The new regulation is expected to go into effect on September 15 in support of the revised Law on Drug Management, which became effective on December 1 last year.

Zhen Xiaoyu, director of the administration, said the regulation strives to watch closely every link in the production and sale of drugs for the sake of guaranteed quality, while endeavors continue to build a more market-oriented distribution system.

For instance, the regulation endows drug authorities at the provincial level with the same rights as the State Drug Administration to examine and authenticate the production quality of drug manufacturers.

A source within the administration, who declined to be identified, said the change will quicken the process of examination and certification.

"The faster the manufacturers are examined, the earlier the people will be supplied with safer drugs," said the official.

The administration has demanded that all of the country's 6,731 drug manufacturers pass the examinations by June 30, 2004. So far 30 percent of them have made it.

And even though the regulation recognizes the practice of "trust production," it says the parties entrusted must have the corresponding production qualification.

Otherwise, both the consignor and the entrusted party will be punished for producing "fake" drugs.

As for retail, the regulation stipulates that every drug retailer be staffed with professional pharmacists, who can help ensure people get the right medicine.

The administration will no longer interfere with the pricing of drugs, except for those listed for use in the country's basic medical insurance program that satisfy the daily medical needs of ordinary employees. Price controls will also continue to apply to drugs with monopolized production and sale.

The regulation vows to punish severely those selling fake and shoddy drugs to pregnant women and children, those selling fake or shoddy biological and blood products, those passing off products like anesthetics as ordinary drugs (and vice versa), those who cause severe results by selling unqualified drugs, or those caught committing a second offence.

The designated punishments consist mainly of fines, confiscation and administrative penalties, except that every severe case will be punishable under criminal law.

(China Daily August 15, 2002)