July 24, 2018 / 12:23 PM / in a month

The unfolding of China's Changsheng vaccine scandal

SHANGHAI (Reuters) - Chinese vaccine maker Changsheng Bio-technology Co Ltd, accused of fabricating production and inspection data, has become the subject of multiple probes - including investigations by police and the corruption watchdog.

Boxes of vials containing the rabies vaccines manufactured by the vaccine maker Changsheng Biotechnology, is seen at a local disease prevention and control centre in Huangshan, Anhui province, China July 23, 2018. REUTERS/Stringer

Under pressure, Changsheng has recalled its vaccine for rabies and been fined for selling ineffective vaccines to inoculate children against diphtheria, whooping cough and tetanus. Its Shenzhen-listed shares have lost $1.8 billion (£1.3 billion), or more than half their value since mid-July.

Based in Changchun city in the northeastern province of Jilin, it sells six types of vaccines and is China’s second largest producer of rabies and chickenpox vaccines, according to its 2017 annual report. Its made 1.55 billion yuan (£173.8 million) in revenue last year, up 53 percent from 2016.

It was once a subsidiary of Changchun High & New Tech Industry, a state-owned bio-pharmaceutical and healthcare enterprise. Chairwoman Gao Junfang, currently being investigated by police, is now the firm’s largest single shareholder.

NOV 3, 2017

China’s drug regulator said sampling inspections had found that some DPT vaccines produced by Changsheng and rival Wuhan Institute of Biological Products did not meet its potency standards. All of Changsheng ineffective DPT vaccines were sold in the eastern province of Shandong. The regulator asked hospitals and disease control centres around the country to immediately stop using vaccines in the same batch.

Changsheng acknowledged that its vaccines could be ineffective, but said they would not cause any safety issues.

JULY 11

China’s drug regulator carries out a spot check at Changsheng’s facilities following a tip-off from a former employee.

JULY 15

The drug watchdog says the process used to make Changsheng’s rabies vaccines violated manufacturing standards and revoked its licence for the vaccine. The local Jilin FDA also launched an investigation.

Changsheng recalled its unexpired rabies vaccines and said it was “deeply sorry” for the incident.

JULY 16

Changsheng’s stock price drops by its daily limit of 10 percent.

JULY 18

Changsheng says in a statement it will recall of all its rabies vaccines.

JULY 20

Jilin’s FDA issues report saying Changsheng sold 252,600 doses of ineffective DPT vaccines to inoculate children against diphtheria, whooping cough and tetanus. Company says it is fined 3.44 million yuan over the issue.

JULY 21

A Chinese blogger posts an article on WeChat critical of the company that goes viral. The story was deleted on July 22nd.

JULY 22

Chinese Premier Li Keqiang said the vaccine incident “crossed a moral line” and promised to “crack down on illegal and criminal acts that endanger the safety of peoples’ lives”.

An official with China’s drug regulator said in an interview with state television that Changsheng had arbitrarily made up and changed manufacturing and inspection records.

JULY 23

Changsheng said in a regulatory filing China’s securities regulator was investigating the firm on suspicion of violating information disclosure rules and warns investors it could be delisted.

The official Xinhua news agency says police in Jilin are investigating Changsheng executives, including its chairwoman, for suspected criminal behaviour.

President Xi Jinping slams the company’s actions as “vile and shocking” and calls for a swift investigation.

JULY 24

China’s graft regulator, the Central Commission for Discipline Inspection, says it is investigating Changsheng for suspected corruption.

Changsheng confirms in a stock exchange filing that Chairwoman Gao Junfang and five other employees are being investigated by the police and have been taken in for questioning. It says they are unable to perform their duties.

Reporting by Adam Jourdan and SHANGHAI newsroom; Editing by Edwina Gibbs

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