Chinese Premier Wen Jiabao has been speaking about the need to put a stop to corruption in the country and has highlighted healthcare as a highly problematic area.

Mr Wen, who was addressing a State Council “anti-graft” conference, said there was a need to target “unnecessary red tape, collusion between officials and businessmen, extravagance and waste,” reports the Xinhua news agency, and highlighted the problems that the country’s pharmaceuticals sector is facing.

Last month, he ordered an investigation into allegations of corruption against Zheng Xiaoyu, the former head of the State Food and Drug Administration (SFDA), who was in office until 2005 and stands accused of abusing the agency's drug approval authority by taking bribes and “turning a blind eye to malpractice by relatives and subordinate officials,” according to a statement released by the Communist Party's disciplinary watchdog.

Mr Wen’s comments came as the Chinese government announced that it is going to review production licences for 170,000 drugs, focusing on those issued between 1999 and 2002. The firms that will be under investigation are not expected to be the global pharmaceutical manufacturers but rather the domestic firms that have for years been flooding the market with cheap and dangerous versions of branded drugs.

The trial of a man accused of making fake versions of Roche’s Tamiflu (oseltamivir) has begun in Shanghai, and vice premier Wu Yi said that tough legal measures were needed against "unscrupulous drug authorities. Fines alone will not be enough. All those people should face the full force of the law."

Plans for a further crackdown on abuses of the system comes after the Chinese government announced that moves to tighten controls on China's pharmaceutical industry led to the business licences of 160 manufacturers and retailers being revoked in 2006.