General Medical Indicators 1

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General Medical Indicators (1)
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General Medical Indicators (2)
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Japans Healthcare System (1)
Major Characteristics Universal Healthcare
Coverage (achieved in 1961) - health insurance
covering the entire population Free Access -
patients can freely choose doctors, clinics,
hospitals Low Co-payment Rate - patient can
receive necessary medical care for a small fee
(patient are required to pay anywhere 10 and 30
of treatment fee) Fee-For-Service - reimbursed
based on point system
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Japans Healthcare System (2)
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Rate of Projected Population - over 65
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National Healthcare Expenditure
Source Ministry of Health, Labor and Welfare
(MHLW)
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Healthcare Reform?

• Past efforts included- cut reimbursement rates
  (biannually since 1965)- established a separate
  insurance system for elderly (1984)- raised
  co-payment for the elderly (1997)- raised
  co-payment for ordinary salaried workers (1997)-
  established a new long-term care insurance system
  (2000)
• Recent efforts (2002) included- cut
  reimbursement rates first time cut on
  doctors technical fee introduction of
  foreign reference price on medical devices-
  raised co-payment for the elderly- raised
  co-payment for ordinary salaried workers

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Japan Medical Device Market
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Medical Device Trade BalancesBetween U.S. and
Japan
US Million
Source Ministry of Health, Labor and Welfare
(MHLW)
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Japan Medical Device Imports
Source Ministry of Health, Labor and Welfare
(MHLW)
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Competitive Products (Japan vs U.S.)
Japan

• Imaging Diagnostic equipment
• Therapeutic and Surgical Equipment
• Biophenomena Measuring and Monitoring Systems
• Home Therapeutic Equipment
• Others (Dialyzers, Endoscopes, Hemodialysis
  Apparatus, etc.)

U.S.

• Pacemakers
• Advanced Interventional Cardiology Products such
  as stents
• Orthopedic Implants
• Laser Surgical Equipment
• Cardiac Valve Prothesis
• Others (MRI, CT, etc.)

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U.S. Medical Device Firms in Japan

• 3M Healthcare
• Allergan
• Bausch Lomb
• Baxter
• Boston Scientific
• Edwards Lifesciences

• General Electric (GE)
• Guidant
• Johnson Johnson
• Kodak
• Medtronic
• St. Jude Medical

American Chamber of Commerce in Japan (ACCJ),
Medial Device Subcommittee has 46 member firms
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Medical Device Regulation System

• Japanese Law
• Pharmaceutical Affairs Law (PAL) ----- enforced
  by the Ministry of Health, Labor and Welfare
  (MHLW).
• Necessary Governmental Authorizations
• Manufacturing (or import) approval ("Shonin")
  which guarantees the safety and efficacy of the
  device. (approx. 2,500-3,000 submissions per
  year)
• Manufacturing ( or import) license ("Kyoka") of
  a device, which the Japanese manufacturer and
  importer hold. (in 2002 manufacturing license -
  2,709 / import license - 1,282)
• Reimbursement listing approval

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How to Register Your Products
Ask Your Importer to Apply
Use In-country Care Taker

• Pros
• Simple
• Less expensive
• No direct involvement with the Japanese
  authorities
• Cons
• The manufacturer often is limited to one importer
• Change of importer forces the manufacturer to
  reapply for shonin from the beginning
• Dependency on the importer increases

• Pros
• Option to work with multiple importers who may
  have different strenghts
• No reapplication for shonin upon change of
  importer
• The ability to focus fully on marketing your
  product
• Cons
• Expensive

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Application Categories
(1) Devices which do not require approval (2)
Me-too Devices which are equivalent to
already-approved devices in Japan (Time Clock
4 months) (3) Improved Devices which do not
have new characteristics as much as the devices
to be reexamined but are not substantially
equivalent to already-approved devices in Japan
(Time Clock 12 months) (4) New Devices which
are different in use, function or technology from
already-approved devices in Japan (Time Clock
12 months)
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Risk Categories of Medical Devices
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Submission to Prefecural Government
Evaluation and Licensing Div., MHLW
Pharmaceuticals and Medical Devices Evaluation
Center (PMDEC)
New Device
Me-too Device
Improved Device
Evaluation by PMDEC
Evaluation by JAAME
Presentation
Presentation
Equivalency Investigation
Expert Discussion
Expert Discussion
Pharmaceuticals and Medical Devices Evaluation
Center (PMDEC)
Evaluation and Licensing Div., MHLW
PAFCS
Evaluation and Licensing Div., MHLW
Prefecural Government
Approval
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Pharmaceutical Affairs Law Revision - Key Points
(1) review of the approval system and enhancement
of past marketing safety measures Introduction
of a classification system corresponding to the
risk of medical devices - three categories by
risk to the human body (extremely low, low and
high) A third party certification system for
low risk medical devices (2) review of the safety
measures regarding medical devices and (3)
enhancement of safety measures for biological
products

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Pharmaceutical Affairs Law Revision - Revision
Schedule
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Review of Categories and Safety Measures
Concerning Medical Devices
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New Independent Administrative Agency
Current System
Proposed New System
Drug Manufacturers
Medical Device Manufacturers
Drug and Medical Device Manufacturers
Inquiry, instruction and answer
Inquiry, instruction and answer
Inquiry, instruction and answer
Application
Application
JAAME Medical devices equivalency
investigation
PMDEC Review of drugs and medical devices
OPSR Drugs equivalency investigation. Clinical
trial consultation. Reliability inspections.
GCP, GLP and GPMSP inspections
New Independent Administrative
Institution Review of drugs and medical devices
(including clinical trial consultation and
inspections)
Report of review results
Report of review results
Consultation
Consultation
Council
MHLW
Council
MHLW
Recommendation
Recommendation
Approval
Approval
Certification by a third party for low-risk
medical devices
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Medical Device Reimbursement
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Seriously, Japan is a tough market

• Cost contamination pressure
• Over-regulation
• High-costs of doing business
• Protectionism
• Unique and complex market culture
• Competitive Japanese firms

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Approaching the Market

• Trade Shows- Modern Hospital Show- Hospex-
  Japan Dental Show- and more
• Academic Conference and Exhibition
• Healthcare Consultants
• The U.S. Commercial Service Programs

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Market Information in English

• Our market research reports http//www.usatrade.g
  ov
• Japan External Trade Organization's
  (JETRO)http//www.jetro.go.jp
• Japan Pharmaceutical Manufacturers Association
  (JPMA)http//www.jpma.or.jp
• Ministry of Health, Labor and Welfare
  (MHLW)http//www.mhlw.go.jp/english/index.html
• Japan Association for the Advancement of Medical
  Equipment (JAAME) http//www.jaame.or.jp/english/
  index.html