Christopher Padilla, the under secretary of commerce for international trade, told a group of businessmen that the United States was concerned that Chinese regulators did not have the authority to monitor both pharmaceuticals and bulk chemicals and that China did not have the ability or will to regulate its economy properly, allowing the export of a chemical that tainted the blood-thinning agent heparin which is linked to the deaths of dozens and the illnesses of hundreds.  The Chinese manufacturer of heparin did not register with that country’s State Food & Drug  Administration (SFDA) as a maker of active pharmaceutical products.

"This is a loophole that must be closed," Padilla said, adding that the Chinese SFDA does not have the authority to simultaneously regulate pharmaceutical makers of active pharmaceutical ingredients and makers of bulk chemicals which may be used in pharmaceuticals but not considered of medicinal use. 

"The rapid growth of China’s economy has clearly outstripped the ability and the will of the government to effectively police that economy,” Padilla said.  Padilla, who is leading a group of healthcare executives to China, also said effective monitoring was a part of larger healthcare reforms that mainland authorities were handling.

This week, U.S. researchers from the Massachusetts Institute of Technology (MIT) identified a chemical contaminating the blood-thinner heparin from China, revealing how it could cause a sometimes-fatal allergic reaction.  The tainted heparin was used by at least 81 U.S. patients who later died, forcing heparin maker Baxter International to recall the drug and causing diplomatic strain between the U.S. and China.

Meanwhile, Padilla also said recently that China's efforts to reform its health care system provide a major opportunity for American companies to enter the Chinese market. As China looks toward revamping a health care system that currently has hundreds of millions of uninsured citizens, American businesses have the chance to be involved through selling medicine, health services, and health insurance. 

"We see in China's health care reforms something that's not only good for Chinese citizens, but something that is a tremendous opportunity for U.S. companies to expand their business in China,” he said.

But he said also cautioned that barriers remain for American companies coming into China, such as prohibitive tariffs on pharmaceuticals and medical devices, lengthy times to register products, and redundant testing for medical products.

Padilla led a delegation of 15 major U.S. health companies representing pharmaceuticals, medical devices, health insurance, and health services to talk with Chinese officials about their health care reform process. Companies included Aetna, Boston Scientific, Johnson & Johnson, and Pfizer.