ASOP Global and LegitScript are pleased to release a new report titled “The Chinese Internet Pharmacy Market Threat Assessment.” ASOP Global contracted with LegitScript to prepare this study as part of the ASOP Global China Initiative, beginning in 2015. At the outset of the China Initiative, ASOP Global published the China Internet Drug Study in 2015, convened an October 2017 symposium in Beijing on combatting illegal on-line drug sales and a December 2018 delegation trip to Beijing. ASOP Global met with China FDA (now China NMPA) during previous trips to Beijing. ASOP Global will continue to coordinate with the China National Medical Products Administration (NMPA) related to the findings of this report.

This report includes new information of the situation in China related to illegal internet drug sales – for which it is illegal to sell prescription drug products online – and makes several important recommendations to promote patient safety and public health. A comprehensive analysis of LegitScript’s review found that 17% of websites surveyed were operating illegally in offering prescription drugs or controlled substances. In total, 57% of online drug sellers are operating illegally with respect to Chinese law and regulation. The Chinese government and private sector have made significant efforts to combat illegal online drug sales, but additional efforts may be taken ensure compliance with relevant laws and practice guidelines.

Additional background and findings can be found in the attached report, available on the ASOP Global website in English and Chinese. This report has been shared with China NMPA and representatives of several federal agencies within the United States including the Food and Drug Administration, Department of Commerce and U.S. Embassy in Beijing. Below is a brief summary of key report components:

Background:

• LegitScript evaluated the landscape of the illicit internet pharmacy market in China through search engine data. In general, 57 percent of online drug sellers are operating unlawfully in China. This percentage is much lower than the global level, which shows that the measures the Chinese government have taken over the past few years are effective.
• However, the risks of illicit online drug sales in the Chinese market are the same as in the rest of the world. Prescription medication and controlled substances are sold online without requiring a prescription. Unapproved medicines are sourced from unlicensed sellers. These practices put patients’ health at risk.
• Chinese illicit drug sellers are unique in that there is a heavy reliance on third-party platforms, such as WeChat, to complete transactions, instead of processing the orders directly through their own websites. These transactions often happen over chats that take place on mobile phones.
• Illicit drug sellers in China also often utilize multiple platforms, such as social media or e-commerce, for different aspects of their businesses (e.g., marketing, order placing, and payment processing). These factors make it challenging for law enforcement to identify problematic sellers.
• The Chinese government and private sector have made efforts to curb illicit online drug sales, but LegitScript predicts the ratio of illicit online drug sales in China to remain at the current level based on the trends observed in the Chinese market and globally. The fact that sellers conduct a big portion of their business across multiple platforms and often on smartphone apps will also continue to pose challenges for Chinese law enforcement.

Study Findings:

• 17 percent of the search results yielded illicit websites facilitating the sale of prescription drugs or controlled substances. Of the illicit results, 56 percent were internet pharmacy websites dedicated to illicit online drug sales.
• The 26 searches for life-saving medicines returned a total of 2,261 results. Of those 18% were illicit results, and 59% of the illicit results were for illicit internet pharmacies.
• The 10 searches for controlled substances returned a total of 877 results. Of those 15% are illicit results and 46% of the illicit results are for illicit internet pharmacies.
• The majority of pharmacy websites in the search results were not properly requiring a prescription.
• None of the websites selling controlled substances required a prescription.
• According to LegitScript data collected for this report, the top three registrars in China used by the illicit internet pharmacies are Alibaba/HiChina, NameSilo, and Xin Net. Among these, LegitScript considers NameSilo one of three US-based safe-haven registrars for illicit internet pharmacies.
• LegitScript has repeatedly reached out to these three registrars to request that illicit pharmacy domain names are suspended and locked. In most instances, these registrars have not acted despite that all three registrars have signed the 2013 Registration Accreditation Agreement (RAA).
• More than half of illicit pharmacies in LegitScript’s are registered with Chinese registrars and 15 percent are registered with a US registrar.
• LegitScript’s research for this report also identified a few websites promoting medical tourism to India for more affordable treatments. This business model itself is not problematic; however, the websites further offer to connect patients with doctors in India through telemedicine and to deliver prescription medication to Chinese patients from a licensed Indian pharmacy they partner with. Currently, there is no regulation regarding telemedicine conducted internationally.

Conclusions and Next Steps:

• In general, 57 percent of online drug sellers are operating unlawfully in China. Prescription medication and controlled substances are sold online without requiring a prescription. Unapproved drugs are sourced from unlicensed sellers.
• Chinese illicit drug sellers are unique in that they rely heavily on third-party platforms, such as WeChat, to complete transactions instead of processing the orders directly through their own websites.
• Illicit drug sellers in China also often utilize multiple platforms, such as social media or e-commerce, for different aspects of their business. These factors make it challenging for law enforcement to identify problematic sellers.
• Illegal online drug sellers conduct a big portion of business across multiple platforms and on smartphone apps. This will continue to pose challenges for law enforcement.
• The Chinese government has realized the new challenges of the online drug market. A more robust monitoring system for websites and third-party e-commerce platforms (with possible expansion to social media platforms and apps) will soon be implemented.
• LegitScript predicts that the trend of illicit online drug sales over smartphone-based apps will continue. Enforcement efforts must evolve to respond to the illegal market’s utilization of technology and social media.
• Continuous public education about illicit online drug sales would help Chines patients better understand the risks involved in buying prescription medication online.

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ABOUT ASOP GLOBAL

The Alliance for Safe Online Pharmacies (ASOP Global), a 501(c)(4) non-profit organization headquartered in Washington, D.C. with activities in U.S., Canada, Europe, India, Latin America and Asia, is dedicated to protecting consumers around the world, ensuring safe access to medications, and combating illegal online drug sellers. ASOP Global has an expansive membership including non-profit public health organizations, international members, pharmacy members, as well as pharmaceutical manufacturers.