HEALTH CARE/Joan Retsinas

Chinese Drugs

Westerners recognize China as the world’s producer of just about everything — computers, toys, dishes, gizmos. Whatever the brand, Chinese workers probably made it. With a population of more than a billion, the domestic market (as well as the export-one) assures a strong demand for the streams of stuff that are “made in China.”

So the fact that Chinese plants are churning out drugs is no surprise.

Much of the production of the 3,000 Chinese firms (down from 7,000 a few years ago) is geared for the domestic market; and the combination of an aging population, the extension of health insurance, and increased business protections linked to entrance in the World Trade Organization augurs for a rapidly growing industry. This industry has been growing at 16% annually.

To date, most of the production has focused on the development of copies of existing drugs, generic versions of drugs, or traditional Chinese medicines. Not surprisingly, the Western pharmaceutical industry has recognized the crucial importance of China. The involvement began in the 19th century when Bayer, Aventis, and Eli Lilly set up shop to sell their products.

Today the top 20 pharmaceutical companies in the world have either established joint ventures with Chinese companies, or own facilities in China. The market for pharmaceutical ingredients, moreover, is strong: at trade shows throughout the world, Chinese chemical companies sell the ingredients for common drugs, including generics and over-the-counter drugs. And China has presented a venue for clinical trials of Western drugs, in part because Chinese residents are not already taking a pharmacopeia of drugs that can complicate trials.

This view of China as the world’s factory, however, is short-sighted. The nation is moving beyond making what others design to designing the panoply of goods. Sparked by a national passion for technology, an eagerness for innovation and a keen desire to succeed, a new generation is plunging into the as-yet-new arena of entrepreneurship, intent on transforming China from the world’s factory to the world’s design-center.

This July I attended a multi-day conference sponsored by the China Planning Network, a group started six years ago by Chinese students joining with faculty at MIT and Harvard, with the aim of sharing of information on urban planning. For the past decade urbanization has been the focus in this country where 100 cities have populations over 1 million, and the skyscrapers continue to sprout.

At this year’s conference the participants segued into economic development. At talks both formal and informal, spread across Nanjing, Changzhou, and Suzhou, involving people from academia as well as government, the topic was entrepreneurship: how to grow and sustain new businesses, new industries. In another decade, China wants to create new products; indeed, Chinese plants may one day be out-sourcing the manufacture of those products to a country with lower-labor costs.

As yet, pharmaceuticals are a minor blip in China’s industrial panoply – yet in such a huge economy, even a minor blip is major by world-standards. And the investment in R & D — the research-and-design component of the Western pharmaceutical industry — is small by Western standards (one estimate is that the entire Chinese industry’s investment in R and D does not equal that of one major Western pharmaceutical firm). And the recent disastrous, lethal consequences of poorly manufactured drugs are too recent to be dismissed. In the United States the chain-of-inspection throughout the production process is stringent; in China, the chemical companies that make the key ingredients are not so tightly overseen. Also, the ethical guidelines that govern American pharmaceutical research do not translate across the ocean. At this moment, the United States, which does not readily allow the importation of drugs made in Canada, is unlikely to lower the floodgates to admit drugs developed and made in China.

But in Chinese economic-time a decade or two may be sufficient. Certainly in the past two decades a bevy of architects has transformed the skyline of Chinese cities: the crane may be the national bird.

On the pharmaceutical front, China is moving swiftly, with protocols in place for clinical trials, with scientists, engineers and physicians working in laboratories, with government opening the spigots of money to nurture these embryonic businesses. Optimistically, the resulting treatments will benefit not just their citizens but the world. I hope that the nation that has produced computers, toys, dishes and gizmos might one day produce cures for diseases.

Joan Retsinas is a sociologist who writes about health care in Providence, R.I. Email retsinas@verizon.net.

From The Progressive Populist, August 15, 2010