China's traditional Chinese medicine (TCM) industry is set to unleash its enormous potential with the first legislation to standardize its medicine and services coming into effect, marking a new level of the industry's development, according to experts.
The TCM legislation was released by the Standing Committee of the National People's Congress on December 25 last year and officially came into force on Saturday.
The law is the first of its kind in the sector, confirming TCM's significant position and optimizing support for the development of TCM drugs and related services, in order to create a good market environment, a TCM expert said, according to the Shanghai Securities News on Saturday.
"The law changed the TCM clinic qualification from a registration system to a filing system, and simplified TCM doctors' entry standard, enormously encouraging the industry's development by shaking off policy shackles," Zhang Ziran, vice president of the China Association of TCM, told the Global Times on Sunday.
In fact, capital has already flowed into the TCM industry, covering the whole industrial chain ranging from herbs and medicine patents to services such as TCM hospitals and clinics, the report said, noting that the services sector tends to be more attractive.
"In terms of services, TCM clinics or centers are particularly favored by investors thanks to their reproducible chain model and popularity among the ordinary people in the last two or three years," Zhang said.
For example, the TCM clinic chain Gushengtang raised $70 million in a series C round led by a U.S.-based global insurance firm last year, to expand the clinic network from its base in Shenzhen, South China's Guangdong Province to other places, according to media reports.
The large-sized clinic chain will be the trend of the future for TCM services, Zhang noted.
The new law also stressed the importance of industrial normalization by guaranteeing the quality and safety of herbs in cultivation, collection, storage and processing. Meanwhile, the law increases penalties for violations, particularly for the cultivation of herbs.
The TCM market will embrace a good environment under the law by "protecting the herbs' quality throughout the production chain, which lays a foundation for further marketing, brand building and internationalization," an industry analyst was quoted as saying to Shanghai Securities News.
"Compared with developed markets such as South Korea, Japan and Europe, China's TCM industrial chain is not yet mature, with much room for improvement," Zuo Jiacheng, a Beijing-based TCM doctor, told the Global Times on Sunday.
"Supported by industry law, we should concentrate on producing more competitive TCM products and enhancing our service standard," Zuo said.