More “Tainted Capsules” to Come from China’s Domestic Pharma Industry?

While coming into Shanghai this afternoon, Saturday’s copy of the Shanghai Daily caught my attention.  One of the front-page national stories called out “TAINTED CAPSULES.”  The story pointed out that “In the latest round of medical capsule inspections, 204 batches made by 56 pharmaceutical enterprises across the nation were found to contain excessive chromium.”  This is of interest given what I had written in Friday’s Asia Times about the mid and long-term implications to China’s domestic pharmaceutical industry if the Anhui Model is allowed to move forward without adequate industry input and regulatory oversight.

In yesterday’s column, I pointed out that,

“Managing the trade-off between lower prices spread across larger volumes is part of what has driven provincial governments to adopt aggressive pricing strategies like that Anhui has put forward. In the short-term, the Anhui Model has lowered costs and improved access, but it has set in motion quality problems and created a race to the bottom among China’s domestic drug manufacturers.

Professor Liu Peng, an Assistant Professor with the Institute of Healthcare Reform and Development at Renmin University in Beijing, shared this week his concerns that while the Chinese domestic pharmaceutical companies are ‘large in scale [and] rapidly growing, they have relatively low technology and quality.’ To Peng, ‘… that is why Chinese domestic manufacturers are not sustainable.’”

Saturday’s China Daily noted “In east China, 11 factories in Anhui were found to manufacture 25 bad batches while Zhejiang, the main production area for capsules, saw nine tainted batches from six factories, authorities said.  Most of the toxic capsules were antibiotics, including Cefradine, Amoxicillin and Norfloxacin …”  For those who are curious about causality behind the use of chromium, the reason is that industrial gelatin has higher chromium levels (and is also cheaper) than pharmaceutical grade gelatin.  The bigger question about cause and effect specific to pharma and the Anhui model is close to unmistakable.  Problems like this actually create openings for multinationals to point out the reason for them to be able to sell on something more than just cost, a point that is much needed in China not only for the industry’s sake, but also to ensure that Chinese get access to many of the safe medicines that we in the West take for granted.