Coronavirus: China’s dire shortage of antigen test kits shows the market gap created by zero-Covid U-turn

If you search the major Chinese e-commerce platforms for “antigen test kit”, you will find limited results – and even those are not for products in stock but merely links to presales.

In China, many pharmacies are posting notices about sold-out antigen test kits and long queues are forming in front of the few stores that still have them.

Following the sudden easing of anti-Covid restrictions, many cities in China are seeing a soaring demand for key medical supplies, such as fever-reducing medicines, N95 masks, and especially the antigen test kits, which have become the most important way for people to test themselves for coronavirus after nucleic acid test sites were closed in China.

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Winner Medical, a leading medical products manufacturer in China, said on Monday in its record form of investor relation activities that its recent revenue for antigen testing kits had exceeded the total of the first few months of 2022.

However, buying these basic testing kits has become a very difficult task for most Chinese.

Wang Fei, a resident in Wuhan, said she had not seen the antigen kits at her neighbourhood pharmacy since Covid-19 restrictions were lifted.

“The antigen kits I bought online two weeks ago haven’t even been shipped,” she said.

Producers of antigen kits attributed the shortage to the gap between an abrupt surge in demand and the time needed to boost production.

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“The pandemic has suddenly become serious in the last two weeks, and the demand has surged,” said one administrator of a certified antigen test manufacturer in China. “The gap between supply and demand was thus generated.”

Premier Li Keqiang said at a State Council meeting on Wednesday that government authorities should assist manufacturers in expanding capacity and boosting production to meet the rising demand for medical and Covid-prevention products. Li also flagged the importance of stepping up global cooperation and importing urgently needed goods.

Zhang Shuwen is general manager of antigen kit manufacturing company Nanjing Liming Bio-products Company that has been approved by the European Union, Southeast Asian countries and several countries in South America. He said production capacity could not ramp up in such a short period.

“The manufacturers needed time to prepare raw material and labour for the increasing demand, particularly at this time of material price increases and manpower shortages due to infection,” he said.

The government has sped up vetting to allow more companies to engage in production
Zhang Shuwen

The National Medical Products Administration has approved antigen test kit production for 42 manufacturing companies. According to Zhang, there are over 100 manufacturers applying and waiting to be certified by the administration.

Zhang’s company is one of them. His company applied in April and was expected to be approved next month, he said.

“Usually, it takes a year,” he added. “The government has sped up vetting to allow more companies to engage in production.”

Earlier this month, the local medical production administrations met antigen kit manufacturers to ensure a smooth registration process, Zhang said.

Jacky Wang, a medical supplies producer in southern China, said profiteers who hoarded antigen kits and sold them at a higher price exacerbated the shortage.

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“Many of the antigen kits sold by these middlemen are from unqualified manufacturers,” he said. “Some antigen kits are even fake.”

According to the regulations governing the supervision and management of medical devices in China, the unauthorised business in antigen kits is illegal and will be penalised. Trading unqualified or fake antigen kits may even be prosecuted as a crime.

On Tuesday, China’s State Administration for Market Regulations announced 10 filed violations of medical supplies, including price gouging and selling unqualified products.

“Too many people are hoarding and selling,” Wang said. “The government cannot deal with each of them.”

Local governments in China are now addressing the difficulty in buying antigen kits by standardising collection and distribution through the government.

In mid-December, a batch of regular priced antigen kits – limited to five kits per person – once again became available at pharmacies in Nanjing after being organised by the local government.

“People lined up in long queues in front of the pharmacies to buy the antigen kits,” said Zhang, who lives in Nanjing. “The kits soon ran out within a couple of days.”

Meanwhile, Chinese manufacturers are racing to expand their capacity for antigen test kits.

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Shenzhen YHLO Biotech Company, a manufacturer whose antigen kits were among the 42 products certified by the National Medical Products Administration, said in its record form of investor relation activities this month, its daily capacity to make the kits would increase from 4 million pieces to 7.5 million pieces.

Huang Guo, deputy commissioner of the administration, said on Tuesday China’s daily capacity for the antigen test kits had reached 60 million pieces. Huang said no unqualified products were found over three product inspection rounds of the certified manufacturers.

“It will take some time for producers to catch up with people’s surging demand,” Zhang said. “The shortage is expected to ease in two weeks.”

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