Chinese authorities are reportedly investigating allegations that several makers of antibiotics in China used so-called gutter oil — repurposed oil salvaged from restaurant waste, gutters, drains and animal fat — in their products instead of more expensive soybean oil.

The state news agency Xinhua and other Chinese media reported that several pharmaceutical companies used gutter oil instead of the more expensive soybean online in the manufacture of 7-aminocephalosporinic acid, or 7-ACA, a chemical used to produce a class of antibiotics called cephalosporins.

The companies reportedly bought the recycled cooking oil from a company called Huikang Grease Co., which is facing prosecution over its alleged processing and selling of thousands of tonnes of gutter oil in 2010 and 2011.

The Taiwanese paper Want China Times reported that Huikang originally bought the oil from a firm called Gelin Biology Company.

Reselling discarded oil lucrative

The names of several of Huikang's suspected customers came out in court last week during the trial of several people charged in connection with the case, the Shanghai Daily reported.

Jiaozuo Joincare Biological Product Co., a subsidiary of the Joincare Pharmaceutical Group, Qilu Pharmaceutical and Charoen Pokphand Group are among the companies accused of buying the discarded oil and using it in their products.

Joincare issued a statement last Thursday saying it would work with the authorities looking into the matter, Xinhua reported.

Salvaging and reselling gutter oil is a lucrative business for the intermediaries who process it, filter it, blend it with edible oils and sell it on to restaurants, animal feed suppliers and drug makers looking for a cheaper alternative to vegetable, plant and other edible oils.

The Shanghai Daily reported that Huikang received around $22.5 million US for the roughly 14,700 tonnes of gutter oil it sold to Jiaozuo Joincare Biological Product Co.

Health effects unclear

Residue of the gutter oil may have ended up in antibiotics produced in China although it is unclear what health risks, if any, gutter oil poses. Some public health experts have said that the oil could contain excessive acid and cholesterol as well as possible carcinogens and other toxic substances.

China's food and drug administration and local authorities in Jiaozuo, a city where the Joincare subsidiary operates, are looking into what potential health effects the inclusion of the substance in antibiotics may have, Chinese media reported.

It's not the first time gutter oil has been in the news as authorities have stepped up efforts in recent years to stamp out the use of the recycled cooking oil and to generally improve the country's dismal record on food safety.

Chinese suppliers have been involved in several high-profile scandals over the past five years involving food and health safety — including the tainting of infant formula, milk products, pet food and beer with various unsavoury chemical products not meant for human or animal for consumption.