Eric Langer
|
China's thriving economy and evolving political landscape are luring companies from around the world to explore the Chinese
biotechnology market.
"How big is it? How fast is it growing?" companies ask. The answers vary by industry segment.
Eliza Yibing Zhou
|
Our new, in-depth study, Advances in Biopharmaceutical Technology in China, copublished by the Society for Industrial Microbiology and BioPlan Associates, Inc., describes the vitality and breadth
of China's biotechnological achievements.
This column is the first in a monthly series that is based on our study. Each installment will explore different aspects
of China's biotechnology phenomenon.
HISTORICAL PERSPECTIVE
In 1989 China developed and marketed its first genetically engineered drug, recombinant human interferon alpha 1b. This was
considered to be the official launch of China's modern biopharmaceutical industry. Since then, China's biopharmaceutical revenue
has grown phenomenally—from RMB 1.8 billion (~$230 million) in 1990 to RMB 30.31 million (~$3.88 billion) in 2005. Although
these numbers are still small compared with the size of the biotech industry in the West (Amgen's 2005 revenue was $12.4 billion,
and is growing at 18%), this growth is greater than 16-fold. Venture capitalists are optimistic about the opportunity this
represents, especially considering the country's 1.3 billion population.
China has developed and commercialized 30 biotech drugs and 150 more biopharmaceutical products are in the pipeline. Over
the next five years, 40 new "Class 1" innovative biopharmaceuticals are expected to complete clinical trials and enter the
market. "Class 1" refers to innovative biological products that have never been marketed in any country before, according
to China's State Food and Drug Administration (SFDA).
The Chinese biopharmaceutical industry is beginning to establish itself as a research-driven, domestic, market-oriented industry.
Meanwhile, China is also emerging as a global outsourcing hub for many overseas biopharmaceutical companies, especially those
in the United States and Europe.
However, as companies continue to grow their business in China, a number of issues need to be resolved, including biogenerics
versus innovative discoveries, intellectual property protection, quality and regulatory oversight, access to venture capital,
and enterprise management.
BIOGENERIC MANUFACTURING PROVIDES THE FOUNDATION
Based on the enormous domestic need for biologics, public health policy in China established biogeneric manufacturing as a
cornerstone of China's biopharmaceutical industry. As the Western world argued about the definition and legality of biogenerics,
the Chinese industry quietly thrived, driven by a relatively liberal regulatory environment and a huge domestic market demand.
Table 1. Major biogeneric Chinese manufacturers
|
China is the world's most populous country but it has an immature medical insurance system: two-thirds of Chinese citizens
are not yet covered by any kind of medical insurance. The Chinese spent less than $20 per capita on medications in 2003, compared
with American per capita spending of $700 in the same year. Therefore, inexpensive biogenerics are deemed to play an indispensable
role in the country's healthcare system. Affordable biogenerics currently dominate 95% of the Chinese biopharmaceutical market.
These include 30 recombinant products, 41 vaccines, 18 blood products, and more than 300 biodiagnostic products.
