At Long Last: China's New Drug Data Exclusivity Regime

Within the spectrum of pharmaceutical intellectual property protections, four special mechanisms stand out: the Bolar exemption, patent linkage, patent term extension, and data exclusivity. The Bolar exemption allows generic manufacturers to conduct necessary research before patent expiry; patent linkage front-loads patent dispute resolution into the drug approval process; and patent term extension compensates for time lost to regulatory review. All three have already been implemented in China—the Bolar exemption was codified in Article 69 of the Patent Law in 2008 (now Article 75(1)(5) of the current Patent Law), the patent linkage system and patent term extension were both formally established by the fourth amendment to the Patent Law in 2021.

Data exclusivity, by contrast, was first written into the Implementing Regulations of the Drug Administration Law as early as 2002, yet remained a "paper tiger" for over two decades—unenforceable in practice and repeatedly stalled by legislative setbacks—until the Implementation Measures for Drug Test Data Protection (“Implementation Measures”) finally took effect on May 15, 2026. This belated arrival reflects both the complexity of interest-group politics in pharmaceutical regulation and China's cautious, incremental approach to balancing innovation incentives against drug accessibility.

I. The Legislative Evolution of China's New Drug Data Protection Regime

The legislative history of China's drug test data protection regime is a slow journey from aspirational principle to operational rule, passing through four distinct phases: conceptual inception, renewed attempts, deliberate reboot, and formal implementation.

The conceptual inception phase dates to 2002. That year, Article 35 of the Implementing Regulations of the Drug Administration Law first introduced data protection, providing that the State would protect independently obtained and undisclosed test data submitted by manufacturers or sellers of drugs containing new chemical entities, and that within six years of the grant of a marketing license, the drug regulatory authority would not approve applications by other applicants to produce or sell such drugs using that data without the original applicant's consent. The provision aimed to give innovative drugs a second layer of protection beyond patents, but its scope was limited to drugs containing "new chemical entities," and it left undefined critical concepts such as "independently obtained" and "undisclosed," while providing no implementing procedures, review standards, or publication mechanisms. Article 20 of the Drug Registration Measures in 2007 restated the principle, but likewise remained at the level of generalities. For more than a decade thereafter, the drug regulatory authorities declined to accept any data exclusivity applications on the ground that implementing rules were lacking, leaving the system in a state of de facto suspension.

In 2017, the regime entered a phase of renewed attempts. In October 2017, the General Offices of the CPC Central Committee and the State Council issued the Opinions on Deepening the Reform of the Review and Approval System to Encourage Innovation in Drugs and Medical Devices, explicitly calling for "improving and implementing the drug test data protection system." In April 2018, the National Medical Products Administration (NMPA) issued a draft Implementation Measuresfor Drug Test Data Protection (Provisional), which for the first time proposed a systematic framework: six years of data exclusivity for innovative drugs, twelve years for innovative biological products, and six years for orphan drugs and pediatric drugs. The draft, however, sparked fierce controversy over ambiguous concepts and overly broad scope, compounded by intense lobbying from both the innovative and generic pharmaceutical industries, and ultimately never reached final promulgation.

In 2020, the regime entered a deliberate reboot. The Phase One U.S.-China Economic and Trade Agreement signed in January 2020 required both parties to provide effective protection and enforcement of pharmaceutical-related intellectual property rights, including undisclosed test data submitted as a condition of marketing approval. Paradoxically, the Drug Registration Measures promulgated in July 2020 deleted the data protection provision that had existed in the 2007 version (Article 20). This deletion was not a retreat but a strategic pause—removing a provision that had never been enforced in practice, and waiting for the revision of the Implementing Regulations of the Drug Administration Law to rebuild the system from the ground up. The period that followed was one of gestation at the level of higher-level legislation. In 2022, the draft revised Implementing Regulations for the first time systematically addressed data protection at the administrative-regulation level. In January 2025, the General Office of the State Council issued Opinions on Comprehensively Deepening the Reform of Regulation of Drugs and Medical Devices to Promote the High-quality Development of the Pharmaceutical Sector (Guobanfa [2024] No. 53), which explicitly distinguished between the "data protection period" (the regulator's obligation not to rely on protected data) and the "market exclusivity period" (the regulator's refusal to approve competing products), extending market exclusivity protection to eligible drugs for rare diseases, drugs for children, the first chemical generic drugs and exclusive varieties of TCMs.

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