THE role of Alibaba Health Information Technology Ltd. (Ali Health) in a regulatory platform tracking drug sales was brought into the spotlight after a pharmacy chain said it had filed a lawsuit alleging the arrangement gave Ali Health an unfair advantage.

    Hunan-based Yontinhe Group posted a notice on its website Tuesday, which said it was suing the China Food and Drug Administration (CFDA) over its electronic drug monitoring system, a platform that is operated by Ali Health.

    The news drove Ali Health’s Hong Kong-listed stock down 20 percent Thursday over concerns the company could lose the right to run the platform, formally known as the Product Identification, Authentication and Tracking System (PIATS). On Friday, Ali Health’s shares rebounded sharply and closed up 16.47 percent.

    China is the world’s second-largest pharmaceutical market behind the United States, and is a magnet for drugmakers, hospital operators and medical device firms targeting a wider health-care bill estimated to hit US$1.3 trillion by 2020.

    Yontinhe said that Ali Health, an affiliate of e-commerce giant Alibaba Group Holding, was itself a major player in online drug sales, creating a potential conflict of interest. (SD-Agencies)