Health commissions firstly announced the strict control of imported reagents and consumables for in vitro diagnosis.
On June 13, 2019, Health Commission of Ningxia Hui Autonomous Region issued a Notice of Office from Health Commission of Ningxia Hui Autonomous Region on Further Standardizing the Procurement of Imported Medical Equipment, Reagents and Consumables (Hereinafter referred to as “the Notice”) on its website. The Notice is the first document released by the Health Commission to strictly restrict the import of reagents and consumables in this year.
The Notice specifies that government should purchase domestic products. If it is necessary to purchase imported products, audits management will be implemented. According to detailed documents, Ningxia Hui Autonomous Region has raised the import threshold for medical equipment, reagents and consumables.
To apply for the procurement of imported products, a hospital should submit the following materials: official application documents of the purchaser for importing products, Application Form for Procurement of Imported Products by Government, Expert Comments on Procurement of Imported Products by Government issued by the expert group, Purchase List of Imported Products, Basic Information Form of Experts Commenting on Procurement of Imported Products by Government, Opinions from Competent Departments of the Industry of the Imported Products Purchased by Government, and other documents which describe the qualifications of imported reagents and consumables.
In the review of Expert Comments on Procurement of Imported Products by Government issued by the expert group, the qualification of experts are subject to strict requirements in the Notice.
1. The expert group for discussing and commenting imported products includes more than five people who don’t work in the unit and are familiar with the work. Among them, there should be one legal expert (with legal professional qualification). Technical experts should have intermediate or above technical titles in the specialties related to purchased products.
2. Experts must follow professional ethics. They should be honesty and self-disciplined, observe disciplines and obey laws with no history of corrupt practices and fraud. Besides, they should be able to objectively, fairly and practically put forward their comments.
3. Experts should participate in the review as an independent individual, willing to accept the supervision and management by the Health Commission of Ningxia Hui Autonomous Region.
4. The experts involved in the review should not participate in the procurement review of the same project as procurement review experts.
It is obvious that the Health Commission of Ningxia Hui Autonomous Region has made strict restrictions on the access of imported reagents and consumables. The expert group for discussing and commenting imported products of more than five people has been established and some requirements have been developed for experts’ qualifications, which means that the imported reagents and consumables can be used by hospitals only when they are approved by the expert group.
What’s more, the stipulation in the Notice that the experts involved in the review should not participate in the procurement review of the same project as procurement review experts aims to ensure an open and fair review.
Not long ago, Financial Department of Shaanxi Province released the Notice of Financial Department of Shaanxi Province on Further Standardizing the Review of Imported Products Purchased by Provincial Governments (hereinafter referred to as “the Notice”) where detailed requirements were developed for “further standardizing the procurement of imported products by governments”.
According to the Notice, governments should purchase domestic products. If products that need to be purchased are not available in China or cannot be obtained under reasonable commercial conditions, and imported products must be purchased in accordance with laws and regulations, the approval from Financial Department of Shaanxi Province should be obtained before the procurement and then imported products should be purchased in accordance with laws.
The Financial Department will strengthen the daily supervision over the procurement of imported products by governments. If violations of laws and regulations in government procurement activities are seen, or the purchaser determines the procurement requirement with high standards or experts present false comments intentionally, liability will be investigated in accordance with relevant provisions.
If the purchaser really needs to purchase imported products, discussing and commenting will be conducted by the expert group. In principle, the expert group should include more than five people who don’t work in the unit and are familiar with the imported products. Among them, there should be one legal expert (with qualification of lawyer). Technical experts should have intermediate or above technical titles in the specialties related to the products to be purchased.
Before that, the List of Imported Products Purchased by the Provincial Government of Shanxi (hereafter referred to as “List of Products Imported”) was released on the website of government procurement (Shanxi). A total of 67 types of medical devices were included in the list of devices permitted to be purchased.
This means that except for the 67 medical devices included in the List of Products Imported, public hospitals need to purchase domestically produced products in government procurement. If medical devices not included in the List of Products Imported should indeed be purchased, the procurement should be subject to strict approval!
Compared with Shanxi province, Notice on Further Standardizing the Administration of Government Procurement of Imported Products (SCG (2019) No. 12) issued by Suzhou City and Notice on Adjusting the Examination of Government Procurement of Imported Medical Devices issued by Tianjin Finance Bureau and Tianjin Municipal and Health Committee imposed stricter requirements on government procurement of imported medical devices (including procurement of medical devices by public hospitals).
In the two documents issued by Suzhou City and Tianjin City, the expert panel of government procurement should be composed of more than 5 people from other institutions (including one legal expert) who are familiar with the products to be purchased. However, one legal expert must be included. The experts should have no economic and administrative relationships with any municipal budget units or purchasing agencies
And in the documents issued by Suzhou City, the following is also highlighted:
The legal expert should determine whether a product to be purchased is restricted for import; technical experts should focus on procurement demands, comparison of technical indicators and performance between imported products and similar domestic products, and their respective advantages and disadvantages,
and put forward reasonable procurement proposals. In the opinion of the experts, it must be made clear that items being discussed meet the requirement that products that need to be purchased are not available in China or cannot be obtained under reasonable commercial conditions, and should be purchased in accordance with laws and regulations. And it should be specified that the procurement demands put forward by the purchaser are true, and the imported products must be purchased.
From a prospective of the whole country, Zhejiang, Sichuan, Shandong, Fujian and other provinces have all issued the List of Unified Procurement of Imported Products by Provincial Government (Medical Equipment). Among them, the provincial government of Shandong province allowed a total of 488 medical devices to be imported, the number for Zhejiang Province was 232, and Fujian province only 211. By comparison, Sichuan province cut that number from 98 to 44. This means that except for the medical devices included in the list, public hospitals must purchase domestically-produced products, or otherwise give strict arguments on importing products!
We must step up the efforts to replace imported medical devices with domestically-produced ones due to escalation of the trade war
In addition, in just one year since 2018, a trade war between China and the US has been started, escalated, negotiated, restarted, intensified, ceased and then restarted again. The latest news showed that on May 5, 2019, Trump announced that the US would increase the tariff from 10% to 25% on 200 billion USD of American goods from May 10. On May 13, 2019, the Customs Tariff Commission of the State Council announced that China would impose tariffs ranging from 5% to 25% on some US products.
As can be seen in the notice issued by the state council, the list of products worth 60 billion USD not only covers large medical equipment but also consumables of in vitro diagnostic reagents.
US restrictions on technology transfer to China will force domestic manufacturers of medical devices to double down on independent innovation and accelerate the transformation of medical and technological achievements. Meanwhile, the Chinese government will be encouraged to shore up the efforts to support domestically produced high-performance medical devices and roll out more policies to champion independent innovation in medical device industry. As for the IVD industry, in centralized purchase of medical devices, the government will give more priority to IVD devices and consumables, in an effort to accelerate the replacement of imported products with domestically produced IVD devices.
On June 13, 2019, Health Commission of Ningxia Hui Autonomous Region issued a Notice of Office from Health Commission of Ningxia Hui Autonomous Region on Further Standardizing the Procurement of Imported Medical Equipment, Reagents and Consumables (Hereinafter referred to as “the Notice”) on its website. The Notice is the first document released by the Health Commission to strictly restrict the import of reagents and consumables in this year.
The Notice specifies that government should purchase domestic products. If it is necessary to purchase imported products, audits management will be implemented. According to detailed documents, Ningxia Hui Autonomous Region has raised the import threshold for medical equipment, reagents and consumables.
To apply for the procurement of imported products, a hospital should submit the following materials: official application documents of the purchaser for importing products, Application Form for Procurement of Imported Products by Government, Expert Comments on Procurement of Imported Products by Government issued by the expert group, Purchase List of Imported Products, Basic Information Form of Experts Commenting on Procurement of Imported Products by Government, Opinions from Competent Departments of the Industry of the Imported Products Purchased by Government, and other documents which describe the qualifications of imported reagents and consumables.
In the review of Expert Comments on Procurement of Imported Products by Government issued by the expert group, the qualification of experts are subject to strict requirements in the Notice.
1. The expert group for discussing and commenting imported products includes more than five people who don’t work in the unit and are familiar with the work. Among them, there should be one legal expert (with legal professional qualification). Technical experts should have intermediate or above technical titles in the specialties related to purchased products.
2. Experts must follow professional ethics. They should be honesty and self-disciplined, observe disciplines and obey laws with no history of corrupt practices and fraud. Besides, they should be able to objectively, fairly and practically put forward their comments.
3. Experts should participate in the review as an independent individual, willing to accept the supervision and management by the Health Commission of Ningxia Hui Autonomous Region.
4. The experts involved in the review should not participate in the procurement review of the same project as procurement review experts.
It is obvious that the Health Commission of Ningxia Hui Autonomous Region has made strict restrictions on the access of imported reagents and consumables. The expert group for discussing and commenting imported products of more than five people has been established and some requirements have been developed for experts’ qualifications, which means that the imported reagents and consumables can be used by hospitals only when they are approved by the expert group.
What’s more, the stipulation in the Notice that the experts involved in the review should not participate in the procurement review of the same project as procurement review experts aims to ensure an open and fair review.
Not long ago, Financial Department of Shaanxi Province released the Notice of Financial Department of Shaanxi Province on Further Standardizing the Review of Imported Products Purchased by Provincial Governments (hereinafter referred to as “the Notice”) where detailed requirements were developed for “further standardizing the procurement of imported products by governments”.
According to the Notice, governments should purchase domestic products. If products that need to be purchased are not available in China or cannot be obtained under reasonable commercial conditions, and imported products must be purchased in accordance with laws and regulations, the approval from Financial Department of Shaanxi Province should be obtained before the procurement and then imported products should be purchased in accordance with laws.
The Financial Department will strengthen the daily supervision over the procurement of imported products by governments. If violations of laws and regulations in government procurement activities are seen, or the purchaser determines the procurement requirement with high standards or experts present false comments intentionally, liability will be investigated in accordance with relevant provisions.
If the purchaser really needs to purchase imported products, discussing and commenting will be conducted by the expert group. In principle, the expert group should include more than five people who don’t work in the unit and are familiar with the imported products. Among them, there should be one legal expert (with qualification of lawyer). Technical experts should have intermediate or above technical titles in the specialties related to the products to be purchased.
Before that, the List of Imported Products Purchased by the Provincial Government of Shanxi (hereafter referred to as “List of Products Imported”) was released on the website of government procurement (Shanxi). A total of 67 types of medical devices were included in the list of devices permitted to be purchased.
This means that except for the 67 medical devices included in the List of Products Imported, public hospitals need to purchase domestically produced products in government procurement. If medical devices not included in the List of Products Imported should indeed be purchased, the procurement should be subject to strict approval!
Compared with Shanxi province, Notice on Further Standardizing the Administration of Government Procurement of Imported Products (SCG (2019) No. 12) issued by Suzhou City and Notice on Adjusting the Examination of Government Procurement of Imported Medical Devices issued by Tianjin Finance Bureau and Tianjin Municipal and Health Committee imposed stricter requirements on government procurement of imported medical devices (including procurement of medical devices by public hospitals).
In the two documents issued by Suzhou City and Tianjin City, the expert panel of government procurement should be composed of more than 5 people from other institutions (including one legal expert) who are familiar with the products to be purchased. However, one legal expert must be included. The experts should have no economic and administrative relationships with any municipal budget units or purchasing agencies
And in the documents issued by Suzhou City, the following is also highlighted:
The legal expert should determine whether a product to be purchased is restricted for import; technical experts should focus on procurement demands, comparison of technical indicators and performance between imported products and similar domestic products, and their respective advantages and disadvantages,
and put forward reasonable procurement proposals. In the opinion of the experts, it must be made clear that items being discussed meet the requirement that products that need to be purchased are not available in China or cannot be obtained under reasonable commercial conditions, and should be purchased in accordance with laws and regulations. And it should be specified that the procurement demands put forward by the purchaser are true, and the imported products must be purchased.
From a prospective of the whole country, Zhejiang, Sichuan, Shandong, Fujian and other provinces have all issued the List of Unified Procurement of Imported Products by Provincial Government (Medical Equipment). Among them, the provincial government of Shandong province allowed a total of 488 medical devices to be imported, the number for Zhejiang Province was 232, and Fujian province only 211. By comparison, Sichuan province cut that number from 98 to 44. This means that except for the medical devices included in the list, public hospitals must purchase domestically-produced products, or otherwise give strict arguments on importing products!
We must step up the efforts to replace imported medical devices with domestically-produced ones due to escalation of the trade war
In addition, in just one year since 2018, a trade war between China and the US has been started, escalated, negotiated, restarted, intensified, ceased and then restarted again. The latest news showed that on May 5, 2019, Trump announced that the US would increase the tariff from 10% to 25% on 200 billion USD of American goods from May 10. On May 13, 2019, the Customs Tariff Commission of the State Council announced that China would impose tariffs ranging from 5% to 25% on some US products.
As can be seen in the notice issued by the state council, the list of products worth 60 billion USD not only covers large medical equipment but also consumables of in vitro diagnostic reagents.
US restrictions on technology transfer to China will force domestic manufacturers of medical devices to double down on independent innovation and accelerate the transformation of medical and technological achievements. Meanwhile, the Chinese government will be encouraged to shore up the efforts to support domestically produced high-performance medical devices and roll out more policies to champion independent innovation in medical device industry. As for the IVD industry, in centralized purchase of medical devices, the government will give more priority to IVD devices and consumables, in an effort to accelerate the replacement of imported products with domestically produced IVD devices.