Author: Zhu Ping, Wu Yingang

Recently, Montana's SB535 bill in the United States has attracted significant attention across the world. This bill permits the direct sale of drugs, biological products, medical devices, or other therapeutic treatments that have completed Phase I clinical trial development. On April 29, 2025, the bill was passed by the state legislature and was signed into law on May 12.

The U.S. had previously been experimenting with "Right to Try" laws passed by individual states. Initially, these laws allowed terminally ill patients with virtually no other treatment options to use unapproved products free of charge with a doctor's authorization—a practice known as compassionate use, which has long been a standard in the industry. However, Montana's recent SB535 bill permits charging for such treatments, creating a clear business model for companies. This has sparked significant reactions within the industry and among businesses, and whether it will trigger a series of chain reactions in the future remains to be seen.

With the same goal of enabling patients to benefit earlier, China's Boao Lecheng also introduced relevant regulations in December 2024, permitting unapproved innovative products—such as those in the field of GCT (referred to as "biomedical new technologies" in Boao)—that have completed Phase II clinical trials or nationally registered IITs to be directly included in the translational application catalog, while also legitimizing charging for such treatments. Compared to the SB535 bill, Boao Lecheng similarly allows the use of and charges for unapproved innovative products.

How unapproved cell and gene therapies can enter clinical paid use: How did China's Boao Lecheng achieve this? What is the actual pathway? What are the similarities and differences compared to Montana's SB535 Bill allowing direct sales of drugs/biologics after only Phase I trials? How can patients benefit better?

This article will examine China's Boao Lecheng policies, actual cases, and field research, along with an analysis of Montana's SB535 bill. Through interviews with multiple industry experts, we explore how China and the U.S. are working to provide life-saving treatments to patients earlier. We aim to draw attention from governments, industries, and enterprises to jointly advance biomedical innovations like CGT, ensuring more patients can access and afford these therapies!

I. Montana's SB535 Bill (USA)

(1) Background and Key Provisions

The original "Right to Try Act" aimed to provide terminally ill patients with access to experimental drugs. This new bill, however, was meticulously drafted and vigorously lobbied for by a group of individuals passionate about extending human lifespan. This coalition includes scientists, libertarians, and thought leaders who envision Montana as a "testing ground" for experimental drug use, breaking free from traditional medical regulations to explore new possibilities in longevity.

The bill passed the state legislature on April 29, 2025, and is expected to be signed into law by the governor. Once enacted, it will fundamentally overhaul the state’s drug approval framework, making Montana the most "open" jurisdiction in the U.S. for drug access by permitting the use of incompletely tested therapies.

To date, 40 U.S. states, including Montana, have enacted laws supporting patient access to non-FDA-approved medical products. Montana first passed its "Right to Try Act" in March 2015, allowing terminally ill patients to use drugs not yet fully approved by the FDA. In 2023, Montana and Texas expanded their Right to Try laws to include non-terminal patients, enabling access to drugs that had only completed Phase I trials.

The SB535 bill represents a major expansion of the 2015 Right to Try Act by:

· Extending access to experimental drugs from terminally ill patients to all patients;

· Establishing the first regulatory framework for experimental treatment clinics (e.g., annual licensing, physician liability protections).

Key Provisions:
✔ Permits the use of drugs/therapies that have completed only Phase I trials in Montana.
✔ Allows physicians to apply for licenses to operate experimental treatment centers and recommend/sell non-FDA-approved therapies.
✔ Mandates that all sold drugs must be manufactured within Montana.
✔ Imposes multiple requirements for clinic licensure (e.g., insurance coverage, informed consent protocols).
✔ Provides legal protections for physicians, including specified immunity from lawsuits.
✔ Prohibits restrictions on patient access to such treatments.
✔ Enforces strict informed consent: Patients must sign documents detailing approved alternatives and potential worst-case outcomes.
✔ Requires a referral from the patient’s primary treating physician.
✔ Clinics must allocate 2% of annual net profits to improve Montana residents’ access to experimental therapies.

(2) Industry Reactions and Evaluations

Responses to Montana's SB535 bill have been mixed, with both supporters and opponents in China voicing distinct perspectives and concerns.

Key Arguing Points

Here are the comments from relevant individuals:

Todd White, who helped draft Montana's SB535 bill:
Clinics that may want to provide these drugs are "unlicensed, unprocessed, and unregistered," necessitating another bill to provide regulatory clarity for service providers. The signing of SB535 primarily addresses the issue of "how clinics can set up shop in Montana."

Carl Coleman, bioethicist and legal scholar at Seton Hall University in New Jersey:
Federal law requires that any drug intended for distribution in interstate commerce must be approved by the FDA. Since SB535 is a law unique to Montana after its signing, it must ensure that the entire supply chain for drugs or biologics used—those that have passed Phase 1 clinical trials—remains entirely within Montana.

A Managing Director and Head of China for a global investment bank commented:
There were originally no restrictions between U.S. states. This bill is specific to Montana, prohibiting interstate trade and requiring all commercial activities to occur solely within the state. The problem lies in the fact that there are no borders between states—residents can freely drive across state lines, unlike Boao Lecheng, which is located on Hainan Island. From a regulatory perspective, this makes practical enforcement very difficult. If it were to be implemented, legal challenges could eventually reach the Supreme Court, where it would most likely be struck down.

Wu Kun, head of China’s well-known rare disease organization "Qisejin Rare Disease":
The background of this bill is actually the U.S. pharmaceutical industry's perception that the current FDA policies are not conducive to encouraging innovation. For professionals, such bills can only be effectively implemented if elevated to the national level. For companies, as long as all operations are confined to Montana, drugs can be "marketed" directly after Phase 1 trials without FDA approval, and patients only need to fly to Montana to access them. Some pharmaceutical companies may incentivize upstream and downstream partners, as well as CDMOs, to relocate there—establishing subsidiaries in Montana to circumvent interstate trade restrictions. Driven by profit motives, this is entirely possible.

(3) Impact on Gene and Cell Therapy (CCT)

For the gene and cell therapy (CGT) sector, this bill could bring transformative changes. Historically, innovative drug development has been a high-risk endeavor, and CGT therapies face numerous challenges, including exorbitant R&D costs—from basic research to clinical trials and final regulatory approval—requiring massive financial investments. Additionally, the stringent regulatory approval process has left many therapies stuck in prolonged review phases. Data shows that, on average, CGT drugs take 10 to 15 years to progress from R&D to market, with costs reaching billions of dollars.

Montana’s new bill may offer a breakthrough for these challenges, including shortening the R&D cycle. While traditional CGT drugs typically take 8–12 years from Phase 1 trials to FDA approval, Montana’s law allows commercialization immediately after Phase 1, drastically reducing waiting time. For example, a gene therapy for diabetic eye disease currently in Phase 2 trials could be commercialized in the state if funding runs out.

On the other hand, it could lower financial barriers. Small and medium-sized enterprises (SMEs) would no longer need to bear the high costs of Phase 3 trials and could instead recoup investments through early commercialization. Statistics show that the average R&D expenditure for U.S. CGT firms exceeds $500 million, with about 60% of companies failing to advance to later-stage trials due to funding shortages.

II. China’s Boao Lecheng Pilot Policy

(1) Background and Relevant Policies

The Hainan Boao Lecheng International Medical Tourism Pilot Zone is China’s first medical special zone, established on February 28, 2013, with approval from the State Council and nine preferential policies. It was formally regulated under the "Provisions on the Establishment and Operation of the Hainan Boao Lecheng International Medical Tourism Pilot Zone Administration" (Hainan Provincial Government Decree No. 283) in August 2019.

The zone is located along the Wanquan River, between Jiaji Town in Qionghai City and the Boao Asia Forum core area, approximately 7.3 km from Boao Airport and 3.7 km from Boao Railway Station. Its planned construction area spans 2.97 million square meters, including:

· 1.86 million sqm for medical facilities,

· 650,000 sqm for R&D,

· 340,000 sqm for specialized wellness, and

· 120,000 sqm for leisure and rehabilitation.

Lecheng benefits from the broader Hainan Free Trade Port (FTP) policies, including zero tariffs, low tax rates, simplified tax structures, and five key freedoms (trade, investment, cross-border capital flows, personnel movement, and transport). Currently, medical and pharmaceutical enterprises in Lecheng enjoy a 15% corporate and personal income tax rate, with significant exemptions. Some medical devices for self-use by institutions are already under a zero-tariff policy.

Lecheng’s strategic positioning includes:

· An international medical tourism destination,

· A hub for cutting-edge medical R&D and translation, and

· A national cluster for innovative medical institutions.
Through continuous policy and regulatory innovations, it has achieved substantial progress.

(2) "Pilot-First" Policy for Gene and Cell Therapy

In December 2024, the "Regulations on Promoting Biomedical New Technologies in the Boao Lecheng International Medical Tourism Pilot Zone of Hainan Free Trade Port" (hereinafter "Regulations") were enacted, becoming China’s first local legislation explicitly supporting biomedical innovation translation. It allows CGT therapies that have completed Phase 2 trials or investigator-initiated trials (IITs) under national filing to enter a fast-track application catalog, while legalizing fee-based treatments, laying a legal foundation for standardized and industrialized CGT development.

The Regulations stipulate that biomedical technologies must demonstrate safety and efficacy through clinical research and comply with ethical standards before translation. This sets a high entry barrier: applicants must possess Grade III-A hospital capabilities and establish rigorous quality and risk control systems to ensure reliability and patient safety.

Regarding pricing, the Regulations require medical institutions to file fee structures with authorities and disclose them publicly, ensuring transparency and legality. This addresses long-standing "gray area" pricing issues, protects patient rights, and fosters sustainable industry growth.

· February 9, 2025: Lecheng released its first batch of biomedical new technology translation catalogs, covering 14 cutting-edge projects, including stem cell and gene therapies.

· March 10, 2025: The second batch expanded to 17 CGT technologies, targeting liver damage, diabetes, cancer, and more.

· April 25, 2025: The third update introduced treatments for malignant tumors, hereditary blindness, and other major diseases, alongside a globally benchmarked pricing system. This marks China’s entry into a dual-track era of "critical care + genetic disease cures", injecting momentum into a multi-billion-dollar market.

Appendix: The First Batch of Cell and Gene Therapy Technology Projects (Announced on February 9, 2025)

The Second Batch of Cell and Gene Therapy Technology Projects

III. Comparison Between Montana and Boao Lecheng

While Montana’s SB535 bill and China’s Boao Lecheng pilot policy share some similarities—such as providing a "green channel" for unapproved therapies to benefit patients earlier and fostering medical tourism—they also exhibit key differences.

Boao Lecheng, as China’s only "medical special zone," has established a globally leading real-world study (RWS) policy framework for cell and gene therapy (CGT). Its "policy breakthrough → data-driven innovation → international collaboration" model sets a pioneering example for CGT development. In contrast, Montana’s approach remains fragmented, lacking comprehensive supporting policies like RWS integration. Below is a detailed comparison:

1. Different Policy Backgrounds

· Montana: Modifies federal law (state-level legislation).

· Lecheng: Directly supported by China’s State Council.

2. Higher Implementation Certainty in Lecheng

· Boao Lecheng’s policies are jointly enforced by multiple government bodies, including the Hainan Health Commission, Hainan Medical Products Administration, and Lecheng Administration Bureau.

· Montana’s bill, though passed by the state legislature and signed by the governor, is largely driven by non-governmental advocates like the Alliance for Longevity Initiatives (A4LI), reflecting stronger private-sector influence.

3. Product Scope & Safety

· Montana: Covers a broader range of products but with looser oversight.

· Lecheng: More structured and safety-focused, with rigorous clinical and ethical review processes.

4. Commercialization & Payment Systems

· Lecheng: Features a mature payment and pricing framework, including transparent fee structures and insurance linkages.

· Montana: Lacks detailed payment regulations, leaving reimbursement ambiguous.

5. Medical Tourism Aspirations

Both aim to become international medical tourism hubs, but Lecheng benefits from Hainan’s free-trade port policies, offering tax incentives and global connectivity.

6. Patient Safeguards

· Lecheng: Prioritizes safety through institutional oversight (e.g., requiring Grade III-A hospitals for CGT applications).

· Montana: Leans toward patient autonomy, placing greater decision-making responsibility on individuals.

7. Industrial Ecosystem

Lecheng’s policies form a closed-loop industrial ecosystem, integrating R&D, clinical translation, and commercialization, while Montana’s model remains less cohesive.

In summary, Lecheng offers a more systematic and regulated pathway, whereas Montana’s approach is more experimental but riskier due to weaker safeguards.

Montana's Radical Breakthrough vs. Lecheng's Systematic Innovation 

Both Models Enjoy National-Level Policy Support

Comparison of Commercialization and Payment Systems

Safety Comparisons

Industrial Ecosystem Closed Loop

IV. Conclusion: Patient Benefits Hinge on Balancing Innovation and Safety

1. Fundamental Model Differences: Radical Breakthrough vs. Steady Innovation

Montana represents a "free exploration" paradigm:

· Advantage: Provides a "last resort" for untreatable rare diseases and age-related conditions, particularly appealing to high-income groups.

· Risk: Phase I data alone cannot adequately validate large-scale safety, potentially accelerating patient mortality or triggering widespread medical incidents.

Lecheng embodies a "regulated advancement" approach:

· Advantage: Phase II data safeguards + execution by top-tier (Grade III-A) hospitals keep risks within acceptable limits.

· Limitation: Focuses primarily on critical illnesses and well-defined genetic disorders (e.g., retinal dystrophy, COPD), with limited coverage for cutting-edge technologies (e.g., anti-aging).

2. Sustainability Challenge: Industrial Ecosystem Determines Success

3. The Ultimate Question of Patient Benefit

Montana's Core Contradiction:
While "allowing all patients access to Phase I drugs" appears inclusive, it risks becoming a "medical testing ground for the wealthy"—economically disadvantaged groups may neither afford treatment nor bear the risks of policy failure.

Lecheng's Unfinished Mission:
Must urgently establish a national payment linkage mechanism (e.g.,医保谈判,专项基金) to ensure therapies like ¥480,000-per-eye gene treatments aren’t just a "Hainan privilege."

4. Future Outlook: Complementarity Over Opposition

Short-Term:
Montana could adopt Lecheng’s "geographically contained regulation" model (e.g., creating a medical enclave) to resolve interstate trade dilemmas.

Long-Term:
Both countries’ policies are converging toward a "dynamic risk-tiering" system—where:

· High-risk, high-reward innovations (e.g., anti-aging) adopt Montana’s access-first approach, while

· Validated therapies follow Lecheng’s safety-optimized pathway.

Ultimate Goal: To ensure that "early access to life-saving treatments" does not equate to "reckless experimentation," but rather represents a science-tiered, precision-opened system.

In Summary: As medical innovation ventures into "uncharted territory," both Montana’s boldness and Lecheng’s meticulousness prove equally invaluable. What patients truly need is not a binary choice between the "most aggressive" or "safest" option, but rather a spectrum of choices tailored to their:

· Risk tolerance

· Financial capacity

· Disease stage

This demands policymakers to not only challenge conventions with courage but also to install systemic "safety ropes" that prevent collapse. Only by balancing freedom with protection can we achieve equitable, sustainable medical breakthroughs.

Unlock China’s CGT Ecosystem at the 2025 Chinese Society of Gene and Cell Therapy (CSGCT) Annual Meeting

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