Chinese Chemicals Flow Unchecked Into The Market
November 2nd, 2007
Submitted By: Ryan Moore
Check out this NY Times article on the export and import of “illegal” Chinese pharmaceuticals.
Did you know that approximately ½ of all of the active pharmaceutical ingredients sold in China are made by uncertified chemical companies? Did you know that these companies are responsible for the poisoning deaths of nearly 100 children in Haiti in the mid 1990’s? Or that more than 138 Panamanians were killed or disabled in 2006 by these companies? These unlicensed companies sell their products to markets in the Latin America, Europe, Canada, and the United States. The real shock is that the Chinese government has not only known about this practice for over a decade, but it actually owns many of these companies! And you were worried about led paint?
It is clear that the Chinese government has been doing little to stop this practice. There is blatant marketing and advertising of active pharmaceutical ingredients by uncertified companies in deliberate violation of Chinese law.
One of the primary causes of the problem is that China’s food and drug agency that regulates pharmaceutical companies has no jurisdiction over chemical companies. The majority of these companies make their profits by selling their products to underdeveloped countries or over the internet.
Although China is taking small steps toward improving this hole in regulatory procedure, it may be too late. It seems that this “illegal” business has had an opportunity to become deeply rooted in relationships with “legitimate” pharmaceutical companies and other middlemen throughout the world – as well as with the Chinese government itself.
Furthermore, it seems that recent globalization has helped to mask the true source of many of these drugs. In what ways do you think globalization has helped these companies operate and what are some of the things that can be done to stop this problem?
Entry Filed under: Pre-Departure, Beijing, China
13 Comments Add your own
1. Angie Q. Dip | November 3rd, 2007 at 1:02 am
It is unfortunate to read that the Chinese government played a role in contributing to the deaths just to make some money. I just can’t believe that a couple of the companies that were owned by the Chinese government actually sold poison ‘mislabeled’ as a drug ingredient, which had caused the deaths and injuries in Haiti and in Panama. Knowing that these uncertified chemical companies caused so many deaths should have made the Chinese government and companies more responsible and ethical with their actions. How can drugs made by these chemical companies neither be certified nor inspected by Chinese drug regulators?
It is a little comforting to hear that the Chinese government is at least trying to improve the regulatory procedure. By doing so, they not only would show that they can be moral, but they would also help decrease the number of deaths and injuries due to the unregulated chemical ingredients used to make drugs. This can help build people’s trust towards China’s policies and procedures, and possibly in the long run increase businesses and profits for China.
Some things that can be done to stop this problem may be:
-Require chemical companies to meet minimal drug-manufacturing standards. Since the chemical ingredients they provide will most likely be used to manufacture the pharmaceutical drugs, it should have the same (or at least similar) standards.
-Warn everyone of the risk they are taking by purchasing drugs online just because they are cheaper. People should have the mindset that they cannot be frugal when it comes to their heath – taking the wrong drugs/buying drugs from the wrong company may be a matter of life or death.
-The Chinese government should repair the regulatory system and be stricter in making sure the chemical ingredients used in drugs are safe for human consumption by punishing those who violate the law for drug manufacturing.
-As the article that I found from the New York Times mentioned, foreign suppliers of drugs are not required to have their drugs inspected by the Food and Drug Administration every two years as it does in the United States. This policy should change so that foreign suppliers are required to have their drugs inspected just as often. In addition, the F.D.A. gives foreign drug makers notice in advance that their companies will be inspected. This allows the foreign companies to conceal any activity that may not be approved of by the F.D.A. The F.D.A. may help contribute in stopping the problem by having unannounced inspections as they have in the U.S. Furthermore, when inspecting, the agency inspectors should bring their own translators along, instead of have certain companies provide the translators. These translators that the companies provide may only say things that they know the F.D.A. would like to hear.
2. Angie Q. Dip | November 3rd, 2007 at 1:09 am
The article I mentioned is “F.D.A. Is Unable to Ensure Drugs Are Safe, Panel Is Told” written by Walt Bogdanich from The New York Times.
3. Andrew Steen | November 3rd, 2007 at 10:05 am
I watched that N.Y. Times video, and it’s pretty scary. The F.D.A. in China inspects only 7% of all chemical manufacturers, as opposed to a bi-yearly inspection of 97% in the U.S. And it’s discouraging that the Chinese government owns uncertified drug producers, and allow 83 uncertified companies to sell their products in public shows.
This brings up some interesting questions concerning China’s ethics. How far are they willing to go to make a profit? They want to be a world superpower again, but with great power comes great: 1) opportunities to sell poison to helpless children, or 2) responsibility.
4. Nicholas Miura | November 3rd, 2007 at 1:30 pm
What I found intriguing in this article was the interview with the man who ran the chemical plant, who said that they only sell their active ingredient drugs to countries who have a lower standard than China does or if they’ll make a lot of profit. Two things are disturbing about this. First, if China becomes the leader in the global economy, will the world accept such a low standard in quality as the benchmark? Second, the mindset that one would blatently break the law to make a profit gives me little faith in China’s ability to regulate their own society.
Based on what we’ve learned so far, I think China will improve on both counts, not so much for their own people, but so the world will see them in a better light. This will only work though, if the rest of the world’s standards and governments remain strong and not lower their standards because China has lower standards or weaken their regulations to compete. Though America likes to think we have the moral high ground, our government has been increasingly siding with big business and consumers rather than citizens. Do we have what it takes to demand a change from China or will we continue to want cheaper and cheaper products - standards and regulations be damned?
5. Chris Carr | November 7th, 2007 at 11:13 pm
Lots in the NY Times and WSJ has been written, and will be written on this topic. Stay tuned for how this story unfolds.
6. Robyn Bowie | November 17th, 2007 at 11:23 am
How far will China go to make it to the top? Well I know one thing, making it to the top requires a strong economy and making a profit is a big part of that. Clearly the Chinese are willing to do whatever it takes, even if that means killing people because they made a “mistake” and fed them poison instead of medicine. It makes me sick to hear a quote from a salesman of a Chinese Chemical company blatantly saying that “the bar for producing chemicals is pretty low” and that they “would export them only to countries with lower standards than China.” I think countries around the world need to put pressure on China to do something about this problem. Otherwise we are only going to see more unnecessary deaths.
7. Naomi Guy | November 17th, 2007 at 2:23 pm
As someone who worked in a pharmaceutical company, I can say that the US regulations are insane. An entire department needs to be dedicated to simply filling out forms and ensuring everything is turned in on time. However, I can also say just how easy it could be to make a very small mistake and have it be a huge problem. Because of this, the regulations are very important to ensure the safety of anyone in the plant and taking the drugs. It is very frightful to know that these drugs are flooding into markets completely unchecked. We need to stand together as a human race to fight against these companies and demand they be held to stronger standards.
We would like to think that these companies would be afraid of putting out a bad drug because of the tarnished reputation they would receive. But with such lax standards all they need to do is “sell” the company to someone and never change a single thing.
It is also critical for other countries to be more responsible for the drugs they do purchase. When purchasing a bulk amount of a raw ingredient, it should be put through testing to ensure it’s integrity. The same should be for any final products. However, as the salesman himself said, they are selling to countries with lower standards. It is unfortunate that these countries are willing to risk so many lives, to possibly save a few because it is all they can afford.
8. Frank Wallace | November 18th, 2007 at 11:51 pm
First of all, I did not know those shocking statistics Ryan, or that this was even an issue, so thank you for bringing it to my attention. I am outraged at these facts. How is our country or any other country for that matter, supposed to respect a country like China when they don’t have the proper regulations in place to prevent these types of things from occurring? I can understand being laissez faire about certain things, but not things that result in the poisoning of children.
Now, in response to your questions Ryan, I think globalization has had a huge effect on these companies in China. It has provided them access to information and technology that they may not have had before. Also, globalization allows the flow of goods to move about much easier making it much harder to control. The Internet is a perfect example of this. As far as things that can be done about this problem, I think Angie hit on some really good points; however, some of the suggestions are tougher to actually do. One suggestion I have would be to really make it public knowledge that there is a risk involved in buying drugs from certain companies in China. This should in turn stimulate the Chinese government to really crack down on this issue because they wouldn’t want it to affect the rest of their pharmaceutical industry.
Ultimately, I hope the situation gets better. It is somewhat reassuring to have read that small steps have been taken, but for problems such as these, drastic measures are usually needed to create the need for change.
9. Shasta Palmer | November 19th, 2007 at 10:02 pm
Companies rely on their reputation with consumers. If Advil had a batch of pain killers that went out with a poison in them that killed people, do you think consumers would be as likely to buy it again? Or even the Tostino’s pizza’s here in the Ralphs super market, they had warnings of E. Coli and were recalled. I use to love those pizzas, but after seeing the warning I’m pretty leery of trying them again. I realize after taking several food science courses that when a company has a recall like that they are more likely to keep their products clean because they know if it happens again the chances of surviving are slim, but that fear of getting a bad product still prevents me from buying. Where I’m going with this is maybe the only way to stop this is for companies to take into their own hands to protect their brand, and to educate consumers about buying off brands and cheaper brands. For example, in machine shops that make parts for aircraft all of the metal has to have a certification, including the heat lot number, manufacturer etc. and the metal producer is held liable. Maybe this will provoke pharmaceutical companies in the U.S. to start requiring their own certifications, and checking the products themselves. Another example of self checking is the pesticide residue on vegetable and fruit crops. It is not mandatory that producers check for this. However, much of this business Primus Labs in Santa Maria, California does is testing produce for pesticide residues for fear that if there is too much residue on the product it may make a consumer sick and jeopardize the company’s reputation. This of course may not have the same effect in developing countries, but it may be an option for the U.S..
10. David Zarcone | November 22nd, 2007 at 8:11 pm
I have to say, I think it is pretty insane that the Chinese government allows this to happen. Not only are they ruining the reputation of their country in a global economy, but they are ruining the reputation of the honest pharmaceutical companies in China. Shasta mentioned that a possible solution would entail these companies taking it into their own hands to protect their brand. I agree with this but it is too bad for the respectable companies that are losing business due to other cheap companies and their chemical’s consequences. I just don’t understand why Americans can buy products from China while knowing that lots of it is fake or counterfeit. I guess they are as naïve and uninformed as I was before reading this blog. Now I finally understand why the hair-growth cream that George ordered from China didn’t work. That was a Seinfeld joke by the way. Shame on you if you haven’t seen that episode!
11. Matt Fencl | November 23rd, 2007 at 5:22 pm
Definitely a scary revelation. The fact that this is the first time I’ve heard of this problem illustrates why it hasn’t be solved yet. There certainly seemed to be a lot of media coverage when Tyco announced all those recalls on toys manufactured in China containing lead paint. You would think that because drugs are supposed to be ingested and toys are not that the backlash from such a discovery would be ten-fold. Clearly it wasn’t. The problem is that there is zero accountability. Remember when Merck pulled Vioxx off the market because it increased the risk of heart attacks? There was a related article in the Wall Street Journal for I don’t know how many consecutive days. The hit the Merck took for releasing a dangerous drug was huge…the lawsuits are still coming in. In China, this is happening on a much larger scale and the publics response is tacit in comparison to the Vioxx hoopla.
12. Deanna Haskell | November 23rd, 2007 at 9:59 pm
The statistics in this article are shocking. I have to wonder that if the Chinese government is not creating quality control standards than maybe the countries that are buying the drugs should be testing the drugs when they import them. While I believe that China should step up their regulations, the countries that are buying the cheap drugs should have their own regulations that require a higher minimum standard. They should inspect the drugs and not buy them if they will cause harm. If cheap drugs are causing deaths , then clearly, it would be more cost effective to buy a more expensive drug that does not have such devastating externalities associated with it.
13. Jeff Mohr | December 2nd, 2007 at 1:06 am
I completely agree that these statistics are scary and that something must be done (either on the part of the companies or by educating consumers) to ensure that we are working toward a solution. As it seems one of the major items driving these companies is profit (big surprise huh?) we need to find a way to make the current situation less profitable or to increase the profitability of selling higher quality chemicals. I imagine a couple solutions.
First, like Angie described, we could require the companies to adhere to higher standards, assessing penalties to those who do not. I see two major roadblocks to this issue. First, the manpower needed to check the 700 companies who export to the US would be unreasonable. Second, if inspections can be made for each company, it would be hard to know if they continued to have high standards after the initial inspections were over (since the likelihood of regular inspections with that many companies is quite small). If a system was created that enabled the fines to be levied, this should reduce the profitability of running a substandard operation and push the company towards higher standards.
An alternative idea would be to start a government run chemical and pharmaceutical company that would compete with current companies. It would be highly regulated and operate under strict standards, and would make this quality widely known. The government could give some form of incentive to downstream suppliers who buy from them, and also support other quality manufacturers so as not to damage the current high quality pharmaceutical companies (Note: I believe there are many companies in China who run legitimate companies with high standards. I believe these companies would be in favor of jumping on-board since the sun-standard ones are hurting the Chinese pharmaceutical industry.) Hopefully this will take away business from the poorer quality suppliers who will either be pressured out of business or into a higher standards operation.
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