I. Introduction

In 2017, the former State Food and Drug Administration issued the 'Administrative Measures for the Supervision of Online Drug Operations (Draft for Comments)',

Which adopted the principle of 'consistency between online and offline' to regulate online drug sales activities, with particularly strict supervision of prescription drugs. The regulations stipulated that prescription drugs shall not be sold through the internet and shall not be displayed via the internet. In 2018, the former State Food and Drug Administration issued the 'Administrative Measures for the Supervision of Online Drug Sales (Draft for Comments)', which continued to prohibit the sale of prescription drugs on online platforms.

In 2019, the newly revised 'Drug Administration Law' was officially promulgated. Article 61 of the 'Drug Administration Law' stipulates that 'marketing authorization holders and drug distribution enterprises selling drugs online shall comply with the relevant provisions of this Law on drug distribution; specific administrative measures shall be formulated by the State drug regulatory department together with the State health administrative department and other relevant departments.' Since then, online drug sales activities have been formally recognized at the legal level. In the same year, the State Administration for Market Regulation stipulated the requirements for online drug sales, platform management, and sales filing in the 'Administrative Measures for Drug Distribution Supervision (Draft for Comments)', establishing the online drug sales supervision and management system.

In 2020, the National Medical Products Administration issued the 'Administrative Measures for the Supervision of Online Drug Sales (Draft for Comments)', which for the first time permitted the sale of prescription drugs on online platforms. In May 2022, the National Medical Products Administration issued the 'Implementation Regulations of the Drug Administration Law (Revised Draft for Comments)', which stipulated the management of online drug sales and the obligations of third-party platforms. In September of the same year, the 'Administrative Measures for the Supervision of Online Drug Sales' was officially promulgated and took effect on December 1.

Through the above development process, the legal supervision of online drug sales in China has been formally established, covering not only the supervision of the drugs themselves but also clear regulatory measures for operators, sales platforms, transportation, and other aspects. This article will analyze the 'Online Drug Sales Measures' from the perspective of enterprises.

II. Legal Provisions

1. Qualifications Required for Online Drug Sales Enterprises

The "Measures for Online Drug Sales" stipulates relevant provisions regarding the qualifications for enterprises engaged in online drug sales. Enterprises engaged in online sales shall be drug marketing authorization holders or drug distribution enterprises that have the capability to ensure the safety of drugs sold online; traditional Chinese medicine (TCM) decoction piece manufacturing enterprises selling their produced TCM decoction pieces shall fulfill the relevant obligations of drug marketing authorization holders.[i]At the same time, drug online sales enterprises shall operate in accordance with the approved business model and scope of business. That is, for enterprises that are drug marketing authorization holders, they may only sell drugs that have obtained drug registration certificates. Enterprises that have not obtained retail qualifications are also not allowed to sell drugs to individuals.[ii]

In summary, the types of enterprises that can engage in online drug sales are only drug marketing authorization holders, qualified drug distribution enterprises, or traditional Chinese medicine decoction piece manufacturing enterprises. At the same time, the drugs sold on online platforms shall not exceed the scope of drugs that the enterprise is permitted to sell.

Enterprises engaged in online drug sales also need to report to the drug regulatory authorities. The contents of the report include the name of the enterprise conducting online sales, website name, application name, IP address, as well as drug production license or drug distribution license information. Drug marketing authorization holders or holders of wholesale drug distribution licenses shall report to provincial-level drug regulatory authorities, while drug retail departments only need to report to municipal, prefecture-level, or county-level drug regulatory authorities.[iii]

2.Qualifications required for online drug sales platforms

The Measures for the Supervision of Online Drug Sales stipulate that platforms shall file records with the provincial drug regulatory department where the platform is located regarding information such as enterprise name, legal representative, unified social credit code, website name, and domain name. The provincial drug regulatory department shall also make the platform's filing information public.[iv]

Meanwhile, according to the Measures for the Administration of Internet Drug Information Services and the Measures for the Administration of Internet Information Services, the organizer of the platform shall submit an application to the provincial food and drug regulatory department at its location, and after obtaining approval, shall apply to the State Council's information industry regulatory department or the provincial telecommunications management authority for a business license or filing procedures.[v]

3.Prohibited Drugs

The current Measures for the Supervision and Administration of Online Drug Sales already permit the sale of prescription drugs on online platforms, but still explicitly stipulate that the following drugs shall not be sold online: （1）Vaccines; （2）Blood products; （3）Narcotic drugs; （4）Psychotropic substances; （5）Toxic drugs for medical use; （6）Radioactive drugs; （7）Controlled precursor chemicals for pharmaceutical use; （8）Other drugs subject to special management in China.[vi]

Prior to the formal implementation of the "Drug Online Sales Measures," the National Medical Products Administration also issued the "List of Prohibited Drugs for Online Sales (First Edition)"[vii].The prohibited list categorizes drugs into two major categories: "Drugs explicitly prohibited from sales by policies and regulations" and "Other drugs prohibited from online retail." As a supplement to the "Drug Online Sales Measures," the "Prohibited List" strengthens the supervision of online retail drugs and ensures public medication safety.

3. Judicial Practice (Online Sale of Prescription Drugs)

Prescription drugs are typically used for the treatment of specialized diseases. In general, taking them without guidance from a physician may lead to various adverse reactions. Therefore, due to the special nature of prescription drugs, China has been researching whether to permit the sale of prescription drugs on internet platforms and the regulatory measures for online prescription drug sales.

The current "Measures for Online Drug Sales" explicitly stipulates that enterprises engaged in prescription drug sales must provide risk warnings in prominent locations and implement a real-name purchase system, strictly reviewing relevant prescriptions.

Among the typical cases of public interest litigation concerning drug safety published by the Supreme People's Procuratorate, there are cases involving illegal sales of prescription drugs on online platforms[viii].

During its supervisory activities, the Beijing Railway Transportation Procuratorate (hereinafter referred to as Beijing Railway Procuratorate) discovered that certain online platform pharmacies, during the electronic prescription review stage after receiving online medication orders, had their licensed pharmacists failing to review electronic prescriptions in accordance with relevant legal norms before proceeding to offline delivery, involving violations such as dispensing prescription drugs exceeding dosage limits and failure to sign prescriptions, which may cause medication safety issues for the public and harm public interests.

In September 2021, Beijing Railway Procuratorate decided to file a case for investigation. The public interest litigation procuratorial department took pharmacies registered on online platforms within Beijing and pharmacies of out-of-Beijing registered online platforms operating in Beijing as key investigation targets. Through methods such as big data screening, manual review, and analytical summarization, it comprehensively understood the sales situation of online prescription drugs. The investigation found that on 3 online platforms (including 2 Beijing-registered online platforms), 28 pharmacies registered on Beijing online platforms had situations where licensed pharmacists failed to fulfill their legal responsibility for electronic prescription review, involving 5 administrative districts. Regarding the division of regulatory authority and responsibility between municipal and district-level administrative departments for online prescription drug sales in Beijing, Beijing Railway Procuratorate held discussions with the municipal drug regulatory department and drug regulatory departments of the 5 involved districts, clarifying that the municipal drug regulatory department is responsible for supervising drug retail chain headquarters and online platforms, while district-level drug regulatory departments are responsible for supervising online platform pharmacies, and reached consensus on issues such as specific procedures for online platform pharmacies selling prescription drugs.

In September and November 2021, Beijing Railway Procuratorate issued procuratorial recommendations to drug regulatory departments of 5 districts respectively, urging the administrative departments to investigate and punish the violations involved while strengthening supervision over licensed pharmacists of online platform pharmacies in fulfilling their electronic prescription review responsibilities and standardizing online prescription drug sales practices.

From the above cases, it can be seen that the relevant departments also attach considerable importance to the matter of online prescription drug sales. Although the sale of prescription drugs through internet platforms has been liberalized, the supervision thereof remains quite strict.

4. Conclusion

As the first departmental regulation specifically governing online drug sales activities, the implementation of the Drug Online Sales Measures is of significant importance for supervising drug sales on internet platforms, ensuring the safety of drug use for the people, and promoting the development of internet pharmaceutical sales. At the same time, it provides clear direction for the compliance of internet drug sales enterprises and internet drug sales platforms. For the relevant enterprises and platforms, improving internal supervision and fulfilling related obligations in accordance with the Drug Online Sales Measures are essential to ensure sustainable development in the field of online drug sales.

[i]Article 7 of the Administrative Measures for Drug Online Sales Supervision

[ii]Paragraph 1, Article 8 of the Administrative Measures for Drug Online Sales Supervision

[iii]Article 11 of the Administrative Measures for Drug Online Sales Supervision

[iv]Internet Drug Sales Supervision and Administration Measures Article 18

[v]Internet Drug Information Service Administration Measures Articles 5 and 12; Internet Information Service Administration Measures Article 7

[vi]Internet Drug Sales Supervision and Administration Measures Article 8(2)

[vii]Internet Drug Sales Prohibition List (First Edition)

[viii]Typical Cases of Pharmaceutical Safety Public Interest Litigation Case 5