An anti-corruption campaign in China’s health sector is gathering steam as regulators says their efforts will cover everything from drug companies and manufacturing to hospitals and its medical insurance fund.
(Bloomberg) — An anti-corruption campaign in China’s health sector is gathering steam as regulators says their efforts will cover everything from drug companies and manufacturing to hospitals and its medical insurance fund.
The initiative includes a comprehensive look at the entire pharmaceutical industry, and increases penalties and disclosure requirements, the official Xinhua News Agency reported, citing an unidentified official at the National Health Commission.
Previous efforts uncovered individuals in key positions who abused their power, accepted kickbacks and bribes, and engaged in corrupt activities, according to the report. Those actions reduced the benefits of health-care reform and curbed development, hurting the public interest, the unnamed official said, according to Xinhua.
Since news broke in late July that China’s Central Commission for Discipline Inspection was working with the NHC, Ministry of Public Securities and other agencies to weed out corruption, headlines have been filled with reports about hospital chiefs being taken away and bribes to doctors and health-care workers from drug and medical device companies. Rumors of raids and executives whisked away from Chinese and foreign pharmaceutical firms also swirled online.
China’s health-care stocks slumped as sentiment took a hit from the anti-graft crackdown, with the CSI 300 Health Care Index falling 0.5% on Tuesday. It’s down 13% year-to-date.
Nearly 30 hospital chiefs, party secretaries and health officials have been swept up by the anti-graft campaign in the three weeks since it launched. The number of healthcare professionals and officials ensnared in a broader CCDI investigation rose to more than 170 since the beginning of this year, data compiled by Beijing-based healthcare consultancy and media Saibailan shows. Most are from hospitals and government agencies in lower-tier cities across China, indicating the crackdown is far from complete.
Western drugmakers have also fallen afoul of Chinese regulators in the past. In 2014, GSK Plc was fined nearly $500 million and a suspended prison sentence was imposed on its foreign executive in China for bribing doctors.
While some academic conferences in the pharmaceutical field have been suspended or postponed due to the anti-corruption efforts, the official said normal medical activities should be encouraged for the advancement of medical technology and innovation.
–With assistance from Li Liu.
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