To ensure the quality of exported supplies, China required all medical products to obtain a certificate from Chinese regulators before they could be exported, according to a statement released by the Chinese National Medical Products Administration (NMPA). Previously, Chinese companies could export such products if they had the appropriate foreign certificates, such as those from the U.S. Food and Drug Administration (FDA) or the EU, which issues CE certificates. However, those certificates were being handled by third-party agencies, many of which were providing fake certificates, allowing the export of substandard products. The number of such agents has surged into the thousands, compared with less than 100 in normal times, an industry insider told the Global Times. “The EU side doesn’t care whether an exporter has a medical device registration in its own country. You can get a CE certificate for medical use if your products can pass their testing,” the manager of a mask producer in Jinan, Shandong province told the Global Times.

China’s new rules allow its regulators to weed out products approved by fake agents and could help address foreign concerns over the quality of Chinese-made medical products, industry insiders said. However, obtaining new Chinese export certificates could take time during which the companies would not be able to export their products. “A qualified mask producer should obtain two certificates: one is for export and the other is the mask registration certificate granted by the NMPA. Most exporters do not have the latter,” said Li Lin, General Manager of Anhui Fumei Medical Company. As of last week, the NMPA had issued certificates for 1,426 masks, 23 test kits, 42 ventilators, 236 infrared thermometers, and 301 protective gowns, according to a list the agency released. Industry insiders believe that these numbers are significantly lower than those involving current exporters.

Apart from China’s new rules, there have also been media reports of some foreign governments tightening regulations on Chinese-made medical supplies or facing rising calls to do so, including the U.S., where regulators have reportedly banned the import of certain types of Chinese-made medical masks. Chinese Foreign Ministry Spokeswoman Hua Chunying said that while there are issues with discrepancies among countries’ regulations and standards for the products, “these issues should not become an obstacle for cooperation on products and materials for fighting the epidemic.”

The discrepancies have shut the door on many Chinese companies that have been in the export businesses for years. Beijing Xidebao Sterilization Product Co has been seeking ways to export its disinfection products “but we have not found the right path so far,” General Manager Chen Huijun told the Global Times. Other companies refrain from exporting their products because they fear huge fines from foreign regulators in light of tightening rules. “They could settle accounts with us afterward,” Jin Xiaobo, CEO of Zhejiang Kaierhai Textile Garments Co, told the Global Times.

This chilling effect on Chinese companies stems from the recent incidents where some small quality issues and misunderstandings have been politicized into attacks on China, industry analysts said. “Politicizing China’s medical supply exports will harm the global anti-virus fight,” an industry insider said.

Gene sequencing companies from China are also stepping up nucleic acid kit exports as demand for testing suspected patients increases worldwide. Data from caclp.cn, an industry monitoring platform under the National Association of Health Industry and Enterprise Management, showed that by March 28, detection equipment made by more than 110 Chinese in vitro diagnostic (IVD) enterprises have got the CE-IVD Marking and Free Sale Certificates. The certifications are necessary for IVD devices to be sold in Europe. In the North American market, detection kits from BGI Genomics and Lupu Medical have received the Emergency Use Authorization issued by the U.S. FDA, indicating that their products can now be sold in the U.S. market. The world demand for test kits has reached a daily average of 500,000 to 700,000 kits, according to data from Huaxi Securities. Shenzhen-based BGI, which also has the CE-IVD Marking, is now gearing up for exporting its detection kits, with export orders surpassing 1 million by the end of March, covering 70 countries and regions.

Markets and Markets, an industry research consultancy, expects the global IVD market to attain a value of USD75.1 billion this year. Multinational corporations, including Abbott, Roche, Siemens, Danaher, and Thermo Fisher, account for over 50% of market share. However, domestic IVD firms are also catching up. According to Beijing-based research firm China Stone, in 2018, China’s IVD sector grew at a rate of 18.43% year-on-year, way higher than the global rate, which was less than 5%. The sector is expected to witness compound annual growth rates of over 15% in the next five to 10 years, the China Daily reports.

China has chartered 178 planes to send 100 medical staff and over 2,635 tons of medical supplies to over 40 countries including the U.S., UK and Italy by April 1. According to the General Administration of Customs, from March 1 to April 4, China inspected and exported up to CNY10.2 billion worth of epidemic prevention and control goods, including 3.86 billion face masks, 37.52 million units of protective clothing, 2.41 million infrared thermometers, 16,000 ventilators, 2.84 million detection kits, and 8.41 million pairs of protective goggles.