China announces 1st group of infant formula companies that get approval for market access in 2018

In early August, China’s Food and Drug Administration (CFDA) has announced the first batch of infant nutrition companies and products that have passed its new registration program, and are now free to do business in the country from 1 January 2018.
The CFDA now requires manufacturers of infant formula to register brands and recipes with them in advance.
The first announcement showed that 22 companies with total of 89 products got approval. Five are international companies and they are Mead Johnson (9 products), Wyeth (6), Abbott (6), Friesland Campina (3) and Nestle (2). Meanwhile, Australia’s a2 Milk Company and its partner Synlait are hopeful their application in May will also be approved.
According to regulations expert Rong Liu, from Yantai Foodmate Information Technology, each infant formula enterprise can apply for a maximum of 9 products. “All formulas passing the formula registration shall be indicated with the registration number in the label and instruction from January 2018,” she said.
Domestic companies that received approval include Yashili (15 products), Beingmate (12), Feihe (9), Mengniu (6), Yili (6), Red Star (6), Junlebao (3), Biostime (3) and CHG (3).
Meawhile, latest news revealed that the 2nd batch of companies have jut been approved comprising of 3 domestic companies with 9 products. No foreign manufacturers are in the list.
The CFDA has confirmed that more approvals will soon be announced, and that unapproved formulas on the shelves can be sold until their expiry dates, to ensure a lower risk of supply shortage after the 1 January 2018 registration deadline for manufacturers.
Currently, there are still 80 infant formula manufacturers that have not submitted their formula registration dossiers, of which about 50 are overseas manufacturers.
Rong Liu added that all the large domestic and foreign manufacturers have already been approved, and these companies contribute more than 70% share of the market. They also have competitive advantage with more time to organise production and marketing activities during the post-registration period.
The new registration system has created some uncertainty in the market. CFDA’s wish to reduce the number of brands on the market led to many local players particularly those which had multiple brands to heavily discount in order to shed stock before the new rules come into force. The knock-on effect of this was that sales from some of the international firms slumped, however, in the long run, they will benefit from the new rules.