Security concerns raised as China fills U.S. medicine chest

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Security concerns raised as China fills U.S. medicine chest By Tim Johnson, McClatchy NewspapersThu Dec 6, 6:00 AM EThttp://news./s/mcclatchy/20071206/wl_mcclatchy/2774948 BEIJING — The medicine cabinet in the average U.S. home is filling withdrugs made in China , and some experts say that could be a prescriptionfor trouble. China's booming pharmaceutical industry has doubled exports to the UnitedStates in the past five years, undercutting competitors and makingAmerican consumers reliant on the safety of Chinese factories and captiveto any disruptions in Sino-U.S. commerce. It might seem like merely a trade issue. But industry experts in Europe andthe United States say national-security concerns are edging into thedebate. Consider this scenario: If a major anthrax attack were to occur in the United States — larger thanthe one in 2001, when five people died— pharmaceutical companies that makethe two antibiotics most suitable for treatment, Cipro and doxycycline,would have no choice but to rely on China or India for key ingredientsonce American stockpiles were exhausted. Those ingredients no longer aremade in the West. A Portuguese company that ramped up doxycycline production in 2001 atWashington's request said China now controlled the flow of its crucialdrug component. "If we were asked to do this again, we would be dependent on Chinaproviding us with key starting materials that are unavailable in the restof the world," said Guy Villax, the chief executive of Hovione, aLisbon -based fine chemicals company. The spectacular growth of China's pharmaceutical industry coincides withsome equally huge problems. A kickback scandal ensnared China's State Foodand Drug Administration and its chief in charges that they gave approvalfor bogus drugs, including a counterfeit antibiotic that left 13 peopledead. Wary of rising public anger, the state issued a Draconian sanction:It executed the agency chief in July. Cases of tainted toothpaste, toys and pet food that have made globalconsumers wary of the "Made in China " label added urgency to ahigh-profile drug agency purge. Even so, China's $65 billion pharmaceutical industry is galloping at anannual growth rate of 24 percent in the first eight months of this year.Competitors say China's drug companies not only have low-cost advantagesbut also get a nearly free pass from U.S. drug regulators, who hold thescrews to American companies— raising their costs significantly— butrarely inspect in China . China says it's a reliable source of safe medicine for its own citizens andexport markets. At a news conference this week, the deputy drug agencychief, Wu Zhen , called on countries to work together to ensure a safeglobal supply chain of medicines. "To solve the drug safety problems, we need international cooperation," Wusaid. "We hope to have . . . more cooperation, and less finger-pointing." China dominates more than just antibiotics. U.S. regulators license 714plants in China to produce ingredients for over-the-counter, generic andprescription drugs for Americans. China has snagged a major share of theglobal sales of many vitamins, antibiotics, enzymes and painkillers. Itmakes a third of the world's acetaminophen, an over-the-counter painmedication. Acetaminophen is sold under many brand names, the best knownof which is Tylenol, though Tylenol itself isn't made in China . This brings up another possible scenario: "Just suppose you are taking some cholesterol drug, and its intermediatesor active ingredients are made in China . Then there's some conflict withTaiwan . Will your drug still be available?" asked Joe Acker , thepresident of the Synthetic Organic Chemical Manufacturers' Association , atrade group in Washington . "The whole drug supply could be in jeopardy inthese kinds of situations." Acker noted that he thinks that the United States could rebound fromdisruptions in the increasingly globalized supply chain for drugcomponents, in which materials are bought from a number of low-costcountries. "I'm not a Chicken Little type of person," Acker said. "However, if therewere to be a major problem, and we could not source material from China ,we would have to gear up production very quickly." The anthrax scare jolted the United States just a week after the terroristattacks of Sept. 11, 2001 . Letters containing anthrax spores were mailedto news organizations in Florida and New York and to the offices of twoU.S. senators. Authorities don't know the source of the letters, and noarrests have been made. Because of the attacks, the Health and Human Services Department increasedstockpiles of antibiotics and vaccines against anthrax. "We have enough antibiotics . . . to treat 40 million Americans," BillHall , a spokesman for the department, said in an e-mail, adding that thegovernment also has 28.75 million doses of anthrax vaccine. Bayer, the German health-care giant, held patent protection until 2004 overthe antibiotic known as ciprofloxacin, which it marketed as Cipro. Thatantibiotic now is mass-produced by generic firms, which get a keyingredient, dichloro fluorobenzene, from one of four Chinese companies ortwo Indian firms. The Chinese and Indian companies are all but exempt from oversight by theU.S. Food and Drug Administration . "Only 13 inspections were conducted in China in 2007," Rep. John Dingell ,a Michigan Democrat who chairs the House Committee on Energy and Commerce,said at a hearing Nov. 1 . "At this rate, it would take the FDA 55 yearsjust to clear this backlog." By giving China a virtual pass on FDA inspections, Acker said, Chinesefirms get a cost savings of about 25 percent above American companies,which face unannounced on-site inspections at any time. Since European pharmaceutical companies also face tougher standards, theytoo have stopped producing some basic drug ingredients, ceding productionto Chinese and Indian companies that face less scrutiny and have lowercosts. On both sides of the Atlantic, manufacturers say they fret over thenational-security implications of the massive off-shoring of production toAsia . "If there is a peak in demand triggered by a pandemic or a terrorist event,there will be little domestic production capacity to meet public healthneeds," said an August 2006 white paper by the U.S. chemicals trade groupin conjunction with the European Fine Chemicals Group , its counterpart. Chinese chemical companies that sell ingredients used by foreignpharmaceutical firms also shield themselves from the news media. Sun Dongliang, the deputy chief of the chemical industry chamber under thepowerful China Council for the Promotion of International Trade , refuseda request for an interview. "He thinks that your interview has nothing to do with the chemicalindustry. It's about pharmaceutical things," said an assistant who gaveonly her surname as Guo. All four Chinese companies that manufacture the key ingredient forciprofloxacin declined requests for interviews. China offered foreign journalists a tour of two model pharmaceutical plantsin Hangzhou on Nov. 23 . The plants were spotless. Workers in face maskstoiled in jumpsuits on assembly lines. Polished machinery gleamed. Onefactory made Chinese medicines to treat prostate ailments. The other madeherbal remedies. Outsiders say Chinese drug plants run the gamut from First to Third World. "You will see some companies where you can eat off the floor. They arestate of the art," said Acker, the U.S. trade group chief. "I hear otherstories of places where people are making chemicals while wearingflip-flops." Despite multiple requests over a two-week period, McClatchy was unable togain access to any drug ingredient-manufacturing facilities other than themodel firms presented by the Chinese government. Although Chinese authorities warn against foreign finger-pointing, thegovernment's own reaction to the scandal over bogus and substandard drugsearlier this year was extremely harsh. After drug chief Zheng Xiaoyu's execution, the state began a vasthousecleaning. This week, it said it had shut down 300 drug andmedical-device makers, convicted 279 people of irregularities and prompteddrug companies to withdraw 7,300 applications for drug approval,indicating more rigor in the approval process. Such actions left doubt whether consumers ought to be reassured by thefactories shut down or alarmed at the state of the industry. Wu, thedeputy drug chief, said he hoped to restore faith in Chinese drugs afterthe kickback scandal. "The corruption case . . . has tarnished our image," he said. "One of thetargets of this campaign is to clean up the legacy caused by thiscorruption case." Still unclear is whether increased self-policing is sufficient given themagnitude of China's production and its rising share of global medicinechests. Villax, the Portuguese executive who's a board member of the European FineChemicals Group , said some Chinese pharmaceutical manufacturers werecutting corners and that unless enforcement tightened "people will die.It's not low-cost labor that concerns us," Villax said. "What we're sayingis there are a lot of people not playing by the rules, and not gettingcaught." A sign of the troubles that can occur in the pharmaceutical industry cameat a plant that was manufacturing a key ingredient used in ciprofloxacin. A deafening blast ripped through the Fuyuan Chemical Co. plant in Jiangsuprovince on July 28, 2006 . Once the smoke cleared, 22 people lay dead andanother 29 were injured. China's State Administration of Work Safety laterissued a report charging the plant with ignoring safety rules, adoptinglow construction standards and operating without permits. ( McClatchy special correspondent Fan Di contributed to this article.) -- politics=polyticks many blood sucking parasites---------------------------