(Yicai) Oct. 28 -- Baxter International has informed its distributors in China that the US healthcare firm mainly focused on kidney disease treatments has ceased commercial operations of intravenous therapy products in the Chinese market.

Baxter recently adjusted its global supply network and the IV therapy products made by its Shanghai plant will stop being supplied to the Chinese market, according to a notice the company's local unit sent to distributors seen by Yicai. Related commercial operations were halted on Oct. 23.

The China arm of Baxter later confirmed to Yicai that the information in the notice was true.

"With the changes in the environment and market, Baxter's IV therapy business in China faces numerous challenges," according to the subsidiary. "Over the past few years, Baxter has actively explored and attempted various business transformation plans to find a suitable long-term sustainable development strategy for the infusion business.

"After thorough consideration of patient safety and ensuring a reliable supply of products to the market, we plan to gradually cease commercial operations related to the IV therapy business in the Chinese market," the Shanghai unit pointed out.

Baxter is exiting the Chinese IV therapy market mainly because the demand for and usage of the products has significantly decreased due to the country promoting the rational use of antibiotics, industry insiders told Yicai. In addition, because of intense competition leading to a drop in prices, the soft bag infusions it first launched have been increasingly imitated by Chinese rivals, resulting in shrinking product competitiveness, the person added.

The change is limited to products related to the infusion business, Baxter's unit noted, adding that it will continue to do business in China and actively pursue transformation, bringing more innovative products into the market while actively exploring localized cooperation.

Illinois-based Baxter has plants in Shanghai, Guangzhou, Suzhou, and Tianjin. Set up in 1998, its Shanghai factory mainly produces IV solutions, while its Guangzhou plant focuses on producing peritoneal dialysis solutions.

Baxter is one of the world's largest manufacturers of IV solutions, holding around 80 percent of the US market. However, its peritoneal dialysis solution business, which falls under its renal care unit, recently replaced the IV therapy business as its largest in China.

Baxter's infusion business in China peaked in 2007, a former head of the company's IV therapy business said to Yicai. The supply volume of IV bags in the Chinese market exceeded 100 million at that time, the person added.

Editor: Martin Kadiev