China vitamins: Call for new regulations to stop price surge 03-23-2017

China’s active pharmaceutical ingredient (API) industry is facing a monopolized situation nowadays, due to strict regulations in the manufacturing of API’s, like vitamins. This has led to elevating prices of vitamins, which are supposed to be sold in cheap drugs, in the past years. Manufacturers are urging once more to change the monopoly in the industry to enable cheap and transparent drug prices.


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In the beginning of March 2017, the 9th National Pharmaceuticals Industry Symposium took place, in which the mentioned price surges of pharmaceuticals has been discussed. The API manufacturers were complaining about surging prices and asked for new regulations to abandon the current monopolized situation of China’s pharmaceuticals industry.


The high prices of vitamins are forcing manufacturers to lower the production of commonly cheap drugs in China. Hence, these situation leads to a lower supply of the drugs, which increases their prices dramatically. This trend has led to the call for changing regulations to guarantee a clear drug pricing system in China.


Currently, API manufactures need an API production license, issued by the government, to be allowed entering the market in China. In addition to that, so called Good Manufacturing Practice certificates are needed as well. The problem is, that less enterprises are approved for these licenses, which keep the number of manufacturers low and creates the monopolistic situation.


This system is demanded to be changed, to make it easier for new manufactures to get the permission of producing and selling pharmaceuticals, especially the needed cheap drugs. To achieve this, API’s should be excluded from the national drug management system and production guidelines could be implemented, which ensure sufficient supply of pharmaceuticals.


Furthermore, to enable faster applications for production licenses, the existing administrative review system shell be exchanged with a more advanced Drug Master File system. Implementing such a new system will definitely reduce the working time in application processes and speed up production of manufacturers. The main idea behind this system is an universal document, which will be prepared by the manufacturer, stating information about facilities, processes, packaging etc., and submitted to the appropriate authority.


According to CCM, the possible implementation of the new system would have a significant impact on China’s current big vitamin manufacturers. Stronger competition will lead to falling prices and probably stimulate more investments and innovations.


Monopolistic situation

The market situation of vitamin E is a good example for the high monopolistic situation, not only in China, but worldwide. For this vitamin, the four biggest player account for more than 90% of the global supply. The enterprises are Zhejiang Medicine, Zhejiang, NHU, Royal DSM, and BASF.

For China, the price of vitamin E showed the beginning of surge in March 2016, after a depressing year in 2015. Insufficient supply of raw materials for vitamin E boosted the price rise even more. The last price rise was made in March 2017 by Zhejiang NHU, raising quotations by 30% again, according to CCM’s price monitoring.


China also inherits the largest vitamin B2 producer worldwide, namely Guangji Pharmaceutical, who is accounting for global sales of 55%. The company has increased prices several times in 2016, due to production suspensions and marketing strategies. A report by the company states “We adheres to our marketing strategy in controlling supply and increasing prices, and managed to realise the optimum balance.”


Speaking in general, the monopolistic situation is a huge thorn in Chinese manufacturers’ side. The production license for vitamin E was only issued to 8 manufacturers in China yet, while Guangji Pharmaceutival is even the only one holding the license for vitamin B2 production currently. With the change of the current regulations, the monopoly could be weakened to establish more competition and price regulation in China’s API industry.



Active pharmaceutical ingredient (API) is the term for a therapeutically active ingredient or material combination, which is used in producing drug products. The production of active pharmaceutical ingredients is a highly technically demanding process. Currently, the worldwide active pharmaceutical ingredient market is elevating due to the increased demand for drugs, which can be explained by the overall aging population in industrialized countries. This is increasing occurrence of chronic diseases as cancer and diabetes.

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CCM is the leading market intelligence provider for China’s agriculture, chemicals, food & ingredients and life science markets.

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