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Chinese regulator hits Changsheng with 9.11B yuan fine over vaccine scandal

A Chinese health regulator has imposed a fine of 9.11 billion Chinese yuan on Changchun Changsheng Life Sciences Ltd. for manufacturing substandard vaccines, FiercePharma reported, citing an official release.

China's National Medical Products Administration charged the vaccine-maker with eight violations of drug regulations as part of a probe into the company's manufacturing practices.

The investigation was launched following a surprise inspection, which found that the company fabricated records and flouted manufacturing rules while making its human rabies vaccines. The officials halted the production of the rabies vaccine but later discovered that Changchun had also produced almost 500,000 defective DPT vaccines for children.

The vaccine scandal created a public uproar with Chinese President Xi Jinping calling for severe punishment and the government sacking several senior officials related to the scandal.

In its Oct. 16 release, the regulator said Changchun illegally produced 748 batches of rabies vaccines by mixing antigen ingredients with several batches dating as far back as January 2014. The company, owned by Shenzhen-listed Changsheng Bio-Technology Co. Ltd., produced nearly 12 batches by using expired ingredients, according to FiercePharma.

As a result, the regulator canceled its approval for Changchun's rabies vaccine and also took away the company's permit to make drugs.

The 9.11 billion yuan penalty consists of 1.89 billion yuan as recovery for revenue earned from selling the rabies vaccine and 7.21 billion yuan as fine on those earnings plus loss pertaining to 7.79 million unsold doses. The sum also includes nearly 12.03 million yuan related to Changsheng withdrawing previously released batches, the news outlet reported.

In a separate action, the China Securities Regulatory Commission slapped a 600,000 yuan fine on Changsheng Bio-Technology for violations related to disclosures. The securities regulator barred the company's chairwoman Gao Junfang from the drug industry and banned her from serving as a director or executive at any publicly traded company.

The regulator could also press criminal charges against Gao and several other company executives, FiercePharma reported.

As of Oct. 15, US$1 was equivalent to 6.92 yuan.