I’m a Chicago guy. I love the city, having lived in within a stone’s throw nearly all my life. I never tire of its sublime architecture, the unique neighborhoods, and its magnificent lakefront, food, culture and people. And its politics remains for me a constant source of eye-rolling entertainment and laughable wonder. No one puts the “fun” in dysfunctional quite like ‘da Mayor and the Chicago City Council. Above all, I love Chicago for its history – in particular, its early history. It is an amazing success story, and success stories are difficult not to like.

When Chicago incorporated in 1833 its citizenry numbered less than 350. It rose at a nearly inconceivable pace, on the shores of Lake Michigan along the eastern edge of what was then called the “dismal nine-mile swamp.” The city nearly quadrupled in size (from 29,000 to 112,000), in the decade between 1850 and 1860 and would have grown faster if not stymied by the lack of infrastructure; no clean, potable water, streets of knee-deep mud and constant sewage problems. The local prairie bogs that surrounded it on three sides provided fertile ground for disease-carrying insects, which hindered expansion and decimated the population. In 1871 The Great Chicago Fire all but destroyed the entire slapdashedly constructed city. As many as 18,000 clapboard dwellings and businesses were reduced to cinder and ash, leaving 300,000 people homeless. The rough and tumble citizens rebuilt. The city reinvented itself and 20 years later the population was 1.2 million, second only to New York, and it became unrivaled in its industrial output.

But at what cost? Unable to keep pace with its own growth and success, the Chicago River became an open sewer that flowed directly into Lake Michigan. On the near south side, the Chicago stockyards – the world’s largest – blanketed the city with an inescapable stench resulting from the thousands of livestock slaughtered daily and the nearby tanning factories. Black soot belched from the ebb and flow of the more than 400 coal-fired steam locomotives with mile-long trains of goods and grain that crawled through the city limits. Smokestacks from countless factories and steel mills billowed sun-darkening clouds of smoke and ash far out across the prairie sky. Chicago’s epitaph would be forever romanticized in the words of author Carl Sandburg as “hog butcher for the world, tool maker, stacker of wheat, player with railroads and the nation’s freight handler, stormy, husky, brawling, city of the big shoulders.” All this came at a terrible price, with a legacy of long-standing environmental side effects. It’s hard to believe that the glistening city of Chicago we know today was once referred to as “filthiest city in America.” How times have changed.

In many respects, modern-day China parallels Chicago’s early history. Thrust onto the world stage, China is emerging with a bit of an identity crisis, often struggling between its recent communist past and its new free market enterprise. China has embraced technology; catapulting itself forward even while the government bureaucracy, unable to shed its old one-party ways, lags far behind. This has led to severe quality issues, and a rash of graft and corruption within industries weakly regulated, where standards are inadequate or where the laws are often ignored or not enforced.

This is troubling when so much of the world’s reliance on drug manufacturing comes from a country still trying to grow into itself.

A few years ago, China emerged as one seven “pharmerging” countries – along with Brazil, Russia, India, Mexico, Turkey and South Korea – that represented the future growth of the pharmaceutical industry. Analysts at IMS Health now state that China is such an important market that it is the exclusive occupant of Tier 1, with Brazil, Russia and India comprising the second tier, and Mexico, Turkey and South Korea now residing in Tier 3.1

China, now in a league of its own, is projected to become the world’s third largest pharma market in 2011 (up from 8th in 2006). It is expected that China is set to contribute more than twice the total of the other two tiers combined: an excess of $40 billion annually in sales by 2013 given its $8 trillion GDP, large population, consistent healthcare investment and rise in an affluent middle-class.

And like Chicago’s early days, this has come at a tremendous cost. High-profile drug quality issues remain throughout China, hurting the demand for Chinese made API, a market that showed a 4% drop domestically in 2009, and an 8% drop in export API. China exports about half of the $31 billion of API it manufactures.2 This fall in demand, analysts say, is the result of concern regarding quality within Chinese APIs, such as the widely publicized tainted heparin supply in 2008.

These shortfalls have prompted some API manufacturers to beef-up their quality control and implement tighter cGMP. If China can get its API act together, analysts predict it can quickly rebound and expand by 8-10% to $33 billion this year alone and expect a faster 15% growth clip by 2015. But other bad publicity abounds.

In April 2010, state regulators revealed that four batches of rabies vaccine made by a Chinese subsidiary of Simcere Pharmaceuticals did not have enough active ingredient to be effective, a result of employees avoiding necessary testing and inspections.3 In another case, the FDA issued a warning letter in March 2010 to XiAn Libang Pharmaceuticals after it learned that an employee there manipulated testing data on incoming raw materials used in the production of API.4

Recently, five government officials with the China State Food and Drug Association (SFDA) were arrested on allegations of bribery. And in an earlier bribery scandal concerning the SFDA less than four years ago, Zheng Xiaoyu, the former head of the agency, was executed for taking bribes to approve licenses for new drugs.

In a story near-and-dear to my heart (and my cold chain expertise), Chinese health authorities in Shanxi Provence vehemently refuted that the distribution of unsafe vaccines were responsible for killing or seriously disabling about 100 children. A Hong Kong investigative reporter claims that provincial officials improperly stored vaccines in rooms without air conditioning, rendering them ineffective, and then allowed them to be administered to children.5

It is cases such as these that have caused at least one governmental authority, the Medicines and Healthcare products Regulatory Agency (MHRA) in Great Britain, to reconsider its approval processes of drug products originating in China based not only on manufacturing practices, but storage facilities and transportation infrastructure.

I have every confidence that China will work out these problems as it continues to grow into its 21st century economy. Meantime, drug manufacturers and regulators alike must remain vigilant in the acceptance of these drug products and help China raise its standards by following the MHRA’s lead. China and the rest of the world cannot afford otherwise. And let’s hope one day soon we can all look back on this and see that – like Chicago, China is an amazing success story – because success stories are difficult not to like.

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