China Policies to Promote Local Production of Pharmaceutical Products and Protect Public Health
(2017; 60 pages)

Abstract

As part of a series of studies and reports regarding local production and transfer of technology in the pharmaceutical sector, the Programme on Public Health, Innovation and Intellectual Property in the World Health Organization (WHO) Department of Essential Medicines and Health Products (EMP) commissioned this study with respect to the pharmaceutical sector in the People’s Republic of China (China). This study involved desk research, interviews of relevant stakeholders in China, and follow-up review and comments by interviewees with respect to the report. The main objective of the report is to identify elements of the experience in China in terms of pharmaceutical sector development that may assist other WHO Member States, in particular developing countries, to foster development of their own pharmaceutical sectors.

From the WHO standpoint, the single most important aspect of China’s current policy with respect to the pharmaceutical sector is its close linkage to the objective of universal health care (UHC). UHC is a key priority for the China Government, which has committed to providing access to medicines for its people. Pharmaceuticals account for a substantial part of the current China health care budget. To achieve and sustain UHC, pharmaceutical supply must be undertaken in a way that is affordable, notwithstanding the fairly substantial financial resources of China. China has a population of approximately 1.4 billion people, and it is a population that is rapidly aging. This will increase demand for pharmaceuticals, and place increasing burden on the health care budget and system as a whole.

First, policy with respect to pharmaceutical industry development should be closely linked to the objective of providing access to medicines to the population, including measures to contain costs.

Second, it is important to establish a regulatory framework that can assure the quality and safety of medicines, preferably as a precondition to industrial development.

Third, environmental controls are an important element of pharmaceutical industry development, and should be a priority in government planning.

Fourth, financial, tax and related incentives are important elements of promoting pharmaceutical manufacturing, and the establishment of industrial zones where common infrastructure, environmental support, transport and other elements may be jointly used by manufacturers is likely to be a useful model for other settings.

Fifth, foreign direct investment may play a useful role in development of the local pharmaceutical sector, including through investments in R&D and transfer of technology.

Sixth, governments may promote areas of local advantage, such as strength in traditional medicines and their components, as an element of local production and export opportunity

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