China investigates after vaccine suspected in seven deaths

BEIJING (Reuters) - Chinese health authorities are investigating after seven infants died following inoculation with a hepatitis B vaccine, state media reported on Monday.

China has been beset by a series of product safety scandals over the past few years.

At least six children died in 2008 after drinking milk contaminated by the industrial chemical melamine, and there have also been reports of children dying or becoming seriously ill from faulty encephalitis, hepatitis B and rabies vaccines.

State news agency Xinhua said that of the seven deaths from the hepatitis B vaccine in the latest case, four were in the southern province of Guangdong. The other cases were in the provinces of Hunan and Sichuan.

The official China Daily said that all hospitals using the vaccine, made by Shenzhen-based BioKangtai, had been ordered to take it off their shelves while the Health Ministry investigates the company's products and the deaths.

The company said in a statement last week, carried by state media, said that it rigorously followed safety rules but that they were testing the batches suspected of causing the deaths.

The topic has been widely discussed on China's popular Twitter-like microblogging service Sina Weibo, with many people worried about the safety of China's vaccines and calling on the government to make more information public.

"Why was this allowed onto the market? The government needs to come clean about this," wrote one Weibo user.

Many Chinese people are suspicious that the government tries to cover up bad news about health problems, despite assurances of transparency. In 2003, the government initially tried to cover-up the outbreak of the SARS virus.

(Reporting by Ben Blanchard and Hui Li; Editing by Robert Birsel)

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GSK says CEO's China visit flags commitment in face of graft scandal

LONDON/BEIJING (Reuters) - GlaxoSmithKline's (GSK) chief executive is showing his commitment to doing business in China by joining a trade trip there, a GSK spokesman said on Monday, after allegations of illegal payments to Chinese doctors and officials.

Andrew Witty declined to comment on the investigation into alleged corruption but he told Reuters in Beijing that the British drugmaker would have something to say "quite soon".

Witty - on his first visit to the country since the corruption scandal blew up in July - is in China as part of a 100-strong business delegation with British Prime Minister David Cameron.

"It's an important opportunity to show our continued commitment to China and to supplying our medicines to the country," GSK spokesman Simon Steel said in London.

Chinese police have accused GSK of funneling up to 3 billion yuan ($492 million) to travel agencies to facilitate bribes to boost its drug sales. The accusations are the most serious against a multinational in China in years.

GSK's sales in China dived 61 percent in the third quarter after hospital staff shunned visits by its sales teams in the wake of the investigation.

Legal and industry sources told Reuters last month that police were likely to charge some of GSK's Chinese executives but not the company itself. One person with direct knowledge of the situation said the police investigation was likely to be concluded by around early December.

GSK has said some of its senior Chinese executives appear to have broken the law. It has also said it has zero tolerance for bribery, calling the allegations in China "shameful".

GSK sold 759 million pounds ($1.2 billion) of pharmaceuticals and vaccines in China in 2012, up 17 percent on 2011, representing about 3.5 percent of its worldwide total. ($1 = 6.0932 Chinese yuan) ($1 = 0.6105 British pounds)

(Reporting by Ben Hirschler and Andrew Osborn; Editing by Louise Ireland)

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China says not looking at broad one-child policy relaxation

BEIJING (Reuters) - China is not considering a broad relaxation of its strict one-child policy despite an easing of existing rules since it would be too disruptive, the health ministry said on Saturday.

The government announced on Friday that it would allow millions of families to have two children in the country's most significant liberalization of its strict one-child policy in about three decades. China, the world's most populous nation, has nearly 1.4 billion people.

Couples in which one parent is an only child will now be able to have a second child, one of the highlights of a sweeping package of reforms announced after the ruling Communist Party held a key meeting that mapped out policy for the next decade.

The plan to ease the policy was envisioned by the government about five years ago as officials worried that the strict controls were undermining economic growth and contributing to a rapidly ageing population the country had no hope of supporting financially.

In a statement carried on the ministry's website, deputy director Wang Peian said if everyone were suddenly allowed to have two children it would cause too many problems.

"Adjusting and perfecting family planning policy is not the same as abandoning it," he said.

"There has been no fundamental change to the fact that we are a very populous country, and the pressures on the economy, society, resources and the environment will be around for a long time," Wang added.

"The basic policy of family planning will need to be upheld over the long term and we cannot rest up on this."

Wang did not give a timeframe for when the new relaxed policy would begin, only that it would not take long and it would be up to each province to decide.

In areas where people were more likely to be able to take advantage of the relaxation, the government would encourage couples not to quickly have a second child, he said, to "prevent a rush of births".

A growing number of scholars has long urged the government to reform the policy, introduced in the late 1970s to prevent population growth spiraling out of control, but now regarded by many experts as outdated and harmful to the economy.

Although it is known internationally as the one-child policy, China's rules governing family planning are more complicated. Under current rules, urban couples are permitted a second child if both parents do not have siblings and rural couples are allowed to have two children if their first-born is a girl.

There are numerous other exceptions as well, including looser rules for ethnic minorities.

But any couple violating the policy has to pay a large fine.

Wang said the system of punishments would also remain.

Many analysts say the one-child policy has shrunk China's labor pool, hurting economic growth. For the first time in decades the working age population fell in 2012, and China could be the first country in the world to get old before it gets rich.

(Reporting by Ben Blanchard; Editing by Raju Gopalakrishnan)

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China to crack down on family planning fines after abuses found

BEIJING (Reuters) - China will crack down on penalties paid by families flouting strict family planning rules after a National Audit Office probe found $260 million in fines had been levied illegally, state media reported.

There has been growing public anger about the one-child policy, which was introduced in the late 1970s to prevent population growth spiralling out of control.

The policy covers 63 percent of China, although family planning rules have been loosened over the years to allow some couples to have a second child.

The audit office's investigation of 45 counties in nine provinces and municipalities from 2009-12 found 1.6 billion yuan ($260 million) in fines had been given out in contravention of the rules, Chinese newspapers said on Thursday.

The "social support fee" - the fine - is meant to go towards the government budget to compensate for resources and public services the child would use.

National Health and Family Planning Commission spokesman Mao Qunan said the fines are "a means to ensure the implementation of the one-child policy", according to the official Xinhua news agency.

His department is now pushing "related local family planning departments to rectify misconduct in the collection and management of such fines", the report said.

The ministry "will take effective measures to address problems uncovered from the auditing process and improve the system on the collection and management of fines", Xinhua said.

"The commission will tighten supervision and guide local family planning departments to publish information for public scrutiny," it said.

The audit office found that problems included inaccurate reports of the number of extra children parents had, fees not successfully collected and officials handing out higher fines than they should have.

However, the figure reported for the amount of fines illegally collected falls far short of the more than 16.5 billion yuan activists say provincial governments have failed to account for.

($1 = 6.1212 Chinese yuan)

(Reporting by Ben Blanchard; Editing by Paul Tait)

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Danone hit by China bribery claims

16 September 2013 Last updated at 20:39 ET

China has been hit by a series of milk-related scandals over the past years

A baby food brand owned by France's Danone said it is investigating claims the company bribed hospital staff in China to use its products.

According to China Central Television, Dumex allegedly paid doctors and nurses in the northern city of Tianjin to sell its baby formula products.

Dumex said it was "extremely shocked" by the allegations, which aired on Chinese state television on Sunday.

The report cited an unidentified former sales manager.

China has been cracking down on corruption in its $350bn healthcare market. Some inquiries have targeted foreign firms, including British pharmaceutical giant GlaxoSmithKline.

Beijing has also been investigating alleged price-fixing by foreign infant milk makers, which led food giants Nestle and Danone to cut prices of some of their infant milk formula products in China.

Demand for foreign brands has surged in China, after tainted milk scandals in recent years led to a distrust of local producers.

According to some estimates, foreign brands now account for about half of all infant milk sales in China.

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Exclusive: China amends patent law in fight for cheaper drugs

AppId is over the quota
AppId is over the quota

HONG KONG (Reuters) - China has overhauled parts of its intellectual property laws to allow its drugmakers to make cheap copies of medicines still under patent protection in a move likely to unnerve foreign pharmaceutical companies.

The Chinese move comes within months of a similar move by India to effectively end the monopoly on an expensive cancer drug made by Bayer AG by issuing its first so-called "compulsory license".

Similar action by China will ring alarm bells in Big Pharma, since the country is a vital growth market at a time when sales in Western countries are flagging.

The amended Chinese patent law allows Beijing to issue compulsory licenses to eligible companies to produce generic versions of patented drugs during state emergencies, or unusual circumstances, or in the interests of the public.

For "reasons of public health", eligible drugmakers can also ask to export these medicines to other countries, including members of the World Trade Organisation.

Compulsory licenses are available to nations to issue under WTO rules in certain cases where life-saving treatments are unaffordable.

"The revised version of Measures for the Compulsory Licensing for Patent Implementation came into effect from May 1, 2012," China's State Intellectual Property Office said in a faxed statement to Reuters.

The changes can be found on the website of China's State Intellectual Property Office at http://www.sipo.gov.cn/.

China is known to be looking at Gilead Sciences Inc's tenofovir, which is recommended by the World Health Organisation as part of a first-line cocktail treatment for AIDS patients, two sources with direct knowledge of the matter said.

China's generic drugmakers were getting ready to produce tenofovir, they added.

At a drug access workshop hosted by the United Nations and health activists in Bangkok in early June, Chinese officials spoke of the changes to its patent law. Officials from Cambodia, India, Indonesia, Malaysia, Myanmar, the Philippines, Thailand and Vietnam also participated in the meeting.

"In May 2012, China created a change in their IPR (intellectual property rights) legislation to be able to issue compulsory licenses. China is considering further strengthening its legal framework, so as to make use of legal space to produce generic drugs," said Bob Verbruggen, senior adviser for the UNAIDS Asia Pacific office, who was present at the workshop.

"China's action plan at the workshop seemed to confirm that it intends to become a generic producer for the domestic and international market," he told Reuters by telephone.

CHINA PREPARED LONG AND HARD FOR THIS

China's move follows India's granting of a compulsory license in March to local generic drugs firm Natco Pharma to manufacture Bayer's cancer drug Nexavar, used for treating kidney and liver cancer.

However, China had signaled interest in the idea from at least 2008-2009, when its State Intellectual Property Office invited foreign experts to Beijing to show Chinese officials how to prepare the legal grounds for issuing compulsory licenses.

"They wanted to know the legal perspective ... They wanted to know about Thailand's IP Act that allowed us to make a CL (compulsory license) under the law for public interests, in an emergency," said Vithaya Kulsomboon, associate professor at Thailand's Chulalongkorn University, who was invited to Beijing at the time.

Kajal Bhardwaj, a legal expert from India who is working on health, HIV and human rights trade laws, said China's move was well within the limits of international trade agreements.

"CLs have previously been issued in the region by Malaysia, Indonesia, Thailand and India. CLs have also been issued on multiple occasions by developed countries including the U.S. and EU member countries," Bhardwaj said.

"It is very encouraging that China is seeking to ensure that this right ... is reflected in its legal regime on intellectual property," she added.

SABRE-RATTLING

China's stable of generic drugmakers has been producing the key ingredients - or active pharmaceutical ingredients (APIs) - in medicines for years, exporting them to foreign drugmakers, which then sell the patented finished products back to China at prices which the average Chinese citizen often cannot afford.

In particular, the government is struggling to provide newer HIV drugs, such as Gilead's tenofovir, known by its brand Viread and which had worldwide sales last year of $737.9 million.

China's government, initially slow to acknowledge the problem of HIV/AIDS in the 1990s, now admits to having a ballooning number of HIV/AIDS cases.

Although Gilead moved to share its intellectual property rights on its medicines in a patent pool with generic drugmakers from many countries last July in return for a small royalty, China was excluded, which meant it had to continue paying high prices for tenofovir.

Since the change in China's patent law, Gilead has offered certain concessions, including giving China a substantial donation of tenofovir if it continues to buy the same amount, said Paul Cawthorne, coordinator for Medecins Sans Frontieres' Access Campaign in Asia.

"This is all a negotiation game; this offer from Gilead came about once the news that the Chinese was considering issuing a CL came out. The end game is okay, you get a better deal or you use the CL, it's a strategy that many countries use," he said.

Gilead in Hong Kong declined to comment. No one was immediately available to comment at its head office in California.

All eyes are now trained on how China battles it out with big foreign drug exporters, especially from 2013 when the Geneva-based Global Fund to Fight AIDS, Tuberculosis and Malaria will no longer give grants to China to fight HIV.

(Reporting by Tan Ee Lyn in Hong Kong and Beijing newsroom; Additional reporting by Ben Hirschler in London; Editing by Anne Marie Roantree and David Cowell)