China Forbids Leasing Of Drug Store Shelves
SHANGHAI – Chinese drug stores are no longer allowed to rent shelf space to drug suppliers, previously a common marketing practice, or to put OTC and prescription drug products and non-drug products next to each other on store shelves. Sale of prescription drugs off the open shelf is also prohibited under a rule issued Aug. 13 by the State Food and Drug Administration.
Previously, some drug stores leased counters to drug suppliers for advertising and marketing activities, which is forbidden under the new notice.
Drug suppliers and distributors are no longer allowed to conduct any marketing activities at retailers that sell their products, including distributing advertisements and brochures. Firms are also forbidden from advertising non-drugs as drugs, according to the new rule, which became effective immediately.
The notice also aims to regulate where pharmaceutical products may be displayed at a retail store. From now on, retail companies wanting to sell other products in drug stores will have to separate them from drugs in a clear and obvious way and sell them in different areas of the store.
“In the second half of this year, we will enhance supervision on the drug retail sector and ensure that pharmaceutical and non-pharmaceutical businesses are strictly isolated,” SFDA Spokeswoman Yan Jiangying said during the agency’s monthly press conference Aug. 8.
In China, “There are several reasons why people buy pharmaceuticals from drug stores” Zhou Rui, an analyst for Shanghai-based Haitong Securities Ltd., told PharmAsia News. “The drug store is the first choice for patients who are not a part of the medical care system or don’t have medical insurance, because of the price advantage against hospital pharmacies.”
“Many are also not willing to queue for a long time and so choose to buy from nearby drug stores for convenience,” Zhou said.
In recent years, SFDA has stepped up enforcement against illegal advertising and marketing activities, including advertisements that exaggerate the effects of drugs, advertisement of prescription drugs to the general public and health supplement advertisements that fail to provide adequate warnings.
In March, SFDA issued new standards for drug advertisements (PharmAsia News, July 9, 2007). According to regulators, drug stores will have their drug trade licenses revoked if they violate these regulations.
Drug retailers also are required to meet good supplying practices under a certification system adopted by SFDA in 2002.
The Aug. 13 notice is part of a broad campaign by SFDA to increase oversight and regulation of the retail drug industry. Earlier this month, SFDA also issued a list of legal online drug stores and said it would block illegal drug retail Web sites (PharmAsia News, Aug. 20, 2007).
Some experts have welcomed the policies in the latest SFDA notice.
“It is a good move to purify the pharmaceutical retail market,” said Zhou. “Many illegal activities will be banned and a fair competitive environment will be created.”
– Dai Jialing
© FDC Reports 2007 - All Rights Reserved
