Law of the People's Republic of China on Pharmaceutical Administration

Promulgation Date : 2001-02-28/Effective Date : 2001-12-01

Chapter 1 General Principles

Article1  In order to strengthen the supervision over and administration of pharmaceuticals, to guarantee the quality of pharmaceuticals, to safeguard the security of pharmaceuticals for human bodies, and to maintain the health and the legal rights and interests of the masses to use and consume pharmaceuticals, this Law is hereby enacted.

Article2  Units and individuals engaging in research, manufacture, management, use, control, and supervision of pharmaceuticals in the territory of the People's  Republic of China must abide by this Law.

Article3  The state develops the modern and traditional pharmaceuticals and exercises their function adequately on prevention, treatment, and health care.
The state protects the wild pharmaceutical resources and encourages cultivating Chinese traditional medical materials.

Article4  The state encourages researching and creating new pharmaceuticals, and protects the legal rights and interests of citizens, legal persons, and other organizations to research and create new pharmaceuticals.

Article5  The supervisory and administrative departments in charge of pharmaceuticals of the State Council shall be responsible for the supervision over and administration of national pharmaceuticals. The relevant departments of the State Council shall be responsible for the supervision and administration work concerning pharmaceuticals within their respective authorities.
The supervisory and administrative departments in charge of pharmaceuticals of all provinces, autonomous regions, and municipalities directly under the Central People's  Government shall be responsible for the supervision over and administration of pharmaceuticals within their own administrative jurisdiction. The relevant departments of all provinces, autonomous regions, and municipalities directly under the Central People's  Government shall be responsible for the supervision and administration work concerning pharmaceuticals within their respective authorities.
The supervisory and administrative departments in charge of pharmaceuticals of the State Council shall cooperate with the comprehensive administrations on economy of the State Council to execute the development planning and industrial polices on pharmaceutical industry as constituted by the state.

Article6  The supervisory and administrative departments in charge of pharmaceuticals shall establish the pharmaceutical inspection organs to implement the examination and approval on pharmaceuticals according to law and the inspection on pharmaceuticals needed by the inspection and supervision over quality of pharmaceuticals.

Chapter 2 Administration of Pharmaceutical Manufacturing Enterprises

Article7  Any unit or individual who wishes to establish pharmaceutical manufacturing enterprises shall apply to the supervisory and administrative departments in charge of pharmaceuticals of all provinces, autonomous regions, and municipalities directly under the Central People's  Government for approval and the Pharmaceutical Manufacture License. He shall then register with the administration of industry and commerce with the License. Without the Pharmaceutical Manufacture License, the pharmaceuticals shall not be manufactured.
The validity period and manufacture scope shall be specified in the Pharmaceutical Manufacture License. Upon expiry, it shall be re-checked and re-issued.
Pharmaceutical manufacturing enterprises established upon approval of the supervisory and administrative departments in charge of pharmaceuticals shall not only be based on qualifications as provided by Article 8 herein, but also accord with the development planning and industrial policies on pharmaceuticals. Duplicated construction shall be prevented.

Article8  Pharmaceutical manufacturing enterprises must possess the following qualifications:
(1) Having pharmaceutical technicians, engineering technicians and corresponding technical works with accredited qualifications;
(2) Having factory buildings, facilities, and healthy environment;
(3) Having organs, personnel, and equipment to control and examine quality of produced pharmaceuticals; and
(4) Having regulations or rules to guarantee the quality of pharmaceuticals.

Article9  Pharmaceutical manufacturing enterprises must organize production according to the Administrative Criteria on Quality of Pharmaceuticals formulated by the supervisory and administrative departments in charge of pharmaceuticals of the State Council according to this Law. The supervisory and administrative departments in charge of pharmaceuticals shall authenticate whether pharmaceutical manufacturing enterprise accord with this Criteria, and shall issue the authentication certificate to qualified enterprises.
Detailed implementing measures and steps of these Criteria shall be formulated by the supervisory and administrative departments in charge of pharmaceuticals of the State Council.

Article10  Except processing of Chinese traditional medicine crude slices, pharmaceuticals must be manufactured according to the manufacturing technique approved by the supervisory and administrative departments in charge of pharmaceuticals of the State Council and the national pharmaceutical standard, and the manufacturing records must be kept wholly. The pharmaceutical manufacturing enterprises, if wishing to change manufacturing technique that will affect quality of pharmaceuticals, shall report it to the original approval department for examination and approval.
Chinese traditional medicine crude slices shall be processed according to the national pharmaceutical standard. If the state does not stipulate such standard, they shall be processed according to the processing standard stipulated by the supervisory and administrative departments in charge of pharmaceuticals of all provinces, autonomous regions, and municipalities directly under the Central People's  Government. The processing standard drafted by the supervisory and administrative departments in charge of pharmaceuticals of all provinces, autonomous regions, and municipalities directly under the Central People's  Government shall be reported to the supervisory and administrative departments in charge of pharmaceuticals of the State Council for records.

Article11  Raw materials and accessory materials for manufacturing pharmaceuticals shall accord with the relevant criteria.

Article12  Pharmaceutical manufacturing enterprises must carry through the quality examination on finished pharmaceuticals. Pharmaceuticals that do not accord with the national pharmaceutical standard or are not processed according to the processing criteria formulated by The supervisory and administrative departments in charge of pharmaceuticals of all provinces, autonomous regions, and municipalities directly under the Central People's  Government shall not leave the manufacturing factory for selling.

Article13  Pharmaceutical manufacturing enterprises may be entrusted to manufacture pharmaceuticals upon approval of the supervisory and administrative departments in charge of pharmaceuticals of the State Council or the supervisory and administrative departments in charge of pharmaceuticals of all provinces, autonomous regions, and municipalities directly under the Central People's  Government authorized by the former.

Chapter 3 Administration of Pharmaceutical Operation Enterprises

Article14  Any unit or individual who wishes to establish pharmaceutical wholesale enterprises must apply to the supervisory and administrative departments in charge of pharmaceuticals of all provinces, autonomous regions, and municipalities directly under the Central People's  Government for issuing the Pharmaceutical Operation License. Any unit or individual who wishes to establish pharmaceutical retail enterprises must apply to the local supervisory and administrative departments in charge of pharmaceuticals for approval and the Pharmaceutical Operation License, and then shall register with the local administration of industry and commerce with the License. Without the License, anyone shall not operate pharmaceuticals.
The validity period and manufacture scope shall be specified in the Pharmaceutical Operation License. Upon expiry, it shall be re-checked and re-issued.
Pharmaceutical operation enterprises established upon approval of the supervisory and administrative departments in charge of pharmaceuticals shall not only be based on qualifications as provides by Article 15 herein, but also abide by the principle of reasonable overall arrangement and being convenient for the masses.

Article15  The pharmaceutical operation enterprises shall possess the following qualifications:
(1) Having accredited pharmaceutical technicians;
(2) Having business places, equipment, warehousing facilities, and sanitation corresponding to pharmaceutical operation;
(3) Having quality administration organs or personnel corresponding
to pharmaceutical operation; and
(4) Having regulations and rules to guarantee the quality of pharmaceuticals.

Article16  The pharmaceutical operation enterprises shall operate pharmaceuticals according to the Administrative Criteria on Quality of Pharmaceuticals Operation formulated by the supervisory and administrative departments in charge of pharmaceuticals of the State Council according to this Law. The supervisory and administrative departments in charge of pharmaceuticals shall authenticate whether pharmaceutical operation enterprises accord with this Criteria, and shall issue the authentication certificate to qualified enterprises.
Detailed implementing measures and steps of these Criteria shall be formulated by the supervisory and administrative departments in charge of pharmaceuticals of the State Council.

Article17  The pharmaceutical operation enterprises shall establish the system on examination, check, and acceptance on purchase when purchasing pharmaceuticals, to verify the qualification certification and other marks of pharmaceuticals, and shall not purchase unqualified pharmaceuticals.

Article18  The pharmaceutical operation enterprises must have the true and complete purchase and sale records. The purchase and sale records must specify the general appellation of the pharmaceutical, the medicament type, specification, approval number, validity period, manufacturer, purchase or sale unit, quantity and price of purchase or sale, date of purchase or sale, and other contents as provided by the supervisory and administrative departments in charge of pharmaceuticals of the State Council.

Article19  The pharmaceutical operation enterprises must sell pharmaceuticals exactly, and shall correctly explain the usage, dosage, and proceedings of attention. Preparation of prescription must be verified; pharmaceuticals listed in the prescription shall not be changed or substituted without authorization. The prescription with surplus dosage or incompatibility drugs shall be refused to prepare. When necessary, it may be prepared upon the second signature of or correction of the prescription physician.
The places of origin of Chinese traditional materials sold by pharmaceutical operation enterprises shall be indicated clearly.

Article20  The pharmaceutical operation enterprises must formulate and enforce the pharmaceutical safekeeping system, and adopt necessary refrigeration, frostbite resistant, damp-proof, mothproof, and mouse-proof measures to guarantee the quality of pharmaceuticals.
The strict examination system must be implemented for pharmaceuticals to leave or enter the warehouse.

Article21  The Chinese traditional medicine materials may be sold on the trading bazaars of cities and villages, unless it is provided by the State Council otherwise.
Pharmaceuticals beyond the Chinese traditional medicine materials shall not be sold on the trading bazaars of cities and villages. However, the pharmaceutical retail enterprises with the Pharmaceutical Operation License may sell pharmaceuticals beyond Chinese traditional medicine materials on the trading bazaars of cities and villages, within permitted range. The State Council shall formulate the detailed measures.

Chapter 4 Administration of Medical Organizations on Medicament

Article22  The medical organizations must be equipped with pharmaceutical technicians who are accredited according to law. Anyone who is not the pharmaceutical technician shall not engage in the technical pharmaceutical work directly.

Article23  The medical organizations, when compounding medicament, must be examined and verified by the administrative departments in charge of health of all provinces, autonomous regions, and municipalities directly under the Central People's  Government, and apply to the supervisory and administrative departments in charge of pharmaceuticals of all provinces, autonomous regions, and municipalities directly under the Central People's  Government for approval and the Medicament License for Medical Organizations. Without this License, the medicament shall not be compounded.
The validity period must be indicated in this License. Upon expiry, it shall be re-examined and re-issued.

Article24  When compounding medicament, the medical organizations must have facilities, administrative rules, testing equipment, and sanitary conditions to guarantee the quality of medicament.

Article25  The medicament compounded by medical organizations shall be the variety that is needed by the clinic of their own units and may not be purchased from the market, and shall be compounded upon approval of the supervisory and administrative departments in charge of pharmaceuticals of all provinces, autonomous regions, and municipalities directly under the Central People's  Government. The quality examination must be carried through for the compounded medicament. Qualified medicament may be used in their own organizations by the prescription of the physicians. The medicament of the medical organizations may be regulated between appointed medical organizations upon approval of the supervisory and administrative departments in charge of pharmaceuticals of the State Council or all provinces, autonomous regions, and municipalities directly under the Central People's  Government, under special conditions.
The medicament of the medical organizations shall not be sold on the market.

Article26  The medical organizations shall establish the system on examination, check, and acceptance on purchase when purchasing pharmaceuticals, to verify the qualification certification and other marks of pharmaceuticals, and shall not purchase unqualified pharmaceuticals. The pharmaceutical operation enterprises must sell pharmaceuticals exactly, and shall correctly explain the usage, dosage, and proceedings of attention.

Article27  Preparation of prescription must be verified, pharmaceuticals listed in the prescription shall not be changed or substituted without authorization. The prescription with surplus dosage or incompatibility drugs shall be refused to prepare. When necessary, it may be prepared upon the second signature of or correction of the prescription physician.

Article28  The medical organizations must formulate and enforce the pharmaceutical safekeeping system, and adopt necessary refrigeration, frostbite resistant, damp-proof, mothproof, and mouse-proof measures to guarantee the quality of pharmaceuticals.

Chapter 5 Administration of Pharmaceuticals

Article29  The data and samples of research methods, quality index, results of pharmacodynamics and virus experiments of newly researched pharmaceuticals shall be reported to the supervisory and administrative departments in charge of pharmaceuticals of the State Council according to facts and the relevant provisions. Upon approval of the supervisory and administrative departments in charge of pharmaceuticals of the State Council, the new pharmaceutical may be experimented for the clinic. The authentication measures of the qualifications of the clinic experimental organs shall be formulated by the supervisory and administrative departments in charge of pharmaceuticals of the State Council and the administrative departments in charge of health jointly.
The certificate shall be issued to new pharmaceuticals that are qualified upon clinic experiment by the supervisory and administrative departments in charge of pharmaceuticals of the State Council.

Article30  The evaluation and research organs on non-clinic safety of pharmaceuticals and the experimental clinic organs shall enforce the quality administration criteria on non-clinic research and the quality administration criteria on clinic research respectively.
The quality administration criteria on non-clinic research and the quality administration criteria on clinic research shall be formulated by the department appointed by the State Council.

Article31  To manufacture new pharmaceuticals or pharmaceuticals with the national standard must be based on the approval of the supervisory and administrative departments in charge of pharmaceuticals of the State Council and obtain the serial approval number. However, the Chinese medicine materials and crude slices on which the administration of serial approval numbers is not implemented shall be excluded. The catalogue of Chinese medicine materials and crude slices under administration of serial approval number shall be formulated by the supervisory and administrative departments in charge of pharmaceuticals of the State Council jointly with the administrative departments in charge of Chinese medicines of the State Council.
Upon obtaining the serial approval number on the pharmaceutical, the pharmaceutical manufacturing enterprises may manufacture this pharmaceutical.

Article32  The pharmaceuticals must accord with the national pharmaceutical standard. The Chinese medicine crude slices shall be enforced according to Article 10 Paragraph 2 herein.
The pharmaceutical standard as provided by the Pharmaceutical Codes of the People's  Republic of China promulgated by the supervisory and administrative departments in charge of pharmaceuticals of the State Council shall be the national pharmaceutical standard.
The supervisory and administrative departments in charge of pharmaceuticals of the State Council shall organize the pharmacopoeia committee to be in charge of the formulation and revision of the national pharmaceutical standard.
The pharmaceutical examination organs of the supervisory and administrative departments in charge of pharmaceuticals of the State Council shall be in charge of demarcating the national standard pharmaceutical and comparison.

Article33  The supervisory and administrative departments in charge of pharmaceuticals of the State Council shall organize pharmaceutical, medical, and other technical personnel to evaluate the new pharmaceuticals and re-evaluate the pharmaceuticals that have been put into production.

Article34  The pharmaceutical manufacturing enterprises, pharmaceutical operation enterprises, and medical organizations must purchase pharmaceuticals from enterprises with pharmaceutical manufacturing or operation qualifications. However, the Chinese traditional medicine materials for which the serial approval number administration is not implemented shall be excluded.

Article35 The state implements the special administration on anesthetics, psychotropic drugs, toxic pharmaceuticals for treatment, and radioactive pharmaceuticals. The State Council shall formulate the administrative measures

Article36  The state implements the system of Chinese traditional medicine variety protection. The State Council shall formulate the detailed measures.

Article37  The state implements the classified administration system of prescription pharmaceuticals and non-prescription pharmaceuticals. The State Council shall formulate the detailed measures

Article38  The pharmaceuticals with unreliable treatment effect, adverse reaction, and other factors to endanger the health shall be prohibited from being imported.

Article39  The import of pharmaceuticals shall be examined and verified by the supervisory and administrative departments in charge of pharmaceuticals of the State Council. Safe and effective pharmaceuticals that accord with the quality standard upon examination and verification may be imported and the import pharmaceutical registration certificates shall be granted to them.
The important procedures shall be transacted according to the relevant provisions of the state for import pharmaceuticals that are needed by the medical units or individuals urgently.

Article40  Pharmaceuticals must be imported from the port from which the pharmaceuticals are allowed to enter China, and the enterprise that imports these pharmaceuticals shall register with the supervisory and administrative departments in charge of pharmaceuticals of the port. The customs shall release these pharmaceuticals by the Customs Declaration Bills of Import Pharmaceuticals issued by the supervisory and administrative departments in charge of pharmaceuticals. Otherwise, the customs shall not release them.
The supervisory and administrative departments in charge of pharmaceuticals of the port shall notify the pharmaceutical inspection organs to selectively inspect the import pharmaceuticals according to the provisions of the supervisory and administrative departments in charge of pharmaceuticals of the State Council, and shall collect inspection fees according to Article 41 Paragraph 2 herein.
The ports from which pharmaceuticals are allowed to enter China shall be nominated by the supervisory and administrative departments in charge of pharmaceuticals of the State Council jointly with the State Administration of Customs, and shall be reported to the State Council for approval.

Article41  the supervisory and administrative departments in charge of pharmaceuticals of the State Council shall appoint pharmaceutical inspection organs to inspect the following pharmaceuticals before selling or upon import. Unqualified pharmaceuticals upon inspection shall not be sold or imported:
(1) Biological pharmaceuticals as provided by the supervisory and administrative departments in charge of pharmaceuticals of the State Council;
(2) Pharmaceuticals that are sold in China for the first time; and
(3) Other pharmaceuticals as provided by the State Council.
The inspection fee items and charging criteria of the aforesaid pharmaceuticals shall be verified and proclaimed by the financial departments of the State Council jointly with the supervisory and administrative departments in charge of pharmaceuticals of the State Council.

Article42  The supervisory and administrative departments in charge of pharmaceuticals of the State Council shall organize investigation on pharmaceuticals that have been approved for production or import pharmaceuticals. As to pharmaceuticals with unreliable treatment effect or adverse reaction, or other pharmaceuticals endangering the health of the human body, the serial approval number or import pharmaceutical registration certificate shall be revoked.
Pharmaceuticals whose serial approval numbers or import pharmaceutical registration certificates have been revoked shall not be manufactured, imported, sold, or used; such pharmaceuticals that have been imported or manufactured shall be destroyed or disposed by the local supervisory and administrative departments in charge of pharmaceuticals.

Article43  The state implements the pharmaceutical reserve system.
When serious disaster situation or epidemic situation and other outburst accidents occur in the state, the departments as provided by the State Council may transfer pharmaceuticals of enterprises urgently.

Article44  The State Council shall have the right to restrict or prohibit pharmaceuticals with insufficient supplies in China from being exported.

Article45  To import and export anesthetics and psychotropic drugs within the range prescribed by the state, the Import Permit and Export Permit issued by the supervisory and administrative departments in charge of pharmaceuticals of the State Council must be possessed

Article46  Pharmaceutical materials that are newly discovered or introduced from abroad may be sold upon the examination and verification of the supervisory and administrative departments in charge of pharmaceuticals of the State Council.

Article47  The measures on administration of regional civilian habitually used pharmaceutical materials shall be formulated by the supervisory and administrative departments in charge of pharmaceuticals of the State Council and the administrative departments in charge of Chinese traditional medicine of the State Council.

Article48  The fake pharmaceuticals shall be prohibited from being manufactured (including prepared, hereinafter inclusive).
If falling into one of the following situations, the pharmaceutical shall be the fake pharmaceutical:
(1) The ingredients contained by the pharmaceutical do not accord with the ingredients as prescribed by the national pharmaceutical standard; and
(2) Using the non-pharmaceutical to imitate the pharmaceutical or using one kind of pharmaceutical to imitate the other pharmaceutical;
If falling into one of the following situations, the pharmaceutical shall be regarded as the fake pharmaceutical:
(1) Pharmaceuticals prohibited by the supervisory and administrative departments in charge of pharmaceuticals of the State Council from being used;
(2) The pharmaceuticals whose manufacture or import shall be approved according to this Law are manufactured or imported without approval, or the pharmaceuticals that shall be sold upon inspection according to this Law are sold without inspection;
(3) Denatured pharmaceuticals;
(4) Polluted pharmaceuticals;
(5) Pharmaceuticals that are manufactured by the raw materials without obtaining the serial approval number that must be obtained; and
(6) Pharmaceuticals whose indicated application of diseases or main functions exceed the prescribed range.

Article49  Inferior pharmaceuticals shall be prohibited from being manufactured:
(1) Pharmaceuticals whose validity period is not indicated or changed;
(2) Pharmaceuticals whose production serial numbers are not indicated;
(3) Pharmaceuticals beyond the validity period;
(4) Pharmaceuticals whose packing materials and containers directly touching them are not used upon approval;
(5) Pharmaceuticals with added colorant, antiseptic, flavor, taste corrector, and accessory materials without authorization; and
(6) Other pharmaceuticals that do not accord with the pharmaceutical standard.

Article50  The pharmaceutical appellations listed in the national pharmaceutical standard shall be general appellations of pharmaceuticals. The general appellations of pharmaceuticals shall not be used as trademarks.

Article51  The health examination for staffs who directly touch pharmaceuticals of the pharmaceutical manufacturing enterprises, pharmaceutical operation enterprises and medical organizations shall be carried through every year. Any staff with infectious disease or other diseases that are possible to pollute pharmaceuticals shall not be engaged in the working of touching pharmaceuticals directly.

Chapter 6 Administration of Packing of Pharmaceuticals

Article52  Packing materials and containers that directly touch pharmaceuticals must accord with the relevant requirements, accord with the standard of safeguarding the health and security of human body, and shall be examined and approved by the supervisory and administrative departments in charge of pharmaceuticals jointly when examining and approving pharmaceuticals.
Pharmaceutical manufacturing enterprises shall not use packing materials and containers that directly touch pharmaceuticals without approval.
Unqualified packing materials and containers that directly touch pharmaceuticals shall be ordered by the supervisory and administrative departments in charge of pharmaceuticals to be discontinued.

Article53  Packing materials must accord with requirements of the quality of pharmaceuticals and shall be convenient for storage, transportation and treatment.
Packing materials must be used for delivery of Chinese traditional medicinal materials. The item name, place of origin, date, and transfer unit must be indicated on each packing, and the symbol of qualified quality must be attached.

Article54  Labels shall be printed or affixed on, and the specification must be attached to the packing of pharmaceuticals according to the relevant provisions.
The label or specification must indicate clearly the general appellation of the pharmaceutical, ingredients, specifications, manufacturing enterprise, serial approval number, lot number, manufacturing date, validity period, applicable disease or main functions, usage, dosage, incompatibility£adverse reaction, and proceedings of attention.
Labels of anesthetics, psychotropic drugs, toxic pharmaceuticals for treatment, radioactive pharmaceuticals, prescription pharmaceuticals, and non-prescription pharmaceuticals must have the prescriptive printed signs.
Chapter 7 Administration of Price and Advertisement of Pharmaceuticals

Article55  As to pharmaceuticals under fixed price and guiding price of the government, the administrations of price control of the People's  governments shall formulate and adjust the price of pharmaceuticals according to the pricing principle as provided by the Law of the People's  Republic of China on Price, the social average cost, the marketing supply and demand conditions, and social bearing capability, to reach balanced price and quality, to eliminate the falsely high price, and to protect the legal rights and interests of the pharmaceutical users.
Pharmaceutical manufacturing enterprises, pharmaceutical operation enterprises, and medical organizations must execute the fixed price and guiding price of the government, and shall not huff the price by any means without authorization.
Pharmaceutical manufacturing enterprises shall provide the production and operation cost of pharmaceuticals to the administrations of price control of the People's  governments according to facts and law, and shall not refuse to report, falsely report, and conceal the cost.

Article56  As to pharmaceuticals under market regulatory price according to law, the pharmaceutical manufacturing enterprises, pharmaceutical operation enterprises, and medical organizations shall formulate the price according to the principle of "equity, fairness, good faith, and reasonable quality to price ratio" and provide pharmaceuticals to users with tenable price.
The pharmaceutical manufacturing enterprises, pharmaceutical operation enterprises, and medical organizations shall abide by the provisions of the administrations of price control of the State Council on pharmaceutical price, and shall formulate and indicate the retail price of pharmaceutical. Swindling acts concerning price such as sudden huge profits and damaging interests of pharmaceutical users shall be prohibited.

Article57  The pharmaceutical manufacturing enterprises, pharmaceutical operation enterprises, and medical organizations shall provide such data as actual purchase and sale price and amount of pharmaceuticals to the administrations of price control of the State Council according to law.

Article58  The medical organizations shall provide the price list of used pharmaceuticals to patients, and the medical organizations appointed by the medical insurance shall proclaim the price of common pharmaceuticals according to the relevant measures based on facts, and strengthen the administration of reasonable pharmaceutical usage.
The detailed measures shall be formulated by the administrative departments in charge of the public health under the State Council.

Article59  The pharmaceutical manufacturing enterprises, pharmaceutical operation enterprises, and medical organizations shall be prohibited from giving or accepting discount or other profits beyond the books in the course of pharmaceutical purchase and sale.
The pharmaceutical manufacturing enterprises and pharmaceutical operation enterprises or their deputies shall be prohibited from giving properties or other profits to the principals, pharmaceutical buyers, physicians, and so on of the medical organizations that use pharmaceuticals in any name. The principals, pharmaceutical buyers, physicians, and so on of the medical organizations that use pharmaceuticals shall be prohibited from accepting properties or other profits given by the pharmaceutical manufacturing enterprises and pharmaceutical operation enterprises or their deputies.

Article60  Pharmaceutical advertisements shall be examined and approved by the supervisory and administrative departments in charge of pharmaceuticals of the province, autonomous region, or municipality directly under the Central People's  Government in which the enterprises are located. These advertisements may be published upon the serial approval number; otherwise, they shall not be published.
The prescription pharmaceuticals may be introduced on the medical or pharmaceutical publications appointed by the administrative departments in charge of health of the State Council and the supervisory and administrative departments in charge of pharmaceuticals of the State Council jointly. However, advertisements on public media shall not be allowed or other advertisements or propaganda whose object is the public shall not be allowed.

Article61  Contents of pharmaceutical advertisements shall be true and legal based on the specifications approved by the supervisory and administrative departments in charge of pharmaceuticals of the State Council. False contents shall be prohibited.
Pharmaceutical advertisements shall not contain non-scientific affirmation or guarantee on functions. Names and images of experts, scholars, physicians, and patients, or government agencies, medical research units, and academic organs shall be prohibited from being used as proof.
Non-pharmaceutical advertisements shall not concern propaganda on pharmaceuticals.

Article62  the supervisory and administrative departments in charge of pharmaceuticals of all provinces, autonomous regions, and municipalities directly under the Central People's  Government shall censor pharmaceutical advertisements approved by them. As to advertisements in violation of this Law and the Law of the People's  Republic of China on Advertisements, they shall circularly notify the supervisory and administrative departments in charge of advertisements and raise the handling proposals, and the supervisory and administrative departments in charge of advertisements shall handle these cases according to law.

Article63  If this Law does not make complete stipulations on pharmaceutical price and advertisements, the Law of the Republic of China on Price and the Law of the People's  Republic of China on Advertisements shall be applicable.

Chapter 8 Supervision over Pharmaceuticals

Article64  The supervisory and administrative departments in charge of pharmaceuticals shall have the right to inspect and supervise proceedings of using pharmaceuticals by the pharmaceutical manufacturing enterprises, pharmaceutical operation enterprises, and medical organizations that are examined and approved by them according to the relevant laws or administrative regulations; the correlated units or individuals shall not refuse and conceal the inspection and supervision.
When implementing the inspection and supervision, the supervisory and administrative departments in charge of pharmaceuticals must show the certificates and shall keep secrets of the technical and business secrets of the inspected and supervised.

Article65  The supervisory and administrative departments in charge of pharmaceuticals may inspect the pharmaceutical quality selectively according to needs of supervision and inspection. In the course of selective inspection, the sampling must be carried through without any charge, and the needed expenses shall be paid according to the relevant provisions of the State Council.
The supervisory and administrative departments in charge of pharmaceuticals may adopt mandatory administrative measures such as sealing-up and detention for pharmaceuticals and correlated materials that are possible to endanger the health of the human body, and shall make an administrative handling decision within seven days. If the pharmaceuticals need to be inspected, the administrative decision must be made within fifteen days upon the issuing of the inspection report.

Article66  The supervisory and administrative departments in charge of pharmaceuticals of the State Council or all provinces, autonomous regions, and municipalities directly under the Central People's  Government shall regularly proclaim the results of selective inspection on pharmaceutical quality. If the proclamation is not appropriate, correction within the range of the original proclamation must be made.

Article67  The interested party, if having objections to the inspection results, may files an application to the original pharmaceutical inspection organ or the next higher supervisory and administrative department in charge of pharmaceuticals or the determinate pharmaceutical inspection organ for re-inspection, or may directly files an application to the supervisory and administrative departments in charge of pharmaceuticals of the State Council or the determinate pharmaceutical inspection organ for re-inspection. The pharmaceutical inspection organ that accepts the re-inspection shall make a re-inspection conclusion within the time limit as provided by the supervisory and administrative departments in charge of pharmaceuticals of the State Council.

Article68  The supervisory and administrative departments in charge of pharmaceuticals shall carry through the following-up inspection, upon authentication, on qualified pharmaceutical manufacturing enterprises and pharmaceutical operation enterprises according to the Administrative Criteria on Pharmaceutical Manufacturing Quality and the Administrative Criteria on Pharmaceutical Operation Quality.
Article69
The local People's  governments and the supervisory and administrative departments in charge of pharmaceuticals shall not restrict or exclude pharmaceuticals manufactured by non-local pharmaceutical manufacturing enterprises according to this Law from entering their own administrative regions by means of requiring pharmaceutical inspection, examination, and approval.

Article70  The supervisory and administrative departments in charge of pharmaceuticals, their established pharmaceutical inspection organs, and determinate organs specializing in pharmaceutical inspection shall not take part in the pharmaceutical manufacture and operation activities, and shall not recommend or supervise the manufacture and sales of pharmaceuticals.
Staffs of the supervisory and administrative departments in charge of pharmaceuticals, their established pharmaceutical inspection organs, and determinate organs specializing in pharmaceutical inspection shall not take part in the pharmaceutical manufacture and operation activities.

Article71  The State implements the system of reporting adverse reaction of pharmaceuticals. The pharmaceutical manufacturing enterprises, pharmaceutical operation enterprises, and medical organizations must investigate regularly the quality, treatment effect, and reaction of pharmaceuticals manufactured, operated, and used by their own units. Serious adverse reaction related to the pharmaceuticals shall be reported to the local supervisory and administrative departments in charge of pharmaceuticals and administrative departments in charge of health of all provinces, autonomous regions, and municipalities directly under the Central People's  Government in time. The detailed measures shall be formulated by the supervisory and administrative departments in charge of pharmaceuticals of the State Council jointly with the administrative departments in charge of health of the State Council.
The supervisory and administrative departments in charge of pharmaceuticals of the State Council or all provinces, autonomous regions, and municipalities directly under the Central People's  Government may adopt emergent control measures on stopping manufacturing, selling, or using pharmaceuticals whose adverse reaction has been confirmed, and shall organize an appraisal within five days. The administrative handling decision shall be made according to law within fifteen days upon the making date of the appraisal conclusion.

Article72  Pharmaceutical inspection organs or personnel of the pharmaceutical manufacturing enterprises, pharmaceutical operation enterprises, and medical organizations shall accept the business guidance from the pharmaceutical inspection organs set up by the local supervisory and administrative departments in charge of pharmaceuticals.

Chapter 9 Legal Liabilities

Article73  Any enterprise that manufactures or operates pharmaceuticals without obtaining the Pharmaceutical Manufacture License, the Pharmaceutical Operation License, or the Medicament License for Medical Organizations shall be outlawed according to law. The illegally manufactured and sold pharmaceuticals and illegal gains shall be confiscated; a fine of more than twice of the value of illegally manufactured and sold pharmaceuticals (including pharmaceuticals that have been or have not been sold, hereinafter inclusive) but less than five times of this value shall be imposed. It shall be prosecuted for criminal liabilities if its acts constitute a crime.

Article74  Any enterprise that manufactures or sells fake pharmaceuticals shall be imposed a fine of more than twice of the value of illegally manufactured and sold pharmaceuticals but less than five times of this value; the illegal manufactured and sold pharmaceuticals and illegal gains shall be confiscated. The pharmaceutical certificates, if any, shall be revoked and this enterprise shall be ordered to stop production and make internal rectification. If its circumstances are serious, the Pharmaceutical Manufacture License, the Pharmaceutical Operation License, or the Medicament License for Medical Organizations shall be revoked. It shall be prosecuted for criminal liabilities if its acts constitute a crime.

Article75  Any enterprise that manufactures or sells inferior pharmaceuticals shall be imposed a fine of more than one time of the value of illegally manufactured and sold pharmaceuticals but less than five times of this value; the illegal manufactured and sold pharmaceuticals and illegal gains shall be confiscated. If its circumstances are serious, the pharmaceutical certificates, if any, may be revoked or this enterprise may be ordered to stop production and make internal rectification the Pharmaceutical Manufacture License, the Pharmaceutical Operation License, or the Medicament License for Medical Organizations shall be revoked. It shall be prosecuted for criminal liabilities if its acts constitute a crime.

Article76  The directly responsible directors and other directly responsible personnel of enterprises or other operation units that engage in manufacturing or selling fake pharmaceuticals and manufacturing or selling inferior pharmaceuticals with serious circumstances shall not engage in pharmaceuticals manufacture and operation activities.
The raw materials, accessory materials, and packing materials, and equipment used specially for manufacturing fake or inferior pharmaceuticals shall be confiscated.

Article77 Any unit or individual who knows or should know the pharmaceuticals are fake or inferior pharmaceuticals and provide convenience for transporting, storing, and warehousing such pharmaceuticals shall be imposed on a fine of more than 50% but less than three times of illegal gains, and the total income from transportation, storage and warehousing shall be confiscated. It or he shall be prosecuted for criminal liabilities if its or his acts constitute a crime.

Article78  The penalty notice on fake or inferior pharmaceuticals must indicate the quality inspection results of the relevant pharmaceutical inspection organ, unless it falls into one of the situations as provided by Article 48 Paragraph 3 Item 1, 2, 5, 6 and Article 49 Paragraph 3.

Article79  Pharmaceutical manufacturing enterprises, pharmaceutical operation enterprises, the evaluation and research organs on pharmaceutical non-clinic security, and the clinic testing organs of pharmaceuticals shall be given a warning and ordered to make corrections within a specified time limit if they do not implement the quality administration criteria according to the Administrative Criteria on Pharmaceutical Manufacturing Quality, the Administrative Criteria on Pharmaceutical Operation Quality, the administrative criteria on quality of non-clinic pharmaceutical research , or the administrative criteria on quality of clinic pharmaceutical testing. If they do not make corrections within the specified time limit, they shall be ordered to stop production and make internal rectification, and a fine of more than CNY 5,000 but less than CNY 20,000 shall be imposed. If their circumstances are serious, their Pharmaceutical Manufacture Licenses, or the Pharmaceutical Operation Licenses, or clinic testing qualifications shall be revoked.

Article80  Pharmaceutical manufacturing enterprises, pharmaceutical operation enterprises, and medical organizations that, in violation of Article 34 herein, purchase illegal pharmaceuticals from enterprises without the Pharmaceutical Manufacturing License or the Pharmaceutical Operation License shall be ordered to make corrections; the illegally purchased pharmaceuticals shall be confiscated; and a fine of more than twice of but less than five times of the value of illegally purchased pharmaceuticals shall be confiscated jointly. The illegal gains, if any, shall be confiscated. If their circumstances are serious, the Pharmaceutical Manufacture License, the Pharmaceutical Operation License, or the certified licenses for medical organizations shall be confiscated.

Article81 Any enterprise that imports pharmaceuticals on which the import registration certificates have been granted and does not register with the supervisory and administrative department in charge of pharmaceuticals of the port from which pharmaceuticals are allowed to enter China shall be given a warning, and ordered to make corrections in a specified time limit. If it does not make corrections in the specified time limit, the pharmaceutical import registration certificates shall be revoked.

Article82  Any unit or individual who fabricates, alters, buys, sells, releases, or lends licenses or pharmaceutical approval documents shall be imposed upon a fine of more than one time but less than three times of illegal gains and the illegal gains shall be confiscated. If there are no illegal gains, a fine of more than CNY 20,000 but less than CNY 100,000 shall be imposed. If the circumstances are serious, the Pharmaceutical Manufacture License, the Pharmaceutical Operation License, or the Medicament License for Medical Organizations of the buyer, seller, or lender shall be revoked, or the pharmaceutical approval documents shall be revoked. If his acts constitute a crime, he shall be prosecuted for criminal liabilities.

Article83  Any enterprise that, in violation of this Law, obtains the Pharmaceutical Manufacture License, the Pharmaceutical Operation License, or the Medicament License for Medical Organizations, or pharmaceutical approval documents by swindling means such as providing false certificates, materials, data, or other means shall be imposed on a fine of more than CNY 10,000 but less than CNY 30,000. The aforesaid licenses or documents shall be confiscated, and its application for such licenses shall not be accepted within five years.

Article84  Any medical organization that sells its compounded medicaments on the market shall be ordered to make correction, and the sold medicaments illegally shall be confiscated, and a fine of more than one time but less than three times of the value of illegal sold medicaments shall be imposed on it jointly. The illegal gains, if any, shall be confiscated.

Article85  Any pharmaceutical operation enterprise in violation of Article 18 and Article 19 of this Law shall be ordered to make corrections and given a warning. If its circumstances are serious, its Pharmaceutical Operation License shall be revoked.

Article86  Any enterprise whose pharmaceutical labels do not accord with Article 54 herein shall be ordered to make corrections and given a warning. These pharmaceuticals shall be regarded as the inferior or fake pharmaceuticals. If its circumstances are serious, the pharmaceutical approval documents shall be revoked.

Article87  Any pharmaceutical inspection organ that issues the false inspection report and constitutes a crime shall be prosecuted for its criminal liabilities. If its acts do not constitute a crime, it shall be ordered to make corrections and given a warning, and a fine of more than CNY 30,000 but less than CNY 50,000 shall be imposed on the unit. The directly responsible directors and other directly responsible persons shall be given sanctions such as degrading, dismissing for offices or discharge and a fine of less than CNY 30,000 shall be imposed on them. The illegal gains, if any, shall be confiscated. If the circumstances are serious, its inspection qualification shall be revoked. If the inspection results issued by it are not true and cause losses therefore, it shall bear the corresponding compensation liabilities.

Article88  The administrative punishments as stipulated by Article 73 to Article 87 herein shall be decided by the supervisory and administrative departments in charge of pharmaceuticals at and above the county level according to the responsibilities and work division as provided by the supervisory and administrative departments in charge of pharmaceuticals of the State Council. The decision of revoking the Pharmaceutical Manufacture License, the Pharmaceutical Operation License, the Medicament License for Medical Organizations, the certified licenses for medical organizations, or the pharmaceutical approval documents shall be made by the original license-issuing or approving departments.

Article89  Any unit in violation of Article 55, 56, and 57 on administration of pharmaceutical price shall be punished according to the Law of the People's  Republic of China on Price.

Article90  The pharmaceutical manufacturing enterprises, pharmaceutical operation enterprises, and medical organizations that give or accept discount or other profits in the dark, or the pharmaceutical manufacturing enterprises, pharmaceutical operation enterprises, and medical organizations or their deputies that give properties or other profits to the principals, pharmaceutical buyers, and physicians of the medical organizations that use their pharmaceuticals shall be imposed upon a fine of more than CNY 10,000 but less than CNY 200,000. The illegal gains, if any, shall be confiscated. If their circumstances are serious, the administrations of industry and commerce shall revoke their business licenses, and shall notify the supervisory and administrative departments in charge of pharmaceuticals to revoke their Pharmaceutical Manufacturing Licenses or Pharmaceutical Operation Licenses. If their acts constitute crimes, they shall be prosecuted for criminal liabilities.

Article91  Principals, buyers, and so on of the pharmaceutical manufacturing and operation enterprises who accept properties or other profits given by other pharmaceutical manufacturing or operation enterprises or their deputies in the course of pharmaceutical purchase and sale shall be given sanctions according to law. The illegal gains shall be confiscated. If they commit crimes, they shall be prosecuted for criminal liabilities.
Principals, pharmaceutical buyers, or physicians of the medical organizations who accept properties or other profits given by other pharmaceutical manufacturing or operation enterprises or their deputies shall be given sanctions by their units or the administrative departments in charge of health. The illegal gains shall be confiscated. The certified licenses of the certified physicians with illegal serious circumstances shall be confiscated by the administrative departments in charge of health. If they commit crimes, they shall be prosecuted for criminal liabilities.

Article92  Any unit in violation of this Law on administration of pharmaceutical advertisements shall be punished according to the Law of the Republic of China. Its advertisement approval numbers shall be revoked by the supervisory and administrative department in charge of pharmaceuticals that issued these numbers. Its application for examination and approval of the advertisement shall not be accepted within one year. If its acts constitute crimes, it shall be prosecuted for criminal liabilities.
If the supervisory and administrative departments in charge of pharmaceuticals do not perform responsibilities on inspection of pharmaceutical advertisements according to law, and the advertisements approved by them have false contents or other contents in violation of laws or administrative regulations, the directly responsible directors and other directly responsible persons shall be given administrative sanctions. If they commit crimes, they shall be prosecuted for criminal liabilities.

Article93  The pharmaceutical manufacturing enterprises, pharmaceutical operation enterprises, and medical organizations that, in violation of this Law, cause damage to users, shall bear compensation liabilities according to law.

Article94  The supervisory and administrative departments in charge of pharmaceuticals that, in violation of this Law, have one of the following acts, shall be ordered by the next higher departments or supervisory organs to recall licenses and pharmaceutical approval documents issued by them illegally. The directly responsible directors and other directly responsible personnel shall be given administrative sanctions according to law. If they commit crimes, they shall be prosecuted for criminal liabilities:
(1) Issuing authentication certificates to enterprises that do not accord with the Administrative Criteria on Pharmaceutical Manufacturing Quality or the Administrative Criteria on Pharmaceutical Operation Quality; not performing following-up inspection on enterprises that obtained authentication certificates according to the relevant provisions; or not ordering unqualified enterprises upon authentication to make corrections or not revoking their authentication certificates;
(2) Issuing the Pharmaceutical Manufacture License, the Pharmaceutical Operation License, or the Medicament License for Medical Organizations to unqualified units;
(3) Issuing pharmaceutical import registration certificates to pharmaceuticals that do not accord with the import requirements; or
(4) Approving the clinic testing, issuing new pharmaceutical certificate, or issuing serial approval numbers to enterprises without clinic qualifications or manufacturing qualifications.

Article95  If the supervisory and administrative departments in charge of pharmaceuticals, their established pharmaceutical inspection organs, or their determinate organs specializing in pharmaceutical inspection take part in pharmaceutical manufacture and operation activities, their next higher departments or supervisory organs shall order them to make corrections. The illegal gains, if any, shall be confiscated. If their circumstances are serious, the directly responsible directors and other directly responsible personnel shall be given administrative sanctions according to law.
Staffs of the supervisory and administrative departments in charge of pharmaceuticals, their established pharmaceutical inspection organs, or their determinate organs specializing in pharmaceutical inspection who take part in pharmaceutical manufacture and operation activities shall be given administrative sanctions according to law

Article96  If the supervisory and administrative departments in charge of pharmaceuticals, their established pharmaceutical inspection organs, or their determinate organs specializing in pharmaceutical inspection collect inspection charges illegally, the relevant departments of the People's  governments shall order them to return these charges. The directly responsible directors and other directly responsible personnel shall be given administrative sanctions according to law. The inspection qualifications of the pharmaceutical inspection organs that collect inspection charges illegally with serious circumstances shall be revoked.

Article97 The supervisory and administrative departments in charge of pharmaceuticals shall perform the duties of supervision and inception according to law, and shall supervise enterprises that have obtained the Pharmaceutical Manufacture Licenses or the Pharmaceutical Operation Licenses to engage in pharmaceutical manufacturing or operation activities as provided by this Law. Enterprises that have obtained the Pharmaceutical Manufacture Licenses or the Pharmaceutical Operation Licenses and manufacture or sell fake or inferior pharmaceuticals shall be prosecuted for legal liabilities. Moreover, administrative sanctions shall be given to directly responsible directors and other directly responsible persons of the supervisory and administrative departments in charge of pharmaceuticals with acts of breach of duties or malfeasance. If they commit crimes, they shall be prosecuted for criminal liabilities.

Article98  The supervisory and administrative department in charge of pharmaceuticals shall order its next lower supervisory and administrative departments in violation of this Law to make correction within a specified time limit. It has the right to change or revoke them if they do not make corrections within the specified time limit.

Article99  Personnel of pharmaceutical supervision and administration who abuse their authorities, practice their favoritism, neglect their duties shall be prosecuted for their criminal liabilities if they commit crimes or shall be given administrative sanctions if they do not commit a crime.

Article100  The supervisory and administrative departments in charge of pharmaceuticals shall notify the administrations of industry and commerce to transact alteration or revocation registrations for enterprises whose Pharmaceutical Manufacture Licenses or Pharmaceutical Operation Licenses have been revoked according to this Law.

Article101  The value of goods as referred to herein shall be calculated by the marked price of the illegally manufactured or sold pharmaceuticals. If there are no marked prices, the market price of the like pharmaceuticals shall be used.

Chapter 10 Supplementary Rules

Article102   The meaning of the terms referred to herein shall be as follows:
Pharmaceuticals shall mean materials that are used for preventing, treating, or diagnosing diseases of the people, and regulating the physiological functions, with prescribed applicable diseases, main functions, usage, and dosage, including Chinese traditional medicinal materials, Chinese medicine crude slices, prepared Chinese medicines, chemical raw material pharmaceuticals and their preparation, antibiotics, biochemical pharmaceuticals, radioactive pharmaceuticals, blood serum, vaccine, blood products, and diagnosis pharmaceuticals, etc.
The accessory materials shall mean the excipients and additives when prepare prescription or manufacture pharmaceuticals.
Pharmaceutical manufacturing enterprises shall mean enterprises that specialize in manufacturing pharmaceuticals or concurrently manufacture pharmaceuticals.
Pharmaceutical operation enterprises shall mean enterprises that specialize in operating pharmaceuticals or concurrently operate pharmaceuticals.

Article103  The State Council shall otherwise formulate the administrative measures on cultivation, gathering, and breeding of Chinese traditional medicinal materials.

Article104  The state implements special administration on circulation of preventive biological products. The detailed measures shall be formulated by the State Council

Article105  The detailed measures for the People's  Liberation Army to enforce this Law shall be formulated by the State Council and the Central Military Commission according to this Law.

Article106  This Law shall take effect as of 1st December 2001.