July 30, 2019

By Daniel Choi

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One of the most vital industries in a country with a looming population crisis

Despite its later start than most, the Chinese biopharmaceutical industry has evolved into a massive industry driven by the need for high-quality healthcare in orderto provide quality services for its ailing population. Uneven developmentacross the country, a lack of insurance coverage for biopharmaceuticalproducts, unclear policies and lower standards for clinical trials have caused the market to be flooded with low quality products and potentially endangermore lives than save them. This leaves room for stronger foreign brands andcompanies to take the reins and guide the industry into a stronger position.

One of the greatest problems faced by the government, a negative side effect of the controversial government induced birth-control practices decades ago, is the aging population, which may prove to be the single greatest driver for industry growth and also provide a strong case for the improvement of health care products.

Industry data and key segments

The Chinese biopharmaceutical industry created a total output of 2783.7 billion CNY (403.82 billion USD as of July 30th 2019) in 2017, a 10.8% growth over the previous year. According to ASKCI’s projections, the industry is set to reach a total of 5939 billion CNY by theyear 2022 (861.55 billion USD as of July 30th2019), in large part due to improving technologies and standards in Chinese companies, many of which are seeking to utilize international M&As or the creation of joint ventures for further development.

The manufacturing industry for biopharmaceutical products in particular earned a total of 398.8 billion CNY in sales revenues (57.98 billion USD as of July 19th2019) in 2017, a year-on-year growth rate of 12.05%.

While there are other segments in the Chinese Biopharmaceutical Industry, the segments for Vaccines, Diagnostics Kits, Blood Products, Antibody Engineering and Genetic Engineering in particular are prioritized over other segments due to strong political backing. 

Key development targets

China’s population, currently at almost 1.4 billion, is faced with a myriad of issues that come with a large population. An aging population, increasing numbers of patients with life-threatening illnesses such as cardiovascular deficiencies and tumors and extremely high demand for vaccines as befitting of the country with the largest population in the world are some of the key reasons why the Chinese biopharmaceutical industry’s main development goals include diagnostics/detection, improving biotechnology, regenerative medicine, vaccine improvement and further industrialization. 

Notable companies

Some of the strongest Chinese biopharmaceutical companies include CNBG, Hualan Bio, CAHIC, Walvax, KHB, Sinopharm, Fosun Pharma and SL Pharm.