In life sciences R&D, China is reaching for the stars

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This says that by 2015 China will be the 2nd largest pharmaceutical market in the world. Is that a good thing?

Fierce Biotech Research
By Mark Hollmer
6/9/12

At the long-awaited kickoff of the 2012 BIO International Convention in Boston on June 18, many of the initial sessions weren't exactly crowded. The same can't be said, however, for the all-day session on China.

At the morning part of the session, panelists represented different facets of China's increasingly sophisticated life sciences drug discovery and development operations. The crowd very quickly became standing-room only. Clearly, China is where it's at these days, even more so than before.

What was interesting to me was that a nation that can be very modest about expressing its ambitions actually laid them out pretty clearly. You've probably heard about China's goal to build a space station by 2020? Well, the world's most populous nation has the same scope of ambition for its drug discovery and development work, explained Ying Luo, a panelist and chairman of the Beijing Continent Pharmaceutical Co. Fair enough, and the various facts you could glean from their presentations brought the point home.

Among the highlights:

Life science researchers at Chinese universities are increasingly forming collaborations with multinational corporations and Chinese biotechs. The Beijing Cancer Hospital, for example, is working with WuXi AppTech (a massive Chinese CRO) to develop new cancer cell lines for research, noted Edward Hu, WuXi's CFO/COO.

We've all heard about major life sciences research coming from places in the U.S. such as Harvard University, the Sloan-Kettering Cancer Center and the Scripps Research Institute. We'll see tomorrow's big research generated from places in China like the China Academy of Science, Peking University and Tsinghua University. Top research talent with major government financial support is based at those and many other academic institutions in China, said Zegon Zhang, a deputy director of the Beijing Pharma and Biotech Center, a nonprofit government agency. (We told you about China's research surge back in April.)

More than 97% of residents in China now have medical insurance coverage, a sea change that is helping to drive much of the R&D surge the country is facing.

Domestic Chinese biotechs are aggressively investing in R&D and do that, in part, by leveraging government support, Hu said.

Drug discovery work in China costs as little as one-third to one-half the cost in the U.S., according to Ying Luo of Beijing Continent Pharmaceutical. Pre-IND work, for example, can cost as little as $600,000 to $1 million, he said.

China is developing a small army of experienced scientists. WuXi, for example, employs 6,000 people globally, with more than 5,000 of its scientific cadre based in China. And the panel explained that the country continues to train scientists at its universities, or welcome back residents after they earn a Ph.D. abroad.

Pfizer ($PFE) is apparently the largest pharma/life sciences multinational doing business in China today.

China at the moment is the third-largest pharmaceutical market in the world. That will change by 2015 when it becomes the second-largest pharmaceutical market.

-- Mark Hollmer