Biosafety Law: China’s new, stricter controls

Authors: Zhou Hanshuo / Wang Xiaoyun

(This article was first published on China Business Law Journal column "Life sciences & healthcare", authorised reprint)

On 15 April 2021, China’s sixth National Security Education Day, the Biosafety Law came into effect, providing a comprehensive, systematic and overarching law governing this key area. To highlight its growing importance, the recent 33rd Politburo collective study session of the CPC Central Committee was on the theme of strengthening China’s biosafety. President Xi Jinping delivered a speech on strengthening national biosafety risk prevention, control and governance capabilities.

Starting from several points closely related to biomedical enterprises, this paper suggests some trends in China's biosafety supervision before and after the implementation of the Biosafety Law.

Tight grip on R&D

The Biosafety Law distinguishes high, medium and low risks in biotechnology R&D. Following the introduction of the law, the specific classification criteria and lists will be formulated, revised and published by the relevant authorities.

Previous safety regulation relating to biotechnology R&D was mainly covered by the 2017 Measures for the Administration of the Safety of Biotechnology Research and Development issued by the Ministry of Science and Technology (MoST). The annex to the measures includes a classification of biotechnology R&D activities by level of risk. However, being neither law nor administrative regulations, these measures could not serve as the basis for specific administrative permissions, i.e. approval or recordal.

In March 2019, the MoST oversaw the draft Regulations for the Administration of the Safety of Biotechnology Research and Development. Under these,

(1) biotechnology R&D activities that posed a medium to high risk would have been subject to approval or filing; 

(2) those deemed of average risk would have required a risk assessment to be conducted;

(3) and for those not included on the risk list, the risk level would have had to been determined and submitted to the provincial science and technology authority. These draft regulations were not implemented.

The Biosafety Law is at the top level in the hierarchy of Chinese legislation. Following its implementation, more detailed rules for classification and regulations will be promulgated. It is not inconceivable that these may reflect criteria and approaches taken in the formulation of the previous attempts to regulate the sector.

The Biosafety Law also provides that medium to high-risk biotechnology R&D activities must be conducted by organisations legally established in China and subject to approval or filing. This should not be interpreted as a barrier for foreign investors, whose qualification will be further determined by their inclusion in the Special Administrative Measures (Negative List) for Foreign Investment Access.

Pathogenic microbe labs

In 2018, the State Council promulgated the Regulation on the Bio-safety Management of Pathogenic Microbe Labs to address the safety and experimental activities of such facilities. The Biosafety Law also contains a chapter specifically addressing this issue, further emphasising the importance of regulating these labs.

Pathogenic microbe labs are divided into four levels based on their safety protection capacity. The construction, alteration or expansion of level three and four labs are subject to review and approval by the MoST in accordance with national standards. Level one and two labs must be properly filed. Experiments involving highly pathogenic microbes are restricted to labs at level three or four, and subject to approval prior to commencing the experiments.

Notably, less than one month into the implementation of the Biosafety Law, the government issued the Notice on Further Strengthening the Administration of the Biosafety of Animal Pathogenic Microbe Labs that pointed out a series of issues in the sector, including “failure to promptly file for newly built, altered or expanded level one and level two laboratories” and “unlawfully engaging in experimental activities involving high-pathogenicity animal pathogenic microbes”. Shanghai, Zhejiang, Beijing, Guangdong, Jilin and many other regions have also actively carried out the classification, recordal and oversight of pathogenic microbe labs, as well as biosafety training and inspection.

Heavier penalties

With respect to administrative liability for violating the regulations on the administration of human genetic resource materials, the Biosafety Law essentially retains the relevant provisions of the 2019 Regulations for the Administration of Human Genetic Resources (the Genetic Regulations).

However, the Biosafety Law imposes heavier penalties where a foreign organisation or individual, or an institution established or actually controlled by a foreign organisation or individual in China is involved in the collection, conservation or export of Chinese human genetic resources. If the illegal income derived from such activities exceeds RMB1 million (USD160,000), the fine will range from 10 to 20 times the illegal gains, up from 5 to 10 times in the Genetic Regulations.

Criminalisation

The Amendments to the Criminal Law (No. 11), implemented on 1 March 2021, set forth specific criminal acts relating to biosecurity, including the crime of jeopardising the safety of national human genetic resources and the crime of illegally disposing of invasive species. This achieves an “administrative and criminal convergence” between the Biosafety Law and the Genetic Regulations.

The amendments also added the crimes of illegally engaging in human gene editing and human embryo cloning to the existing list. Implanting a genetically edited or cloned human embryo in a human or animal, or implanting a genetically edited or cloned animal embryo in a human are considered criminal offences.

The ongoing and recurring outbreaks of infectious diseases that have been plaguing the world in recent memory have raised awareness of biosafety strategies in many countries, leading to an era of global governance reform. The promulgation and implementation of the Biosafety Law is a major step forward for China’s efforts to consolidate its biosafety line of defence. And in these efforts we can see the direction of China’s biosafety regulation – higher, and stricter.

Jingtian & Gongcheng’s Life Science and Healthcare Team has extensive legal and industrial experience in the field. Our lawyers have been focused on international and pharmaceutical legal practices over a dozen of years, with working experiences at international law firms and top-tier multinational healthcare companies, and many of them are qualified both in China and abroad.

We have advised clients on mergers and acquisitions, technology licensing, contracted manufacturing, co-promotion, business conduct and compliance, and daily operational issues related to pharmaceutical and medical devices companies. For more information, please contact Ms. Hanshuo ZHOU([e-mail], phone: [phone], mobile: [phone]).

医药医疗专栏往期文章

作者介绍
 周晗烁  

合伙人

021-2613 6241

[e-mail]

周晗烁律师毕业于华东政法大学、美国德克萨斯大学法学院(University of Texas at Austin) ，获中美两地法律硕士学位，具有中国大陆地区以及美国纽约州法律执业资格。

周律师从事法律工作已超过十五年，服务的客户包括国际500强医疗企业，国内大型药企、创新型医疗器械和医疗服务企业，以及著名私募和风险投资基金。周律师深耕于生命科学和医疗健康领域，不仅对传统医疗药械领域的生产、销售、跨境技术服务等交易经验丰富，近年来还深度参与了诸多新兴领域的项目，如生物技术、细胞治疗、基因检测、医疗大数据、互联网+医疗等。

周律师在“LEGALBAND 中国顶级律师排行榜”上连续两年被列为“医疗和生命科学领域的获推荐律师”。在国际知名财经媒体Euromoney公布的“2020年度亚洲商业法律杰出女律师（Women in Business Law Awards 2020）”评选中，荣膺亚洲区域“Best in Life Science （生命科学领域最佳）” 。

周晗烁等律师往期文章回顾

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王晓赟

律师

021-2613 6247

[e-mail]

王晓赟律师毕业于华东政法大学，持有中国律师执照。具有近九年法律工作经验。

王律师的执业领域主要为医疗行业的私募投资和风险资本、兼并收购和公司业务。王律师曾代表多只医疗行业的知名基金完成投资/并购，并协助业内诸多头部企业进行融资并负责其后续常年法律顾问服务，行业经验丰富。

王律师于2021年荣列法律服务评级机构LEGALBAND发布的“2021年度中国律界俊杰榜三十强”。