Chinese Biotech Firms Raising Billions to Boost Drug Innovation

Chinese biotech firms are on track to raise about $10 billion in 2017, double the amount they raised in 2016, according to ChinaBio Consulting. The increase comes as China’s government initiated a series of regulatory changes in October 2017 to accelerate and streamline the approval of new drugs.

Historically, most Chinese drug production has focused on “me-too” products that are similar to existing drugs and aimed at the Chinese domestic market. China only contributes 4% to the $157 billion spent globally on drug R&D, compared to the United States’ 50%. China is the second-largest pharmaceutical market in the world with $117 billion in annual sales. That figure is set to grow 6-8% annually to about $175 billion in 2021.

According to the McKinsey consultancy, the number of new molecules under development in China has increased from 240 in 2012 to 800 in 2017, about 80 of which are in Phase III clinical trials. A quarter of the trials are taking place outside China. Most of the trials completed by Chinese companies in the U.S. are early stage so it will be years before the drugs reach market.