The State Drug Administration ("SDA") has recently distributed the Official Reply on Matters Concerning Drug Production and Circulation under the Drug Marketing Authorization Holder Pilot Program (the "Reply").
The Reply notes that, the drug marketing authorization holder (MAH or Holder) shall specify rights and liability concerning the commissioned production in the written contract for commissioned production and in the quality agreement for commissioned production, prior to the commencement of the commissioned production process. Further, the Reply expressly states that, a Holder may sell drugs it has on its own, and qualification certifications gained by such Holder may serve as those for product sales. According to the Reply, the Holder may entrust a contracted manufacturer or a contracted pharmaceutical dealer to sell drugs it holds as well. But the Holder shall audit and assess the quality management system of the enterprise it has entrusted and enter into a quality agreement with it to make clear rights, obligations and liability of each party. The quality agreement shall include, at least, the division of liability between both parties for the entrustment, procurement of products, acceptance checks before entry to warehouses, storage and maintenance, transport and delivery, after-sales services and quality management.