VZCZCXRO3636
PP RUEHCN RUEHGH RUEHVC
DE RUEHBJ #6201/01 2632243
ZNR UUUUU ZZH
P 202243Z SEP 07
FM AMEMBASSY BEIJING
TO RUEHC/SECSTATE WASHDC PRIORITY 2072
INFO RUEHOO/CHINA POSTS COLLECTIVE
RUEAUSA/DEPT OF HHS WASHINGTON DC
RUEHRC/DEPT OF AGRICULTURE WASHDC
RUCPDOC/DEPT OF COMMERCE WASHDC
RUEATRS/DEPT OF TREASURY WASHINGTON DC
RHEHNSC/NSC WASHDC

UNCLAS SECTION 01 OF 02 BEIJING 006201 
 
SIPDIS 
 
SENSITIVE 
SIPDIS 
 
HHS FOR OGHA/STEIGER AND PASS TO FDA/LUMPKIN 
COMMERCE FOR ITA/HIJIKATA AND CINO 
STATE PASS CONSUMER PRODUCTS SAFETY COMMISSION RICH O'BRIEN/INTL 
PROGRAMS 
STATE PASS TO USTR/TIM WINELAND 
STATE PASS OMB/INTL AFFAIRS 
STATE PASS HOMELAND SECURITY COUNCIL 
STATE PASS IMPORT SAFETY WORKING GROUP 
 
E.O. 12958: N/A 
TAGS: TBIO PREL HHS ETRD BEXP CH
SUBJECT:  Staffdel Knauer Discusses Drug Export Safety with China 
Regulators 
 
¶1.  (SBU) Summary:  In a meeting with Staffdel Knauer on September 
3, officials at China's State Food and Drug Administration (SFDA) 
described a rigorous inspection system for imports and exports of 
active pharmaceutical ingredients (APIs), but admitted that there is 
a "fatal" gap in the system between exported APIs and bulk 
chemicals.  SFDA employs 1500 inspectors countrywide who conduct 
inspections of domestic Chinese drug manufacturers at least once 
each year.  While welcoming more cooperation with the U.S. FDA, SFDA 
expressed some concerns about a permanent FDA presence in China.  In 
a subsequent meeting with the General Administration of Quality 
Supervision, Inspection and Quarantine (AQSIQ), Vice Minister Wei 
Chuanzhong assured the Staffdel that AQSIQ has developed a good 
working relationship with counterpart agencies in the United States 
and will be leading a delegation to Washington on September 9 for 
consultations on food safety issues.  He also pointed out that API 
exports are all handled by SFDA; AQSIQ only deals with shipments 
that are identified by importers as bulk chemicals.  End summary. 
 
 
¶2.  (SBU) In a meeting at SFDA on September 4, Christopher Knauer, 
Peter Spencer and Paul Jung of the House Energy and Commerce 
Committee, met at SFDA with Director General for International 
Cooperation Xu Youjun and Deputy Director General of Drug 
Registration Yang Wei.  Xu and Yang reported that they were involved 
in the discussions with U.S. Health and Human Services (HHS) on an 
MOU that will cover drug quality and safety.  They confirmed that 
the Chinese side had agreed on the date of September 17 next visit 
to China by the HHS delegation that is negotiating the MOU.  Xu 
pointed to these discussions as an indication of a new level of 
cooperation between the two agencies. 
 
FDI Presence in China "Difficult" 
--------------------------------- 
 
¶3.  (SBU) Mr. Knauer commented on the increasing globalization of 
drug manufacturing and how difficult it has become for FDA to 
inspect all of the overseas plants that export to the United States. 
He wondered if having a permanent FDA presence in China would help 
address this problem.  In response, DG Xu suggested that a permanent 
FDA presence in China would be "difficult" and "may not be very 
practical."  She said China is committed to improving its own 
inspection system and noted that China has established a working 
group on product safety that involves seven ministries and has 
launched a new rectification campaign that aims to strengthen 
relevant laws and regulations.  She suggested that that the Good 
Manufacturing Practices (GMP) certification should be a global 
standard and that SFDA, which currently has 1500 inspectors, has 
already certified 4,682 firms in China. 
 
¶4.  (SBU) DDG Yang argued that both SFDA and FDA share the same 
vision of ensuring safety and identified the API issue as an area 
deserving special attention in the bilateral discussions.  Yang 
noted that as of 2004, all APIs require SFDA certification. 
Inspections of API manufacturers are conducted on a yearly basis, 
with at least 25 percent of the inspections being unannounced. 
Imported APIs must be inspected at the port and every lot must be 
inspected separately.  Yang confirmed that SFDA also conducts 
post-surveillance and post-approval inspections.  While most 
inspections are done by provincial SFDA inspectors, all inspections 
of "high risk" materials are organized by the central government's 
SFDA.  The four categories of "high risk" drug products are:  1) 
biological products (e.g., blood, vaccines), 2)  large volume 
injectables, 3)  traditional Chinese medicine injectables, and 4) 
recombinant biochemical products. 
 
APIs a "Fatal" Gap 
------------------ 
 
¶5.  (SBU) Yang reported that for APIs, SFDA tests every batch.  He 
noted that the United States does not currently have such a system 
and urged the FDA to strengthen its inspection of API imports.  In 
this effort, China is willing to provide a list of registered API 
exporters.  He pointed out that the critical "fatal" gap in the 
current arrangement is that some API exports to the United States 
are labeled as bulk chemicals.  As such, they can therefore elude 
SFDA oversight. 
 
BEIJING 00006201  002 OF 002 
 
 
 
¶6.  (SBU) In a follow-on meeting with AQSIQ, Vice Minister Wei 
Chuanzhong told the Staffdel that he had previously met with 
Staffdel Nelson and Representatives Kirk and Larson (see septels). 
Reviewing points shared with the previous visitors, VM Wei noted 
that he will be leading a delegation to the United States on 
September 9 that will focus on establishing a cooperative framework 
with FDA, HHS, the U.S. Department of Agriculture and the Consumer 
Product Safety Commission.  He reported that according to his 
agency's figures, Chinese exports to the United States from 2004 to 
2006 had consistently scored above 99 percent in terms of quality. 
He complained that any problems were simply isolated incidents and 
that the media had distorted the true picture.  Wei maintained that 
AQSIQ, especially at the local level, has developed a strong working 
relationship with FDA. 
 
 
¶7.  (SBU) Mr. Spencer asked Wei how AQSIQ and SFDA work together on 
APIs exports.  Wei said SFDA handles all matters related to 
pharmaceutical products, including APIs.  AQSIQ has no role with 
regard to bulk pharmaceuticals; only bulk chemicals products need 
AQSIQ approval.  Wei confirmed that there is no way to tell the 
difference - it is the importer who states what the chemical will be 
used for and it can thereby be classified as an industrial, food or 
pharmaceutical product. 
 
¶8.  (U) This report was cleared by the delegation. 
 
RANDT