To strengthen the supervision of pharmaceutical companies in China, the State Food and Drug Administration (SFDA) issued the Interim Provisions for Drug Safety Credit Classification on September 13, 2004. The new regulation will categorize domestic and foreign drug companies, including manufactures, distributors, and research and development (R&D) units, into four credit levels based on their compliance with current pharmaceutical laws and regulations.
Drug administration officials will conduct an inspections of manufacturing sites, distribution sites, or R&D facilities to determine whether companies are complying with pharmaceutical laws and regulations in China. Following the inspection, one of four categories will be assigned to the location: (1) initial compliance, or made an improvement and now is in compliance; (2) received one warning due to non-compliance; (3) received a second warning due to non-compliance; and (4) has received numerous warnings, and has not made an effort to comply. The assigned category will result in an increase or decrease in the company’s credit rating.
To keep a record of credit ratings of pharmaceutical companies, an archive of Credit Information Files will be set up by the SFDA. Non-complying companies who receive a category (4) rating will be subject to a decrease in their credit rating. Warnings will also result in a decrease in credit ratings and these companies will be subject to higher levels of supervision and inspection by the local drug administration officials. On the contrary, companies that comply with the necessary laws and regulations will be assigned to the top credit rating category, will have less inspections, and receive priority in administrative approval processes. Additionally, drug companies that currently have unfavorable records can be promoted to a higher credit level if they do not violate any pharmaceutical regulations during a one year period.