The Journal The Authority on Global Business in Japan

In 2016, the Basic Act on the Advancement of Public and Private Sector Data Utilization came into force in Japan. It requires implementation of measures required to en­sure that an “application, notification, notice of a disposition, or any other procedure pertaining to an administrative organ, etc.” is, in principle, handled by means of an electronic data processing system. In the same year, the governmental Pharmaceuticals and Medical Devices Agency (PMDA) started accepting the elec­­­tronic submission of the clinical data required for new drug registration.

For quasi-drugs (QDs) and cosmetics, however, appli­cations and notifi­cations must be submitted on storage media such as disk or using a paper form. These administrative requirements are outdated compared with those of the European Union (EU), the Association of Southeast Asian Nations, and South Korea, where online product registration and notifi­cation systems are used.

The present system is cumbersome and creates delays. The American Chamber of Commerce in Japan (ACCJ) recommends that the Ministry of Health, Labour and Welfare (MHLW) introduce an online product registration and notification system for QDs and cosmetics. We also recommend that this online system be linked with the online system that is already in place for customs clearance to allow cosmetic companies to complete registration or notification procedures and customs clearance at the same time.

 

 

INTERFACE NEEDED
The MHLW has requested funds in the fiscal 2019 budget for initiatives to update the registration procedure system for drugs, medical devices, and other medical products by creating a new online submission function. The ACCJ recommends that the MHLW take swift action to introduce such a system for QDs and cosmetics, as well as for drugs and medical devices.

In the case of customs clearance of imported QDs and cosmetics, QD approval documents and cosmetic product notifications must be submitted to the customs office even though the information is already available in the systems used by the PMDA and prefectural governments. This is because each uses an independent system that does not interface or share infor­mation with the others. The ACCJ recommends that the MHLW take the initiative to integrate the systems of the PMDA, prefectural governments, and customs. By not requiring cosmetic importers to submit the same documents to customs they have already submitted to the PMDA or prefectural governments, the customs clearance process can be simplified and accelerated.

FAIR COMPETITION
An online product registration and notification system would play a key role in establishing a simple and efficient data management process that would take full advantage of information technology—a stated goal of the Japanese government. The ACCJ believes that the introduction of such a system would reduce the burden on cosmetics companies and promote efficiency of administrative management, which would allow both cosmetics companies and the government to use their limited resources for development of safe and more innovative products.

The ACCJ also believes that system integration among the PMDA, prefectural governments, and customs would promote fair competition with Japan-made products, pro­viding Japanese consumers with faster access to a wider choice of imported and domestically produced QDs and cosmetic products.

SIMPLIFY REGISTRATION
With the aim of providing more options for consumers with varying product preferences and needs, the pre-market appro­val system for cosmetics was abolished in 2001, and a system that applies standards for cosmetics ingredients (negative/restricted list and positive list for preservatives, UV filters, and tar colorants) was introduced together with a requirement to include all ingredients on cosmetics labeling.

The new system allows cosmetics companies to release products to market and shoulder responsibility for the products without obtaining approval from the MHLW. This means that cosmetics products will be able to reach consumers faster and will bring Japan’s cosmetics regime into closer alignment with the global best practices of the systems found in the United States and the EU.

In contrast to the cosmetics system, marketing of medicated cosmetics, which are categorized as QDs in Japan, is still highly regulated and requires that approval be obtained from the MHLW prior to marketing and sales, despite the fact that the intended uses and applications of medicated cosmetics are almost identical to those of regular cosmetics. This more restrictive system can hinder the timely market launch of innovative products that consumers want.

APPROVAL PROCESS
QDs that contain new active ingredients require pre-market approval and a thorough review by the MHLW of their efficacy, safety, and quality. This is natural and prudent, especially considering recent safety incidents in the medicated cosmetics market. The ACCJ urges, however, that the MHLW reduce the time required to obtain approval for those QD products that are recognized to be similar to products already approved.

Currently, approvals for such QD products can take five months or more. The ACCJ appreciates the attempts that have been made by the MHLW and the PMDA to increase transparency and shorten the time needed to carry out QD registrations. However, they are not enough.

EFFORTS TO CHANGE
The Japan Cosmetics Industry Association issued registration guidance for Medicated Shampoo and Conditioner, which lists approved active ingredients and the approved levels of these ingredients in product formulae, as well as efficacy and usage. This guidance was submitted to the MHLW, which published it as a regulatory notice on May 2, 2014. Similar registration guidance for Medicated Soaps was created and published by the MHLW as a regulatory notice on March 29, 2018.

Although the introduction of this guidance was intended to reduce the time needed for registering products with the active ingredients to which the guidance refers, there has been no practical change in the review process by the PMDA, and no reduction in the product registration times has been confirmed.

The ACCJ recommends that this registration guidance be made for all medicated cosmetics and be used as the standard for product approvals in such a way that the MHLW can then delegate reviews of products to local prefectural governments. This could finally reduce the time required for reviews.

SPEC CODEX
The PMDA, in an effort to increase transparency and reduce the time required for reviews, collected specifications of besshi kikaku (inhouse specification) ingredients, which have been previously approved for use by consumers but lie outside the compendium of approved ingredients. The agency then issued those specifications as the Quasi-Drug Additives Spec Codex, which was most recently updated on December 6, 2017.

Because raw materials suppliers or cosmetics companies were concerned about the impact on their businesses of publicly disclosing the specification information—which could be proprietary intellectual property—only a limited number of ingredients were identified, and their specifications published in the Codex. The limited nature of the specification infor­mation made available underscores the need to introduce a new system which can better protect proprietary ingredient information while, at the same time, simplifying the process required for QD registrations and PMDA review.

ACCESSING INNOVATION
Process simplification for QDs will expand the choices for consu­mers to meet a variety of demands and preferences for medi­cated cosmetics, just as consumers have with regard to ordinary cosmetics. This will allow consumers to access the most innovative products developed in Japan, as well as in other parts of the world, at a reasonable price.

At the same time, it will also allow the PMDA and the MHLW to focus their efforts and resources on the review of new ingredients and high-level technologies, as well as on drugs and medical devices, so that Japanese consumers will have faster access to those as well.

The present system is cumbersome and creates delays.