APAC offers stability in an increasing challenging global geopolitical environment for clinical stage drug development.
As geopolitical uncertainties and regulatory challenges reshape the global pharmaceutical landscape, the Asia-Pacific (APAC) region has emerged as an increasingly attractive destination for clinical trials. While trials in the European Economic Area (EEA) have seen a steady decline since 2018, APAC has experienced remarkable growth largely due to the region’s work to create a landscape that supports global drug developer’s clinical trials. Recent discussions at the global Jefferies Healthcare Conference in 2024 indicated that the APAC region was a prime location for innovation and expected to continue to grow.
Quality and efficiency against a global backdrop of geopolitical unrest
As we move forward into 2025, the political uncertainty of the next four years for the life sciences in the United States market is a major concern for the global life sciences community. This uncertainty only adds to an already volatile environment. Clinical trials have suffered in Europe as a result of the Ukraine/Russian conflict due to healthcare infrastructure damages and patient displacement. Combined with the active conflicts in both the Middle East and Europe, drug developers are seeking stable clinical trial and regulatory environments. In contrast, the APAC region offers not only stability but continues to be streamlining their clinical trial processes to offer attractive solutions to global sponsors.
“With the conflicts happening in the Middle East and Eastern Europe, which seem to be expanding, I can see where APAC has an increase in demand from that geopolitical
tension,” explained Kento Nakamura, strategy and corporate development, CMIC Group. He further noted that trade dynamics are also reshaping the landscape: “With the trade friction that has evolved between the US and China over the past couple years, the active pharmaceutical ingredient (API) that used to be bought from China are now being sourced from other countries.” With talks of additional tariffs looming, additional concerns surrounding the cost-effectiveness of importing APIs from other regions.
To become more competitive, countries in the APAC region are creating competitive clinical trial landscapes to position their countries as attractive alternative locations. “The time to trial start up has improved a lot in the past couple of years,” Nakamura explained. “It is comparable, or in some instances, better than current averages from European countries and the United States.”
Strategic approaches highlight regional strengths
As a region APAC’s fundamental strengths are compelling: the region houses 4.7 billion people, accounting for 60% of the global population and 54% of the global urban population. More importantly, particularly in developed APAC countries, disease patterns increasingly mirror those in the West, creating ideal conditions for clinical research. However, to avoid being lost in the APAC region, the different countries have further increased their attractiveness by developing distinct strengths in clinical trial conduct.
South Korea represents a prime example of strategic development which focuses on the patient recruitment and retention. “Fifty percent of the South Korean population is in the Seoul metropolitan area,” Toshio Oya, corporate officer of clinical operations business, associate head of global clinical development, CMIC Co., Ltd explained. “Since 2004, the Korean Government has invested heavily in developing these centers as centers of excellence for clinical trials.”
Other APAC countries have streamlined their regulatory processes and worked to create desirable clinical trial environments with cost-reducing incentives. According to Nakamura, Taiwan has established itself through efficiency and quality. “Taiwan has lower clinical trial costs than other countries without sacrificing quality. They’ve been doing an excellent job in having established infrastructure to conduct clinical trials and they have a good track record of that.” To make the area more attractive, the Taiwan FDA implemented the Fast Track review process, which reviews the investigational new drug (IND) application in 15 working days instead of the standard 45 working days.
Australia has also created a particularly attractive environment through financial incentives both Oya and Nakamura noted. Australia’s Research and Development (R&D) tax incentive offers companies a tax rebate of up to 43.5% on clinical trial related R&D costs. Nakamura also noted that their clinical trial notification scheme can reduce study start-up to as little as three months.
Japan’s strategic position
Perhaps the most attractive country in the APAC region, Japan presents a unique value proposition as the world’s third-largest pharmaceutical market overall and second largest for prescription drugs. Oya emphasized the efficiency of the system. “With the country’s streamlined pricing and reimbursement process, “these drug[s] will be... priced within sixty days of their approval date.” Additionally, the government has implemented incentives for innovative drugs, particularly those with new modes of action or pediatric applications.
Meanwhile, Oya pointed Japan’s continual improvements. To facilitate a more cost-effective and streamlined process, “the government health authorities have started an initiative to create a centralized IRB to eliminate duplication efforts due to having to submit to multiple IRBs. “
These elements alone make Japan a compelling clinical trial location, however both Oya and Nakamura also highlighted that Japan can be a gateway to other Asian markets, which makes it a naturally logical clinical trial location. Nakamura explained, “Places like Taiwan, Thailand, Malaysia, Philippines, etc. could allow use of the approval packages submitted in Japan to gain NDA approval in their own approval processes.”
Navigating regional complexities
However, there are regional complexities when approaching the APAC region. Companies considering APAC for clinical trials should approach the region strategically. Nakamura acknowledged historical perceptions prevalent among both the United States and European drug developers. “Besides, the language and the culture being so different, the regulations are more nuanced and different than in the west.” Understanding these differences can prove challenging. However, Nakamura emphasized the power of creating proper partnerships. “Establishing relationships with clinical research organizations are key to unlocking the process. They are able to assist with the cumbersome activities that are required, or perceived cumbersome activities.”
Keeping in mind that other APAC countries defer to Japan, one strategic approach that may benefit drug and device developers is to engage with Japan first. Japan’s approval will help accelerate approvals in other APAC countries.
Looking Ahead
The growth trajectory for APAC clinical trials appears strong, supported by both market fundamentals and strategic initiatives. Regulatory authorities are becoming more
proactive, as Oya explained, “PMDA recently opened a new office in Washington, DC to foster regulatory cooperation between Japan and the United States.” This move reflects global trends. In reviewing all registered studies ClinicalTrials.gov in May 2023, more than more than half (53% percent) are being conducted outside the US. Nakamura indicated that such cooperation is becoming increasingly necessary for the global pharmaceutical industry.
As the global pharmaceutical industry continues to evolve, APAC’s role in clinical trials represents more than just a geographic shift – it signals a fundamental transformation in how and where new drugs are developed. However, companies still need to look for trusted partners within the region. As such, the global market for contract research outsourcing was estimated at $49.8 billion in 2022, and is anticipated to reach $90.4 billion by 2030 at a compound annual growth rate (CAGR) of 7.7 percent. Companies that recognize and begin entering the APAC region early will be better positioned to succeed in an increasingly complex global pharmaceutical landscape.
CMIC Group was founded in 1992 as the first contract research organization (CRO) in Japan. To enable pharmaceutical and biotech companies to develop better medicine sooner, we expanded our solutions to contract development and manufacturing (CDMO), site management (SMO), and market solutions. We also support global drug development companies to bring highly desired treatments to the Japanese market.
This article was written in partnership with CMIC.
