Laws of the People's Republic of China

State Food and Drug Administration

Order of the State Food and Drug Administration

No.6

The Measures for the Administration of Pharmaceutical Trade License, deliberated and adopted at the executive meeting of the State Food and Drug Administration on January 2, 2004, are hereby promulgated, and shall be implemented as of April st, 2004.

Zheng Xiaoyu, Director General of the State Food and Drug Administration

February 4th, 2004

Measures for the Administration of Pharmaceutical Trade License

Chapter I General Provisions

Article 1

With a view to strengthening supervision over and administration of the licensing of pharmaceutical trading, the present Measures are hereby formulated in accordance with the Pharmaceutical Administration Law of the People's Republic of China, the Regulations on the Implementation of the Pharmaceutical Administration Law of the People's Republic of China (hereinafter referred to as the Pharmaceutical Administration Law, and Regulations on the Implementation of the Pharmaceutical Administration Law),

Article 2

The present Measures shall be applicable to the license issuance, renewal, alteration and supervision over and administration of Pharmaceutical Trade License.

Article 3

The State Food and Drug Administration shall be in charge of the supervision over and administration of the licensing of national pharmaceutical trading.

The departments of food and drug administration of the provinces, autonomous regions, and municipalities directly under the Central Government shall be responsible for license issuance, renewal, alteration, and routine supervision over and administration of Pharmaceutical Trade License of pharmaceutical wholesale enterprises within their respective jurisdictions, and shall direct and supervise the lower level organs of food and drug administration on carrying out the supervision over and the administration of Pharmaceutical Trade License.

The organs of food and drug administration at the level of cities with districts under them or those at the county level which are set up directly by the departments of food and drug administration at the levels of provinces, autonomous regions, and municipalities directly under the Central Government, shall be responsible for the work of license issuance, renewal, alteration and routine supervision over and administration of Pharmaceutical Trade License of drug retail enterprises within their respective jurisdictions.

Chapter II Conditions for Applying for the Drug Business License

Article 4

In accordance with the provisions of Article 14 of the Pharmaceutical Administration Law, where a pharmaceutical wholesale enterprise launches, it shall conform to the requirements for the reasonable overall arrangement for pharmaceutical wholesale enterprises of provinces, autonomous regions, and municipalities directly under the Central Government for its establishment, and shall measure up to the following standards for establishment:

1.

Having rules and regulations that can ensure the quality of drugs it deals in.

2.

The enterprise, the legal representative, responsible person, or the person responsible for quality control of the enterprise has no circumstances as prescribed in Articles 76 and 83 of the Pharmaceutical Administration Law;

3.

Having a certain number of practicing apothecaries in line with its business scale. The person responsible for quality control shall have a bachelor's degree or above, and shall be a practicing apothecary as well;

4.

Having normal temperature warehouses, cool warehouses or refrigerators, which can ensure the quality requirements for pharmaceutical storage and can fit in with its variety and scale of business, and in which there shall be special goods shelves for pharmaceutical storage, and the installations and equipment of modern logistic system for the pharmaceuticals' entering a warehouse, transmission, sorting out, putting on shelves, and leaving a warehouse..

5.

Having independent computer management information system, which can cover the whole process of the pharmaceutical purchase, storage, sale, and management and quality control within the enterprise, and can record all the information on the management and implementation of the Standards for Quality Control of Pharmaceutical Trading of the enterprise; meeting the requirements of Standards for Quality Control of Pharmaceutical Trading for each process of pharmaceutical management, and having conditions for accepting supervision of the local departments or organs for food and drug administration; and

6.

Having conditions of conforming to the requirements of the Standards for Quality Control of Pharmaceutical Trading for pharmaceutical business office, auxiliary and office buildings, and warehouse management, quality safeguards for pharmaceuticals in the warehouse, and the entry-exit of warehouse, in-warehouse storage and maintenance.

Unless there are otherwise state provisions on management of stupefacient, psychotropic drugs, toxic drugs for medical treatment, and preventive biological produce, those provisions shall prevail.

Article 5

The establishment of a pharmaceutical retail enterprise shall conform to the requirement of the number of local permanent residents, regions, traffic status and actual needs, and follow the principle of convenience for the mass people to purchase pharmaceuticals, and accord with the following provisions on establishment:

1.

Having rules and regulations that can ensure the quality of pharmaceuticals it deals in; and

2.

Having pharmaceutical technical personnel whose qualifications have been certified in jure.

A pharmaceutical retail enterprise, which undertakes the trading of prescriptive pharmaceuticals, or Class A non-prescriptive pharmaceuticals (OTC), shall have practicing apothecaries or other pharmaceutical technical personnel whose qualifications have been certified in jure. The person responsible for quality control shall have work experiences of quality control for pharmaceutical trading for no less than one year.

A pharmaceutical retail enterprise, which undertakes the trading of Class B non-prescriptive pharmaceuticals (OTC), and the pharmaceutical retail enterprises established in areas below the rural villages and towns, shall recruit business personnel according to Article 15 of the Regulations on the Implementation of the Pharmaceutical Administration Law, and the practicing apothecaries shall also be recruited as long as conditions permit:

The aforesaid personnel shall be on the job during the business hours of the enterprise.

3.

The enterprise, legal representative, responsible person or person responsible for quality control of the enterprise has no circumstances as prescribed in Articles 76 and 83 of the Pharmaceutical Administration Law;

4.

Having the places of business, equipment, warehouse facilities and sanitary conditions fitting in with the pharmaceuticals it deals in. Where a retail pharmaceutical store is established in the supermarkets or within other commercial enterprises, it must have an independent area; and

5.

Having abilities of supplying drugs that can meet the demand of local consumers, and ensuring the 24-hour supply. The departments of food and drug supervision and administration of all provinces, autonomous regions, and municipalities directly under the Central Government shall, according to the specific circumstances of the local regions, determine the variety and quantity of state basic pharmaceuticals that shall be stocked by the pharmaceutical retail enterprises.

Unless there are otherwise state provisions on management of stupefacient, psychotropic drugs, toxic drugs for medical treatment, and preventive biological produce, those provisions shall prevail.

Article 6

The formulation of implementation standards for checking and accepting the establishment of pharmaceutical wholesale enterprises shall remain with the State Food and Drug Administration. The implementation standards for checking and accepting the establishment of drug retail enterprises shall be formulated by the departments of food and drug administrations of the provinces, autonomous regions and municipalities directly under the Central Government in accordance with the relevant contents of the present Measures and the Standards for Quality Control of Pharmaceutical Trading, and shall be reported to the State Food and Drug Administration for archival document.

Article 7

The checking and ratifying of the business scope of the pharmaceutical trading enterprises:

The business scope of pharmaceutical trading enterprises shall cover:

stupefacient, psychotropic drugs, and toxic drugs for medical treatment;

Biological produce;

Chinese traditional medicinal materials; Chinese traditional medicine drink pills; Chinese patent medicines, chemical material medicines and their preparations; antibiotic material medicines and their preparations, biological and chemical medicines.

Where the enterprises undertake pharmaceutical retail, their class of business shall be checked and ratified, the applicants' qualifications of managing the prescriptive pharmaceuticals or non-prescriptive pharmaceuticals or Class B non-prescriptive pharmaceuticals shall be determined first, and after the aforesaid has been clarified in their business scope, the specific scope of business shall be checked and ratified.

The checking and ratifying of toxic drugs for medical treatment, stupefacient, psychotropic drugs, radioactive drugs and preventive biological products shall be carried out according to the relevant state provisions on the administration of special pharmaceuticals and preventive biological products.

Chapter III The Procedures for Applying for the Pharmaceutical Trade License

Article 8

The Pharmaceutical Trade License for opening a pharmaceutical wholesale enterprise shall be handled according to the procedures as follows:

1.

The applicant shall file an application for preparing to establish such an enterprise with the departments of food and drug administration of the provinces, autonomous regions, and municipalities directly under the Central Government at the place where the enterprise to be established is located, and submit the following documents:

(1)

The original and photocopy of the certificate of educational backgrounds and personal resumes of the legal representatives, persons responsible, and persons responsible for quality control of the enterprise to be established;

(2)

The original and photocopy of the practising license of the practicing apothecary;

(3)

The scope of pharmaceuticals to be dealt in; and

(4)

The place of business, equipment, warehouse establishments to be established and the sanitary conditions around, etc.

2.

The departments of food and drug administration shall handle the applications filed by an applicant separately according to the circumstances as follows:

(1)

Where the matters applied for do not fall within the scope of the functions and powers of the corresponding departments, they shall make a decision of not acceptance in time, and issue the Notice of Not Acceptance, and inform the applicant to apply to the relevant departments of food and drug administration;

(2)

Where there is any mistake in application documents, and the mistake can be corrected on the spot, the applicant shall be permitted to correct it on the spot;

(3)

Where the application documents are incomplete or don't measure up to legal forms, the applicant shall be issued the Notice to Supplement the Documents on the spot or within 5 days, and be informed to supplement the whole documents needed in one time. Where they fail to inform the applicant within the prescribed time limit, the date of their receiving the application documents shall be deemed as the date of acceptance; and

(4)

Where the matters applied for fall within the scope of functions and powers of the corresponding departments, and the documents thereof are complete and conforming to the legal form, or the applicant has submitted all the supplementary documents as required, the Notice of Acceptance shall be issued to the applicant. And the date indicated in the Notice of Acceptance shall be deemed as the date of acceptance.

3.

The departments of food and drug administration shall, within 30 working days as of the date of accepting the application, make an examination of the documents submitted according to the provisions of Article 4 of the present Measures, and make a decision on whether or not to agree with the preparation for establishment, and notify the applicants in writing. Where they don't agree with the preparation for establishment, they shall explain the reason, and notify the applicants of their rights of applying for administrative reconsideration or institute an administrative litigation in jure.

4.

After an applicant has finished the preparation for establishment, it shall submit an application for checking to the departments of food and drug administration that accept the application, and submit the following documents:

(1)

Application for Pharmaceutical Trade License;

(2)

Documents of approval and certification issued by the departments for industry and commerce administration for the enterprise to be established;

(3)

Organizational structure of the enterprise to be established;

(4)

Ground disposition plan of the places of business and warehouses, and certificates of the ownership of or right to use the houses;

(5)

Qualification certificates and letter of appointment of the special technical personnel in pharmacy certified in jure; and

(6)

The quality control documents of the enterprise to be established and the indexes of the warehouse establishments and facilities thereof.

5.

The departments of food and drug administration accepting the application shall, within 30 working days from the date of receiving the application for checking, organize the checking according to the implementation standards for checking and accepting the establishment of pharmaceutical wholesale enterprises, make decisions on whether or not to issue the Pharmaceutical Trade License. Those enterprises meeting the requirements shall be issued the Pharmaceutical Trade License; and as to those not meeting the requirements, the applicants shall be notified in writing and the reason shall be explained, and they shall be informed of the rights of applying for administrative reconsideration or instituting an administrative litigation in jure.

Article 9

The Pharmaceutical Trade License for opening a pharmaceutical retail enterprise shall be handled according to the procedures as follows:

1.

The applicant shall file an application for preparing the establishment to the food and drug administrative organs at the level of cities with districts under them where the enterprise to be established is located or to those of the county level established directly by the departments of food and drug administration of provinces, autonomous regions, and municipalities directly under the Central Government, and submit the following documents:

(1)

The originals or photocopies of the educational background, qualifications to practice or certificates of title of a technical post of the legal representative, person in charge, person responsible for quality control of the enterprise to be established, and their personal resumes and qualification certificates and letter of appointment of the special technical personnel;

(2)

The scope of pharmaceuticals to be dealt in; and

(3)

The conditions of the place of business, warehouse facilities and equipment to be established.

2.

The food and drug administrative organs shall handle the application of an applicant separately according to the following conditions:

(1)

Where the matters applied for do not fall within the scope of functions and powers of the corresponding departments, they shall make decisions of not acceptance immediately, issue the Notice of Not Acceptance, and inform the applicant to apply to the relevant departments of food and drug administration;

(2)

Where there is any mistake in the application documents, and it can be corrected on the spot, the applicant shall be permitted to do it on the spot;

(3)

Where the application documents are incomplete or do not measure up to the legal form, they shall issue the Notice for Supplementing the Documents to the applicants on the spot or within 5 days, and inform them of the whole contents to be supplemented in one time. If they fail to inform the applicants within the prescribed time limit, the date of receiving the application documents shall be deemed as the date of acceptance; and

(4)

Where the matters applied for fall within the scope of functions and powers of the corresponding departments, and the documents thereof are complete and conforming to the legal form, or the applicant has submitted all the supplementary documents as required, the Notice of Acceptance shall be issued to the applicant. And the date indicated in the Notice of Acceptance shall be deemed as the date of acceptance.

3.

The departments of food and drug administration shall, within 30 working days from the date of accepting the application, make an examination of the documents submitted according to the provisions of Article 5 of the present Measures, and decide whether or not to agree with the preparation for establishment, and notify the applicant in writing. If they disagree, they shall explain the reason, and notify the applicants of their rights of applying for administrative reconsideration or instituting an administrative litigation in jure.

4.

After the applicant has finished the preparation for establishment, it shall file an application for checking to the departments of food and drug administration that accept the application, and submit the following documents:

(1)

Application for Pharmaceutical Trade License;

(2)

Documents of approval and certification issued by the departments for industry and commerce administration for the enterprise to be established;

(3)

Ground disposition plan of the places of business and warehouses, and the certificates of the ownership of or right to use the houses;

(4)

Qualification certificates and letter of appointment of the special technical personnel in pharmacy certified in jure; and

(5)

The quality control documents of the enterprise to be established and the indexes of the warehouse establishments and facilities thereof.

5.

The food and drug administrative organs accepting the application shall, within 15 working days as of the date of receiving the checking application, organize a checkup in light of the implementation standards for checking and accepting the establishment of pharmaceutical retail enterprises, and make decisions on whether or not to issue the Pharmaceutical Trade License. Where the enterprises fail to meet the conditions, the applicants shall be notified in writing of the reason, and meanwhile shall be informed of their rights of applying for administrative reconsideration or instituting an administrative litigation in jure.

Article 10

Where the departments or organs of food and drug administration find out that the matters of administrative license of an applicant concern directly the major interests of other people when making an examination of its application, they shall notify the interested party. The acceptance departments shall hear the statement and pleadings of the applicant or the interested party. Where the matters shall be dealt with through a hearing in jure, a hearing shall be held in light of the provisions of law.

Article 11

The departments or organs of food and drug administration shall publicize the relevant information on Pharmaceutical Trade License they have issued, and the general public shall have the right to consult.

Where, after the publicity of the information, an enterprise is found to have acts of providing false documents, data or other deceptive acts in the process of applying for the Pharmaceutical Trade License, it shall be punished in jure.

Article 12

The Pharmaceutical Trade License is the legal credence of an enterprise for its undertaking of pharmaceutical trade activities, no entity or individual may forge, alter, deal, lease or lend it.

Chapter IV Alteration and Renewal of Pharmaceutical Trade License

Article 13

The alteration of the Pharmaceutical Trade License shall include the alteration of the license matters and alteration of registration matters.

The alteration of license matters refers to the alteration of the means of operation, scope of business, place of registration and warehouse (including increase or decrease of the warehouses), legal representatives, person in charge, and person responsible for quality control of the enterprise.

The alteration of registration matters refers to changes on matters not mentioned in the aforesaid paragraphs.

Article 14

Where a pharmaceutical trading enterprise alters the license matters concerning the Pharmaceutical Trade License, it shall apply for an alteration of registration on Pharmaceutical Trade License to the former organs for issuing license 30 days in advance. And no license matters shall be altered without approval.

The former organs for issuing license shall, within 15 working days from the date of receiving the application for enterprise alteration and alteration of the application documents, make a decision on whether or not to grant the alteration.

Where an enterprise applies for alteration of the license matters, the original license issuing departments may not handle the formalities for alteration until they have checked and accepted the enterprise and confirmed its eligibility in light of the conditions as prescribed in the present Measures.

After a pharmaceutical trading enterprise has made alteration on the license matters concerning the Pharmaceutical Trade License, it shall go through the relevant alteration procedures for enterprise registration to the departments for industry and commerce administration in jure.

Where an enterprise divides, merges, or changes its means of operation, or transfers exceeding the former jurisdictions, its Pharmaceutical Trade License shall be handled anew in light of the provisions of the present Measures.

Article 15

Where a non-legal person branch of an enterprise legal person alters the license matters of the Pharmaceutical Trade License, it shall show the alteration application with the opinions of the upper level legal person signed therein.

Article 16

Where an enterprise is put on records and investigated into by the departments or organs of food and drug administration for illegal operation, and the case has not been concluded yet; or a decision of administrative punishment has been made but the punishment has not been executed, the organs for issuing license shall suspend the acceptance of its application for alteration of the Pharmaceutical Trade License.

Article 17

Where a pharmaceutical trading enterprise alters the registration matters of the Pharmaceutical Trade License, it shall, within 30 days after the alteration has been approved by the departments for industry and commerce administration, apply for alteration registration on the Pharmaceutical Trade License to the former organs for issuing license, who shall then handle alteration formalities for it within 15 working days from the date of receiving the application for enterprise alteration and alteration application documents.

Article 18

After the registration matters of the Pharmaceutical Trade License have been altered, the former organs for issuing license shall record the contents and time for alteration in the duplicate of the Pharmaceutical Trade License, and change and issue anew the original copy of the Pharmaceutical Trade License in light of the contents altered, and take back the original copy of the Pharmaceutical Trade License. The period of validity of the altered Pharmaceutical Trade License shall remain unchanged.

Article 19

The period of validity of the Pharmaceutical Trade License shall be 5 years. If the license holding enterprises need to continue the trading of pharmaceuticals at the expiration of the period of validity, they shall apply to the original license issuing enterprises for a renewal of the Pharmaceutical Trade License within 6 months before the expiration of the period of validity. The former organs for issuing license shall make examination in light of the conditions for application and establishment as prescribed in the present Measures. If the requirements are met, they shall withdraw the original license and reissue a new one. If the requirements are not met, they shall order the enterprises to rectify within a time limit of three months. And if the requirements are still not met after the rectification, the original Pharmaceutical Trade License shall be written off.

The departments or organs of food and drug administration shall, upon the application of pharmaceutical management enterprises, make decisions on whether or not to approve their renewal of licenses before the expiration of the period of validity of the Pharmaceutical Trade License. If they fail to make decisions within the time limit, they shall be considered as having approved the renewal of license.

Chapter V Supervision and Inspection

Article 20

The departments or organs of food and drug administration shall strengthen the supervision and inspection over the enterprises holding the Pharmaceutical Trade Licenses. And the enterprises holding the licenses shall accept the supervision and inspection in light of the provisions of the present Measures.

Article 21

The contents of supervision and inspection shall mainly include:

1.

The name of the enterprise, business address, place of warehouses, legal representative or responsible person of the enterprise, person responsible for quality control, means of operation, scope of business, the branches, and the implementation and alteration of other important matters concerned;

2.

The alteration of the business establishments and equipment of the enterprise and the warehouses conditions;

3.

The implementation of the Standards for Quality Control of Pharmaceutical Trading by the enterprise; and

4.

Other relevant matters that the organs for issuing license need to examine.

Article 22

The supervision and inspection may be made by ways of inspection in written forms, on-the-spot inspection or the combination of the two ways above-mentioned.

1.

The organs for issuing license may require the license holding enterprises to submit the relevant documents of the Pharmaceutical Trade License, and perform their supervision functions through checking the relevant documents; or

2.

The organs for issuing license may make an on-the-spot inspection on the enterprises holding the license.

In case an enterprise is under any of the following circumstances, it shall be examined on the spot:

(1)

Newly established enterprises in the last year;

(2)

Enterprises having problems in the inspection of the last year;

(3)

Enterprises being imposed upon an administrative punishment for violating the relevant laws and regulations; or

(4)

Enterprises that should be examined on the spot as believed by the organs for issuing license.

The work for supervision and inspection and examination on license alteration may be carried out together in the same year as the renewal of the Pharmaceutical Trade License.

Article 23

The standards for on-the-spot inspection on Pharmaceutical Trade License shall be formulated by the organs for issuing license according to the implementation standards for checking and accepting the establishment of pharmaceutical wholesale enterprises and those of pharmaceutical retail enterprises, and the certification and inspection standards of the Standards for Quality Control of Pharmaceutical Trading, as well as the items for on-the-spot inspection, and shall be reported to the upper level departments (organs) of (food) drug administration for archive documents.

Article 24

Where any business enterprise is found to have violated the requirements of the Standards for Quality Control of Pharmaceutical Trading in the supervision and inspection, the organs for issuing license shall order it to rectify within a prescribed time limit. If an enterprise violates the provisions of Article 16 of the Pharmaceutical Administration Law, and still fails to meet the requirements for undertaking the pharmaceutical business activities after rectification, it shall be punished in light of the provisions of Article 79 of the Pharmaceutical Administration Law.

Article 25

Where an organ for issuing license makes supervision and inspection over pharmaceutical trading enterprises in jure, it shall record the conditions of supervision and inspection and the conclusions of disposal, and put the records on archives after they have been signed by the supervisors and inspectors. The general public shall have the right to consult the relevant records over supervision and inspection. And the organs for issuing license shall record the conclusions for on-the-spot inspection on the duplicate of the Pharmaceutical Trade License and publicize them.

Article 26

Under any of the following circumstances, the Pharmaceutical Trade License shall be written off by the former organs for issuing license:

1.

The Pharmaceutical Trade License fails to be renewed at the expiration of its period of validity;

2.

The pharmaceutical trading enterprise terminates the operation of drugs or is closed down;

3.

The Pharmaceutical Trade License is revoked, withdrawn, suspended, taken back, written off or invalidated;

4.

The license matters of the Pharmaceutical Trade License fail to be implemented due to force majeure; or

5.

Other circumstances that the administrative license shall be written off as prescribed by laws and regulations.

Where the departments or organs of food and drug administration write off the Pharmaceutical Trade License, they shall notify the relevant departments for industry and commerce within 5 working days since the date of the writing-off.

Article 27

The Pharmaceutical Trade License shall include the original copies and duplicate copies, which shall have the same legal force.

Article 28

The organs for issuing license shall establish archives for the license issuance, change, supervision and inspection, or alteration of the Pharmaceutical Trade License, and report the conditions for license issuance and alteration of the Pharmaceutical Trade License to the departments or organs of the upper level food and drug administration in the first month of every quarter. The Pharmaceutical Trade Licenses taken back or cancelled due to alteration, change of license, suspension, or revocation shall be archived for 5 years.

Article 29

Where an enterprise loses its Pharmaceutical Trade License, it shall report to the organs for issuing license immediately, and publish statement of loss in the media designated by the organs for issuing license. The organs for issuing license shall reissue the Pharmaceutical Trade License on the basis of the originally approved matters after one month from the date the enterprise publishes the statement of loss.

Article 30

Where an enterprise terminates its operation of drugs or is closed down, its Pharmaceutical Trade License shall be revoked by the former organ for issuing license.

When suspending or writing off or revoking the Pharmaceutical Trade License, the organs for issuing license shall notify the departments for industry and commerce administration and publicize it to the general public.

Article 31

The original copy of the Pharmaceutical Trade License shall be put an eye-catching place of the business office of an enterprise.

Chapter VI Supplementary Provisions

Article 32

The Pharmaceutical Trade License shall specify the names, legal representative or responsible person of an enterprise, its means of operation, scope of business, place of registration and warehouses thereof, the certificate number, current number, license issuing department, date of issuance, and period of validity of the Pharmaceutical Trade License, and other items.

The patterns of original or duplicate of the Pharmaceutical Trade License, and their numbering methods shall be formulated uniformly by the State Food and Drug Administration.

Article 33

The Pharmaceutical Trade License shall be printed uniformly by the State Food and Drug Administration.

Article 34

The present Measures shall be implemented as of April 1st, 2004.