The Wall Street Journal-20080215-Heparin Probe Finds U-S- Tie to Chinese Plant

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Heparin Probe Finds U.S. Tie to Chinese Plant

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Baxter International Inc.'s investigation into the cause of deaths and allergic reactions linked to its blood-thinner heparin is focusing on variations in batches of the active ingredient for the drug, most of which were supplied by a Chinese manufacturing facility co-owned by a Wisconsin company.

Baxter said the active ingredient for its heparin was supplied by Scientific Protein Laboratories LLC, a Waunakee, Wis., company with a manufacturing facility there and a joint-venture operation called Changzhou SPL in Changzhou, China. Baxter declined to elaborate on the nature of the variations, but heparin is a particularly tricky product to manufacture because it is derived from pig intestines.

David G. Strunce, president of Scientific Protein, said most of its active ingredient for heparin is made at the China plant, but some comes from the Wisconsin facility. "There's nothing that would explain these reactions, and we are very concerned about this," he said. "We have no idea if these reactions have anything to do with our product."

Though the cause of the reactions still isn't clear, the incident places Baxter and Scientific Protein, which is majority-owned by the Bethesda, Md., firm American Capital Strategies Ltd., at the center of a broader debate about the oversight of overseas drug manufacturing. The U.S. Food and Drug Administration has said it didn't inspect the Chinese operation, which is also owned by Changzhou Techpool Pharmaceutical Co., of China.

Baxter said Monday it had temporarily stopped production of heparin because of about 350 bad reactions, including four fatalities, potentially tied to the drug, which is used primarily in kidney dialysis and heart surgery. An FDA official estimated that about 40% of the adverse reactions among patients taking the Baxter drug were classified as serious. They ranged from stomach pain to vomiting and diarrhea, low blood pressure, speeding heartbeats and fainting.

China's rise to become the world's largest manufacturer of drug ingredients has helped drug companies elsewhere trim production costs, particularly for generic products like heparin, where margins are generally slim. Changzhou SPL Co., also known by its Chinese name, Kaipu Biochemical Co., is one of hundreds of Chinese manufacturers that have quietly become a linchpin of the global pharmaceutical industry. In 2005, China had $4.4 billion, or 14%, of the world's $31 billion market for active pharmaceutical ingredients, topping India and Italy, according to a report written last year by Jinsong Du, a health-care analyst in Hong Kong with Credit Suisse Group.

Yesterday, Sen. Charles Grassley, an Iowa Republican, wrote to the FDA and to Baxter, asking for more data about the heparin and its supplier. Michigan Democrats John Dingell and Bart Stupak, leaders of the House Energy and Commerce Committee, have been investigating import-safety issues with drugs and medical devices. In their own letter to the FDA, they said "American lives are unnecessarily being placed at risk" by the limited oversight over foreign manufacturing.

Baxter spokeswoman Erin Gardiner said the company is using "molecular separation" analysis to "look for chemically meaningful differences" between heparin batches linked to bad reactions and "control" batches known to be of high quality.

In a written statement, the FDA said, "We cannot comment on the details of an open and active investigation. We are examining any potential anomalies for the batches implicated and working to determine their cause and significance. We cannot speculate on any potential causes and must continue to pursue the investigation to obtain the necessary answers."

Heparin is a complex sugar molecule that normally exists on the lining of blood vessels in people and animals. It is now made from pig intestines, but processing them can lead to impurities. "Crushing tissue to get extracts means you can get contamination from other things in the tissue," says John R. Hess, a blood expert at the University of Maryland.

In manufacturing, raw intestines are exposed to an enzyme and then to a resin that separates the heparin from the rest of the liquid. The end product is heat-treated to destroy microorganisms.

Scientific Protein Laboratories said it has been making the heparin active ingredient at the Chinese facility since 2004, and that it meets FDA standards and "engages in the same testing and quality- control procedures as U.S. facilities that produce bulk heparin." American Capital Strategies didn't return calls.

Neither the Chinese State Food and Drug Administration nor the General Administration for Quality Supervision, Inspection and Quarantine, which polices quality issues, could be reached. Changzhou Techpool declined to comment.

Yesterday at Changzhou SPL's factory, about a two-hour drive northwest of Shanghai, the smell of chemical reagents and the whir of exhaust fans were detectable outside. Two workers in green uniforms, black rubber boots, face masks and surgical caps scrubbed equipment outside the plant. Guards blocked reporters from entering the compound.

U.S. regulators can provide only limited oversight for such operations. A woman in the administration office of Changzhou SPL said the company is expecting investigators from the U.S. FDA to arrive Monday for their first visit to the plant. "We'll fully cooperate with Baxter and FDA investigators," said a manager of the quality-control department.

The FDA isn't legally required to inspect every foreign drug facility, but it generally does examine them if they are named as a maker in a new application to market a drug in the U.S. If the holder of an existing, approved application switches manufacturers, the new facility would usually get inspected as well. However, a legal requirement for drug manufacturers to get inspected every two years applies only to domestic plants.

The FDA's commissioner, Andrew von Eschenbach, has said he would like to base FDA inspectors and other experts overseas, including in China.

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Ellen Zhu and Sue Feng contributed to this article.