The development of the Chinese pharmaceutical industry is becoming a popular topic at conferences, with various people now calling for attention to be paid to the country’s growth.
At BIO-Europe Spring, the message came from a panel specifically convened to discuss the transformational changes occurring with the Chinese industry.
The panel returned to one point when considering China’s rapid growth -- the level of regulatory change over the last five years.
Jay Mei, CEO of Antengene, a Chinese biotech, said, “We are probably the most heavily regulated industry in the world, so governments have to take the first step and it helps when it has money to help support the industry.”
He continued, “Over the past 10 years, the positive regulatory reforms have helped, including the past three years during which the government has implemented the same innovations developed by the US FDA (Food and Drug Administration) over 30 years.”
Jonathon Zhao, executive chairman of Transcenta, a biotech with sites in China and the US, agreed that the primary driver behind the growth of the Chinese biotech ecosystem has been the regulatory changes over the last five years, but he also added two further reasons.
He suggested, “The second [reason for growth] has been the payment system, which is still being reformed, right now. Very recently, the Chinese government unveiled the rare disease insurance coverage and we'll start to see more and more of these positive changes.”
“The third is the talent attraction – the government has created a lot of incentives to attract the top talent and who can build the best technology from ground zero," he concluded to attendees.
The relationship between China and Europe
The pace of development has enabled capital and technology to make its way between Europe and China. European companies have taken advantage of the growing need for equipment to arrange supply agreements, while capital from China has also flowed into the region from investors looking for next-gen therapies for the market.
However, Zhao, who has spent time working in Europe, suggested that despite this increased trade of information, capital, and technology, between Europe and China, the two markets still do not know each very well.
He said, “When I have talked to the local European biotech companies, they know very little about China and very few people had been to the country. They still carried the wrong perception about China still being in the Stone Age – I was so shocked.
"I challenged someone who said this and told them, 'I went to the same graduate school as you, at the same time; can you believe that I would create inferior technology to you? I'm leapfrogging you.'"
Zhao also admitted that some people within the biotech industry in China also hold the wrong impression of European industry being “conservative, slow, and with a small local capital market.”
Despite these perceptions, the Chinese market holds a lot of opportunity for European biotech, particularly in terms of raising funds, suggested Debra Yu, managing director of Chinese Renaissance.
She told attendees, "I had a company that had never thought about going to China to raise capital, but instead went there to license its technology. However, once the company did a licensing deal, Chinese investors started saying, 'Hey, I haven't thought of this company before, I'm interested to dig into this company more.'"