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Drug Administration Law of the People's Republic of China

Published:

2015-12-13

(Adopted at the 7th meeting of the Standing Committee of the 6th National People's Congress on September 20, 1984, amended at the 20th meeting of the Standing Committee of the 9th National People's Congress on February 28, 2001, and revised according to the Decision on Amending Seven Laws Including the at the 6th meeting of the Standing Committee of the 12th National People's Congress on December 28, 2013, and the Decision on Amending the at the 14th meeting of the Standing Committee of the 12th National People's Congress on April 24, 2015)

Chapter 1 General Provisions

Article 1 To strengthen drug supervision and administration, ensure drug quality, guarantee the safety of drug use for humans, and safeguard the health of the people and their legal rights and interests in drug use, this law is specially formulated.

Article 2 Units or individuals engaged in drug research, production, operation, use, and supervision and administration within the territory of the People's Republic of China must comply with this law.

Article 3 The state develops modern and traditional medicines, fully utilizing their roles in prevention, treatment, and health care. The state protects wild medicinal resources and encourages the cultivation of Chinese medicinal materials.

Article 4 The state encourages research and creation of new drugs and protects the legal rights and interests of citizens, legal persons, and other organizations in researching and developing new drugs.

Article 5 The State Council's drug supervision and administration department is in charge of nationwide drug supervision and administration. Relevant departments of the State Council are responsible for drug-related supervision and administration within their respective duties. The drug supervision and administration departments of the people's governments of provinces, autonomous regions, and municipalities directly under the Central Government are responsible for drug supervision and administration within their administrative regions. Relevant departments of the people's governments of provinces, autonomous regions, and municipalities directly under the Central Government are responsible for drug-related supervision and administration within their respective duties. The drug supervision and administration department of the State Council shall cooperate with the State Council's comprehensive economic management department to implement the national drug industry development plan and industrial policies.

Article 6 Drug inspection institutions set up or designated by the drug supervision and administration department undertake drug inspection work required by law for drug approval and drug quality supervision and inspection.

Chapter 2 Management of Drug Production Enterprises

Article 7 To establish a drug production enterprise, approval must be obtained from the drug supervision and administration department of the people's government of the province, autonomous region, or municipality where the enterprise is located, and a "Drug Production License" must be issued. Without a "Drug Production License," drugs shall not be produced. The "Drug Production License" shall indicate the validity period and production scope and shall be re-examined and reissued upon expiration. When approving the establishment of drug production enterprises, the drug supervision and administration department shall, in addition to the conditions stipulated in Article 8 of this law, comply with the national drug industry development plan and industrial policies to prevent redundant construction.

Article 8 To establish a drug production enterprise, the following conditions must be met:

(1) Having pharmaceutical technical personnel, engineering technical personnel, and corresponding technical workers who have been qualified according to law;

(2) Having workshops, facilities, and sanitary environments suitable for drug production;

(3) Having institutions, personnel, and necessary instruments and equipment capable of quality management and quality inspection of the produced drugs;

(4) Having rules and regulations to ensure drug quality.

Article 9 Drug production enterprises must organize production in accordance with the "Good Manufacturing Practice for Drugs" formulated by the drug supervision and administration department of the State Council under this law. The drug supervision and administration department shall certify whether drug production enterprises meet the requirements of the "Good Manufacturing Practice for Drugs"; those certified shall be issued a certificate. The specific implementation measures and steps of the "Good Manufacturing Practice for Drugs" shall be stipulated by the drug supervision and administration department of the State Council.

Article 10 Except for the processing of Chinese herbal pieces, drugs must be produced according to national drug standards and production processes approved by the drug supervision and administration department of the State Council, and production records must be complete and accurate. If a drug production enterprise changes production processes affecting drug quality, it must report to the original approval department for review and approval. Chinese herbal pieces must be processed according to national drug standards; if no national drug standards are specified, they must be processed according to processing specifications formulated by the drug supervision and administration departments of the people's governments of provinces, autonomous regions, or municipalities directly under the Central Government. The processing specifications formulated by these departments shall be filed with the drug supervision and administration department of the State Council.

Article 11 Raw materials and excipients required for drug production must meet medicinal requirements.

Article 12 Drug production enterprises must conduct quality inspection of their produced drugs; drugs that do not meet national drug standards or are not processed according to the processing specifications for Chinese herbal pieces formulated by the drug supervision and administration departments of the people's governments of provinces, autonomous regions, or municipalities directly under the Central Government shall not be released from the factory.

Article 13 With approval from the drug supervision and administration departments of the people's governments of provinces, autonomous regions, or municipalities directly under the Central Government, drug production enterprises may accept commissioned drug production.

Chapter 3 Management of Drug Operating Enterprises

Article 14 To establish a drug wholesale enterprise, approval must be obtained from the drug supervision and administration department of the people's government of the province, autonomous region, or municipality where the enterprise is located, and a "Drug Operation License" must be issued; to establish a drug retail enterprise, approval must be obtained from the local drug supervision and administration department at or above the county level where the enterprise is located, and a "Drug Operation License" must be issued. Without a "Drug Operation License," drugs shall not be operated. The "Drug Operation License" shall indicate the validity period and business scope and shall be re-examined and reissued upon expiration. When approving the establishment of drug operating enterprises, the drug supervision and administration department shall, in addition to the conditions stipulated in Article 15 of this law, follow the principles of reasonable layout and convenience for the public to purchase drugs.

Article 15 To establish a drug operating enterprise, the following conditions must be met:

(1) Having pharmaceutical technical personnel who have been qualified according to law;

(2) Having business premises, equipment, storage facilities, and sanitary environments suitable for the drugs operated;

(3) Having quality management institutions or personnel suitable for the drugs operated;

(4) Having rules and regulations to ensure the quality of the drugs operated.

Article 16 Drug operating enterprises must operate drugs in accordance with the "Good Supply Practice for Pharmaceutical Products" formulated by the drug supervision and administration department of the State Council under this law. The drug supervision and administration department shall certify whether drug operating enterprises meet the requirements of the "Good Supply Practice for Pharmaceutical Products"; those certified shall be issued a certificate. The specific implementation measures and steps of the "Good Supply Practice for Pharmaceutical Products" shall be stipulated by the drug supervision and administration department of the State Council.

Article 17 Drug operating enterprises must establish and implement a system for inspection and acceptance of purchased drugs, verifying drug qualification certificates and other labels; drugs that do not meet the requirements shall not be purchased.

Article 18 Drug operating enterprises must have true and complete purchase and sales records. Purchase and sales records must indicate the generic name, dosage form, specification, batch number, expiration date, manufacturer, purchasing (selling) unit, purchasing (selling) quantity, purchase and sales price, purchase (sales) date, and other contents stipulated by the drug supervision and administration department of the State Council.

Article 19 Pharmaceutical business enterprises must sell drugs accurately and correctly explain the usage, dosage, and precautions; prescriptions must be verified before dispensing, and the drugs listed in the prescription must not be changed or substituted without authorization. Prescriptions with incompatibilities or overdoses should be refused; if necessary, dispensing can only proceed after correction or re-signing by the prescribing physician. Pharmaceutical business enterprises selling Chinese medicinal materials must indicate the place of origin.

Article 20 Pharmaceutical business enterprises must establish and implement drug storage systems, taking necessary measures such as refrigeration, frost prevention, moisture prevention, insect prevention, and rodent prevention to ensure drug quality. Inspection systems must be followed for drug warehousing and dispatch.

Article 21 Urban and rural market trade centers may sell Chinese medicinal materials, except as otherwise stipulated by the State Council. Urban and rural market trade centers are not allowed to sell drugs other than Chinese medicinal materials, but retail drug enterprises holding a "Pharmaceutical Business License" may set up points within urban and rural market trade centers to sell drugs other than Chinese medicinal materials within the prescribed scope. Specific measures shall be stipulated by the State Council.

Chapter 4 Pharmaceutical Management in Medical Institutions

Article 22 Medical institutions must be equipped with pharmaceutical technical personnel who have been legally qualified. Non-pharmaceutical technical personnel are not allowed to directly engage in pharmaceutical technical work.

Article 23 Medical institutions preparing formulations must obtain approval from the health administrative department of the provincial, autonomous region, or municipality government where they are located, and be approved by the drug supervision and administration department of the provincial, autonomous region, or municipality government, which will issue a "Medical Institution Formulation License." Without this license, formulations may not be prepared. The license must indicate the validity period and be re-examined and reissued upon expiration.

Article 24 Medical institutions preparing formulations must have facilities, management systems, testing instruments, and sanitary conditions that can ensure the quality of the formulations.

Article 25 Formulations prepared by medical institutions should be varieties needed clinically by the institution but not supplied in the market, and must be approved by the drug supervision and administration department of the provincial, autonomous region, or municipality government before preparation. The prepared formulations must undergo quality inspection as prescribed; qualified formulations may be used within the medical institution based on physician prescriptions. Under special circumstances, with approval from the State Council or the drug supervision and administration department of the provincial, autonomous region, or municipality government, formulations prepared by medical institutions may be transferred and used between designated medical institutions. Formulations prepared by medical institutions must not be sold on the market.

Article 26 Medical institutions purchasing drugs must establish and implement an incoming goods inspection and acceptance system, verifying drug qualification certificates and other labels; drugs that do not meet the prescribed requirements must not be purchased or used.

Article 27 Pharmaceutical personnel in medical institutions must verify prescriptions before dispensing and must not change or substitute the drugs listed in the prescription without authorization. Prescriptions with incompatibilities or overdoses should be refused; if necessary, dispensing can only proceed after correction or re-signing by the prescribing physician.

Article 28 Medical institutions must establish and implement drug storage systems, taking necessary measures such as refrigeration, frost prevention, moisture prevention, insect prevention, and rodent prevention to ensure drug quality.

Chapter 5 Drug Management

Article 29 The development of new drugs must truthfully submit relevant information and samples such as development methods, quality indicators, pharmacological and toxicological test results in accordance with the regulations of the drug supervision and administration department of the State Council. Clinical trials may only proceed after approval by the drug supervision and administration department of the State Council. The qualification recognition methods for drug clinical trial institutions shall be jointly formulated by the drug supervision and administration department and the health administrative department of the State Council. New drugs that have completed clinical trials and passed approval shall be approved by the drug supervision and administration department of the State Council, which will issue a new drug certificate.

Article 30 Non-clinical safety evaluation research institutions and clinical trial institutions for drugs must respectively implement the Good Laboratory Practice for Non-clinical Research and Good Clinical Practice for Clinical Trials. These standards are formulated by departments designated by the State Council.

Article 31 Production of new drugs or drugs with existing national standards must be approved by the drug supervision and administration department of the State Council and issued a drug approval number; however, the production of Chinese medicinal materials and decoction pieces not subject to approval number management is excluded. The catalog of Chinese medicinal materials and decoction pieces subject to approval number management is formulated by the drug supervision and administration department of the State Council in conjunction with the State Administration of Traditional Chinese Medicine. Drug manufacturing enterprises may produce drugs only after obtaining the drug approval number.

Article 32 Drugs must comply with national drug standards. Chinese medicinal decoction pieces shall be implemented in accordance with the provisions of the second paragraph of Article 10 of this law. The "Pharmacopoeia of the People's Republic of China" and drug standards promulgated by the drug supervision and administration department of the State Council are national drug standards. The drug supervision and administration department of the State Council organizes the Pharmacopoeia Committee responsible for the formulation and revision of national drug standards. The drug inspection institutions of the drug supervision and administration department of the State Council are responsible for calibrating national drug standard substances and reference substances.

Article 33 The drug supervision and administration department of the State Council organizes pharmaceutical, medical, and other technical personnel to review new drugs and re-evaluate drugs already approved for production.

Article 34 Drug manufacturing enterprises, drug business enterprises, and medical institutions must purchase drugs from enterprises qualified for drug production and operation; however, the purchase of Chinese medicinal materials not subject to approval number management is excluded.

Article 35 The state implements special management for narcotic drugs, psychotropic drugs, toxic drugs for medical use, and radioactive drugs. The management measures are formulated by the State Council.

Article 36 The state implements a protection system for Chinese medicine varieties. Specific measures are formulated by the State Council.

Article 37 The state implements a classification management system for prescription drugs and over-the-counter drugs. Specific measures are formulated by the State Council.

Article 38 The import of drugs with uncertain efficacy, significant adverse reactions, or other reasons harmful to human health is prohibited.

Article 39 Drug imports must be reviewed by the drug supervision and administration department of the State Council. Only after confirming that the drugs meet quality standards and are safe and effective can import approval be granted and an import drug registration certificate issued. Small quantities of drugs urgently needed clinically by medical units or for personal use shall follow relevant national regulations for import procedures.

Article 40 Drugs must be imported through ports authorized for drug importation, and importing enterprises must register with the drug supervision and administration department at the port location. Customs shall release drugs with the "Import Drug Clearance Certificate" issued by the drug supervision and administration department. Without this certificate, customs shall not release the drugs. The drug supervision and administration department at the port location shall notify drug inspection institutions to conduct random inspections of imported drugs according to the regulations of the drug supervision and administration department of the State Council and collect inspection fees in accordance with the second paragraph of Article 41 of this law. Ports authorized for drug importation shall be proposed by the drug supervision and administration department of the State Council in conjunction with the General Administration of Customs and approved by the State Council.

Article 41 The drug supervision and administration department of the State Council shall designate drug inspection institutions to inspect the following drugs before sale or import; drugs failing inspection shall not be sold or imported:

(1) Biological products stipulated by the State Council's drug supervision and administration department;

(2) Drugs sold for the first time in China;

(3) Other drugs stipulated by the State Council.

The inspection fee items and charging standards for the drugs listed in the preceding paragraph shall be determined and announced by the financial department of the State Council in conjunction with the price supervision department of the State Council. The methods for collecting inspection fees shall be formulated by the financial department of the State Council together with the drug supervision and administration department of the State Council.

Article 42 The drug supervision and administration department of the State Council shall organize investigations on drugs that have been approved for production or import; for drugs with uncertain efficacy, significant adverse reactions, or other reasons that harm human health, the approval number or import drug registration certificate shall be revoked. Drugs whose approval number or import drug registration certificate has been revoked shall not be produced, imported, sold, or used; drugs already produced or imported shall be supervised for destruction or disposal by the local drug supervision and administration department.

Article 43 The state implements a drug reserve system.

In the event of major disasters, epidemics, and other emergencies domestically, the departments stipulated by the State Council may urgently requisition enterprise drugs.

Article 44 For drugs insufficiently supplied domestically, the State Council has the authority to restrict or prohibit exports.

Article 45 Import and export of narcotic drugs and psychotropic drugs within the scope stipulated by the state must hold the "Import Permit" and "Export Permit" issued by the drug supervision and administration department of the State Council.

Article 46 Newly discovered and foreign-introduced medicinal materials may be sold only after review and approval by the drug supervision and administration department of the State Council.

Article 47 The management measures for regionally customary folk medicinal materials shall be formulated by the drug supervision and administration department of the State Council in conjunction with the State Administration of Traditional Chinese Medicine.

Article 48 Production (including preparation, the same below) and sale of counterfeit drugs are prohibited.

The following circumstances constitute counterfeit drugs:

(1) The ingredients contained in the drug do not conform to the ingredients specified in the national drug standards;

(2) Pretending non-drugs as drugs or pretending other types of drugs as this drug.

Drugs with any of the following circumstances shall be treated as counterfeit drugs:

(1) Prohibited from use by the drug supervision and administration department of the State Council;

(2) Produced or imported without approval as required by this law, or sold without inspection as required by this law;

(3) Deteriorated;

(4) Contaminated;

(5) Produced using raw materials that require approval numbers under this law but have not obtained such approval numbers;

(6) Indications or main functions stated exceed the prescribed scope.

Article 49 Production and sale of inferior drugs are prohibited. Drugs whose ingredient content does not meet national drug standards are considered inferior drugs.

Drugs with any of the following circumstances shall be treated as inferior drugs:

(1) No expiration date indicated or expiration date altered;

(2) No production batch number indicated or batch number altered;

(3) Past the expiration date;

(4) Packaging materials and containers directly contacting the drug are unapproved;

(5) Unauthorized addition of colorants, preservatives, fragrances, flavor correctors, and excipients;

(6) Other non-compliance with drug standard regulations.

Article 50 The drug names included in the national drug standards are the generic names of drugs. Names already used as generic drug names shall not be used as drug trademarks.

Article 51 Staff of drug manufacturing enterprises, drug operating enterprises, and medical institutions who directly contact drugs must undergo health checks annually. Those suffering from infectious diseases or other diseases that may contaminate drugs shall not engage in work directly contacting drugs.

Chapter 6 Management of Drug Packaging

Article 52 Packaging materials and containers directly contacting drugs must meet medicinal requirements, comply with standards ensuring human health and safety, and be approved by the drug supervision and administration department during drug approval. Drug manufacturing enterprises shall not use unapproved packaging materials and containers directly contacting drugs. The drug supervision and administration department shall order to stop using unqualified packaging materials and containers directly contacting drugs.

Article 53 Drug packaging must meet the quality requirements of the drug and facilitate storage, transportation, and medical use. Chinese medicinal materials in shipment must be packaged. Each package must indicate the product name, origin, date, dispatching unit, and bear a quality qualification mark.

Article 54 Drug packaging must have labels printed or affixed and include instructions as prescribed.

Labels or instructions must indicate the drug's generic name, ingredients, specifications, manufacturer, approval number, product batch number, production date, expiration date, indications or main functions, usage, dosage, contraindications, adverse reactions, and precautions.

Labels of narcotic drugs, psychotropic drugs, toxic medical drugs, radioactive drugs, external-use drugs, and over-the-counter drugs must bear prescribed marks.

Chapter 7 Management of Drug Prices and Advertising

Article 55 For drugs subject to market-regulated prices by law, drug manufacturing enterprises, operating enterprises, and medical institutions shall set prices based on principles of fairness, reasonableness, honesty, credibility, and value for money, providing reasonably priced drugs to users.

Drug manufacturing enterprises, operating enterprises, and medical institutions shall comply with the State Council's price supervision department's regulations on drug price management, set and mark retail prices of drugs, and prohibit profiteering and price fraud that harms drug users' interests.

Article 56 Drug manufacturing enterprises, operating enterprises, and medical institutions shall lawfully provide the government price supervision department with actual purchase and sales prices and quantities of their drugs.

Article 57 Medical institutions shall provide patients with a price list of the drugs used; designated medical insurance medical institutions shall also truthfully disclose the prices of their commonly used drugs in accordance with prescribed methods and strengthen the management of rational drug use. Specific methods shall be stipulated by the health administrative department of the State Council.

Article 58 It is prohibited for drug manufacturing enterprises, business enterprises, and medical institutions to secretly give or receive kickbacks or other benefits off the books in drug purchase and sales.

It is prohibited for drug manufacturing enterprises, business enterprises, or their agents to give property or other benefits to the heads of medical institutions using their drugs, drug procurement personnel, physicians, and other related personnel under any name. It is also prohibited for the heads of medical institutions, drug procurement personnel, physicians, and other related personnel to receive property or other benefits from drug manufacturing enterprises, business enterprises, or their agents under any name.

Article 59 Drug advertisements must be approved by the drug supervision and administration department of the people's government of the province, autonomous region, or municipality where the enterprise is located, and a drug advertisement approval number must be issued; advertisements without the approval number shall not be published.

Prescription drugs may be introduced in medical and pharmaceutical professional publications jointly designated by the health administrative department of the State Council and the drug supervision and administration department of the State Council, but advertisements shall not be published in mass media or otherwise promoted to the public.

Article 60 The content of drug advertisements must be truthful and legal, based on the instructions approved by the drug supervision and administration department of the State Council, and must not contain false content.

Drug advertisements shall not contain unscientific claims or guarantees of efficacy; they shall not use the name or image of state organs, medical research units, academic institutions, experts, scholars, physicians, or patients as proof.

Non-drug advertisements shall not contain drug-related promotions.

Article 61 The drug supervision and administration departments of the people's governments of provinces, autonomous regions, and municipalities shall inspect the drug advertisements they have approved. For advertisements violating this law and the "Advertising Law of the People's Republic of China," they shall notify the advertising supervision and administration authorities and propose handling suggestions, and the advertising supervision and administration authorities shall handle them according to law.

Article 62 For drug prices and advertisements not stipulated in this law, the provisions of the "Price Law of the People's Republic of China" and the "Advertising Law of the People's Republic of China" shall apply.

Chapter 8 Drug Supervision

Article 63 The drug supervision and administration departments have the authority to supervise and inspect the research and development, production, operation of drugs, and the use of drugs by medical institutions according to laws and administrative regulations. Relevant units and individuals shall not refuse or conceal.

When conducting supervision and inspection, the drug supervision and administration departments must present proof documents and keep confidential the technical and business secrets of the inspected parties learned during the inspection.

Article 64 The drug supervision and administration departments may conduct spot checks and inspections of drug quality as needed. Sampling for spot checks shall be conducted according to regulations, and no fees shall be charged. Required expenses shall be budgeted according to State Council regulations.

The drug supervision and administration departments may take administrative compulsory measures such as sealing and seizure for drugs and related materials with evidence of potential harm to human health, and shall make administrative decisions within seven days; if drug testing is required, administrative decisions must be made within fifteen days from the issuance of the test report.

Article 65 The drug supervision and administration departments of the State Council and the people's governments of provinces, autonomous regions, and municipalities shall regularly announce the results of drug quality spot checks; if the announcement is inappropriate, corrections must be made within the original announcement scope.

Article 66 Parties who have objections to the test results of drug testing institutions may apply for re-examination within seven days from receiving the test results to the original drug testing institution or a drug testing institution set up or designated by the higher-level drug supervision and administration department, or directly to a drug testing institution set up or designated by the drug supervision and administration department of the State Council. The drug testing institution accepting the re-examination must make a conclusion within the time prescribed by the drug supervision and administration department of the State Council.

Article 67 The drug supervision and administration departments shall conduct follow-up inspections of drug manufacturing enterprises and drug business enterprises certified as qualified according to the "Good Manufacturing Practice for Drugs" and "Good Supply Practice for Drugs".

Article 68 Local people's governments and drug supervision and administration departments shall not restrict or exclude drugs produced by non-local drug manufacturing enterprises in accordance with this law from entering the local area by requiring drug testing, approval, or other means.

Article 69 Drug supervision and administration departments and their established drug testing institutions and designated professional drug testing agencies shall not participate in drug production and operation activities, nor recommend, supervise, or sell drugs in their name.

Staff of drug supervision and administration departments and their established drug testing institutions and designated professional drug testing agencies shall not participate in drug production and operation activities.

Article 70 The state implements a drug adverse reaction reporting system. Drug manufacturing enterprises, drug business enterprises, and medical institutions must regularly investigate the quality, efficacy, and reactions of drugs they produce, operate, or use. Serious adverse reactions possibly related to drug use must be reported promptly to the drug supervision and administration departments and health administrative departments of the local people's governments of provinces, autonomous regions, and municipalities. Specific methods shall be formulated by the drug supervision and administration department of the State Council in conjunction with the health administrative department of the State Council.

For drugs confirmed to have caused serious adverse reactions, the drug supervision and administration departments of the State Council or the people's governments of provinces, autonomous regions, and municipalities may take emergency control measures such as stopping production, sales, and use, and shall organize appraisal within five days and make administrative decisions within fifteen days from the date of the appraisal conclusion according to law.

Article 71 Drug testing institutions or personnel of drug manufacturing enterprises, drug business enterprises, and medical institutions shall accept business guidance from drug testing institutions set up by local drug supervision and administration departments.

Chapter 9 Legal Liability

Article 72 Those who produce or operate drugs without obtaining the "Drug Production License," "Drug Operation License," or "Medical Institution Preparation License" shall be ordered to stop by law, and the illegally produced and sold drugs and illegal gains shall be confiscated, and a fine of two to five times the value of the illegally produced and sold drugs (including sold and unsold drugs) shall be imposed; if a crime is constituted, criminal responsibility shall be pursued according to law.

Article 73 Those who produce or sell counterfeit drugs shall have the illegally produced and sold drugs and illegal gains confiscated and be fined two to five times the value of the illegally produced and sold drugs; those with drug approval documents shall have them revoked and be ordered to suspend production and business for rectification; in serious cases, the "Drug Production License," "Drug Operation License," or "Medical Institution Preparation License" shall be revoked; if a crime is constituted, criminal responsibility shall be pursued according to law.

Article 74: For the production and sale of inferior drugs, the illegally produced and sold drugs and illegal gains shall be confiscated, and a fine of not less than one time and not more than three times the value of the illegally produced and sold drugs shall be imposed; in serious cases, production and business suspension for rectification or revocation of drug approval documents, revocation of the "Drug Production License", "Drug Business License" or "Medical Institution Preparation License" shall be ordered; if a crime is constituted, criminal responsibility shall be pursued according to law.

Article 75: Enterprises or other units seriously engaged in the production and sale of counterfeit drugs and inferior drugs, their directly responsible supervisors and other directly responsible personnel shall be prohibited from engaging in drug production and business activities for ten years. Raw and auxiliary materials, packaging materials, and production equipment specifically used by producers for producing counterfeit or inferior drugs shall be confiscated.

Article 76: Those who know or should know that the drugs are counterfeit or inferior and provide transportation, storage, warehousing, and other facilitation conditions shall have all income from transportation, storage, and warehousing confiscated and be fined not less than 50% and not more than three times the illegal income; if a crime is constituted, criminal responsibility shall be pursued according to law.

Article 77: The penalty notice for counterfeit and inferior drugs must specify the quality inspection results of the drug inspection agency; however, the circumstances stipulated in Article 48, Paragraph 3, Items (1), (2), (5), and (6), and Article 49, Paragraph 3 of this law are excluded.

Article 78: Drug production enterprises, business enterprises, non-clinical safety evaluation research institutions for drugs, and clinical trial institutions that fail to implement the "Good Manufacturing Practice for Drugs", "Good Supply Practice for Drugs", Good Laboratory Practice for Non-clinical Studies, and Good Clinical Practice for Clinical Trials as prescribed shall be warned and ordered to make corrections within a time limit; if not corrected within the time limit, production and business suspension for rectification shall be ordered and a fine of not less than 5,000 yuan and not more than 20,000 yuan shall be imposed; in serious cases, the "Drug Production License", "Drug Business License", and qualifications of clinical trial institutions shall be revoked.

Article 79: Drug production enterprises, business enterprises, or medical institutions that violate the provisions of Article 34 of this law and purchase drugs from enterprises without a "Drug Production License" or "Drug Business License" shall be ordered to make corrections, have the illegally purchased drugs confiscated, and be fined not less than twice and not more than five times the value of the illegally purchased drugs; illegal gains shall be confiscated; in serious cases, the "Drug Production License", "Drug Business License", or medical institution practice license shall be revoked.

Article 80: Imported drugs that have obtained drug import registration certificates but have not registered with the drug supervision department at the port of entry as required by this law shall be warned and ordered to make corrections within a time limit; if not corrected within the time limit, the import drug registration certificate shall be revoked.

Article 81: Forging, altering, buying, selling, renting, or lending licenses or drug approval documents shall result in confiscation of illegal gains and a fine of not less than one time and not more than three times the illegal gains; if there are no illegal gains, a fine of not less than 20,000 yuan and not more than 100,000 yuan shall be imposed; in serious cases, the seller, lessor, or lender's "Drug Production License", "Drug Business License", "Medical Institution Preparation License" shall be revoked or the drug approval documents shall be canceled; if a crime is constituted, criminal responsibility shall be pursued according to law.

Article 82: Violating the provisions of this law by providing false certificates, documents, samples, or using other deceptive means to obtain the "Drug Production License", "Drug Business License", "Medical Institution Preparation License", or drug approval documents shall result in revocation of the "Drug Production License", "Drug Business License", "Medical Institution Preparation License", or cancellation of drug approval documents, no acceptance of applications within five years, and a fine of not less than 10,000 yuan and not more than 30,000 yuan.

Article 83: Medical institutions that sell their prepared formulations on the market shall be ordered to make corrections, have the illegally sold formulations confiscated, and be fined not less than one time and not more than three times the value of the illegally sold formulations; illegal gains shall be confiscated.

Article 84: Drug business enterprises that violate the provisions of Articles 18 and 19 of this law shall be ordered to make corrections and warned; in serious cases, the "Drug Business License" shall be revoked.

Article 85: If drug labeling does not comply with the provisions of Article 54 of this law, except for cases that should be treated as counterfeit or inferior drugs according to law, corrections shall be ordered and warnings given; in serious cases, the drug approval documents shall be revoked.

Article 86: Drug inspection agencies issuing false inspection reports that constitute a crime shall be held criminally responsible according to law; if not constituting a crime, corrections shall be ordered and warnings given, and a fine of not less than 30,000 yuan and not more than 50,000 yuan shall be imposed on the unit; the directly responsible supervisors and other directly responsible personnel shall be demoted, dismissed, or expelled according to law and fined up to 30,000 yuan; illegal gains shall be confiscated; in serious cases, inspection qualifications shall be revoked. If the inspection results issued by the drug inspection agency are false and cause losses, corresponding compensation shall be borne.

Article 87: Administrative penalties stipulated in Articles 73 to 87 of this law shall be decided by the drug supervision departments at or above the county level according to the division of responsibilities stipulated by the State Council drug supervision department; revocation of the "Drug Production License", "Drug Business License", "Medical Institution Preparation License", medical institution practice license, or cancellation of drug approval documents shall be decided by the original issuing or approving department.

Article 88: Violations of the provisions on drug price management in Articles 55 and 56 of this law shall be punished in accordance with the "Price Law of the People's Republic of China".

Article 89: Drug production enterprises, business enterprises, and medical institutions that secretly give or receive kickbacks or other benefits in drug purchase and sale, and drug production enterprises, business enterprises, or their agents that give property or other benefits to medical institution leaders, drug purchasers, physicians, and related personnel using their drugs shall be fined not less than 10,000 yuan and not more than 200,000 yuan by the industrial and commercial administration department; illegal gains shall be confiscated; in serious cases, the industrial and commercial administration department shall revoke the business licenses of drug production and business enterprises and notify the drug supervision department to revoke their "Drug Production License" and "Drug Business License"; if a crime is constituted, criminal responsibility shall be pursued according to law.

Article 90: Responsible persons, purchasers, and other related personnel of drug production and business enterprises who receive property or other benefits from other production enterprises, business enterprises, or their agents in drug purchase and sale shall be punished according to law and have illegal gains confiscated; if a crime is constituted, criminal responsibility shall be pursued according to law.

Responsible persons of medical institutions, drug purchasers, physicians, and other related personnel who receive property or other benefits from drug production enterprises, drug business enterprises, or their agents shall be punished by the health administrative department or their own units, and illegal gains shall be confiscated; for serious violations by practicing physicians, the health administrative department shall revoke their practice certificates; if a crime is constituted, criminal responsibility shall be pursued according to law.

Article 91 Violations of the management provisions related to drug advertisements in this law shall be punished in accordance with the provisions of the "Advertising Law of the People's Republic of China," and the drug supervision and administration department that issued the advertisement approval number shall revoke the advertisement approval number and not accept advertisement approval applications for that product within one year; if a crime is constituted, criminal responsibility shall be pursued according to law.

The drug supervision and administration department that fails to perform the review duties for drug advertisements according to law, and approves advertisements containing false or other content violating laws and administrative regulations, shall impose administrative sanctions on the directly responsible supervisors and other directly responsible personnel according to law; if a crime is constituted, criminal responsibility shall be pursued according to law.

Article 92 Drug manufacturing enterprises, operating enterprises, and medical institutions that violate the provisions of this law and cause damage to drug users shall bear compensation liability according to law.

Article 93 If the drug supervision and administration department violates the provisions of this law and commits any of the following acts, its superior authority or supervisory authority shall order the withdrawal of illegally issued certificates and the revocation of drug approval documents, and impose administrative sanctions on the directly responsible supervisors and other directly responsible personnel according to law; if a crime is constituted, criminal responsibility shall be pursued according to law:

(1) Issuing certification certificates that meet relevant standards to enterprises that do not comply with the "Good Manufacturing Practice for Drugs" or "Good Supply Practice for Drugs," or failing to perform follow-up inspection duties as required for enterprises that have obtained certification certificates, and failing to order correction or revoke certification certificates for enterprises that do not meet certification conditions according to law;

(2) Issuing "Drug Manufacturing Licenses," "Drug Operating Licenses," or "Medical Institution Preparation Licenses" to units that do not meet legal conditions;

(3) Issuing import drug registration certificates to drugs that do not meet import conditions;

(4) Approving clinical trials, issuing new drug certificates, or issuing drug approval numbers to drugs that do not meet clinical trial conditions or production conditions.

Article 94 If the drug supervision and administration department or its established drug testing institutions or designated professional drug testing institutions participate in drug production and operation activities, the superior authority or supervisory authority shall order correction and confiscate illegal income; if the circumstances are serious, administrative sanctions shall be imposed on the directly responsible supervisors and other directly responsible personnel according to law.

Staff of the drug supervision and administration department or its established drug testing institutions or designated professional drug testing institutions who participate in drug production and operation activities shall be given administrative sanctions according to law.

Article 95 If the drug supervision and administration department or its established or designated drug testing institutions illegally charge inspection fees during drug supervision and inspection, the relevant government departments shall order a refund, and impose administrative sanctions on the directly responsible supervisors and other directly responsible personnel according to law. For drug testing institutions that seriously illegally charge inspection fees, their testing qualifications shall be revoked.

Article 96 The drug supervision and administration department shall perform supervision and inspection duties according to law, supervising enterprises that have obtained "Drug Manufacturing Licenses" and "Drug Operating Licenses" to engage in drug production and operation activities in accordance with the provisions of this law.

Enterprises that have obtained "Drug Manufacturing Licenses" and "Drug Operating Licenses" and produce or sell counterfeit or inferior drugs shall, in addition to being held legally responsible, have the directly responsible supervisors and other directly responsible personnel of the drug supervision and administration department who are negligent or derelict in duty given administrative sanctions according to law; if a crime is constituted, criminal responsibility shall be pursued according to law.

Article 97 The drug supervision and administration department shall order subordinate drug supervision and administration departments to correct administrative acts that violate this law within a time limit; if not corrected within the time limit, it has the right to change or revoke them.

Article 98 Drug supervision and administration personnel who abuse their power, engage in favoritism, or neglect their duties and constitute a crime shall be held criminally responsible according to law; if not constituting a crime, administrative sanctions shall be imposed according to law.

Article 99 The value amount specified in this chapter shall be calculated based on the marked price of illegally produced or sold drugs; if there is no marked price, it shall be calculated according to the market price of similar drugs.

Chapter 10 Supplementary Provisions

Article 100 The meanings of the following terms in this law are:

Drugs refer to substances used to prevent, treat, and diagnose human diseases, purposefully regulate human physiological functions, and have specified indications or main functions, usage, and dosage, including Chinese medicinal materials, Chinese herbal pieces, Chinese patent medicines, chemical raw drugs and their preparations, antibiotics, biochemical drugs, radioactive drugs, serums, vaccines, blood products, and diagnostic drugs.

Excipients refer to fillers and additives used in drug production and prescription preparation.

Drug manufacturing enterprises refer to enterprises specialized or partially engaged in drug manufacturing.

Drug operating enterprises refer to enterprises specialized or partially engaged in drug operation.

Article 101 The management measures for the planting, collection, and breeding of Chinese medicinal materials shall be separately formulated by the State Council.

Article 102 The state implements special management on the circulation of preventive biological products. Specific measures shall be formulated by the State Council.

Article 103 The specific measures for the implementation of this law by the People's Liberation Army shall be formulated by the State Council and the Central Military Commission in accordance with this law.

Article 104 This law shall come into force on December 1, 2001.

Good Supply Practice for Pharmaceutical Products

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