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Victoria Bela

China’s biopharmaceutical sector is said to have entered an “innovation 2.0” phase as it moves to a commercialisation mindset that could see it sideline global competitors and outpace the US – despite restrictive trade policies.
In recent years, innovative drug development in the world’s second-largest pharmaceutical market has rapidly approached – and in some cases surpassed – that of the United States, the world’s biggest market.
Growing concerns over China’s biotech capabilities have led the US to renew efforts to restrict federal contracting with Chinese firms. But those efforts could face diminishing returns as the country’s lead in drug innovation continues to expand.
According to a new report on mainland Chinese biopharmaceutical innovation by analytics company Clarivate, China has matured from a phase of rapid expansion to an “innovation 2.0” phase of quality-focused development.
“This transition represents a fundamental shift in priorities: from speed to quality, from chasing market trends to building sustainable competitive advantages, and from capital-driven growth to value-driven development,” according to the report published on December 8.

Alice Zeng, one of the authors of the report and a senior consultant at Clarivate Life Sciences and Healthcare, said China’s focus in the past decade had been on how to do research and development – not what happened after a drug was approved and launched.
She said companies were now entering a phase where they would need to improve “commercial insight” through the entire development life cycle of a product – including how to make money from it and how to make it a “blockbuster”.
“I think this is a new start and it’s a new era for the whole industry in China,” Zeng said.
In the US, meanwhile, lawmakers have for years attempted to pass versions of the Biosecure Act, which would prohibit entities that receive federal funds from contracting with certain Chinese biotech companies.
It previously failed to pass over concerns that it could disrupt drug development and raise healthcare costs, but a retooled version of the act was signed into law on December 18 as part of a sweeping defence bill.
It does not name any specific companies, but directs the executive branch to come up with a list of “biotechnology companies of concern” that could be blocked from receiving federal contracts, loans or grants.
Zeng said measures like these could have a long-term effect on early drug discovery and research.
But for Chinese biopharma or biotech companies hoping to get their products into the US market now, they “know they have the gap to commercialise their drugs or medicines”.
She said these companies were seeking licensing opportunities and partnerships with multinational corporations in the US that had strengths in late-stage drug development and could help them overcome barriers to market access.
US policymakers given 3-year window to retain industry leadership
In April, the US bipartisan National Security Commission on Emerging Biotechnology – set up by Congress in 2022 – warned that policymakers had a three-year window to retain or regain biotechnology leadership.
In its latest report on the future of US-China biotechnology competition in December, the commission said the evidence showed that “this window is closing faster than anticipated”.
“Imagine a world where the cutting edge of biopharmaceutical innovation no longer runs through San Francisco or Boston, but through Beijing and Shanghai,” the report said.
“Although the United States has historically led in biotechnology, over the past 20 years China has systematically built a vertically integrated biotechnology ecosystem that is now in prime position to challenge US leadership.”
According to Zeng, Chinese companies have R&D investment and supply chain advantages for specific therapeutics such as PD-1 cancer treatments – meaning they can supply cheaper drugs to the US market.
In 2023, a PD-1 antibody cancer drug developed by Shanghai Junshi Biosciences called Toripalimab was approved by the US Food and Drug Administration (FDA) to treat nasopharyngeal carcinoma – the first to be approved by the regulatory agency to treat this aggressive form of throat cancer.


When it hit the market, despite costing over 30 times more in the US than in China, the drug was still 20 per cent cheaper than the top-selling American PD-1 antibody at the time.
On average, only one or two out of every 10,000 compounds that are synthesised in laboratories successfully pass through all the development stages required to enter the market, according to the Geneva-based International Federation of Pharmaceutical Manufacturers and Associations.
From 2004 to 2023, 942 novel active substances were launched globally with the US launching the most, followed by China, the federation said in a 2024 report.
China is now the No 2 country for first launches of new molecular entities after the US, accounting for 18 per cent of them in 2024, according to the Clarivate report.
New molecular entities are drugs containing an active ingredient that has not previously been approved by regulatory bodies like the US FDA and China’s National Medical Products Administration (NMPA).
China is also leading the way in targeted protein degradation, or TPD – a drug development strategy that hijacks the cell’s natural systems to destroy specific disease-causing proteins, which could be used to treat cancer and neurodegenerative diseases.
Mainland China accounted for 38 per cent of worldwide publications on TPD in 2024 – surpassing the number from the US in 2022. It also accounted for 37 per cent of global TPD patents and 30 per cent of TPD agents under development last year.
China almost doubles share of global life science publications in 9 years
China published 255,903 life science papers in 2024, with its share of global life science publications reaching 28.67 per cent – nearly double that in 2015, according to a China Daily report last week, citing figures from the China National Centre for Biotechnology Development.
From 2020 to 2024, among the top 100 most innovative biopharma firms in mainland China, pipeline assets are up by more than 100 per cent, patents are up by 450 per cent, and ongoing clinical trials are up by 110 per cent, according to the Clarivate report.
It said some of the measures in China to support innovative drug development included a “groundbreaking 30-day fast track approval channel for clinical trials” and central policies to connect basic research, financing, regulatory review, health insurance and price management.
“The data clearly shows we’re entering an era where ‘Made in China’ pharmaceuticals will be synonymous with cutting-edge science and global impact,” Henry Levy, the president of Clarivate Life Sciences and Healthcare, said in the report.
As the second-largest pharmaceutical market in the world, China is also becoming increasingly attractive for international companies seeking to market their drugs.




China’s growing integration with global pharma markets
China’s integration with other global pharmaceutical markets is growing, with 66 per cent of the new drugs approved by major global regulators from 2019 to 2023 already approved on the mainland, and another 18 per cent under regulatory review.
There have now been several cases of biopharma companies filing for regulation with China’s NMPA first before pursuing traditional markets like Japan, Canada, Australia or Europe, according to the report.
Incentives to seek drug approval in China include the “very attractive market” and supportive government policies, according to Zeng.
She said the timeline for drug approvals in China was now almost the same as in the US, so choosing China instead could be a route to enter the market faster for companies facing tough competition in America.
“With advantages in speed, labour, supply chain and clinical trial costs, mainland China-origin assets typically transact at a discount versus global benchmarks – upfront payments are often 60 to 70 per cent lower,” the report said.
By August, the volume and value of mainland China’s out-licensing – or granting another company the rights to use a drug, technology or intellectual property for specific markets – had already surpassed last year’s total.
Zeng said that for competitors in emerging drug markets like India and South Korea, the lower cost of Chinese-origin drugs could make competition “fierce” as it also affected the global market and innovation ecosystem.
Some governments of emerging markets request the lowest possible prices in the world, which drugs like China’s PD-1s can provide.
“You cannot get a very healthy ecosystem because if you cannot earn money from the innovative drug, you cannot invest in the future,” Zeng said.


If China could provide a “reasonable price” for drugs rather than the lowest price, it would help the innovation ecosystem and make it easier for other countries or competitors to survive, she said.
While countries like India and South Korea have competitors in areas like active pharmaceutical ingredients, generic drugs and biosimilar drugs, innovative drug development requires an entire ecosystem from basic research to supply chain to be competitive.
She said finding another country with the whole ecosystem that could catch up with China on innovative drug development would be tough, with even the US facing challenges such as cost, supply chain and pricing.
That view was echoed by the National Security Commission on Emerging Biotechnology.
“We no longer have to imagine a world in which China outperforms the United States in biopharmaceutical innovation. That world is already emerging,” the commission said in its December report.
“If the United States cedes biopharmaceutical innovation to China, the US biotechnology industry will never look the same.”


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American commission issues stark warning, as analytics firm Clarivate reports that Chinese innovative drug development has entered new phase


American commission issues stark warning, as analytics firm Clarivate reports that Chinese innovative drug development has entered new phase.


China’s biopharma sector ‘in prime position to challenge US leadership’

.css-1c6uqr6{color:inherit;font-weight:inherit;font-size:inherit;font-family:inherit;line-height:inherit;overflow-wrap:break-word;}American commission issues stark warning, as analytics firm Clarivate reports that Chinese innovative drug development has entered new phase

American commission issues stark warning, as analytics firm Clarivate reports that Chinese innovative drug development has entered new phase