In China, the pharmaceutical market is dominated by its non-branded generic industry that operates with basic technology and simple production methods. Although its domestic pharmaceuticals are not as technologically advanced as western products, the former still take up approximately 70% of the market in China. Domestic companies are mainly government owned and fraught with overproduction and losses. The Chinese government has begun consolidating and upgrading the industry in an effort to compete with foreign firms. At present, hospitals are the main outlets for distributing pharmaceuticals in China. It is estimated that most hospitals derive 25% to 60% of their revenue from prescription sales.