China’s Vaccine Roll Out Overshadowed by History of Pharma Corruption

As several Chinese drugmakers prepare for a global roll-out of their COVID-19 vaccines, a number of newspapers have recently published investigations highlighting the murky world of pharmaceutical dealmaking in China, including a long history of corruption by companies that are now leading China’s vaccination campaign. Executives at domestic vaccine creator Sinovac Biotech and manufacturer Shenzhen Kangtai Biological Products have been involved in prominent bribery cases that have led to the conviction of at least one government regulator. On Monday, The New York Times’ Sui-Lee Wee and Javier Hernandez reported on history of corruption at Shenzhen Kangtai Biological Products, the exclusive manufacturer of the Oxford/AstraZeneca vaccine:

Capitalizing on that success, Mr. Du and his company are now at the forefront of the global race to produce a coronavirus vaccine, a national priority for China’s ruling Communist Party. Kangtai will be the exclusive manufacturer in mainland China for the vaccine made by the British-Swedish pharmaceutical giant AstraZeneca, and the companies could work together on deals for other countries. The Chinese company is also in early trials for its own candidate.

Mr. Du’s success, against the backdrop of scandal, is not an outlier in China. It is the norm.

[…] In 2013, 17 infants died after injections with Kangtai’s hepatitis B vaccine. Regulators cleared Kangtai of wrongdoing, and the vaccine continues to be used safely. But the government didn’t provide substantial details about its investigation into the deaths or Kangtai’s safety practices; the company had negative articles retracted.

[…] “The stakes are very high,” Dr. [Yanzhong Huang, a senior fellow for global health at the Council on Foreign Relations] said. “Imagine if a similar scandal is reported again in China. It’s not just going to undermine the confidence of the company manufacturing the vaccine, it’s also going to hurt the reputation of AstraZeneca itself and their vaccine, too.” [Source]

Separately, an article published last Friday by The Washington Post’s Eva Dou reported on the extensive track record of corruption at Sinovac, which is producing its own vaccine, with a particular focus on supplying developing nations including Brazil, Turkey, and Indonesia:

A review of public records and trial testimonies by The Washington Post reflects that Sinovac’s rise to the front ranks of China’s vaccine industry took place with the help of priority projects from Beijing and kickbacks to officials who assisted in regulatory reviews and sales deals. A number of details from the court cases have not been reported previously, in part because of China’s censored media.

In 2016 court testimony, Sinovac’s founder and chief executive, Yin Weidong, admitted to giving more than $83,000 in bribes from 2002 to 2011 to a regulatory official overseeing vaccine reviews, Yin Hongzhang, and his wife. Yin Hongzhang confessed to expediting Sinovac’s vaccine certifications in return.

[…] Yin Hongzhang, who shares a surname with Sinovac’s CEO but is no relation, was sentenced in 2017 to a decade in prison for taking bribes from Sinovac and seven other companies. Sinovac’s Yin Weidong, now 56, was not charged and continues to oversee the company’s coronavirus-vaccine drive this year.

For Sinovac, that case was not a one-off: At least 20 government officials and hospital administrators across five provinces admitted in court to taking bribes from Sinovac employees between 2008 and 2016. [Source]

Neither of these reports allege that the two drugmakers have engaged in corruption in relation to their manufacturing of the COVID-19 vaccine. But a report by the Associated Press’ Dake Kang published last week did uncover how political cronyism in the early days of China’s coronavirus outbreak significantly hobbled the rollout of mass testing, potentially allowing the virus to spread out of control:

China’s Center for Disease Control and Prevention gave test kit designs and distribution rights exclusively to three then-obscure Shanghai companies with which officials had personal ties, the reporting found. The deals took place within a culture of backdoor connections that quietly flourished in an underfunded public health system, according to the investigation, which was based on interviews with more than 40 doctors, CDC employees, health experts, and industry insiders, as well as hundreds of internal documents, contracts, messages and emails obtained by the AP.

The Shanghai companies — GeneoDx Biotech, Huirui Biotechnology, and BioGerm Medical Technology — paid the China CDC for the information and the distribution rights, according to two sources with knowledge of the transaction who asked to remain anonymous to avoid retribution. The price: One million RMB ($146,600) each, the sources said. It’s unclear whether the money went to specific individuals.

In the meantime, the CDC and its parent agency, the National Health Commission, tried to prevent other scientists and organizations from testing for the virus with their own homemade kits. In a departure from past practice for at least two epidemics, the NHC told Wuhan hospitals to send virus samples — from which tests can be developed — only to central labs under its authority. It also made testing requirements to confirm coronavirus cases much more complicated, and endorsed only test kits made by the Shanghai companies.

These measures contributed to not a single new case being reported by Chinese authorities between Jan. 5 and 17, even though retrospective infection data shows that hundreds were infected. The apparent lull in cases meant officials were slow to take early actions such as warning the public, barring large gatherings and curbing travel. One study estimates that intervention two weeks earlier could have reduced the number of cases by 86 percent, although it’s uncertain whether earlier action could have halted the spread of the virus worldwide. [Source]

The three stories highlight the murky world of China’s pharmaceutical sector, where rampant corruption has led not only to financial and legal implications, but to public health consequences as well. Previous scandals have seriously affected the Chinese public’s confidence in the pharmaceutical sector. In 2018, after it was exposed that more than 200,000 babies in Shandong may have been given substandard vaccines for diphtheria, pertussis, and tetanus (DPT), the severity of the public outcry in China led Xi Jinping to publicly condemn the vaccine maker, Changchun Changsheng Life Sciences, as “vile” and “shocking.” Initial reports that uncovered the substandard vaccines were quickly covered up and censored. In the aftermath of the 2018 scandal, the South China Morning Times quoted a former regulator saying that there was insufficient manpower at China’s central regulatory body to ensure that drugs were up to standard, and that they often relied on pharmaceutical companies’ compliance. In 2019, revelations that children receiving expired polio vaccines led to violent protests in Jiangsu province. 

As China has made creating an effective COVID-19 vaccine a national priority, public doubts about the domestic pharmaceutical sector may come up against a rising tide of “vaccine nationalism,” as well as general impatience for the vaccine to arrive. There are reasons to be wary of China’s leading vaccine candidates: the frontrunner, Sinopharm, whose subsidiary was implicated in the 2018 DPT scandal, has still not released Phase 3 trial results concerning the vaccines’ efficacy. Additionally, aforementioned Sinovac has been distributing the vaccine widely even though incomplete trials in Brazil have reportedly delivered mixed results. Pending efficacy rates from top manufacturers and the completion of clinical safety trials, it remains to be seen whether China’s vaccine makers can overcome their pasts to deliver safely and effectively.


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