual total reward per institution not exceeding 3 million yuan;For local medical institutions using certified innovative medical devices and high-quality Hangzhou-produced medical devices, such products shall not be included in the assessment of the proportion of pharmaceuticals and consumables in medical institutions, and a reward of up to 3% of the actual product usage amount shall be granted, with a maximum annual total reward per institution not exceeding 3 million yuan. (Lead Agencies: Municipal Bureau of Economy and Information Technology, Municipal Health Commission; Cooperating Agencies: Municipal Finance Bureau, Municipal Medical Security Bureau)

(13) Strengthen the medical insurance system’s support for the application of innovative products. Actively guide the inclusion of various innovative products in the National Drug List or the National Negotiated Drug List. Leverage the role of financial services such as commercial insurance in the city to enrich the supply of commercial supplemental medical insurance products. Improve the “Health Commission–Medical Insurance–Enterprise” face-to-face mechanism to guide high-quality innovative products from the city into hospitals in Hangzhou. (Lead Agency: Municipal Medical Security Bureau; Cooperating Agencies: Municipal Health Commission, Municipal Bureau of Economy and Information Technology)

IV. Promoting Industrial Cluster Development

(14) Elevate the Development Level of the Industrial Chain. Implement the “chain leader system” for the biopharmaceutical industrial chain, vigorously attract and cultivate leading enterprises and “single-champion” enterprises, and leverage the industrial chain to help Kunpeng enterprises, chain-leading enterprises, “single-champion” enterprises, and specialized, refined, distinctive, and innovative “Little Giant” enterprises grow larger, stronger, and better. Continuously advance the digital and intelligent transformation of biopharmaceutical manufacturing enterprises and improve the new “Future Factory” system for the biopharmaceutical industry.(Lead Agency: Municipal Bureau of Economy and Information Technology; Cooperating Agencies: Municipal Development and Reform Commission, Municipal Science and Technology Bureau, Municipal Investment Promotion Bureau)

(15) Promote the industrialization and implementation of innovation projects. For major biopharmaceutical industry projects newly established during the validity period of this policy with fixed-asset investments (excluding investments in land acquisition, factory buildings, used equipment, and working capital) reaching 200 million yuan or more, financial support of up to 20% of the total actual fixed-asset investment will be provided. (Responsible Units: Municipal Bureau of Economy and Information Technology, Municipal Development and Reform Commission, Municipal Investment Promotion Bureau)

(16) Encourage enterprises to expand their markets and grow stronger. Districts, counties (cities) are encouraged to provide corresponding rewards to local biopharmaceutical enterprises with an industrial output value of 100 million yuan or more, based on their actual contributions. Reward proposals shall be submitted by district, county (city) governments to the Office of the Municipal Leading Group for Promoting the Innovative Development of the Biopharmaceutical Industry (hereinafter referred to as the Municipal Leading Group) for review. Reward funds shall be shared by the municipal government and the relevant districts, counties (cities) in accordance with the fiscal allocation ratio.Enterprises are encouraged to actively participate in national centralized bulk drug procurement to expand their markets. A reward of 3% of the total winning bid price will be granted for winning products, with a maximum reward of 3 million yuan per product. (Lead Agency: Municipal Bureau of Economy and Information Technology; Cooperating Agencies: Municipal Finance Bureau, Municipal Medical Security Bureau)

(17) Promote new models of contract research and manufacturing organizations (CMOs/CDMOs). Districts, counties (cities) are encouraged to provide appropriate incentives to Marketing Authorization Holders (MAHs) that outsource R&D and production activities via CMO or CDMO arrangements, provided that sales tax settlements and output value are recorded within the city, as well as to enterprises commissioned by MAHs to manufacture the pharmaceutical and medical device products held by the MAHs (provided there is no investment affiliation between the commissioning and commissioned parties).Specific implementation plans shall be submitted by the relevant district, county (city) governments to the Municipal Leading Group Office for review. Reward funds shall be shared by the municipal government and the relevant districts, counties (cities) in accordance with the fiscal allocation ratio. (Lead Agency: Municipal Bureau of Economy and Information Technology; Cooperating Agencies: Municipal Finance Bureau, Municipal Market Regulation Bureau)

(18) Promote the integrated development of digital health. In accordance with the national standards for the classification and tiered opening of healthcare big data, establish healthcare big data centers and open infrastructure to facilitate the orderly release of data to enterprises. Encourage the application of medical artificial intelligence and new digital health services, and support local medical institutions in participating in pilot programs for the procurement of digital therapeutic products. (Lead Agency: Municipal Health Commission; Cooperating Agencies: Municipal Bureau of Economy and Information Technology, Municipal Finance Bureau, Municipal Bureau of Data Resources)

V. Enhancing the Capacity of Supporting Factors

(19) Enhance the carrying capacity of industrial space. Subject to compliance with the national spatial planning, prioritize the allocation of land quotas for biopharmaceutical industry projects. For provincial key projects located within the “One Core, Four Parks, and Multiple Points” framework, seek additional quotas for construction land, energy consumption, and pollutant discharge from the province for major industrial projects, and provide priority support.The Municipal Leading Group Office will quantify, allocate, and evaluate industrial development quotas and GMP-standard factory space quotas for major industrial platforms within the “One Core, Four Parks” area over a three-year period. (Responsible Units: Municipal Bureau of Economy and Information Technology, Municipal Development and Reform Commission, Municipal Bureau of Planning and Natural Resources, Municipal Bureau of Ecology and Environment, Municipal Investment Promotion Bureau)

(20) Optimize environmental access management for the biopharmaceutical sector. Biopharmaceutical enterprises that meet ecological and environmental regulatory requirements shall be included in the positive list for ecological and environmental supervision. Accelerate the linkage between planning environmental impact assessments and project environmental impact assessments in key areas, and streamline the processing procedures. Major municipal industrial projects shall enjoy a green approval channel, with total pollutant emission quotas coordinated and guaranteed by both the municipal and local levels.Encourage districts, counties (cities) to provide subsidies to specialized institutions handling hazardous waste within biopharmaceutical parks based on the volume of hazardous waste treated. Encourage the development of green, miniaturized production equipment and processes, such as microreactors. (Lead Agency: Municipal Ecology and Environment Bureau; Cooperating Agency: Municipal Development and Reform Commission)

(21) Strengthen industrial financial support. Leverage the investment guidance role of government industrial funds to attract social and financial capital toward the biopharmaceutical industry. Utilize the Government Industrial Innovation and Development Fund to support, through equity investment, R&D for biopharmaceutical innovation projects, the construction of GMP-standard facilities, the commercialization of Marketing Authorization Holders (MAHs), and the introduction of major projects; the portion of fund proceeds foregone may be used to reward project core teams. Encourage the “One Core, Four Parks” main platform to establish multi-tiered biopharmaceutical industry funds in accordance with market-oriented mechanisms.Fund establishment proposals submitted by district, county (city) governments must be reviewed and approved by the municipal government; for approved proposals, the municipal government will provide matching funds at a 1:1 ratio for the government-contributed portion. Flexibly utilize monetary policy tools such as the central bank’s re-lending and rediscounting to guide financial institutions in innovating financial products and services. (Lead Agency: Municipal Bureau of Local Financial Supervision; Cooperating Agencies: Municipal Finance Bureau, Municipal State-owned Assets Supervision and Administration Commission, Municipal Bureau of Economy and Information Technology, Hangzhou Central Branch of the People’s Bank of China)

(22) Strengthen the recruitment and cultivation of talent in the biopharmaceutical sector. Explore biopharmaceutical talent recognition standards with “Hangzhou characteristics” and provide support in the classification and recognition of high-level talent. Create a biopharmaceutical talent map to enhance targeted talent recruitment. Pilot programs at key employers to allow for autonomous classification and recognition of high-level talent based on actual contributions.Actively promote the mutual recognition of international professional qualifications and specialized evaluations in the biopharmaceutical industry, and streamline channels for professional title evaluation and rank promotion for biopharmaceutical technical professionals. Make full use of the “Hangzhou Business Academy” platform to establish specialized courses for the biopharmaceutical industry. (Lead Agency: Municipal Party Committee Talent Office; Cooperating Agencies: Municipal Bureau of Economy and Information Technology, Municipal Bureau of Human Resources and Social Security, Municipal Health Commission)

VI. Improving the Ecosystem Service System

(23) Support the development of key public service platforms. Support the development of public service platforms for GCP, CRO, CMO, CDMO, registration testing, MAH licensing transactions, intellectual property transactions, and smart healthcare. Provide funding of up to 18 million yuan to recognized municipal key public service platforms in the biopharmaceutical industry, covering no more than 30% of their newly added investments in R&D equipment and software.For recognized public service platforms that provide services to local biomedical enterprises and institutions (where there must be no investment ties between the service provider and the recipient), innovation voucher subsidies of up to 10% of the technical contract amount will be granted based on technical contracts and service performance, with a maximum annual subsidy of 1 million yuan per platform. (Lead Agency: Municipal Science and Technology Bureau; Cooperating Agencies: Municipal Bureau of Economy and Information Technology, Municipal Finance Bureau, Municipal Market Regulation Bureau, Municipal Health Commission)

(24) Enhance review and inspection service capabilities. Strengthen drug registration review capabilities, establish a Product Registration Guidance and Service Center, and improve the “one-stop” biopharmaceutical registration service system. Enhance the capabilities of testing and inspection institutions and improve the public biopharmaceutical testing and inspection platform. Support third-party drug and medical device registration, GMP compliance consulting, and quality system certification agencies to shorten the review and approval cycle for drugs and medical devices. (Responsible Unit: Municipal Market Regulation Bureau)

(25) Improve and refine customs clearance facilitation measures. Establish a “whitelist” for local biopharmaceutical enterprises and goods, and improve supporting services such as biomaterial warehousing, cold-chain logistics, and customs inspection. Further leverage the role of the “Zhejiang Biopharmaceutical Special Goods Entry-Exit Centralized Supervision Platform” to enhance overall customs clearance efficiency. Capitalize on the advantages of airport logistics to build a biopharmaceutical distribution hub serving the entire province, thereby driving the clustering of biopharmaceutical enterprises and R&D institutions.[Lead Agencies: Municipal Bureau of Commerce (Hangzhou Pilot Free Trade Zone Administration Committee), Qianjiang Customs; Cooperating Agency: Municipal Market Regulation Bureau]

VII. Strengthening the Coordinated Implementation Mechanism

(26) Implement the “156 Action Plan” for the biopharmaceutical and health industries. Focusing on establishing a comprehensive ecosystem across the entire biopharmaceutical and health sector, the plan targets five key areas: innovative drugs, medical devices, bio-digital technologies, pharmaceutical distribution, and medical wellness. It will carry out six priority tasks: improving the R&D innovation system, enhancing the ecosystem service system, developing an enterprise attraction and cultivation system, building a digital empowerment system, establishing a modern distribution system, and strengthening the factor support system, with the goal of creating a trillion-yuan industrial cluster.(Responsible Units: Member Units of the Municipal Leading Group)

(27) Improve the decision-making and promotion mechanism for key projects. Centered on key target enterprises and objectives, establish promotion mechanisms for project coordination, collaborative problem-solving, and consultation-driven advancement, and implement full-lifecycle management of project information for city-wide investment attraction initiatives. For particularly major projects or city-district collaborative projects, the Municipal Leading Group Office, relevant municipal departments, or districts and counties (cities) shall submit proposals to the Municipal Party Committee and Municipal Government for decision-making. (Responsible Units: Member Units of the Municipal Leading Group)

(28) Advance the detailed implementation of specialized task force mechanisms. Strengthen the responsibilities of specialized working groups—covering drug research, clinical trials, registration, distribution, enterprise recruitment, health and wellness services, and manufacturing upgrades—as well as those of districts, counties (cities). Establish mechanisms such as supervision and evaluation, and regular work meetings to ensure the detailed implementation and tangible results of the biomedicine and health industry initiatives. (Responsible Units: Member Units of the Municipal Leading Group)

These guidelines shall take effect on August 23, 2021, and remain valid until December 31, 2025. The Office of the Municipal Leading Group shall be responsible for leading and organizing their implementation. Projects that met the eligibility criteria between May 1, 2021, and the effective date of these guidelines may be implemented in accordance with these guidelines.Where this Opinion overlaps with other similar policies at various levels within the city, support shall be provided in accordance with the principles of “selecting the most favorable, applying the highest standard, and avoiding duplication.” Funding for grants (and rewards) shall be jointly borne by the municipal government and the respective districts, counties (cities) in accordance with the fiscal system. The previously issued “Implementation Opinions of the General Office of the Hangzhou Municipal People’s Government on Promoting the Innovative Development of the Biomedical Industry in Hangzhou” (Hang Zheng Ban Han [2018] No. 66) is hereby repealed.

General Office of the Hangzhou Municipal People’s Government

July 23, 2021

(This document is publicly released)