Tea leaves foretell pharma rival

On the face of it, yesterday's announcement from China Aoxing concerning a GMP re-certification by the State Food and Drug Administration (SFDA) following inspection of a new facility has a business-as-usual quality to it. The facts are stated, a trace of company pride is evident, and the promise of more re-certifications is included.

Beneath this bland exterior, however, is a remarkable reality that might be easy to miss without considering China's evolution in the global pharma business over the last five years or so.

Financial analysts last week raised their rating on the entire Chinese pharma industry to "attractive" from "in-line," saying that health-care reform there will increase demand for pharmaceuticals, says Bloomberg. And as reported earlier, 2008 saw the People's Republic place third among 20 countries by filing 21 patents for aseptic applications, up from just one filing in 2003.

But 2008 also saw the recall of deadly contaminated heparin that originated in China. And one year earlier, the Chinese government executed its former drug czar for bribery stemming from the approval of unsafe drugs.

China is now preparing to revise its good manufacturing practices regulations. And in 2007 it began an overhaul of drug safety regulations. Despite these recent steps in two directions, China's pharma momentum today is clearly forward.

- here's the China Aoxing release
- see our financial ratings and patents coverage
- read about the heparin and czar execution incidents

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