Eastern Promise

Nov 5th 1998 
From The Economist print edition

THE trade in medicines between the West and China is not all one way. Traditional Chinese medicine—acupuncture, herbal mixtures and other remedies—is gaining in popularity. According to Kalorama Information, a market-research firm based in New York, American sales of herbal remedies, vitamins and minerals, including traditional medicines, could reach $12.3 billion in 2001, almost double the level in 1996.

Although western patients might shy away from bear paw or tiger penis (especially in the age of Viagra), they are lapping up ephedra for colds and ginseng for enervation. Such medicines have gained from patients’ switch from conventional, prescribed therapies to alternative, over-the-counter remedies, sold as nutritional supplements to prevent the real illness.

In China, traditional remedies are still going strong, having survived both 50 years of communism and competition from western pharmaceuticals. Traditional Chinese medical practitioners and hospitals exist alongside those dispensing new-fangled western medicine. According to Joanne McManus, author of a report on the future of the Asian drug industry, China has 1,000 traditional manufacturers turning out 4,000 different products—about half the drugs China consumes.

But firms making traditional remedies are, like their pharmaceutical counterparts, feeling the pinch of government reforms and cuts in the national drugs budget: as many as a third of traditional producers are in the red. One solution may be to boost China’s exports; at the moment, only 4% of the world’s $15 billion market in herbal products comes from China. The government wants to increase exports to $2 billion by 2008.

Foreigners are interested in traditional medicine. Some drug firms, such as Pfizer, are collaborating with the Chinese government to find out how traditional therapies act. Smaller companies, among them Pharmakon, based in Hong Kong, and Marco Polo Technologies, based in Bethesda, Maryland, are also applying modern techniques to standardized traditional remedies, before launching them in America.

Putting traditional medicine on a scientific footing is vital to its continued success in the West. In America herbal supplements now escape the requirements of safety and efficacy imposed by drug regulators because they state that they are “not intended to treat, cure or prevent any disease”: a hollow claim. However, the authorities are uneasy. A recent study by California’s Department of Health Services showed that almost a third of imported Asian herbal remedies contained an active drug or heavy metal that was not mentioned on the label.

America’s Food and Drug Administration (FDA) has no immediate plans to tighten its regulation of herbal supplements. But traditional firms could start making medical claims for their products and rake in the margins that other drugs enjoy, so long as they pay the roughly $100m it costs to conduct the clinical trials the FDA requires. Some are already proving their worth. Studies to be published in the Journal of the American Medical Association on November 11th show the effectiveness of treating irritable bowel disease and breach birth with traditional Chinese medicine. 

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