China NMPA Inspection - Wushan County Pharmaceutical Company Traditional Chinese Medicine Processing Plant - May 16, 2017

An unannounced inspection conducted from March 22-24, 2017, by the State Food and Drug Administration and Gansu Provincial Food and Drug Administration uncovered significant compliance issues at Wushan County Pharmaceutical Company and its Traditional Chinese Medicine Slices Factory. The inspection was initiated due to a complaint.

The primary finding was that Wushan County Pharmaceutical Company's Traditional Chinese Medicine Slices Factory continued operations despite its "Drug Production License" expiring on December 31, 2015 (with an extension to March 31, 2016), and its "Drug GMP Certificate" being revoked in August 2016. Inspectors confirmed the original factory was empty and devoid of production equipment, having been rented out.

Further investigation into the parent entity, Wushan County Pharmaceutical Company, revealed that after its license expired, the Traditional Chinese Medicine Slices Factory engaged in illegal activities. It purchased traditional Chinese medicine slices from external markets, repackaged them at the pharmaceutical company's warehouse using old batch numbers, and sold them without conducting necessary quality inspections or maintaining appropriate repackaging records. The company's legal representative admitted to these unauthorized activities.

Under the relevant drug regulatory framework, these actions constitute suspected illegal production and distribution of pharmaceutical products. Consequently, the State Food and Drug Administration has mandated the Gansu Provincial Food and Drug Administration to thoroughly investigate and prosecute Wushan County Pharmaceutical Company for its alleged illegal production activities. Additionally, the provincial authority is required to oversee the company's recall of all implicated products from the market.