In 2025, global pharmaceutical R&D spending experienced a year of divergence.

According to the "Top 15 Global Biopharma R&D Spending" list released by industry media Endpoints News, the R&D spending threshold for the top 15 giants has risen to US5.8 billion, with leading companies each investing over US5.8billion,withleadingcompanieseachinvestingoverUS10 billion annually. However, according to Biospace data, the combined R&D spending of the top 16 pharmaceutical companies totaled approximately US$159.1 billion, a year-on-year decline of 3.6%, marking the second consecutive year of overall industry R&D expenditure contraction.

Meanwhile, R&D spending by Chinese pharmaceutical companies generally increased. The deceleration of the giants and the high-speed pursuit of Chinese companies form the defining characteristic of this year.

TONACEA 01: MNCs – Divergent R&D Strategies

Topping the list, Merck & Co. led with US$15.8 billion in R&D spending, but its investment was down 12% year-on-year. However, the reduction came mainly from decreased business development expenses, while its core internal R&D spending continued to grow.

With the patent cliff for its flagship product Keytruda approaching (sales exceeded US$31.6 billion in 2025, accounting for 54% of its pharmaceutical business revenue), Merck is building a diversified moat for the "post-Keytruda era" through M&A. Its oral PCSK9 inhibitor, KRAS G12C inhibitor, and IBD pipeline have all advanced to Phase III clinical trials.

The second tier of companies displayed more diverse R&D approaches.

Roche ranked second with approximately US$14.3 billion in R&D spending. Although the total declined about 10% year-on-year, its investment in high-difficulty indications such as Alzheimer's disease and multiple sclerosis remained strong.

AstraZeneca adopted a broader "full-track layout" strategy, currently boasting over 100 Phase III clinical trials, covering almost all hot innovation tracks – from IL-33 antibodies to in vivo CAR-T therapies, from oral GLP-1s to eight self-developed ADCs.

Notably, Regeneron had the highest R&D-to-revenue ratio on the list at 41%, making it the "most daring" investor. The company is betting on frontier breakthroughs through intensive R&D, ranging from gene therapies to siRNA therapies, while also addressing the pain point of muscle loss in the obesity field.

Amgen and Eli Lilly, with growth rates of 22% and 21% respectively, bucked the trend with expansion, becoming the two giants with the most significant R&D spending increases this year.

TONACEA 02: Chinese Pharma – Catching Up on R&D Intensity

According to R&D analysis of Chinese pharmaceutical companies released by Insight Database, BeiGene ranked first in domestic R&D spending with RMB 15.412 billion, a year-on-year increase of 9.9%, and an R&D expense ratio of 40.16%, approaching Regeneron's level.

Hengrui Medicine's cumulative R&D investment in 2025 reached RMB 8.724 billion, accounting for 27.58% of its revenue, with R&D intensity also nearing the typical level of multinational pharmaceutical companies. Hansoh Pharmaceutical's R&D expenditure was RMB 3.358 billion, up 24.3% year-on-year, representing 22.34% of revenue, maintaining a growth rate of over 20% for three consecutive years, demonstrating continued commitment to innovation.

The translation of innovation achievements is also forming a positive cycle. BeiGene's Brukinsa achieved global sales of US$3.9 billion in 2025. Hengrui's innovative drug sales revenue reached RMB 16.3 billion, a 26% year-on-year increase. Hansoh's innovative drug revenue accounted for as high as 82.2% of its total.

However, there remains a significant absolute scale gap in R&D spending between Chinese pharmaceutical companies and global leaders. Merck & Co.'s annual R&D spending is approximately RMB 110 billion, almost equivalent to the total R&D spending of China's top 15 pharmaceutical companies. Catching up in total R&D scale will still take time. However, in terms of R&D intensity and localized innovation breakthroughs, Chinese pharmaceutical companies are moving closer to global standards with near-rigorous determination.

References:

1. Top 15 Global Pharma R&D Spending List Unveiled; WuXi AppTec

2. Insight Database

3. Biospace data