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China to Allow Online Prescription Drug Sales By February

By Victoria Kim 01/27/15

The new policy is expected to take effect as soon as February.

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China will allow online sales of prescription drugs as early as this month, as the China Food and Drug Administration (CFDA) finalizes which prescription medicines to approve for sale.

In the United States, around a third of drugs are sold online compared with almost zero in China, according to Frank Zhao, chief financial officer at pharmacy chain China Jo-Jo Drugstores Inc.

The policy will open the market, which is currently controlled by state-run distributors and hospitals, to online pharmacies, general online retailers, and marketplaces like Alibaba,, and Wal-Mart, which already have licenses to sell over-the-counter drugs online.

Currently, hospitals account for around 70% of drugs sold to consumers in China. Online pharmacies are restricted to selling over-the-counter medicines and products such as cough remedies and vitamins. But with the new policy, they will be able to compete with hospitals for prescription drug sales.

The new policy, which is expected to be finalized by February, according to an anonymous senior healthcare policy advisor, will open up over 1 trillion yuan ($161 million) to online pharmacy operations like Alibaba and Wal-Mart.

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