Key Insights:

• From Desert to Global Hub: Over the past 22 years, China’s pharmaceutical industry has dramatically evolved from focusing on low-level generic drugs to producing globally competitive, First-in-Class (FIC) innovative assets.
• The Payoff of Involution: The intense domestic competition of the PD-1 era acted as a crucial training ground. It established a complete, high-quality, and cost-effective industrial foundation for next-generation biologics like ADCs and bispecific antibodies.
• A Surge in Global Licensing Deals: Driven by multinational companies’ urgent need to replenish pipelines ahead of patent cliffs, Chinese innovative drugs accounted for nearly half of the global out-licensing transaction value in 2025, surpassing the United States.
• A New Global Connector: As global attention shifts from “Why China?” to “How China?”, the industry’s center of gravity is moving. This shift is giving rise to new domestic industry platforms to showcase Chinese innovation to the world.

Capital, talent, information, and opportunities in an industry often emerge first where people gather.

Today, conference rooms in China’s innovative drug industry are no longer filled just with scientists and R&D heads. Business Development (BD) teams from multinational pharmaceutical companies (MNCs), investment bank managing directors, fund partners, law firm consultants, and overseas collaborators frequently share the same agenda. They discuss not only targets, experiments, and clinical data, but also licensing deals, NewCo structures, global commercialization paths, and who will build the next truly Chinese MNC.

This scene would have been almost unimaginable 22 years ago.

Early organizers of pharmaceutical exchanges remember that around 2004, tthere were only a handful of people doing new drug R&D. Gatherings were scarce. A few people sitting around a table with mineral water, talking from noon until dark, was considered an event. Cheng Zengjiang, founder of Tongxieyi, remembers that these early events were simply called small salons. There were almost no industry-wide technical conferences.

One scientist who returned to China in 2006 recalled his generation’s journey. Mostly born in the 1960s, they were part of the first wave of students to study abroad in the 1980s. Inspired by the slogan “The 21st century is the era of biology,” they entered the field just as China began opening its doors.

By 2006, many had earned PhDs and spent years working at major overseas pharmaceutical companies or biotech startups. This coincided with China’s economy entering a golden era. The 2008 global financial crisis shifted global economic momentum. This shift, combined with various talent attraction programs, triggered a massive wave of returning scientists.

Talent returned, but China’s biopharmaceutical field remained practically a “desert.” Founding an original drug company was impossible. Instead, most returning scientists joined platform enterprises like WuXi AppTec. These were among the earliest companies to plug into the global biopharmaceutical supply chain, later known as the CXO service system. It was a realistic path: there were orders and cash flow, allowing them to survive first and pursue innovation later.

Lu Xianping, founder of Chipscreen Biosciences and one of China’s earliest biotech founders, also struggled initially with whether to provide CRO services or develop new drugs. He ultimately chose the arduous path of innovative drug development.

In an era dominated by generic drugs, active pharmaceutical ingredients (APIs), and local pharmaceutical factories, a company’s core strength wasn’t R&D. It was channel capabilities, local relationships, and the ability to secure production approvals. Industry “exchanges” were often just endless drinking banquets between sales managers and hospital directors.

Discussions about “R&D” mostly revolved around meeting the domestic drug registration requirements of the time. No one talked about BD. No one talked about IPOs, and “global cooperation” was rarely mentioned. Back then, “BD” simply meant buying a few generic drug approvals from domestic research institutes.

These returning scientists had seen true innovation at top global pharma companies. Back home, they felt like a group of people standing in an empty field, staring at a distant, glowing destination, wondering when they would ever reach it.

Even for generic drugs, the industry was still playing catch-up on basic concepts. What is a bioequivalence study? What are related substances? What is a generic drug in the truest sense?

True innovative drug companies were incredibly rare. Venture capital had not yet taken shape. Clinical trial systems, registration regulations, intellectual property protections, and professional talent reserves were all strictly held to local Chinese standards. Most “R&D” meant slightly tweaking dosage forms or making “me-too” drugs.

Because the starting point was so low, the dramatic transformation of the past 22 years is remarkable.

Today, MNCs come to China to buy projects. Banks, brokerages, and law firms have systematically embedded themselves in the industry. Pharmaceutical companies no longer discuss just technical issues, but also BD, NewCos, commercialization, global markets, and payment systems.

In a sense, the evolution of an industry conference serves as a cross-section of this massive industrial upgrade.

1、The Era of a Few Bottles of Mineral Water

More than 20 years ago, the biopharmaceutical circle was very small. Very few people were doing true innovative R&D. Everyone either knew each other or could connect through mutual contacts. News about who had returned, who had started a project, or who had brought back a new technical route spread quickly.

During this stage, Tongxieyi shifted from hosting salons to organizing conferences.

The earliest conferences focused heavily on specialized pharmaceutical technologies. Topics included experimental design, formulation analysis, CDE regulations, and confirmatory clinical trials. Attendees listened intently and took furious notes. People stood in the aisles, chased down speakers for questions after the sessions, and eagerly exchanged business cards.

Back then, meetings weren’t for transactions; they were for learning. The main focus was R&D training.

This reflected the true mission of that era: before China could make innovative drugs, it first had to learn how to make modern drugs. Furthermore, the industry supply chain was far from formed.

Modern entrepreneurs take CROs, CDMOs, registration consultancies, and clinical resources for granted. Early pioneers lacked these mature external partners. To advance a project, they had to figure it out themselves or cobble together resources. Finding a place for toxicology, a hospital for trials, or someone who understood registration rules was incredibly difficult.

Therefore, it is not surprising that many early returnees chose companies like WuXi AppTec.

There, they could access international clients and standard systems while building execution capabilities in China. The foundation of China’s pharmaceutical industry grew bit by bit out of these platform companies.

Directly pursuing innovative drugs was a massive risk. Wang Yinxiang, an early attendee of these 2004 salons, was a rare exception. Cheng Zengjiang recalled that Wang sat quietly among the 10 to 20 attendees, listening to lectures. No one imagined he would quietly become one of the earliest representative figures in China’s innovative drug sector.

At that time, domestic efforts mainly focused on “fast-follow” strategies, tracking foreign new drug projects entering Phase 1 or 2 clinical trials. It wasn’t creating something from nothing; it was rushing in swiftly just as the boundary of world knowledge was pushed open a crack.

That generation was pragmatic and restrained. They knew China couldn’t do too much yet, so they learned, followed, and filled in foundational gaps. No one casually claimed to be disruptive or a global first. Just advancing a project into clinical trials was enough cause for celebration.

2、Some Succeeded, Others Drifted Apart

In the history of China’s innovative drugs, Venturepharm (Dezhong Wanquan) is rarely discussed today. Around 2000, it was as famous as WuXi AppTec. With opportunities in both CRO services and innovative drugs, it was viewed as a platform player with massive potential.

Years passed; WuXi AppTec grew into a massive industrial group, while Venturepharm faded from the mainstream.

This divergence was not uncommon in the early days. Some companies had great starting points—teams, resources, and opportunity windows—but ultimately couldn’t stay at the table.

A symbolic story circulates within the industry:

Some early companies shifted their focus to Hainan, hoping to leverage policy perks to build “China’s Puerto Rico.” It sounded imaginative: low costs, policy dividends, and a regional testing ground. However, they eventually learned that long-term survival depends on R&D, supply chain strength, and global capabilities, not local arbitrage.

Years later, Hainan was left with chemical generic drug production capacities, while the true wave of innovation rose elsewhere. This was the tuition paid by a generation of enterprises.

The 2015 pharmaceutical regulatory reforms pushed the industry into an accelerated development phase, but also created a bubble. When financing is hot, telling a story is easier than doing clinical trials. Many companies were rapidly pushed up, only to plummet in the subsequent squeeze. The market ultimately cared about only one thing: do you actually have a good drug?

The survivors were often the companies that seemed “stupid”—slowly building their teams, honestly conducting trials, and advancing pipelines step by step.

If the success of BeiGene and its drug Zanubrutinib was somewhat expected—given its elite scientists, abundant capital, and global R&D system—SystImmune (Baili Tianheng) was an unexpected outlier. Few thought a company without a “standard luxury setup” could create a product that secured a massive, cash-heavy BD deal with an MNC. To this day, this drug supports the company’s multi-billion dollar market capitalization.

SystImmune shattered the old assumptions about the path to success: it proved that perfectly configured companies aren’t the only ones qualified to win.

Cheng Zengjiang noted that many people didn’t understand SystImmune’s founder, Zhu Yi. He lacked the typical biotech founder resume, didn’t raise massive funds, and set up in Chengdu instead of Shanghai or Boston. Before partnering with BMS, his Seattle team had only about 20 people.

When he worked on tetra-specific antibodies, many thought it was a joke. When Cheng Zengjiang asked him on stage if he was just trying to attract eyeballs, Zhu Yi simply answered: “I am already doing clinical trials.”

Cheng Zengjiang admitted his early doubts, but believed that anyone willing to spend real money on clinical trials deserved to be taken seriously. In China’s innovative drug circle, the true dividing line is not the PPT or the story, but whether you actually advance the project and dare to face the test of real data.

Relying on local strength to make global blockbuster products also applies to traditional pharma companies. 3SBio made the market re-evaluate it through a PD-1/VEGF bispecific antibody deal. CSPC Pharmaceutical Group has also consistently produced assets with international collaboration value.

These are success stories today, but true history is never a straight upward climb. It is made up of a large number of people who drifted apart, missed companies, and the tuition fees they paid.

3、How Chinese Efficiency Grew

For twenty years, China’s pharmaceutical role was clear: introduce, learn, digest, and innovate by following MNCs. China was the buyer; MNCs were the innovators.

Over the past two or three years, this paradigm has decisively shifted.

• 2025 Deal Volume: Chinese companies secured 157 outbound licensing deals.
• Market Share: Total transaction value exceeded $135.6 billion, capturing 49% of the global total and surpassing the US for the first time. The total outbound licensing amount was 3.2 times that of the US during the same period.
• Continued Momentum: In Q1 2026 alone, outbound deal value exceeded $60 billion, nearly half of the entire 2025 total.

This is largely driven by growing pressure on global pharma companies. By 2030, a global market of over $260 billion will face patent expiration risks, involving over thirty blockbuster drugs like Keytruda and Ozempic. Once patents expire, generic drugs swarm the market, and original drug sales shrink drastically. Meanwhile, MNC internal R&D efficiency has hit a decade low.

Pipelines need replenishing, but the window is narrowing. Furthermore, the efficiency of US Biotechs has fallen far behind China.

As a result, Chinese assets have become highly strategic targets:

• Pfizer CEO Albert Bourla publicly stated that China is an important source of future BD.
• Roche’s CEO stated at the 2025 JPM Healthcare Conference that they will continue looking for high-quality Chinese assets.
• Nearly one-third of external innovation projects for large MNCs in 2024 came from Chinese biotechs, up from 10-12% between 2020 and 2022.
• Seven of the top ten global pharmaceutical licensing deals in 2025 were from Chinese companies.

This shift affects daily operations. “Some multinational pharmaceutical headquarters, upon noticing reports from a conference in China on a certain cutting-edge direction, will directly issue tasks to their Chinese teams: you must visit several relevant companies one by one, compile a list, and complete it on time,” said Cheng Zengjiang. This happened after an in vivo CAR-T conference in Shanghai last September.

MNC anxiety met a decade of capability accumulation in China:

• By late 2024, Chinese companies had 3,575 active innovative drugs (1st globally in scale).
• China held 7,032 pipelines under development (29.5% globally, ranking 2nd).
• First-in-Class (FIC) drugs independently developed by Chinese companies entering clinical trials jumped from 9 in 2015 to 120 in 2024.

This leap was forged during the intense internal competition of the “PD-1 era.” Dozens of Chinese companies piled into the PD-1 track, crashing prices to the floor. While viewed as negative homogeneous competition at the time, this intense “involution” built a complete, high-quality, and cost-effective manufacturing foundation.

PD-1 became the backbone for next-generation drugs. In particular, PD-1/VEGF bispecific antibodies developed by Chinese companies have become cornerstone products that every MNC wants.

At the 2025 ASCO Annual Meeting, 73 oral presentations came from China. China contributed about 48% of global research in the ADC field and 49% in bispecific antibodies. That round of involution was an expensive but worthwhile tuition fee.

Finally, the national industrial positioning shifted. In 2025, new measures supported adding innovative drugs to commercial health insurance catalogs. Biomedicine was officially listed as a national strategic emerging pillar industry, shifting the policy focus from controlling costs to expanding the industry.

Three forces converged: MNC external demand, China’s supply capacity, and a strategic shift in national industrial positioning.

4、A New Battlefield

Industry changes will ultimately be reflected in conference rooms.

In September 2024, a hastily organized symposium on in vivo CAR-T in Shanghai completely sold out before the deadline. The attendance exceeded a thousand people, forcing a last-minute venue change.

This massive turnout for a niche topic signaled that the industry’s attention had long surpassed superficial quiet.

Amid this chaos, Cheng Zengjiang ran into Kong Fu’an, Secretary of the Management Committee of the Shanghai Hongqiao International Central Business District.

An idea surfaced: Since China’s innovative drugs are attracting global attention, why not build a platform on Chinese soil for global industry followers?

Kong Fu’an supported the idea, suggesting the China International Import Expo (CIIE) venue in Hongqiao. Hongqiao and Zhangjiang are the two major hubs planned for Shanghai’s future biopharmaceutical development. The Yangtze River Delta region already accounts for over 60% of China’s innovative drug capabilities. Hongqiao serves as the perfect window to showcase this ecosystem to the world.

While this conference aims to benchmark against JPM (J.P. Morgan Healthcare Conference), JPM is difficult to replicate. JPM relies on decades of accumulation of the US capital market and global allocation center.

The crowd flying to San Francisco every January will not disappear. However, historically, when an industry’s center of gravity shifts, it spawns new platforms. People previously asked “Why China?” at JPM. Now, they ask “How China?” The industry is beginning to need its own global connector.

Twenty-two years ago, a few bottles of mineral water and a simple afternoon made a gathering.

Twenty-two years later, the people sitting in the conference room include both new and old faces.

Some have gone public, some are going global, some are staying up late in labs, and some exited during the last bubble. The industry has gained capital, scale, and global opportunities. As the industry finally flourishes, the most important question may be: how many people still remember why they set out in the first place?

Original Link：https://www.blueview.vip/industry/a-22-year-on-site-documentary-witnessing-and-recording-the-rise-of-chinas-innovative-drugs/