July 23 (NBD) -- The vaccine case has crossed a moral line, and the nation deserves a clear explanation, Chinese Premier Li Keqiang said in an instruction concerning Changsheng Bio-tech Co Ltd (002680.SZ) which was found to have fabricated production records of rabies vaccines for human use.

Li said in the instruction that the State Council should immediately send out a team to investigate every link in the production and sales process of vaccines to unearth the truth, and any company or any individual that is found to be responsible for the case should be punished severely.

After an announced inspection of the State Drug Administration (SDA) found Changchun Changsheng, a wholly-owned subsidiary of Shenzhen-listed Changsheng Bio-tech, to have conducted manufacturing irregularities, the regulator revoked the Good Manufacturing Practice (GMP) certificate of the vaccine maker.

After the SDA's announcement, Changsheng Bio-tech on Monday apologized to the public in a filing to the Shenzhen Stock Exchange (SZSE). But the apology is far from enough to answer people's concerns and ease the public's panic, and is even less when the vaccine maker was found to have sold substandard adsorbed diphtheria-pertussis-tetanus (ADPT) vaccine for infants.

In the filing submitted to the SZSE, Changsheng Bio-tech said it had suspended the production of both human rabies vaccine and ADPT vaccine.


Photo/VCG 

Other than vaccine irregularities, the sales expenses of Changsheng Bio-tech was found alarmingly high.

In 2017, the company's sales costs increased by 152 percent year on year to 583 million yuan (86.3 million U.S. dollars), equivalent to 37.6 percent of its revenue of 1.55 billion yuan (229.3 million U.S. dollars) in that year. It's noteworthy that the listed company has only 25 salespersons.

With regard to the surprising increase in sales expenses, Changsheng Bio-tech attributed it to the higher costs in promotion, market services, convention and transportation caused by tighter regulations on vaccine distribution.

It's noticed that Changsheng Bio-tech is not the only vaccine producer that expended heavily on sales channels. The sales expenses accounted for more than 50 percent of the overall operating costs for Shenzhen Kangtai Biological Products (300601.SZ) and Changchun High & New Technology Industry (Group) Inc. (000661.SZ) whose shares plummeted by the daily limit of 10 percent on Monday.

Except for the intermediary costs, the major part of the sales expenses was stealthily used to bribe grassroots disease control and prevention centers or health centers to get orders, the new portal yicai.com reported citing industry insiders.


Email: gaohan@nbd.com.cn

Editor: Gao Han