In Shijiazhuang, drug makers complain about govt’s blunt measures

By Zhang Ye Source:Global Times Published: 2016/11/27 18:08:39

Pollution fight’s fallout

Despite China's efforts to tackle its air pollution problem, it is still suffering from bad air. Shijiazhuang, capital of North China's Hebei Province, is the country's most polluted city. Recently, the local government ordered all factories in the city to suspend production to reduce air pollution there. The move drew criticism from companies with factories in the city, specifically those in the pharmaceutical industry. Company representatives complained that the suspensions are a blunt, one-size-fits-all solution that will have severe consequences for their bottom lines. Experts agreed, but noted that the measures might just be necessary to deal with China's stubborn and severe air pollution.

Scenes of Shijiazhuang. The picture (down) was shot at 3 pm on December 23, 2015, while the smoggy picture was taken at 3 pm the next day. Photos: CFP

Scenes of Shijiazhuang. The picture (down) was shot at 3 pm on December 23, 2015, while the smoggy picture was taken at 3 pm the next day. Photos: CFP

Bu Jibo looks worried these days.

The executive, whose company supplies ingredients to major pharmaceutical manufacturers in Shijiazhuang, capital of North China's Hebei Province, doesn't know when the local government will allow his company to resume production.

And the wait is killing him, or at least, his business.

"The authorities have not told us why we must suspend production or when we can restart it," a visibly upset Bu told the Global Times on Wednesday. "Our production follows the country's laws and regulations."

Even if the local Shijiazhuang government hadn't suspended his company's production, his company still wouldn't have buyers for its products.

Two of its major customers, ­Shijiazhuang-based CSPC ­Pharmaceutical Group Ltd and North China Pharmaceutical Co, also had to temporarily halt operations last week under the local government's latest crackdown on air pollution.

The local government specifically ordered the suspension of all pharmaceutical production to fight against pollution, according to a filing posted by CSPC on the Hong Kong Stock Exchange on November 21. The factories are not allowed to resume production until approved by the Shijiazhuang government, said the filing.

It is hard to tell if the suspension can improve air quality, said Zhang Yunxuan, a researcher with Chinese Academy of Sciences.

Discharges from pharmaceutical manufacturing can damage the environment, especially from the production of synthetic drugs, created using man-made chemicals, as opposed to natural ingredients, Zhang told the Global Times on Thursday.

Drugs in the air

While walking along the Heping Road in the industrial center of ­Shijiazhuang, local resident Li Jian usually smells chemicals.

The stench comes from production of synthetic drugs, including some antibiotics, said Li, who worked in a local pharmaceutical plant for years.

He said that the waste gas from antibiotic drugs production is harmful to human beings.

"Workers who produce these kinds of drugs are frequently transferred to other production lines to limit the damage to their bodies," Li told the Global Times on Wednesday.

Beijing, a three-hour drive away from Shijiazhuang, has also been affected, according to a paper published in October in the journal Microbiome by researchers from the University of Gothenburg in Sweden.

Beijing's smog harbored the highest concentration of antibiotic resistance genes of about 64 different types, as well as the highest bacterial richness of any environment, according to the paper.

Hebei has long been a major manufacturer of chemical pharmaceuticals. It produced 446,000 tons of chemical pharmaceuticals in 2015, down 11.6 percent from 2014, according to data from Hebei Provincial Bureau of Statistics.

"Homegrown CSPC and North China Pharmaceutical combined supply more than half of the country's antibiotics," a drug distributor, who only gave his surname Ma, told the Global Times on Thursday.

A long campaign

The fight against the pollution generated by Hebei's pharmaceutical industry has been going on for a while.

Earlier this year, local authorities set up a special team to investigate the alleged pollution of 10 subsidiaries of North China Pharmaceutical.

About 18 high-pollution and high-energy-consuming factories, including some run by North China Pharmaceutical, were ordered to leave Shijiazhuang by 2017, according to a local government statement issued in 2013.

Experts consider the latest suspensions as the most far-reaching campaign that have ever been taken against the pharmaceutical manufacturing industry. The suspensions were part of the 14 measures issued by the Shijiazhuang City Air and Water ­Pollution Prevention Command ­Office on November 18.

Authorities have taken similar actions against industries such as steel, chemicals, cement and coal carbonization, which are also sources of Shijiazhuang's severe pollution.

The city aims to bring down its average concentration of PM 2.5 by 10 percent by the end of 2016 and keep its Air Quality Index (AQI) below 500 for the rest of the year.

The AQI tops out at 500, following a similar standard used in the US. Any reading above 500 means the air quality is extremely bad.

The Ministry of Environmental Protection monitors the AQI in 74 major cities in China. In October, seven of the 10 worst AQI readings were in cities in Hebei, the country's sixth most populous province. ­Shijiazhuang topped the ranking.

Economic fallout

"We applaud the government's determination to protect our environment. But we hope the process can be carried out in a rational and flexible way. The current suspension in Shijiazhuang is a one-standard-fits-all campaign," Bu said.

Bu complained that the authorities do not care whether or not an individual plant is actually polluting the environment, so they ordered all related firms to halt production first and identified the polluters later.

The authorities have stationed a special team in Bu's factory to ensure production remains suspended.

Several calls to the environmental protection authorities of Shijiazhuang remained unanswered by press time.

Ma believes the government's decision is understandable, considering that it is difficult for authorities to determine whether a company is actually following environmental protection regulations. "Companies devote a lot of resources to purchasing environmental protection equipment, but not all of them will keep those facilities running due to the very, very high costs," Ma said.

Entrepreneurs petition authorities to resume production, but Bu said it takes time to get approval.

"A suspension for a month or two is no big deal. But if it lasts until the end of the year, the factories have to prepare themselves for losses in revenue and workers," Li said.

Ma worried that the suspensions might cause a spike in drug prices, even though both CSCP and North China Pharmaceutical said they had large enough inventories to cope with the halt in production.

According to North China Pharmaceutical's filing, the company estimated that it would lose 50 million yuan ($7.23 million) in profits if the suspension lasted until the end of the year.

Zhang, the professor, acknowledged that government's blunt approach to dealing with air pollution will hurt the economy.

"Still, it is necessary at this early stage of environmental protection," he said.

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