Beijing Tong Ren Tang, China's leading producer of traditional Chinese medicine with a history of more than 330 years, intends to tap the overseas market.

The move is a result of China's entry into the World Trade Organization (WTO).

"We plan to set up 30 joint ventures and 100 pharmacies overseas by the year 2005," said Ding Yongling, manager of the Import & Export Company of Beijing Tong Ren Tang.

It had signed co-operative agreements with firms in Malaysia, Canada, Indonesia and the Republic of Korea recently. And it will open Tong Ren Tang pharmacies in these countries early next year.

At present, Tong Ren Tang has five joint-venture companies overseas to handle local sales as well as several pharmacies in the Hong Kong Special Administrative Region, Britain, the United States, Australia and Thailand.

The pharmacy in Thailand, which began a trial operation in February, has been welcomed by Chinese in Southeast Asia and has begun to make a profit.

Brisk overseas business has helped the company increase its foreign exchange earnings to more than US$10 million this year, compared with US$1.9 million in 1993, when it began to do overseas trade by itself and the first joint venture was established in Hong Kong.

"Our aim is that by 2005, the sales volume of exported products will amount to 500 million yuan (US$60.4 million) and foreign exchange earnings will reach US$60 million, with an annual increase of 46.8 per cent," Ding said.

Tong Ren Tang's existing cooperation with overseas firms largely involves trading. "But now we are considering moving into the manufacturing sector," she said.

"We will first do packing in some areas and then realize the localization of production step by step in two to three years," Ding said. "It is an easier way to open the overseas market."

According to the State Drug Administration, global sales volume of herbal medicines is as high as US$30 billion, increasing 10 per cent year-on-year. Whereas China's products account for only 3 to 5 per cent, and 80 per cent of Chinese traditional medicine traded on the world market is raw materials.

The lack of standards and accurate statistics on ingredients and effectiveness is a major factor restricting traditional Chinese medicine from entering the global market. Europe and the United States have set strict restrictions on imports of herbal medicine, said a State Drug Administration official.

Researchers at Tong Ren Tang introduced chromatographic analysis technology to map out components of best quality medicines, said Li Zhimeng, chief engineer of Tong Ren Tang. Production of medicines must be in accordance with the maps. This will help the company push the products to reach global standards.

In addition, Tong Ren Tang is conducting new research on traditional recipes and developing new products to cater to the international market.

Despite traditional Chinese medicine like bolus, Tong Ren Tang is now able to manufacture products in many ways, including liquids, tablets, soft and hard capsules, drops and granular preparations, in accordance with customers' demands.

Ding said Tong Ren Tang medicine is being recognized by more and more Westerners, though its major market is still Asia. "We aim to make the reputation of the Tong Ren Tang brand worldwide," she said.

Tong Ren Tang was established in 1669. It listed in the Shanghai stock market in 1997. Its Technologies Co Ltd listed in the Hong Kong Growth and Enterprise Market in 2000.

Turning out more than 800 kinds of medicine, Tong Ren Tang has had sales volume of 3 billion yuan (US$362 million) this year.

(China Daily December 17, 2001)