China is implementing a new crackdown on the manufacture and sale of counterfeit medicines, a problem which is widespread on the mainland. Eight pharmacies have been closed down; this is the first time retail outlets have been punished in China's ongoing attempts to stop counterfeit and substandard medical products from reaching the market. Twelve factories have been stopped from producing seven different categories of medicine.
Stopping the production and marketing of counterfeit medicine is a growing challenge in China. According to the State Drug Administration, a nationwide survey on the quality of medicine, which was carried out in the last quarter of 1998, found that 13.1%of the 20000 batches tested were either counterfeit or fell below minimal pharmaceutical standards. No details of specific findings were given. The administration has now stepped up inspections of companies suspected of intentionally manufacturing or selling counterfeit products and those producing substandard medicines.
The attempted clean up is part of a much wider overhaul of China's medical services, which includes efforts to deal with the problem of overprescribing. Many hospitals make large profits from the sale of medicine, which often accounts for more than half of a hospital's total annual income. The Ministry of Health plans reforms later this year that will end the practice of “lengthy prescriptions,” whereby inflated sales of medicine make up for the low fees charged for hospital consultations. This results in huge costs for the central government and for patients. From this year, profits at hospitals from the sale of medicine must be handed over to health administrative departments, which will allocate the money according to a hospital's performance.