Law of the People's Republic of China on the Administration of Pharmaceutical Products

(Passed at the 7th Meeting of the Standing Committee of the Sixth National People's Congress on September 20, 1984; First Revision passed at the 20th Meeting of the Standing Committee of the Ninth National People's Congress on February 28, 2001; First Amendment based on the Decision on Amending Seven Laws, including the Law of the People's Republic of China on the Protection of Marine Environment, passed at the 6th Meeting of the Standing Committee of the Twelfth National People's Congress on December 28, 2013; Second Amendment based on the Decision on Amending the Law of the People's Republic of China on the Administration of Pharmaceutical Products, passed at the 14th Meeting of the Standing Committee of the Twelfth National People's Congress on April 24, 2015; Second Revision passed at the 12th Meeting of the Standing Committee of the Thirteenth National People's Congress on August 26, 2019)

Table of Contents

Chapter I General Provisions

Chapter II Development and Registration of Pharmaceutical Products

Chapter III Holders of Marketing Authorization for Pharmaceutical Products

Chapter IV Pharmaceutical Production

Chapter V Pharmaceutical Operation

Chapter VI Pharmaceutical Administration in Medical Institutions

Chapter VII Post-Marketing Management of Pharmaceutical Products

Chapter VIII Pharmaceutical Pricing and Advertising

Chapter IX Pharmaceutical Reserves and Supplies

Chapter X Supervision and Management

Chapter XI Legal Liabilities

Chapter XII Supplementary Provisions

（1）       Chapter I General Provisions

Article 1: This Law is enacted to strengthen the administration of pharmaceutical products, ensure the quality of pharmaceutical products, protect the safety and legitimate rights and interests of the public in medication, and safeguard and promote public health.

Article 2: This Law shall apply to the activities of pharmaceutical research, production, operation, use, and supervision and management conducted within the territory of the People's Republic of China.

The term "pharmaceutical products" as used in this Law refers to substances, including Chinese herbal medicines, chemical medicines, and biological products, that are used for the prevention, treatment, and diagnosis of human diseases, purposefully regulate human physiological functions with indications or specified therapeutic effects, usage, and dosage.

Article 3: The administration of pharmaceutical products shall be centered on the people's health, adhere to the principles of risk management, full-process control, and social governance, establish a scientific and strict system of supervision and management, comprehensively improve the quality of pharmaceutical products, and ensure the safety, efficacy, and accessibility of pharmaceutical products.

Article 4: The state develops modern medicines and traditional medicines, fully leveraging their roles in prevention, medical treatment, and healthcare.

The state protects the resources of wild medicinal materials and varieties of Chinese herbal medicines and encourages the cultivation of authentic Chinese medicinal materials.

Article 5: The state encourages research and innovation in new drugs and protects the legitimate rights and interests of citizens, legal persons, and other organizations in the research and development of new drugs.

Article 6: The state implements a system of marketing authorization holders for pharmaceutical products. The marketing authorization holders shall be responsible for the safety, efficacy, and controllability of pharmaceutical products throughout the process of research, production, operation, and use in accordance with the law.

Article 7: Those engaged in the activities of pharmaceutical research, production, operation, and use shall comply with laws, regulations, rules, standards, and norms, ensure the authenticity, accuracy, completeness, and traceability of information throughout the process.

Article 8: The competent department for the supervision and management of pharmaceutical products under the State Council shall be in charge of the national supervision and management of pharmaceutical products. The relevant departments of the State Council shall be responsible for the supervision and management of pharmaceutical products within their respective scope of duties. The competent department for the supervision and management of pharmaceutical products under the State Council shall cooperate with the relevant departments of the State Council in implementing the national development plan for the pharmaceutical industry and industrial policies.

The departments for the supervision and management of pharmaceutical products of the people's governments of provinces, autonomous regions, and municipalities directly under the Central Government shall be responsible for the supervision and management of pharmaceutical products within their respective administrative regions. The departments (referred to as the departments for the supervision and management of pharmaceutical products) designated by city-level and county-level people's governments shall assume the responsibilities of supervision and management of pharmaceutical products within their respective administrative regions. The relevant departments of local people's governments at or above the county level shall be responsible for the supervision and management of pharmaceutical products within their respective scope of duties.

Article 9: The people's governments at or above the county level shall be responsible for the supervision and management of pharmaceutical products within their respective administrative regions, unify the leadership, organization, and coordination of the supervision and management of pharmaceutical products and the response to pharmaceutical safety emergencies, and establish sound mechanisms for the supervision and management of pharmaceutical products and information sharing.

Article 10: The people's governments at or above the county level shall incorporate pharmaceutical safety work into the national economic and social development plans at their respective levels, include the funding for pharmaceutical safety work in the budgets of their respective governments, strengthen the capacity building for the supervision and management of pharmaceutical products, and provide guarantees for pharmaceutical safety work.

Article 11: The specialized technical institutions for pharmaceutical products set up or designated by the department for the supervision and management of pharmaceutical products shall undertake the evaluation, inspection, verification, monitoring, and evaluation work required for the implementation of the supervision and management of pharmaceutical products in accordance with the law.

Article 12: The state shall establish and improve a traceability system for pharmaceutical products. The department for the supervision and management of pharmaceutical products under the State Council shall formulate unified standards and specifications for the traceability of pharmaceutical products, promote the interoperability and sharing of information on pharmaceutical product traceability, and achieve traceability of pharmaceutical products.

The state shall establish a drug vigilance system to monitor, identify, evaluate, and control adverse reactions and other harmful reactions related to medication.

Article 13: The people's governments at all levels and their relevant departments, pharmaceutical industry associations, and others shall strengthen the publicity and education on pharmaceutical safety, and carry out popularization of knowledge on pharmaceutical safety laws and regulations.

News media shall conduct public service propaganda on pharmaceutical safety laws and regulations and supervise drug-related illegal activities. Reports on pharmaceuticals shall be comprehensive, scientific, objective, and fair.

Article 14: Pharmaceutical industry associations shall strengthen self-discipline, establish and improve industry norms, promote the construction of an integrity system in the industry, and guide and supervise members to conduct pharmaceutical production and operation activities in accordance with the law.

Article 15: The people's governments at or above the county level and their relevant departments shall give recognition and rewards to units and individuals who have made outstanding contributions in the work of pharmaceutical research, production, operation, use, and supervision and management in accordance with relevant state regulations.

Chapter II Development and Registration of Pharmaceutical Products

Article 16: The state supports the innovation of drugs based on clinical value and with clear or special therapeutic effects on human diseases. It encourages the development of new drugs with new therapeutic mechanisms, for the treatment of severe life-threatening diseases, rare diseases, and with multi-targeted systemic regulatory intervention functions in the human body, among others, to promote technological progress in pharmaceuticals.

The state encourages the use of modern science and technology and traditional Chinese medicine research methods to carry out scientific and technological research on Chinese herbal medicines and the development of drugs, establish and improve a technical evaluation system that is in line with the characteristics of Chinese herbal medicines, and promote the inheritance and innovation of Chinese herbal medicines.

The state shall take effective measures to encourage the development and innovation of medicines for children, support the development of new varieties, dosage forms, and specifications of medicines for children that are in line with the physiological characteristics of children, and give priority to the review and approval of medicines for children. Article 17: When engaging in the development of pharmaceuticals, it is necessary to comply with the quality management specifications for non-clinical research on drugs and the quality management specifications for clinical trials of drugs, ensuring that the entire process of pharmaceutical development continuously meets legal requirements.

The quality management specifications for non-clinical research on drugs and the quality management specifications for clinical trials of drugs are formulated by the drug regulatory authorities under the State Council in conjunction with relevant departments of the State Council.

Article 18: When conducting non-clinical research on drugs, it should comply with relevant national regulations and have personnel, facilities, equipment, instruments, and management systems suitable for the research project, ensuring the authenticity of related data, information, and samples.

Article 19: When conducting clinical trials of drugs, it should submit truthfully the research methods, quality indicators, pharmacological and toxicological test results, and other related data, information, and samples in accordance with the regulations of the drug regulatory authorities under the State Council, and obtain approval from the drug regulatory authorities under the State Council. The drug regulatory authorities under the State Council should decide whether to approve and notify the applicant of the clinical trial within 60 working days from the date of accepting the clinical trial application. If no notification is given within the specified period, it is considered as approval. For conducting bioequivalence trials, it should be filed with the drug regulatory authorities under the State Council.

Clinical trials of drugs should be conducted in clinical trial institutions that meet the corresponding requirements. Clinical trial institutions for drugs should implement a filing management system, and specific measures should be jointly formulated by the drug regulatory authorities under the State Council and the health administration authorities under the State Council.

Article 20: When conducting clinical trials of drugs, it should comply with ethical principles, formulate clinical trial protocols, and obtain approval from the ethics committee.

The ethics committee should establish a work system for ethical review, ensuring that the ethical review process is independent, objective, and fair, supervising and regulating the conduct of clinical trials of drugs, protecting the legitimate rights and interests of subjects, and safeguarding public interests.

Article 21: During the implementation of clinical trials of drugs, the purpose and detailed information about the clinical trial, including risks, should be truthfully explained and interpreted to the subjects or their guardians. Informed consent forms voluntarily signed by the subjects or their guardians should be obtained, and effective measures should be taken to protect the legitimate rights and interests of the subjects.

Article 22: If safety issues or other risks are discovered during the course of a clinical trial, the sponsor of the clinical trial should promptly adjust the clinical trial protocol, suspend or terminate the clinical trial, and report to the drug regulatory authorities under the State Council. When necessary, the drug regulatory authorities under the State Council may order the adjustment of the clinical trial protocol, suspension, or termination of the clinical trial.

Article 23: For drugs being tested in clinical trials for the treatment of severe life-threatening diseases for which there are no effective treatment methods available, and if there is a potential benefit based on medical observations and it complies with ethical principles, it may be used in other patients with the same condition within the institution where the clinical trial is conducted, after review and informed consent.

Article 24: Drugs marketed within China should be approved by the drug regulatory authorities under the State Council and obtain a drug registration certificate, except for traditional Chinese medicinal materials and Chinese herbal pieces that are not subject to approval. The catalog of traditional Chinese medicinal materials and Chinese herbal pieces subject to approval is formulated by the drug regulatory authorities under the State Council in conjunction with the competent department of traditional Chinese medicine under the State Council.

Article 25: The competent department of drug supervision and administration under the State Council shall organize pharmaceutical, medical, and other technical personnel to conduct evaluations on the safety, efficacy, and quality controllability of the applied drugs, as well as the applicant's quality management, risk prevention and control, and liability compensation capabilities. If the conditions are met, a drug registration certificate shall be issued.

When approving drugs, the competent department of drug supervision and administration under the State Council shall also evaluate and approve the active pharmaceutical ingredients, related excipients, packaging materials, and containers directly in contact with the drugs, as well as the quality standards, production processes, labels, and instructions of the drugs.

The term "excipients" referred to in this law means the excipients and additives used in the production of drugs and the preparation of prescriptions.

Article 26: For diseases that are seriously life-threatening and have no effective treatment methods, as well as urgently needed drugs in public health, if the clinical trial of the drug has data showing its efficacy and its clinical value can be predicted, conditional approval may be granted, and relevant matters shall be specified in the drug registration certificate.

Article 27: The competent department of drug supervision and administration under the State Council shall improve the drug evaluation and approval system, strengthen capacity building, establish and improve mechanisms for communication and consultation with experts, optimize the evaluation and approval process, and improve the efficiency of evaluation and approval.

The evaluation conclusions and basis for the approval of marketed drugs shall be made public in accordance with the law and subject to social supervision. Commercial secrets learned during the evaluation and approval process shall be kept confidential.

Article 28: Drugs shall comply with national drug standards. If the quality standards of a drug approved by the competent department of drug supervision and administration under the State Council are higher than the national drug standards, the approved drug quality standards shall be followed. If there are no national drug standards, the approved drug quality standards shall be followed.

The "Pharmacopoeia of the People's Republic of China" and drug standards promulgated by the competent department of drug supervision and administration under the State Council are national drug standards.

The competent department of drug supervision and administration under the State Council, together with the competent department of health under the State Council, shall organize the Pharmacopoeia Commission to be responsible for the formulation and revision of national drug standards.

The drug inspection institutions established or designated by the competent department of drug supervision and administration under the State Council shall be responsible for standardizing national drug reference standards and control samples.

Article 29: The names of drugs included in the national drug standards are generic names. Once a name has been designated as a generic name for a drug, it shall not be used as a trademark for drugs.

Chapter III: Holder of Drug Marketing Authorization

Article 30: The holder of a drug marketing authorization refers to an enterprise or a drug research institution that obtains a drug registration certificate.

The holder of a drug marketing authorization shall fulfill the responsibilities for non-clinical research, clinical trials, production and operation, post-marketing research, adverse reaction monitoring and reporting, and handling in accordance with this law. Other units and individuals engaged in drug research, production, operation, storage, transportation, and use shall assume corresponding responsibilities in accordance with the law.

The legal representative and the principal responsible person of the holder of a drug marketing authorization shall be fully responsible for the quality of the drugs.

Article 31: The holder of a drug marketing authorization shall establish a drug quality assurance system and appoint dedicated personnel responsible for drug quality management.

The holder of a drug marketing authorization shall conduct regular audits of the quality management system of entrusted drug production enterprises and drug operation enterprises and supervise their continuous capability to ensure quality.

Article 32: The holder of a drug marketing authorization may produce drugs themselves or entrust a drug manufacturing enterprise to produce them.

If the holder of a drug marketing authorization produces drugs themselves, they must obtain a drug production license in accordance with the provisions of this law. If they entrust the production to another party, they must entrust it to a qualified drug manufacturing enterprise. The holder of a drug marketing authorization and the entrusted manufacturing enterprise should sign an agreement and quality agreement and strictly fulfill the obligations stipulated in the agreement.

The State Council's drug regulatory authority shall formulate guidelines for quality agreements for the entrusted production of drugs, guiding and supervising the fulfillment of drug quality assurance obligations by the holders of drug marketing authorizations and the entrusted manufacturing enterprises.

Blood products, narcotic drugs, psychotropic drugs, toxic drugs for medical use, and drug precursor chemicals are not allowed to be entrusted for production, except as otherwise specified by the State Council's drug regulatory authority.

Article 33: The holder of a drug marketing authorization shall establish drug release procedures for drugs produced by drug manufacturing enterprises, and the drugs can only be released after review and authorization by the authorized quality personnel. Drugs that do not meet the national drug standards shall not be released.

Article 34: The holder of a drug marketing authorization can sell drugs with their registered certificate themselves or entrust a drug distribution enterprise to sell them. If the holder engages in drug retail activities, they must obtain a drug distribution license.

If the holder of a drug marketing authorization sells drugs themselves, they must meet the conditions specified in Article 52 of this law. If they entrust the sales to another party, they must entrust it to a qualified drug distribution enterprise. The holder of a drug marketing authorization and the entrusted distribution enterprise should sign an agreement and strictly fulfill the obligations stipulated in the agreement.

Article 35: If the holder of a drug marketing authorization, a drug manufacturing enterprise, or a drug distribution enterprise entrusts the storage and transportation of drugs to another party, they shall evaluate the entrusted party's capability for quality assurance and risk management, sign an entrusted agreement with them, and specify the responsibilities for drug quality and operating procedures, etc., and supervise the entrusted party.

Article 36: The holder of a drug marketing authorization, a drug manufacturing enterprise, a drug distribution enterprise, and medical institutions shall establish and implement a drug traceability system, provide traceability information as required, and ensure the traceability of drugs.

Article 37: The holder of a drug marketing authorization shall establish an annual reporting system and report annually to the drug regulatory authority of the provincial, autonomous regional, or municipal people's government on drug production and sales, post-marketing research, risk management, and other situations in accordance with the regulations.

Article 38: If the holder of a drug marketing authorization is a foreign enterprise, they shall authorize a corporate legal person designated by them within the territory of China to fulfill the obligations of the holder of the drug marketing authorization and assume joint liability with the holder of the drug marketing authorization.

Article 39: Chinese medicinal materials production enterprises shall fulfill the relevant obligations of the holder of a drug marketing authorization, implement full-process management for the production and sale of Chinese medicinal materials, establish a Chinese medicinal material traceability system, and ensure the safety, effectiveness, and traceability of Chinese medicinal materials.

Article 40: With the approval of the State Council's drug regulatory authority, the holder of a drug marketing authorization may transfer the drug marketing authorization. The transferee shall have the ability to ensure the safety, effectiveness, and quality controllability of the drug, as well as the ability to perform the obligations of the holder of the drug marketing authorization, such as quality management, risk prevention and control, and liability compensation.

Chapter IV: Drug Production

Article 41: Those engaged in drug production activities must obtain a drug production license from the drug regulatory authority of the provincial, autonomous regional, or municipal people's government where they are located. Without a drug production license, drugs must not be produced.

The drug production license shall indicate the validity period and scope of production, and it shall be re-examined and issued upon expiration.

Article 42: Those engaged in drug production activities must meet the following conditions:

(1) They must have pharmacy technicians, engineering technicians, and corresponding technical workers who have been qualified and certified according to the law.

(2) They must have appropriate workshops, facilities, and sanitary environments suitable for drug production.

(3) They must have institutions, personnel, and necessary instruments and equipment to ensure quality management and quality inspection of the drugs produced.

(4) They must have regulations and systems to ensure drug quality and comply with the drug production quality management specifications formulated by the State Council's drug regulatory authority based on this law.

Article 43: Those engaged in drug production activities must comply with the drug production quality management specifications, establish and improve a drug production quality management system, and ensure that the entire process of drug production continuously meets the statutory requirements.

The legal representative and the principal person in charge of a drug manufacturing enterprise are fully responsible for the drug production activities of the enterprise.

Article 44: Drugs shall be produced in accordance with the national drug standards and approved production processes of the drug regulatory authority. Production and inspection records must be complete and accurate, and must not be fabricated.

Chinese herbal pieces should be prepared in accordance with the national drug standards. If the national drug standards do not specify, they should be prepared in accordance with the preparation specifications formulated by the drug regulatory authority of the provincial, autonomous regional, or municipal people's government. The preparation specifications formulated by the drug regulatory authority of the provincial, autonomous regional, or municipal people's government shall be filed with the State Council's drug regulatory authority. Drugs that do not comply with the national drug standards or the preparation specifications formulated by the drug regulatory authority of the provincial, autonomous regional, or municipal people's government must not be released or sold.

Article 45: The raw materials and excipients required for drug production shall meet the requirements for pharmaceutical use and the relevant requirements of the drug production quality management specifications.

When producing drugs, the suppliers of raw materials and excipients should be audited according to the regulations to ensure that the purchased and used raw materials and excipients comply with the requirements specified in the preceding paragraph.

Article 46: The packaging materials and containers that come into direct contact with pharmaceuticals shall meet the pharmaceutical requirements and comply with standards that ensure human health and safety. The drug regulatory authority shall order the cessation of use of packaging materials and containers that do not meet the prescribed standards.

Article 47: Pharmaceutical manufacturers shall conduct quality inspections of their products. Drugs that do not meet the national drug standards shall not be released for sale. Pharmaceutical manufacturers shall establish procedures for the release of products, clearly specifying the standards and conditions for release. Only products that meet the prescribed standards and conditions shall be released after being signed by the authorized quality personnel.

Article 48: Drug packaging shall meet the quality requirements of the drugs and facilitate storage, transportation, and medical use. Packaging is required for the transportation of traditional Chinese medicinal materials. Each package shall indicate the product name, place of origin, date, supplier, and be accompanied by a qualified quality mark.

Article 49: Drug packaging shall be labeled or accompanied by instructions as prescribed. The label or instructions shall indicate the generic name, ingredients, specifications, the holder of the marketing authorization and their address, the manufacturing enterprise and its address, approval number, product batch number, production date, expiration date, indications or main therapeutic functions, usage, dosage, contraindications, adverse reactions, and precautions. The text on labels and instructions shall be clear, and production dates, expiration dates, and other relevant information shall be prominently marked and easily identifiable. Labels and instructions for anesthetic drugs, psychotropic drugs, medical toxic drugs, radioactive drugs, topical drugs, and non-prescription drugs shall bear the prescribed symbols.

Article 50: The marketing authorization holders, pharmaceutical manufacturers, pharmaceutical distributors, and personnel directly involved in handling drugs in medical institutions shall undergo annual health examinations. Individuals with infectious diseases or other illnesses that may contaminate drugs shall not engage in direct contact with drugs.

Chapter 5: Pharmaceutical Operations

Article 51: Wholesale activities of pharmaceuticals shall be subject to approval by the drug regulatory authority of the provincial, autonomous regional, or municipal people's government where the activities are conducted, and a pharmaceutical operation license shall be obtained. Retail activities of pharmaceuticals shall be subject to approval by the drug regulatory authority of the local people's government at or above the county level where the activities are conducted, and a pharmaceutical operation license shall be obtained. It is prohibited to engage in pharmaceutical operations without a pharmaceutical operation license. The pharmaceutical operation license shall indicate its validity period and scope of operations, and it shall be reviewed and reissued upon expiration. When granting pharmaceutical operation licenses, the drug regulatory authority shall also adhere to the principle of facilitating public access to medicines, in addition to meeting the conditions specified in Article 52 of this Law.

Article 52: The following conditions shall be met for engaging in pharmaceutical operations:

(1) Having qualified pharmacists or other pharmaceutical professionals recognized in accordance with the law;

(2) Having business premises, equipment, storage facilities, and sanitary conditions suitable for the pharmaceuticals being operated;

(3) Having a quality management organization or personnel suitable for the pharmaceuticals being operated;

(4) Having established rules and regulations to ensure the quality of pharmaceuticals and comply with the pharmaceutical operation quality management requirements formulated by the State Council's drug regulatory authority in accordance with this Law.

Article 53: When engaging in pharmaceutical operations, compliance with pharmaceutical operation quality management requirements shall be observed, and a sound pharmaceutical operation quality management system shall be established to ensure that the entire process of pharmaceutical operations continuously meets the legal requirements. The state encourages and guides the retail chain operation of pharmaceuticals. The headquarters of enterprises engaged in pharmaceutical retail chain operations shall establish a unified quality management system and assume management responsibility for the operations of their affiliated retail enterprises. The legal representative and the main person in charge of a pharmaceutical operation enterprise shall be fully responsible for the pharmaceutical operation activities of the enterprise.

Article 54: The state implements a classification management system for prescription and non-prescription drugs. Specific measures shall be formulated by the State Council's drug regulatory authority in conjunction with the competent health authority of the State Council.

Article 55: The marketing authorization holders, pharmaceutical manufacturers, pharmaceutical distributors, and medical institutions shall purchase drugs from marketing authorization holders or enterprises with pharmaceutical production and operation qualifications, except for Chinese medicinal materials that are not subject to approval management.

Article 56: Pharmaceutical distribution enterprises shall establish and implement a system for inspection and acceptance of purchased drugs, verifying the qualification certificates and other marks. Drugs that do not meet the prescribed requirements shall not be purchased or sold.

Article 57: Pharmaceutical distribution enterprises shall maintain accurate and complete records of drug purchases and sales. The purchase and sales records shall indicate the generic name, dosage form, specifications, product batch number, expiration date, marketing authorization holder, manufacturing enterprise, purchasing and selling units, quantities, prices, dates of purchase and sale, and other information prescribed by the State Council's drug regulatory authority.

Article 58: Pharmaceutical distribution enterprises shall accurately and correctly dispense drugs and provide instructions on usage, dosage, and precautions. Prescription dispensing shall be checked, and changes or substitutions to the drugs listed in the prescription shall not be made without authorization. Prescription dispensing for incompatible combinations or excessive dosages shall be refused, and if necessary, it shall be corrected or re-signed by the prescribing physician before dispensing.

Pharmaceutical distribution enterprises selling traditional Chinese medicinal materials shall indicate the place of origin. Qualified pharmacists or other pharmaceutical professionals recognized in accordance with the law shall be responsible for pharmaceutical management, prescription review and dispensing, and guidance on rational use of drugs in their respective enterprises.

Article 59: Pharmaceutical distribution enterprises shall establish and implement a drug storage system, taking necessary measures for refrigeration, antifreeze, moisture-proofing, insect-proofing, and rodent-proofing to ensure drug quality. Inspection procedures shall be implemented for drug storage and delivery.

Article 60: Traditional Chinese medicinal materials may be sold in urban and rural market trade markets, except as otherwise stipulated by the State Council.

Article 61: Marketing authorization holders and pharmaceutical distribution enterprises selling drugs through the internet shall comply with the relevant provisions of this Law regarding pharmaceutical operations. Specific management measures shall be formulated by the State Council's drug regulatory authority in conjunction with other relevant departments, including the competent health authority of the State Council. Vaccines, blood products, anesthetic drugs, psychotropic drugs, medical toxic drugs, radioactive drugs, and drug-like precursor chemicals subject to special management by the state shall not be sold online.

Article 62: Providers of online third-party platforms for drug trading shall file records with the drug regulatory authorities of the provincial, autonomous regional, or municipal people's governments where they are located, in accordance with the provisions of the State Council's drug supervision and administration department.

Third-party platform providers shall lawfully review the qualifications of the drug marketing authorization holders and drug operating enterprises applying to operate on the platform, ensuring compliance with statutory requirements, and manage drug trading activities occurring on the platform.

If third-party platform providers discover any violations of this law by the drug marketing authorization holders or drug operating enterprises operating on the platform, they shall promptly take measures to stop such violations and immediately report to the county-level people's government drug regulatory authority where they are located. If serious violations are discovered, they shall immediately cease providing online trading platform services.

Article 63: Newly discovered medicinal materials and imported medicinal materials introduced from overseas may be sold only after approval by the State Council's drug regulatory authority.

Article 64: Drugs shall be imported through ports authorized for drug importation and the enterprises importing drugs shall file records with the local drug regulatory authority at the port. Customs shall clear the goods upon presentation of the drug clearance form issued by the drug regulatory authority. Goods without the drug clearance form shall not be released by customs.

The local drug regulatory authority at the port shall notify the drug inspection institution to conduct random inspections and testing of imported drugs in accordance with the provisions of the State Council's drug regulatory authority.

The ports authorized for drug importation shall be proposed by the State Council's drug regulatory authority in conjunction with the General Administration of Customs and submitted to the State Council for approval.

Article 65: Medical institutions may import a small quantity of drugs urgently needed for clinical purposes upon approval by the State Council's drug regulatory authority or the people's government of a province, autonomous region, or municipality authorized by the State Council. The imported drugs shall be used for specific medical purposes within designated medical institutions.

Individuals carrying a small quantity of drugs for personal use upon entry shall comply with relevant national regulations.

Article 66: Imported and exported narcotic drugs and psychotropic drugs within the scope defined by the state shall be accompanied by an import permit or an export permit issued by the State Council's drug regulatory authority.

Article 67: The importation of drugs that have uncertain efficacy, significant adverse reactions, or pose risks to human health due to other reasons is prohibited.

Article 68: Prior to the sale or importation of the following drugs, the State Council's drug regulatory authority shall designate a drug inspection institution for testing. Drugs that have not been tested or have failed the test shall not be sold or imported:

(1) Drugs being sold for the first time in China;

(2) Biologics specified by the State Council's drug regulatory authority;

(3) Other drugs specified by the State Council.

Chapter 6: Pharmaceutical Management in Medical Institutions

Article 69: Medical institutions shall employ licensed pharmacists or other pharmaceutical professionals who have been certified according to the law to be responsible for drug management, prescription review and dispensing, and rational drug use guidance. Non-pharmaceutical professionals are not allowed to engage directly in pharmaceutical technical work.

Article 70: Medical institutions shall establish and implement a system for inspecting and accepting purchased drugs, verifying drug quality certificates and other labels. Drugs that do not meet the requirements shall not be purchased or used.

Article 71: Medical institutions shall have premises, facilities, storage facilities, and sanitary environments suitable for the drugs they use, establish and implement a drug storage system, and take necessary measures such as refrigeration, antifreeze, moisture-proofing, insect and rodent control to ensure drug quality.

Article 72: Medical institutions should adhere to the principles of safe, effective, and cost-effective medication. They should follow the principles of rational drug use, such as clinical practice guidelines, clinical treatment guidelines, and drug package inserts, and review the appropriateness of physician prescriptions and medication orders.

Other drug use units outside of medical institutions should comply with the provisions of this law regarding the use of drugs in medical institutions.

Article 73: Pharmacists or other pharmaceutical technical personnel who are qualified and certified according to the law should verify and check prescriptions when dispensing medications. They must not alter or substitute the drugs listed in the prescription without authorization. Prescriptions with incompatible combinations or excessive doses should be refused for dispensing. If necessary, with the correction or re-signing by the prescribing physician, they can be dispensed.

Article 74: Medical institutions that prepare pharmaceutical preparations should obtain a medical institution preparation license approved by the drug regulatory authority of the provincial, autonomous region, or municipality directly under the central government. Preparation of preparations without a medical institution preparation license is prohibited.

The medical institution preparation license should indicate its validity period, and it should be reviewed and reissued upon expiration.

Article 75: Medical institutions that prepare pharmaceutical preparations should have facilities, management systems, testing equipment, and sanitary environments that ensure the quality of preparations. The raw materials, excipients, packaging materials, and other necessary items used should meet the requirements for medicinal use.

Article 76: Preparations prepared by medical institutions should be varieties that are clinically needed by the unit but not available in the market, and they should be approved by the drug regulatory authority of the provincial, autonomous region, or municipality directly under the central government. However, this provision does not apply to the preparation of traditional Chinese medicine preparations that are otherwise regulated by law.

Preparations prepared by medical institutions should undergo quality inspection according to regulations. If qualified, they can be used within the unit based on physician prescriptions. Preparations prepared by medical institutions that have been approved by the State Council's drug regulatory authority or the drug regulatory authority of the provincial, autonomous region, or municipality directly under the central government can be distributed and used among designated medical institutions.

Preparations prepared by medical institutions must not be sold on the market.

Chapter 7: Post-Marketing Management of Drugs

Article 77: The holder of a drug marketing authorization should develop a post-marketing risk management plan, proactively conduct post-marketing studies, further confirm the safety, effectiveness, and quality controllability of the drug, and strengthen the continuous management of marketed drugs.

Article 78: For drugs granted conditional approval, the holder of the drug marketing authorization should take corresponding risk management measures and complete the required studies within the specified time limit. If the studies are not completed as required within the specified time limit or if it cannot be demonstrated that the benefits outweigh the risks, the drug regulatory authority under the State Council should handle it in accordance with the law, including revoking the drug registration certificate.

Article 79: Changes in the drug manufacturing process should be classified and managed based on the risks to the safety, effectiveness, and quality controllability of the drug and the degree of impact. Major changes require approval from the drug regulatory authority under the State Council, while other changes should be recorded or reported as specified by the drug regulatory authority under the State Council.

The holder of the drug marketing authorization should comprehensively assess and verify the impact of the changes on the safety, effectiveness, and quality controllability of the drug in accordance with the regulations of the drug regulatory authority under the State Council.

Article 80: The holder of the drug marketing authorization should conduct post-marketing adverse reaction monitoring, proactively collect and track, analyze suspected drug adverse reaction information, and take timely risk control measures for identified risks.

Article 81: The holders of drug marketing authorizations, drug manufacturers, drug distributors, and medical institutions should regularly assess the quality, efficacy, and adverse reactions of the drugs they produce, distribute, or use. If suspected adverse reactions are discovered, they should promptly report them to the drug regulatory authority and the health authority. The specific measures shall be formulated by the drug regulatory authority under the State Council in conjunction with the health authority.

For drugs with confirmed serious adverse reactions, the drug regulatory authority under the State Council or the drug regulatory authority of the provincial, autonomous region, or municipality directly under the central government shall take emergency control measures, such as suspending production, sales, and use, based on the actual circumstances. Within five days, an evaluation shall be organized, and an administrative decision shall be made in accordance with the law within 15 days from the date of the evaluation conclusion.

Article 82: If a drug has quality issues or other safety hazards, the holder of the drug marketing authorization shall immediately cease sales, inform relevant drug distributors and medical institutions to stop sales and use, recall the sold drugs, promptly disclose recall information, and if necessary, suspend production. The recall and disposal of drugs and the situation shall be reported to the drug regulatory authority and the health authority of the provincial, autonomous region, or municipality directly under the central government. Drug manufacturers, distributors, and medical institutions should cooperate.

If the holder of the drug marketing authorization fails to recall a drug as required by law, the drug regulatory authority of the provincial, autonomous region, or municipality directly under the central government shall order the recall.

Article 83: The holders of drug marketing authorizations should conduct regular post-marketing evaluations of the safety, efficacy, and quality controllability of the drugs on the market. When necessary, the drug regulatory authority under the State Council may order the holders of drug marketing authorizations to conduct post-marketing evaluations or directly organize such evaluations.

Based on the evaluation results, drugs with uncertain efficacy, significant adverse reactions, or other reasons that pose harm to human health should have their drug registration certificates canceled.

Drugs with canceled drug registration certificates shall not be produced, imported, sold, or used.

Drugs with canceled drug registration certificates or drugs that have expired should be supervised and destroyed by the drug regulatory authority in accordance with the law or subjected to other harmless disposal measures.

Chapter 8: Drug Pricing and Advertising

Article 84: The state will improve the drug procurement management system, monitor drug prices, conduct cost price investigations, strengthen supervision and inspection of drug prices, investigate and handle drug price violations such as price monopolies and price hikes in accordance with the law, and maintain the order of drug prices.

Article 85: For drugs subject to market-regulated pricing, holders of drug marketing authorizations, drug manufacturers, drug distributors, and medical institutions should set prices based on the principles of fairness, reasonableness, honesty and credibility, and matching quality and price, providing reasonably priced drugs to users.

Holders of drug marketing authorizations, drug manufacturers, drug distributors, and medical institutions should comply with the regulations of the drug pricing authority of the State Council regarding drug price management, establish and indicate the retail prices of drugs, and prohibit acts of profiteering, price monopolies, and price fraud.

Article 86: Holders of drug marketing authorizations, drug manufacturers, drug distributors, and medical institutions should provide the drug pricing authority with actual purchase and sale prices, sales quantities, and other information about their drugs in accordance with the law.

Article 87: Medical institutions should provide patients with a price list of the drugs used, truthfully disclose the prices of commonly used drugs as required, and strengthen the management of rational drug use. The specific measures shall be formulated by the health authority under the State Council.

Article 88: It is prohibited for holders of drug marketing authorizations, drug manufacturers, drug distributors, and medical institutions to provide or accept kickbacks or other improper benefits in drug procurement.

It is prohibited for holders of drug marketing authorizations, drug manufacturers, drug distributors, or their agents to provide financial or other improper benefits to the heads of medical institutions, drug purchasers, physicians, pharmacists, and other relevant personnel involved in the use of their drugs. It is also prohibited for the heads of medical institutions, drug purchasers, physicians, pharmacists, and other relevant personnel to accept financial or other improper benefits provided by holders of drug marketing authorizations, drug manufacturers, drug distributors, or their agents.

Article 89: Drug advertising must be approved by the advertising review authority designated by the people's government of the province, autonomous region, or municipality directly under the central government where the advertiser is located; unauthorized advertising shall not be published.

Article 90: The content of drug advertising shall be truthful and legal, based on the drug instructions approved by the drug regulatory authority of the State Council, and shall not contain false information.

Drug advertisements shall not contain assertions or guarantees regarding efficacy and safety; the names or images of state organs, research institutes, academic institutions, industry associations, experts, scholars, physicians, pharmacists, patients, etc., shall not be used for recommendation or endorsement.

Non-drug advertisements shall not involve drug promotion.

Article 91: If there are no provisions regarding drug pricing and advertising in this law, the relevant provisions of the "Price Law of the People's Republic of China," "Anti-Monopoly Law of the People's Republic of China," "Anti-Unfair Competition Law of the People's Republic of China," "Advertising Law of the People's Republic of China," and other laws and regulations shall apply.

Chapter 9: Drug Reserve and Supply

Article 92: The state implements a drug reserve system, establishing central and local levels of drug reserves.

During major disasters, epidemics, or other emergencies, drugs may be urgently requisitioned in accordance with the provisions of the "Emergency Response Law of the People's Republic of China."

Article 93: The state implements a basic drug system, selects an appropriate number of essential drug varieties, strengthens organized production and reserve, improves the supply capacity of essential drugs, and meets the basic medication needs for disease prevention and treatment.

Article 94: The state establishes a drug supply and demand monitoring system, promptly collects and collates information on the supply and demand of drugs in short supply, issues warnings for drugs in short supply, and takes corresponding measures.

Article 95: The state implements a management system for the list of drugs in short supply. The specific measures shall be formulated by the health authority under the State Council in conjunction with the drug regulatory authority of the State Council and other relevant departments.

If a holder of a drug marketing authorization stops the production of a drug in short supply, it shall report to the drug regulatory authority under the State Council or the drug regulatory authority of the provincial, autonomous region, or municipality directly under the central government in accordance with the regulations.

Article 96: The state encourages the development and production of drugs in short supply and gives priority to the expedited evaluation and approval of new drugs for short-supply drugs needed in clinical emergencies, prevention and treatment of major infectious diseases, rare diseases, and other diseases.

Article 97: The State Council may restrict or prohibit the export of drugs in short supply. When necessary, relevant departments of the State Council may take measures such as organizing production, price intervention, and expanding imports to ensure drug supply. Holders of drug marketing authorizations, drug manufacturers, and drug business operators shall ensure the production and supply of drugs in accordance with regulations.

Chapter 10: Supervision and Administration

Article 98: Production (including compounding), sale, and use of counterfeit drugs and substandard drugs are prohibited. The following situations are considered counterfeit drugs:

The ingredients of the drugs do not comply with the ingredients specified in the national drug standards.

Non-drugs are presented as drugs or drugs of a different kind are presented as this kind of drug.

Deteriorated drugs.

The indications or therapeutic functions indicated by the drugs exceed the specified range.

The following situations are considered substandard drugs:

The content of drug ingredients does not comply with the national drug standards.

Contaminated drugs.

Drugs without or with altered expiration dates.

Drugs without or with altered product batch numbers.

Expired drugs.

Drugs with unauthorized additives or excipients.

Other drugs that do not meet the drug standards.

The production and importation of drugs without obtaining the drug approval certificate are prohibited; the use of active pharmaceutical ingredients, packaging materials, and containers in drug production without being evaluated and approved as required is prohibited.

Article 99: The drug regulatory authority shall supervise and inspect activities such as drug research, production, operation, and drug use by drug use units in accordance with laws and regulations. When necessary, it may conduct extended inspections of units and individuals that provide products or services for drug research, production, operation, and use. The relevant units and individuals shall cooperate and shall not refuse or conceal.

The drug regulatory authority shall conduct focused inspections on high-risk drugs. In cases where there is evidence of potential safety hazards, the drug regulatory authority, based on the results of the inspection, shall issue warnings, interviews, deadlines for rectification, and measures such as suspending production, sale, use, and importation, and shall promptly announce the inspection and handling results.

When conducting inspections, the drug regulatory authority shall present the certification documents and shall keep confidential any trade secrets obtained during the inspection.

Article 100: The drug regulatory authority may conduct random inspections and testing of drug quality as required by the supervision and management. Sampling for inspection shall be carried out according to the regulations and shall not involve any charges; samples shall be purchased for sampling. The necessary expenses shall be provided according to the regulations of the State Council.

For drugs and related materials that have evidence indicating potential harm to human health, the drug regulatory authority may seal and detain them and make administrative decisions within seven days; if the drugs need to be tested, administrative decisions shall be made within fifteen days from the date of issuance of the test report.

Article 101: The drug regulatory authority of the State Council and the drug regulatory authorities of provinces, autonomous regions, and municipalities directly under the central government shall regularly announce the results of random inspections and testing of drug quality. If the announcement is improper, it shall be rectified within the scope of the original announcement.

Article 102: If a party has objections to the results of a drug inspection, they may, within seven days from the date of receiving the drug inspection results, apply for re-inspection to the original drug inspection institution or the drug inspection institution designated by the higher-level drug supervision and administration department. They may also directly apply for re-inspection to the drug inspection institution designated by the State Council's drug supervision and administration department. The drug inspection institution accepting the re-inspection shall make a re-inspection conclusion within the time prescribed by the State Council's drug supervision and administration department.

Article 103: The drug supervision and administration department shall inspect and supervise the compliance with the statutory requirements of drug production quality management standards, drug operation quality management standards, non-clinical research quality management standards for drugs, clinical trial quality management standards for drugs, etc., by drug marketing authorization holders, drug manufacturers, drug business operators, non-clinical safety evaluation research institutions, and drug clinical trial institutions, etc., to ensure their continuous compliance.

Article 104: The country establishes a professional and specialized team of drug inspectors. Inspectors shall be familiar with drug laws and regulations and possess professional knowledge of drugs.

Article 105: The drug supervision and administration department shall establish a credit file for drug safety for drug marketing authorization holders, drug manufacturers, drug business operators, non-clinical safety evaluation research institutions, drug clinical trial institutions, and medical institutions. The file shall record the issuance of licenses, results of routine supervision and inspections, and investigations and handling of illegal activities, and shall be published to the public in accordance with the law and updated in a timely manner. For those with records of adverse credit, the frequency of supervision and inspections shall be increased, and joint disciplinary actions may be implemented in accordance with national regulations.

Article 106: The drug supervision and administration department shall publicize its email address and telephone number, accept inquiries, complaints, and reports, and shall respond, verify, and handle them promptly in accordance with the law. Reporters who provide verified information shall be rewarded in accordance with relevant regulations.

The drug supervision and administration department shall keep the information of informants confidential and protect their legitimate rights and interests. If the informant reports the unit they belong to, the unit shall not retaliate against the informant by terminating or changing their labor contract or by other means.

Article 107: The country implements a unified system for the public announcement of drug safety information. The State Council's drug supervision and administration department shall uniformly publish the general situation of drug safety, drug safety risk warning information, information on significant drug safety incidents and their investigation and handling, and other information that needs to be uniformly published by the State Council. If the impact of drug safety risk warning information and significant drug safety incidents and their investigation and handling is limited to specific regions, they may also be published by the drug supervision and administration departments of relevant provinces, autonomous regions, and municipalities directly under the central government. The above-mentioned information shall not be released without authorization.

The publication of drug safety information shall be timely, accurate, comprehensive, and accompanied by necessary explanations to avoid misleading.

No unit or individual shall fabricate or disseminate false drug safety information.

Article 108: County-level and higher-level people's governments shall formulate emergency plans for drug safety incidents. Drug marketing authorization holders, drug manufacturers, drug business operators, and medical institutions shall formulate their own drug safety incident response plans, organize training and emergency drills.

In the event of a drug safety incident, county-level and higher-level people's governments shall immediately organize response work in accordance with the emergency plan; relevant units shall immediately take effective measures to handle the situation and prevent further harm.

Article 109: If the drug supervision and administration department fails to timely discover systemic drug safety risks or eliminate hidden dangers, or fails to effectively prevent and control drug safety incidents, resulting in serious consequences, the persons directly in charge and other directly responsible personnel shall be given administrative sanctions or be held criminally liable in accordance with the law.

Article 110: Local people's governments and their drug regulatory authorities shall not use measures such as requiring drug inspection or approval to restrict or exclude the entry of drugs produced by non-local drug marketing authorization holders or pharmaceutical manufacturers into their jurisdiction.

Article 111: Drug regulatory authorities and their designated drug technical institutions shall not engage in drug production and business activities, nor recommend, supervise, or promote drugs in their name. The staff of drug regulatory authorities and their designated drug technical institutions shall not participate in drug production and business activities.

Article 112: If the State Council has other special management regulations for narcotic drugs, psychotropic drugs, medical toxic drugs, radioactive drugs, or drug-like precursor chemicals, they shall be implemented according to those regulations.

Article 113: If the drug regulatory authority discovers drug-related illegal activities suspected of constituting a crime, it shall promptly transfer the case to the public security organs. If it is determined that administrative responsibilities should be pursued without criminal liability according to the law, the public security organs, the People's Procuratorate, and the People's Court shall promptly transfer the case to the drug regulatory authority. If the public security organs, the People's Procuratorate, or the People's Court request the assistance of the drug regulatory authority, the competent department of ecological environment, or other relevant departments in providing inspection conclusions, determinations, and assistance in the harmless disposal of the drugs involved, the relevant departments shall provide timely assistance.

Chapter 11: Legal Liabilities

Article 114: Whoever violates the provisions of this law and commits a crime shall be held criminally liable according to the law.

Article 115: Whoever produces or sells drugs without obtaining a drug production license, a drug distribution license, or a medical institution preparation license shall be ordered to close down, confiscate the illegally produced or sold drugs and illegal gains, and impose a fine of no less than fifteen times but no more than thirty times the value of the drugs illegally produced or sold (including those already sold and unsold); if the value is less than one hundred thousand yuan, it shall be calculated as one hundred thousand yuan.

Article 116: Whoever produces or sells counterfeit drugs shall have the illegally produced or sold drugs and illegal gains confiscated, be ordered to suspend production and business operations for rectification, have their drug approval documents revoked, and be fined no less than fifteen times but no more than thirty times the value of the illegally produced or sold drugs (including those already sold and unsold); if the value is less than one hundred thousand yuan, it shall be calculated as one hundred thousand yuan; if the circumstances are serious, their drug production license, drug distribution license, or medical institution preparation license shall be revoked, and their corresponding applications shall not be accepted for a period of ten years; if the drug marketing authorization holder is a foreign enterprise, the import of their drugs shall be prohibited for a period of ten years.

Article 117: Whoever produces or sells substandard drugs shall have the illegally produced or sold drugs and illegal gains confiscated, and be fined no less than ten times but no more than twenty times the value of the illegally produced or sold drugs; if the value of the illegally produced or wholesaled drugs is less than one hundred thousand yuan, it shall be calculated as one hundred thousand yuan, and if the value of the illegally retailed drugs is less than ten thousand yuan, it shall be calculated as ten thousand yuan; if the circumstances are serious, they shall be ordered to suspend production and business operations until their drug approval documents, drug production license, drug distribution license, or medical institution preparation license are revoked.

If the Chinese medicinal materials used in the production and sale of Chinese patent medicines do not meet the drug standards and do not affect their safety and efficacy, they shall be ordered to make corrections within a time limit and be given a warning; a fine of no less than one hundred thousand yuan but no more than five hundred thousand yuan may be imposed.

Article 118: Whoever produces or sells counterfeit drugs or produces or sells substandard drugs with serious circumstances shall have the illegal gains acquired during the period of the illegal activities confiscated and be fined no less than thirty percent but no more than three times the amount of the illegal gains; the legal representative, principal responsible person, directly responsible person in charge, and other persons responsible shall also be fined no less than twenty thousand yuan but no more than two hundred thousand yuan; they shall be permanently banned from engaging in drug production and business activities, and may also be detained by the public security organs for a period of not less than five days but not more than fifteen days.

The raw materials, excipients, packaging materials, and production equipment specifically used for the production of counterfeit drugs or substandard drugs shall be confiscated.

Article 119: If a drug user uses counterfeit drugs or substandard drugs, they shall be punished in accordance with the provisions on the sale of counterfeit drugs or retail of substandard drugs; if the circumstances are serious, the legal representative, principal responsible person, directly responsible person in charge, and other persons responsible who hold a medical and health professional practitioner certificate shall have their practitioner certificate revoked.

Article 120: Anyone who knows or should know that a drug belongs to counterfeit drugs, substandard drugs, or the drugs specified in items (1) to (5) of the first paragraph of Article 124 of this law, and provides convenient conditions such as storage and transportation for such drugs, shall have all storage and transportation income confiscated and be fined no less than one time but no more than five times the illegal income; if the circumstances are serious, a fine of no less than five times but no more than fifteen times the illegal income shall be imposed; if the illegal income is less than five hundred thousand yuan, it shall be calculated as five hundred thousand yuan.

Article 121: The penalty decisions for counterfeit drugs or substandard drugs shall specify the quality inspection conclusions of the drug inspection institution in accordance with the law.

Article 122: Whoever forges, alters, leases, lends, or illegally buys or sells licenses or drug approval documents shall have the illegal gains confiscated and be fined no less than one time but no more than five times the illegal gains; if the circumstances are serious, a fine of no less than five times but no more than fifteen times the illegal gains shall be imposed, and their drug production license, drug distribution license, medical institution preparation license, or drug approval document shall be revoked. The legal representative, principal responsible person, directly responsible person in charge, and other persons responsible shall be fined no less than twenty thousand yuan but no more than two hundred thousand yuan and shall be banned from engaging in drug production and business activities for a period of ten years; they may also be detained by the public security organs for a period of not less than five days but not more than fifteen days; if the illegal gains are less than one hundred thousand yuan, it shall be calculated as one hundred thousand yuan.

Article 123: Whoever provides false certificates, data, information, samples, or uses other means to deceive the clinical trial permits, drug production permits, drug distribution permits, medical institution preparation permits, or drug registration permits, etc., shall have the relevant permits revoked, shall not be accepted for the corresponding applications for a period of ten years, and be fined no less than five million yuan but no more than fifty million yuan; if the circumstances are serious, the legal representative, principal responsible person, directly responsible person in charge, and other persons responsible shall be fined no less than twenty thousand yuan but no more than two hundred thousand yuan, shall be banned from engaging in drug production and business activities for a period of ten years, and may also be detained by the public security organs for a period of not less than five days but not more than fifteen days.

Article 124: In violation of the provisions of this Law, the following actions shall result in confiscation of illegally produced, imported, or sold drugs and the illegal gains, as well as the specialized materials, auxiliary materials, packaging materials, and production equipment specifically used for illegal production. The offender shall be ordered to cease production, suspend operations for rectification, and be fined a penalty of not less than 15 times but not more than 30 times the value of the illegal drugs produced, imported, or sold. If the value of the drugs is less than 100,000 yuan, it shall be calculated as 100,000 yuan. In serious cases, the drug approval certificate shall be revoked until the drug production license, drug operation license, or medical institution preparation permit is revoked. The legal representative, principal responsible person, directly responsible person in charge, and other personnel responsible shall have their illegal income acquired during the period of the illegal act confiscated, and shall be fined an amount ranging from not less than 30% to not more than 300% of the illegally obtained income. They shall be banned from engaging in drug production and operation activities for a period of ten years to life, and may be detained for a period of not less than five days but not more than fifteen days by the public security organs.

(1) Producing or importing drugs without obtaining drug approval certificates.

(2) Producing or importing drugs using approval certificates obtained through deception.

(3) Producing drugs using unapproved raw materials.

(4) Selling drugs without undergoing required inspections.

(5) Producing or selling drugs prohibited by the State Council's drug supervision and management department.

(6) Fabricating production or inspection records.

(7) Making significant changes in the drug production process without approval.

If the drugs specified in the preceding paragraph, items (1) to (3), are sold, or if the drugs specified in items (1) to (5) are used by drug users, they shall be punished in accordance with the provisions of the preceding paragraph. In serious cases, if the legal representative, principal responsible person, directly responsible person in charge, and other personnel responsible of the drug user have a medical and health practitioner's license, their medical and health practitioner's licenses shall also be revoked.

In cases where a small quantity of overseas drugs that have already been legally marketed are imported without authorization, those with minor circumstances may be given lenient or no punishment in accordance with the law.

Article 125: In violation of the provisions of this Law, the following actions shall result in confiscation of illegally produced or sold drugs and the illegal gains, as well as the packaging materials and containers, and the offender shall be ordered to cease production, suspend operations for rectification, and be fined a penalty of not less than 500,000 yuan but not more than 5 million yuan. In serious cases, the drug approval certificate, drug production license, drug operation license shall be revoked, and the legal representative, principal responsible person, directly responsible person in charge, and other personnel responsible shall be fined a penalty of not less than 20,000 yuan but not more than 200,000 yuan. They shall be banned from engaging in drug production and operation activities for a period of ten years to life. The illegal income acquired during the period of the illegal act shall be confiscated, and a fine of not less than 10% but not more than 50% of the illegally obtained income shall be imposed. The prohibition on engaging in drug production and operation activities shall last for ten years.

(1) Conducting clinical trials of drugs without approval.

(2) Using packaging materials or containers for drugs that directly contact drugs without undergoing evaluation and approval, or selling such drugs.

(3) Using unapproved labels or package.

Article 126: Unless otherwise provided by this Law, if the holder of a drug marketing authorization, a drug manufacturing enterprise, a drug operation enterprise, a non-clinical drug safety evaluation research institution, a clinical drug trial institution, or others fails to comply with the regulations on drug production quality management, drug operation quality management, non-clinical drug research quality management, clinical drug trial quality management, they shall be ordered to make corrections within a specified time and be given a warning. If they fail to make corrections within the specified time, they shall be fined no less than 100,000 yuan but no more than 500,000 yuan. If the circumstances are serious, they shall be fined no less than 500,000 yuan but no more than 2,000,000 yuan, ordered to suspend production or business operations until the revocation of drug approval documents, drug production licenses, drug operation licenses, etc. Non-clinical drug safety evaluation research institutions, clinical drug trial institutions, and others shall be prohibited from conducting non-clinical drug safety evaluation research and clinical drug trials for a period of five years. The legal representative, principal responsible person, directly responsible personnel, and other persons responsible shall have their illegal income confiscated during the period of the violation, and shall be fined not less than 10% but not more than 50% of the income obtained, and they shall be prohibited from engaging in drug production and operation activities for a period of ten years up to a lifetime.

Article 127: If any of the following acts are committed in violation of this Law, the responsible party shall be ordered to make corrections within a specified time and be given a warning. If they fail to make corrections within the specified time, they shall be fined no less than 100,000 yuan but no more than 500,000 yuan:

(1) Conducting bioequivalence tests without filing;

(2) During the clinical trial of a drug, if safety issues or other risks are found, the clinical trial applicant fails to timely adjust the clinical trial protocol, suspend or terminate the clinical trial, or fails to report to the State Drug Administration;

(3) Failing to establish and implement the drug traceability system as required;

(4) Failing to submit annual reports as required;

(5) Failing to file or report changes in the drug production process as required;

(6) Failing to develop a post-marketing risk management plan for drugs;

(7) Failing to conduct post-marketing studies or evaluations of drugs as required.

Article 128: In addition to the penalties for counterfeit or substandard drugs as stipulated by law, if the drug packaging does not have the required labels, instructions, or markings indicating relevant information, the responsible party shall be ordered to make corrections and be given a warning. If the circumstances are serious, the drug registration certificate shall be revoked.

Article 129: If the holder of a drug marketing authorization, a drug manufacturing enterprise, a drug operation enterprise, or a medical institution fails to purchase drugs from the holder of a drug marketing authorization or an enterprise qualified for drug production and operation as required by law, they shall be ordered to make corrections, and the illegally purchased drugs and illegal gains shall be confiscated. They shall also be fined an amount of not less than twice but not more than ten times the value of the illegally purchased drugs. If the circumstances are serious, they shall be fined an amount of not less than ten times but not more than thirty times the value of the goods and have their drug approval documents, drug production licenses, drug operation licenses, or medical institution practice licenses revoked. If the value of the goods is less than 50,000 yuan, it shall be calculated as 50,000 yuan.

Article 130: If a drug operation enterprise fails to keep records of drug purchases and sales as required, fails to provide proper instructions on the use and dosage of retail drugs, or fails to dispense prescriptions as required, they shall be ordered to make corrections and be given a warning. If the circumstances are serious, the drug operation license shall be revoked.

Article 131: If a third-party platform provider for online drug trading fails to fulfill its obligations such as qualification review, reporting, or ceasing to provide online trading platform services, they shall be ordered to make corrections, and the illegal gains shall be confiscated. They shall also be fined no less than 200,000 yuan but no more than 2,000,000 yuan. If the circumstances are serious, they shall be ordered to suspend business for rectification and be fined no less than 2,000,000 yuan but no more than 5,000,000 yuan.

Article 132: If imported drugs with a registered certificate are not filed with the drug regulatory authority in the place where the port allowing drug importation is located as required, the responsible party shall be ordered to make corrections within a specified time and be given a warning. If they fail to make corrections within the specified time, the drug registration certificate shall be revoked.

Article 133: If a medical institution sells its compounded preparations on the market, the responsible party shall be ordered to make corrections, and the illegally sold preparations and illegal gains shall be confiscated. They shall also be fined an amount of not less than twice but not more than five times the value of the illegally sold preparations. If the circumstances are serious, they shall be fined an amount of not less than five times but not more than fifteen times the value of the goods. If the value of the goods is less than 50,000 yuan, it shall be calculated as 50,000 yuan.

Article 134: If the holder of a drug marketing authorization fails to conduct drug adverse reaction monitoring as required or fails to report suspected drug adverse reactions, they shall be ordered to make corrections within a specified time and be given a warning. If they fail to make corrections within the specified time, they shall be ordered to suspend production or business operations and be fined no less than 100,000 yuan but no more than 1,000,000 yuan. If a drug operation enterprise fails to report suspected drug adverse reactions as required, they shall be ordered to make corrections within a specified time and be given a warning. If they fail to make corrections within the specified time, they shall be ordered to suspend production or business operations and be fined no less than 50,000 yuan but no more than 500,000 yuan. If a medical institution fails to report suspected drug adverse reactions as required, they shall be fined no less than 50,000 yuan but no more than 500,000 yuan.

Article 135: If a drug marketing authorization holder refuses to recall drugs after being ordered to do so by the drug regulatory authority of a provincial, autonomous region, or municipality directly under the Central Government, they shall be fined an amount ranging from five times to ten times the value of the recalled drugs. If the value of the recalled drugs is less than one hundred thousand yuan, the fine shall be calculated based on one hundred thousand yuan. In serious cases, the drug approval certificate, drug manufacturing license, and drug distribution license shall be revoked. The legal representative, principal responsible person, directly responsible senior management personnel, and other responsible personnel shall be fined an amount ranging from twenty thousand to two hundred thousand yuan. Drug manufacturers, drug distributors, and medical institutions that refuse to cooperate with the recall shall be fined an amount ranging from one hundred thousand to five hundred thousand yuan.

Article 136: If the marketing authorization holder for a drug is a foreign enterprise and its designated corporate entity in China fails to fulfill its obligations as stipulated in this Law, the provisions on the legal liability of drug marketing authorization holders shall apply.

Article 137: The following acts shall be punished more severely within the range of penalties stipulated in this Law:

(1) Using narcotic drugs, psychotropic drugs, medical toxic drugs, radioactive drugs, or drugs classified as precursor chemicals for illicit production as other drugs, or using other drugs as the aforementioned drugs.

(2) Producing or selling counterfeit or substandard drugs primarily intended for use by pregnant women or children.

(3) Producing or selling counterfeit or substandard biological products.

(4) Producing or selling counterfeit or substandard drugs that cause personal injury.

(5) Repeatedly producing or selling counterfeit or substandard drugs after being penalized.

(6) Refusing or evading supervision and inspection, falsifying, destroying, concealing relevant evidence and materials, or unlawfully using sealed or confiscated items.

Article 138: If a drug testing institution issues a false testing report, it shall be ordered to rectify the situation and be given a warning. A fine ranging from two hundred thousand to one million yuan shall be imposed on the institution. The directly responsible senior management personnel and other directly responsible personnel shall be subject to downgrading, removal from office, or dismissal according to law. Illegal gains shall be confiscated, and a fine of no more than fifty thousand yuan shall be imposed. In serious cases, its testing qualifications shall be revoked. If the issuance of a testing report by a drug testing institution is false and causes losses, it shall bear corresponding compensation liability.

Article 139: Administrative penalties stipulated in Articles 115 to 138 of this Law shall be determined by the drug regulatory authority of the people's government at or above the county level according to their respective responsibilities. The revocation of permits or licenses shall be decided by the original approving or issuing department.

Article 140: If a drug marketing authorization holder, drug manufacturer, drug distributor, or medical institution violates the provisions of this Law in employing personnel, the drug regulatory authority or the health administrative authority shall order the dismissal of such personnel and impose a fine ranging from fifty thousand to two hundred thousand yuan.

Article 141: If a drug marketing authorization holder, drug manufacturer, drug distributor, or medical institution provides kickbacks or other improper benefits in the purchase and sale of drugs, and the marketing authorization holder, drug manufacturer, drug distributor, or agent provides financial or other improper benefits to the responsible person of the medical institution using their drugs, the market supervision and administration department shall confiscate the illegal gains and impose a fine ranging from three million to thirty million yuan. In serious cases, the business license of the drug marketing authorization holder, drug manufacturer, drug distributor shall be revoked, and the drug regulatory authority shall revoke the drug approval certificate or drug distribution license.

Article 142: If the responsible persons, purchasers, or other relevant personnel of drug marketing authorization holders, drug manufacturers, or drug distributors accept money, goods, or other improper benefits from other drug marketing authorization holders, drug manufacturers, drug distributors, or agents in drug procurement and sales, their illegal gains shall be confiscated, and they shall be punished according to law. In serious cases, they shall be prohibited from engaging in drug production and business activities for a period of up to five years.

The heads of medical institutions, drug purchasers, physicians, pharmacists, and other relevant personnel who accept money, goods, or other improper benefits from drug marketing authorization holders, drug manufacturers, drug distributors, or agents shall be subjected to disciplinary actions by the health administrative authority or their own institution. Their illegal gains shall be confiscated. In serious cases, their practice certificates shall be revoked.

Article 143: If anyone violates the provisions of this Law by fabricating or spreading false drug safety information, constituting a violation of public security management, they shall be subjected to public security administrative penalties according to law.

Article 144: If drug marketing authorization holders, drug manufacturers, drug distributors, or medical institutions violate the provisions of this Law and cause harm to drug users, they shall bear liability for compensation according to law.

In cases where harm is caused due to drug quality issues, the victims may request compensation for losses from drug marketing authorization holders or drug manufacturers, as well as from drug distributors or medical institutions. Upon receiving a compensation request, the liable party shall assume primary responsibility and provide initial compensation. After the initial compensation is made, recovery of the compensation may be pursued according to law.

In cases of producing or selling counterfeit or substandard drugs, or knowingly selling or using counterfeit or substandard drugs, the victims or their immediate family members may request compensation for losses and may also claim compensation ten times the price or three times the losses. If the additional compensation amount is less than one thousand yuan, it shall be set at one thousand yuan.

Article 145: If drug regulatory authorities or drug professional technical institutions established or designated by them participate in drug production and business activities, their higher-level supervisory authorities shall order them to rectify the situation and confiscate illegal income. In serious cases, the directly responsible supervisory personnel and other directly responsible personnel shall be subjected to disciplinary actions according to law.

If the staff of drug regulatory authorities or drug professional technical institutions participate in drug production and business activities, they shall be subjected to disciplinary actions according to law.

Article 146: If drug inspection institutions established or designated by drug regulatory authorities violate the law by charging illegal inspection fees during drug supervision and inspection, the relevant government departments shall order them to refund the fees, and the directly responsible supervisory personnel and other directly responsible personnel shall be subjected to disciplinary actions according to law. In serious cases, their inspection qualifications shall be revoked.

Article 147: If drug regulatory authorities violate the provisions of this Law in any of the following ways, the relevant permits shall be revoked, and the directly responsible supervisory personnel and other directly responsible personnel shall be subjected to disciplinary actions according to law:

(1) Approving clinical trials of drugs that do not meet the requirements;

(2) Issuing drug registration certificates for drugs that do not meet the requirements;

(3) Issuing drug manufacturing licenses, drug distribution licenses, or medical institution formulation licenses to units that do not meet the requirements.

Article 148: If the people's governments at or above the county level violate the provisions of this Law in any of the following ways, the directly responsible supervisory personnel and other directly responsible personnel shall be given disciplinary warnings or serious disciplinary actions. In serious cases, they shall be demoted, dismissed, or removed from office:

(1) Concealing, fabricating, delaying reporting, or omitting reporting of drug safety incidents;

(2) Failing to timely eliminate regional major drug safety hazards, resulting in particularly serious drug safety incidents within their administrative regions or continuous occurrence of major drug safety incidents;

(3) Failing to fulfill their duties, causing serious adverse effects or significant losses.

Article 149: If drug regulatory authorities and other departments violate the provisions of this Law in any of the following ways, the directly responsible supervisory personnel and other directly responsible personnel shall be given disciplinary warnings or serious disciplinary actions. In cases of relatively serious circumstances, they shall be demoted or dismissed. In serious cases, they shall be dismissed:

(1) Concealing, fabricating, delaying reporting, or omitting reporting of drug safety incidents;

(2) Failing to promptly investigate and handle discovered violations of drug safety;

(3) Failing to promptly identify systemic risks to drug safety or timely eliminate drug safety hazards in the supervision and management areas, resulting in serious consequences;

(4) Other failures to fulfill their responsibilities for drug supervision and management, causing serious adverse effects or significant losses.

Article 150: Drug regulatory personnel who abuse their powers, engage in favoritism, or neglect their duties shall be given disciplinary actions according to law.

In cases where the investigation and handling of illegal activities involving counterfeit or substandard drugs involve dereliction of duty or misconduct, the directly responsible supervisory personnel and other directly responsible personnel of the drug regulatory authorities shall be given heavier disciplinary actions according to law.

Article 151: The value of goods as stipulated in this chapter shall be calculated based on the price indicated for the illegally produced or sold drugs. If there is no price indicated, it shall be calculated based on the market price of similar drugs.

Chapter XII Supplementary Provisions

Article 152: The management of the cultivation, collection, and breeding of traditional Chinese medicinal materials shall be implemented in accordance with the relevant laws and regulations.

Article 153: The measures for the management of folk medicinal materials used in specific regions shall be formulated by the drug regulatory authority under the State Council in conjunction with the competent department of traditional Chinese medicine under the State Council.

Article 154: The specific measures for the implementation of this Law by the People's Liberation Army and the People's Armed Police Force shall be formulated by the State Council and the Central Military Commission in accordance with this Law.

Article 155: This Law shall come into effect on December 1, 2019.