* First quarter Fresenius, FMC earnings miss market view
* Hit by drug price cuts in China, U.S. reimbursement cuts
* FMC shares down, Fresenius shares recoup initial losses (Recasts, adds analyst comment, details on China, U.S., blood product)
FRANKFURT, May 6 (Reuters) - First quarter earnings at German healthcare group Fresenius SE grew more slowly than expected, hurt by spending cuts in the United States and China and lower sales of a blood substitute product.
The drugmaker, which also operates hospitals and controls dialysis provider Fresenius Medical Care, said on Tuesday adjusted net income rose 2 percent to 228 million euros ($316 million), short of the 244 million euro average estimate in a Reuters poll.
Its generic injectable drugs business suffered from price cuts in China and lower sales of a blood substitute called HES, an emergency treatment for sudden blood loss. European regulators had advised physicians to no longer use it for certain patient groups.
Commerzbank analyst Volker Braun said most negative effects, such as China and HES, had been known, but were hard to quantify. "The picture remains relatively blurred," he said.
Fresenius shares recovered from initial losses of as much as 2.5 percent, trading 0.6 percent higher at 0804 GMT.
Its subsidiary Fresenius Medical Care, the world's largest kidney dialysis provider, said net income declined 9 percent to $205 million, less than the $225 million average expectation in a Reuters poll.
The U.S. federal agency that sets reimbursements for Medicare in January cut dialysis payment rates, which cancelled out routine annual mark-ups to adjust for inflation, a move that will be repeated next year and possibly beyond.
FMC fell 1.2 percent, among the biggest decliners on Germany's blue-chip DAX index as analysts said the company's full-year outlook for an earnings drop, confirmed on Tuesday, had previously been viewed as cautious but now looked more realistic.
FMC is targeting net profit of between $1 billion and $1.05 billion this year, compared with $1.11 billion last year.
"There is certainly less of a likelihood now of an improved outlook during the remainder of the year," said Commerzbank's Braun.
($1 = 0.7205 Euros) (Editing by John Stonestreet)