Medicine as defined in Article 6 of the Pharmaceutical Affairs Law refers to materials and finished medicine in one of the following categories:

1. Medicine listed in the R.O.C Pharmacopoeia or pharmacopoeias of other countries, prescription catalogs, or any supplements to the above documentation that are recognized by the Department of Health.

2. Medicine not listed in the above documentation but are used for diagnose, treatment, ameliorate or preventing human diseases.

3. Medicine that have the potential to affect the human body or organic functions.

4. Materials used to manufacture medicine stated in the above three categories.

 

Medicine for human beings use may include Western medicine, Chinese medicine, herbs and Tibetan medicine. Western medicine may include small molecule medicine and biologics. Medicine in these categories is more clearly regulated by global drug control laws and has become major income sources for the global pharmaceutical industry.

Medicine can be categorized into materials (including agents) and finished medicine.  Materials refer to the active ingredients in medicine and finished medicine refers to medicine of certain types and dosages manufactured from basic materials. Finished medicine can be further categorized as Western medicines and Chinese medicines. They are commonly manufactured as tablets, liquids, powders, pills, capsules, ointments or injection solutions.

Moreover, the Department of Health classifies finished medicine into four categories based on safety levels and efficacy: (1) prescription medicine, (2) instructional medicine, over-the-counter medicine (OTC) and traditional formulas.

In addition to Western medicine, Chinese medicine is roughly classified into three categories based on current regulations and requirements for clinical trials: traditional formulas, non-traditional formulas, and herbal extracts (mixtures). This industry is highly unique in the sense that:

1. It is strictly monitored and supervised by the administrative agency.

2. Advanced research and development funding requires enormous investment.

3. It has a high technical threshold and is targeted at highly specialized markets.

4. Products are very profitable and the lifecycles are long.

5. It is an industry that requires cross-disciplinary technologies.