China drug price-fixing probe involves UK, German firms

China Featured - July 5th, 2013

Dozens of pharmaceutical companies in China, both domestic and international, will come under scrutiny for alleged excessive pricing of drugs.

The probe by the National Development and Reform Commission (NDRC) will investigate on wholesale prices of drugs and production costs at several Chinese companies, among them industry leader Sinopharm Group and Jiangsu Hengrui Medicine.

Both specializes in anti-tumor drugs.

The investigation will look into Sino-foreign ventures involving Britain’s GlaxoSmithKline, Germany’s Boehrigner-Ingelheim and global healthcare firm MSD.

Senior staff of GlaxoSmithKline are under investigation for suspected “economic crimes” but it was unclear whether the two probes are linked, reports AFP.

The NDRC, which helps regulate prices in China, said the four-month probe aims to “timely set and adjust drug prices”.

A similar probe by NDRC on foreign baby formula producers earlier this week resulted in price cuts of up to 20%, reports the Financial Times.

“The government wants to make sure healthcare is more affordable for ordinary Chinese. This is a warning shot. They want to exert downward pressure on pricing,” Shaun Rein of China Market Research in Shanghai said.