Outlook on biopharma innovation trends in China

"Innovation" is a major driver of industrial development across the world and a vital force in biopharma sector transformation and advancement. Over recent years, China's biopharma industry has been actively innovating in technologies, business models, and enterprise management.

As China's biopharma industry continues to boom, its technical innovations are increasingly aligned with those globally. New business strategies and tactics "conforming to Chinese characteristics" will emerge to drive innovation and transformation in China's biopharma industry.

Outlook on biopharma innovation trends in China was authored by Deloitte China Life Sciences and Health Care team and the Shanghai Association for Science and Technology. Based on long-term observations of the biopharma industry, from "application and empowerment of innovative technology" and "explorations and breakthroughs in innovative R&D", this report explores biopharma innovation globally and in China, assesses the opportunities and challenges facing China's biopharma industry's innovative development, and analyzes and envisages biopharma innovation trends through the views of thought leaders in the sector.

Innovative breakthroughs in the global biopharma industry

Innovative biologics are undergoing constant iteration, development, and breakthroughs. Today, the development of new-generation innovative biologics, such as CGTs, is well underway. Accelerating development is therefore critical to promote global biopharma innovation.

Application of digital technology to biologics innovation and rising dominance of medical outsourcing service providers such as CROs and CDMOs, will accelerate the number of innovative biologics across the globe.

• Biopharma innovation is accelerating amid digital transformation
  As technologies become mature, digital healthcare will play an increasingly important role in penetrating every link of the "top-down" biopharma industrial chain, not only driving application transformation on the enterprise side, but also promoting comprehensive acceleration of the entire biopharma industrial chain.
• Application of AI in the entire medical industrial chain is accelerating technical breakthroughs
  In the coming 3-5 years, even more AI will be used in new drug R&D, expanding the industrial chain of biopharma companies from molecular development to market launch.
• Biopharma enterprises’ R&D priorities are shifting to innovation of targets and the development of new-generation therapies
  Driven by increased inputs into the application of science and technology, particularly AI, prospects for the discovery, R&D and marketing of new targets are now more promising. Deloitte expects more funds and resources to be injected into the development of CGT treatments, bringing about more innovation in biopharmaceutical industry.

Innovation trends in China’s biopharma industry

Influenced by global biopharma innovation trends and driven by the national dual circulation development model, China's biopharma market is conforming to global development and embracing international innovation. At the same time, it is enhancing its own innovation capacity to prove the innovation power of China's biopharma companies to the world.

• Innovative biologics are increasingly valued by government agencies. Thanks to the implementation of a host of regulations and policies in connection with the biopharma industry, R&D and market access are accelerating.
• China is becoming a digital transformation powerhouse for biopharma enterprises. Local and multinational biopharma companies in China are expanding their investment and application scenarios for digital technology.
• Innovation breakthroughs as AI empowers the entire biopharma industrial chain. As pharmaceutical and tech giants race to enact their business plans, China's investment market for "AI + biological technology" is changing dynamically. Its early industry development stage boasts huge market potential.
• For the new-generation therapy, China is a burgeoning market for CGT. Innovative biopharma companies with CGTs in China are suggested to consider diversified and innovative payment models, and think about raising CGT treatment output while ensuring quality.
• Innovation and implementation capabilities in China's biopharma companies are mainly driven by talent and technology accumulation, long-term government inputs and policy support.

Challenges and suggestions for biopharma innovation in China

China's biopharma industry has seen dramatic development in recent years. Global and domestic biopharma companies are expanding their footprints in the country, while cross-sectoral players are swarming into the industry.

However, there are still many challenges to innovation in China's biopharma industry, including weak basic research and insufficient innovative talent, etc. Deloitte gives recommendations for innovative development of China's biopharma industry, including conducting more basic research, working harder to commercialize research achievements, facilitating cooperation between the government and investment institutions to inject funds effectively and build a robust talent pipeline.

Government agencies are working with the biopharma innovation ecosystem to create a conducive environment for the innovative development of domestic biopharma enterprises, showing their commitment to transform China from a great generics manufacturer into a pharmaceuticals innovator, and even a global pharmaceuticals powerhouse, in the coming years.