Alibaba bans online listing and trade of pharmaceutical products

Sweeping ban includes APIs, intermediates and prescription and OTC medicines and comes amid tight regulatory requirements and the "high risk nature" of pharma products, e-commerce giant says

The sweeping ban came into effect on Wednesday, April 28, after initially being announced on April 20 with Alibaba saying that penalties will start to be imposed against any violations of the new rules.

The largely unexpected move will hand competitive advantage to regulated and specialized online operators such as Kemiex, Amazon Pharmacy and others in their respective fields.

“In light of the regulatory requirements and the high risk nature of pharmaceutical products, Alibaba.com has revised the ‘Rules of Prohibited and Restricted Products’ to assist members in complying with applicable laws and maintain the sustainable development of the platform,” the company said in a notice to clients.

As a  result, Alibaba said it would be shutting down four sub-categories on its platform (Medicine, Pharmaceutical, Veterinary Medicine and Herbal Medicine) and products listed under these headings would be “taken down in batches” and banned from being sold under any other categories.

Pharma products subject to the ban also include human and animal drugs, hormonal drugs, steroids, radiopharmaceuticals, antibiotics, vaccines, traditional Chinese herbs and medicines and special pharmaceuticals such as analeptics and blood products.

“The aforementioned products are strictly prohibited by the platform, regardless of whether the seller, the buyer, the manufacturer or the product has relevant qualifications,” Alibaba said, adding that non-compliant products will be removed from listing or deleted.

“Kemiex remains the only regulated online platform to buy and sell pharmaceutical raw materials,” said Pau Franquet, chief executive officer at the online trade platform and data provider, adding that the company holds a Good Distribution Practice (GDP) certification from Swissmedic.

Seen as a worldwide pioneer, Switzerland strengthened its regulatory landscape and Therapeutic Products Act in 2019 in anticipation of a growing ecosystem of online solutions, as well as explicitly recognizing broker and agency activities.

The global online pharmacy market – which delivers finished prescription and OTC products – continues to grow due to increasing internet access and the popularity of smartphones, with dominant players including Amazon, Carepoint Healthcare and Giant Eagle.