{"id":193641,"date":"2016-05-04T18:29:26","date_gmt":"2016-05-05T01:29:26","guid":{"rendered":"http:\/\/chinadigitaltimes.net\/?p=193641"},"modified":"2021-09-14T20:35:54","modified_gmt":"2021-09-15T03:35:54","slug":"baidu-probe-exposes-chaos-of-chinas-medical-system","status":"publish","type":"post","link":"https:\/\/chinadigitaltimes.net\/2016\/05\/baidu-probe-exposes-chaos-of-chinas-medical-system\/","title":{"rendered":"Baidu Probe Exposes Chaos of China’s Medical System"},"content":{"rendered":"

On Monday, Chinese authorities launched an investigation into Baidu’s unethical search ranking and advertising practices in response to public outrage over the\u00a0death of Wei Zexi<\/a>, a 21-year-old college student who died last month after undergoing a bogus cancer treatment program advertised prominently on the search engine. Analysts believe the probe will likely end in harsh penalties for Baidu and stricter regulation of online medical advertising<\/a><\/strong>.\u00a0At South China Morning Post, Bien Perez,\u00a0Jack Liu, and\u00a0<\/span><\/span>Zen Soo<\/span><\/span>\u00a0report:<\/span><\/span><\/p>\n

\n

The analysts said on Tuesday that they expected Baidu, which has more than 70 per cent revenue share of China\u2019s online search market, to receive more than a cash fine if found guilty of misconduct as a publisher of digital advertising or for violating certain regulations.<\/p>\n

\u201cViolations of China\u2019s advertising laws and regulations are subject to penalties, and even the potential termination of advertising operations or removal of a business licence,\u201d Morningstar senior equity analyst Marie Sun said in a report.<\/p>\n

[…]\u00a0Paul Haswell, a partner at international law firm Pinsent Masons, said \u201ca ban on Baidu\u2019s health-care-related advertising, or at least [enforcement of] tighter controls on such advertising\u201d would serve \u201cas a logical and relatively balanced\u201d penalty.<\/p>\n

\u201cIt is entirely possible that as a result of this case more stringent controls will be placed over internet-based advertising , requiring a licence or approval for each and every advertisement,\u201d he said.<\/p>\n

\u201cChina has the political climate and technological capabilities to make that happen.\u201d [Source<\/a><\/strong>]<\/p>\n<\/blockquote>\n

Baidu has disproportionally dominated the Chinese search engine market<\/a> since Google’s exit in 2010, which took place following a\u00a0censorship dispute with the Chinese government<\/a>. Unlike its American\u00a0counterpart, Baidu relies heavily on revenue generated from medical advertisements through the\u00a0bid ranking\u00a0of sponsored health-care providers<\/a><\/strong> in its search results. South China Morning Post’s Alice Woodhouse and Zen Soo report:<\/p>\n

\n

Medicine and health care were among the 10 major industries contributing to Baidu\u2019s online marketing revenue in 2015, according to the company\u2019s latest annual report.<\/p>\n

By contrast, the medical industry does not even factor into Google\u2019s top 10 industries in terms of advertising revenue, according to data by Shanghai-based digital marketing firm Sekkei Studio.<\/p>\n

[…]\u00a0Depending on the target country, Google\u2019s advertising policy restricts promotion of health-care-related content including over-the-counter medication, medical services and procedures.<\/p>\n

[…]\u00a0An internal letter circulated in Baidu\u2019s intranet obtained by\u00a0The Beijing News<\/em> said Baidu turned down 30 million yuan in promotional requests from illegal medical services and closed down 438,000 suspicious advertising accounts in 2015. [Source<\/a><\/strong>]<\/p>\n<\/blockquote>\n

The department where Wei received his treatment at the\u00a0Second\u00a0Armed Police Hospital was allegedly\u00a0run under contract by a medical company affiliated with the Putian Clan<\/a>, a network\u00a0of medical entrepreneurs from Fujian who are among China’s largest private healthcare providers frequently associated with misleading\u00a0advertising and overpriced treatments<\/a>. At Global Voices, Patrick Wong looks at the growth of Putian hospitals and their business connection with Baidu<\/a><\/strong>:<\/p>\n

At the onset of the Reform and Opening in 1978, many hospitals did not have sufficient state subsidies to operate. As a result, these doctors in Putian seized the chance and filled the funding gap by offering investments, as well as additional doctors and medical devices, entering into profit-sharing arrangements with the hospitals. It was the dawn\u00a0of a new era of medical marketization. In the 1990s, when China started allowing the private sector to invest in public hospitals, the country’s medical industry became massively profitable.<\/p>\n

In 2000, the authorities prohibited private investment in\u00a0public hospitals, but lifted the ban on establishing private hospitals.<\/p>\n

Many hospitals in China have titles like \u201carmy,\u201d \u201cair force,\u201d and\u00a0\u201carmed police,\u201d and all of these military hospitals have been under the direct regulation by the People\u2019s Liberation Army, unlike the public facilities\u00a0supervised by the Health Department. These military hospitals have become strategic partners for the Putian faction.<\/p>\n

[…]\u00a0Putian-affiliated hospitals often claim that they have the world\u2019s most advanced medical treatment and the country’s most experienced doctors and can cure any kind of disease.<\/p>\n

According to Tencent news, Putian faction hospitals contributed 10 billion yuan\u00a0(the equivalent of 1.6 billion US dollars) to Baidu’s advertising revenue\u00a0in 2014. This\u00a0January, Baidu came\u00a0under fire for flooding\u00a0online communities with false claims and advertisements for unlicensed hospitals. [Source<\/a><\/strong>]<\/p><\/blockquote>\n

The Second\u00a0Armed Police Hospital announced on Wednesday that it will temporarily terminate admission of new patients as the medical center awaits investigation in connection to Wei’s case<\/a><\/strong>. At Reuters, Adam Jourdan reports:<\/p>\n

The Second Hospital of Beijing Armed Police Corps has stopped new admissions, the state-run People’s Daily said in a post on its official microblog, a day after the health ministry launched an investigation into the hospital.<\/p>\n

[…]\u00a0China’s paramilitary police, which ran the hospital, said it would cooperate fully with the probe.<\/p>\n

In a brief statement released on the Chinese military’s news website, the People’s Armed Police said it paid great attention to Wei’s case and had already sent its own team to the hospital.<\/p>\n

“Problems that are discovered will be seriously investigated and handled in accordance with the law, and there will be no compromises,” it said, without elaborating. [Source<\/a><\/strong>]<\/p><\/blockquote>\n

Medical corruption has long been an issue<\/a> in China, where patients face problems ranging from the sale of\u00a0spoiled vaccines<\/a>\u00a0to unethical medical malpractices<\/a>.<\/p>\n","protected":false},"excerpt":{"rendered":"

On Monday, Chinese authorities launched an investigation into Baidu’s unethical search ranking and advertising practices in response to public outrage over the\u00a0death of Wei Zexi, a 21-year-old college student who died last month after undergoing a bogus cancer treatment program advertised prominently on the search engine. Analysts believe the probe will likely end in harsh […]<\/p>\n","protected":false},"author":1088,"featured_media":193584,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_et_pb_use_builder":"","_et_pb_old_content":"","_et_gb_content_width":"","footnotes":"","_links_to":"","_links_to_target":""},"categories":[7,10,14744,14745,14746,6,5],"tags":[5957,2834,308,2249,6056,3900],"class_list":["post-193641","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-information-revolution","category-law","category-level-2-article","category-level-3-article","category-level-4-article","category-sci-tech","category-society","tag-baidu","tag-cancer","tag-health-care","tag-health-care-corruption","tag-medical-ethics","tag-medical-malpractice","et-has-post-format-content","et_post_format-et-post-format-standard"],"yoast_head":"\nBaidu Probe Exposes Chaos of China's Medical System<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"http:\/\/chinadigitaltimes.net\/2016\/05\/baidu-probe-exposes-chaos-of-chinas-medical-system\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Baidu Probe Exposes Chaos of China's Medical System\" \/>\n<meta property=\"og:description\" content=\"On Monday, Chinese authorities launched an investigation into Baidu’s unethical search ranking and advertising practices in response to public outrage over the\u00a0death of Wei Zexi, a 21-year-old college student who died last month after undergoing a bogus cancer treatment program advertised prominently on the search engine. 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