The Ministry of Finance and its provincial commissioner offices have fined 19 pharmaceutical companies for inflating drug prices and indulging in practices that violate the country's accounting law, officials said on Monday.

The companies have been slapped with fines of 30,000 yuan ($4,578) or 50,000 yuan, based on the violation facts and sanction provisions in the country's accounting laws. It also follows an inspection of the quality of accounting information jointly conducted by the Ministry of Finance and the National Healthcare Security Administration from 2019.

A senior official from the Ministry of Finance told China Daily that the inspection, which covered 77 randomly selected pharmaceutical companies, focused on analyzing the cost composition of their products, and aimed to find out the causes of high prices of medicines.

Some of the penalized companies had used false invoices to siphon money from the company for various other uses. Some others made up business matters or conspired with medicine dealers to extract funds. Other breaches include setting nonstandard accounting books that violate the accounting law and accounting standards, said an announcement issued by the Ministry of Finance.

Administrative sanctions on these companies have been postponed due to the novel coronavirus pandemic. The penalties will warn pharmaceutical producers to comply with the accounting laws standards and help curb medicine price rises to a certain extent, the official said.

This action also indicates that Chinese regulatory authorities are stepping up inspection and investigation of accounting information quality in the corporate sector, and the Ministry of Finance, as the competent authority, will further strengthen regulation and supervision in the accounting profession, the official said.