China bars vaccine sales by drug wholesalers after scandal: state media

[April 27, 2016]  BEIJING (Reuters) - China has banned drug wholesalers from selling vaccines, state media said on Monday, after a scandal in which about $90 million worth of improperly stored vaccines was suspected of being sold illegally in dozens of provinces.

China is pushing ambitious healthcare reforms to improve its home-made medicines, but the vaccine scandal underscores the challenge facing the world's second-largest drug market in regulating its fragmented supply chain.

The new rules, signed by Premier Li Keqiang and adopted on Saturday, toughen requirements for distribution of non-compulsory vaccines, the official Xinhua news agency said.

They require county health officials to get the vaccines directly from manufacturers before sending them to hospitals, instead of going through wholesalers, it added.

Hospitals, clinics and government health authorities must also keep better records of purchases and inventory, with regular monitoring of vaccine temperatures, records of which hospitals must request upon receiving the vaccines.

The rules hike fines for improper handling of vaccines, and prescribe the sacking of government officials guilty of violations, Xinhua said.

The government plans to set up an electronic vaccine tracking system, it added, but gave no details.

Chinese authorities punished hundreds of officials in the aftermath of the vaccine scandal, which involved millions of illegal trades of vaccines through a blackmarket drugs ring, and ignited public anger.

The vaccines, including ones against meningitis, rabies and other illnesses, are suspected of being sold around China since 2011. They were all "category 2" vaccines, meaning they were sold on the private market.

China's drug regulator said on its website on Monday that it has passed the cases of two firms, Hebei Shanggu Shengwu Technology and Shaanxi Bangxin Shengwu, to the police after suspecting them of illegal behavior.

It has also revoked the licenses of two other companies and plans to cancel the licenses of 41 more, the China Food and Drug Administration said, adding that all 45 firms were selling vaccines to non-qualified units and fabricating vaccine sales records.

Hebei Shanggu Shengwu Technology and Shaanxi Bangxin Shengwu did not answer Reuters' calls for comment.

(Reporting by Megha Rajagopalan; Additional reporting by Brenda Goh in SHANGHAI; Editing by Clarence Fernandez and Muralikumar Anantharaman)

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