After a recent trip to China, I returned more impressed than ever with the rapid level of development within the major markets there. The maturity of the infrastructure in place, ready to support global commerce, was something I was not expecting.

Much has been said of China’s commitment to developing and competing in the world market for the regulated life sciences. A recent market analysis ranked China as the top destination in Asia for Big Pharma (2008 PricewaterhouseCoopers report “The Changing Dynamics of Pharma Outsourcing in Asia: Are You Readjusting Your Sights?”). While both clinical trial activity and investments by pharmaceutical companies to expand their presence in Asia are accelerating, the report suggests that Asia outsourcing is moving up the value chain. Low-cost production is eclipsed by a broad range of factors, including market potential and R&D capacity, as the new drivers of growth.

Still, with all the hype surrounding China’s low-cost manufacturing potential, Big Pharma is not really looking to China for low-cost manufacturing for the global market, but rather for early discovery. The phrase “made in China” is evolving to “discovered in China.”

This evolution is due in no small part to the recent quality issues associated with Chinese API suppliers and manufacturers. The grave quality issues related to the willful adulteration of Heparin by a key API supplier for Baxter and the very high profile Melamine adulteration of milk, a key ingredient in baby formula for the world market, have raised serious concerns about the viability of China to compete in the U.S. and European markets.

To date, China’s regulatory authority, the State Food and Drug Administration (SFDA) has developed many of its cGMP and related regulatory guidance based upon transgressions by manufacturers within their own market. The result is an amalgam of recommended best practices that, in many cases, make sense theoretically but are difficult to implement practically. Unlike the U.S. guidance for good facility design, which is based upon pressure cascades as a foundation for preventing crosscontamination, or the European guidance philosophy of escalating air quality, the SFDA’s guidance does not follow a single rationale or approach.