Skip to content

China biopharma: From contractor to competitor

June 17, 2017

This story by Damien Garde at Stat is well worth a look. It goes into a question that people in biopharma have been asking themselves for some years now: when does China move from a contractor to a competitor? This was brought home by the recent results at the ASCO meeting from Nanjing Legend, who presented some very interesting data on CAR-T therapy in multiple myeloma. I can guarantee you that the response from almost everyone hearing this news was “Who?” And that makes you wonder how many more “Who?” companies are going to be making appearances in the next few years.

China’s biotech boom was no overnight success. For years, global pharma companies largely viewed the country in the context of cost arbitrage, and firms in China made their money by providing contract services to the Mercks and Pfizers of the world. Chinese companies that sold drugs of their own focused on decades-old generics, not the innovative biological treatments minting fortunes in the West.

But things swiftly changed in the last decade, thanks in large part to China’s Thousand Talents program, said Jonathan Wang, who leads the Asian division of life sciences investment giant OrbiMed. The 2008 government initiative targeted Chinese-born academics and workers who trained overseas, enticing them to come home with the promise of grants and tax breaks.

I don’t expect a Chinese Merck, Novartis, or Biogen any time soon, for some values of “soon”. But I do expect Chinese companies to have a growing presence in research-driven biopharma, because that’s the sort of move up the value chain that makes sense. What could slow it down are the funding mechanisms for smaller companies (which is where the US excels). As Garde’s article mentions, you can’t list on the Chinese stock markets until your company is showing a profit, and what would the NASDAQ look like if that were the requirement over here? Another thing that could slow (or warp) the nascent sector over there is a dirigiste approach to it from above, and you can never rule that out. In real R&D, some drugs (and companies) are going to succeed and others are going to fail, but those may not line up with the ones who have the best connections or the most support from inside the government.

On the other hand, one thing that could speed up the business over there is a different attitude towards clinical trials and drug approvals. I know that I’ve been going on for a long time around here about how clinical trials are necessary for both safety and efficacy, that we could end up wasting a lot of time and money and endangering patients if we loosen things up too much. But what if your regulatory regime sees these as prices that are worth paying in order to build up a new industrial sector? That will be worth watching, too. I don’t think that’s the best way to go, obviously, but I don’t think we can be sure that the Chinese government agrees. There have already been (too many) instances of corner-cutting even within the current regulations for anyone to be complacent. The government is well aware of the problem, and certainly realizes that it’s a problem, but may end up having to decide how strict they want to be.

One way or another, though, there will indeed be home-researched, home-developed Chinese drugs. The business case for them is sound, and there is no shortage of Chinese business executives who realize this. On the research side, there are too many intelligent, highly competent people working there for that to be any kind of barrier. China has a lot of people with scientific training, and the best of them are right up there with the best anywhere else in the world. I hope it goes well, because there’s a lot of medical need in the world and a lot of things that are yet to be discovered.

http://bit.ly/2sdCrZY

Advertisements

From → Uncategorized

Leave a Comment

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s

%d bloggers like this: