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Obstacles and opportunities in Chinese pharmaceutical innovation

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Background Global healthcare innovation networks nowadays have expanded beyond developed countries with many developing countries joining the force and becoming important players. China, in particular, has seen a significant increase in the number of innovative firms and research organizations stepping up to the global network in recent years. Nevertheless, the intense Research and Development input has not brought about the expectable output. While China is ascending at a great speed to a leading position worldwide in terms of Research and Development investment, scientific publications and patents, the innovation capabilities in the pharmaceutical sector remain weak. DiscussionThis study discusses the challenges and opportunities for pharmaceutical innovation in China. One hand, academic, industrial, institutional and financial constraints were found to be the major and inevitable barriers hindering the development of drug innovation. On the other hand, unique advantages had been observed which included growing pharmaceutical market, Research and Development funding, distinctive source, and international cooperation. SummaryThe most important thing for China’s pharmaceutical sector to leap forward is to break though innovation barriers and integrate own advantages into global value-chain of healthcare product development.
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D E B A T E Open Access
Obstacles and opportunities in Chinese
pharmaceutical innovation
Jingyun Ni, Junrui Zhao, Carolina Oi Lam Ung, Yuanjia Hu
*
, Hao Hu and Yitao Wang
Abstract
Background: Global healthcare innovation networks nowadays have expanded beyond developed countries with
many developing countries joining the force and becoming important players. China, in particular, has seen a
significant increase in the number of innovative firms and research organizations stepping up to the global network
in recent years. Nevertheless, the intense Research and Development input has not brought about the expectable
output. While China is ascending at a great speed to a leading position worldwide in terms of Research and
Development investment, scientific publications and patents, the innovation capabilities in the pharmaceutical
sector remain weak.
Discussion: This study discusses the challenges and opportunities for pharmaceutical innovation in China. One
hand, academic, industrial, institutional and financial constraints were found to be the major and inevitable barriers
hindering the development of drug innovation. On the other hand, unique advantages had been observed which
included growing pharmaceutical market, Research and Development funding, distinctive source, and international
cooperation.
Summary: The most important thing for Chinas pharmaceutical sector to leap forward is to break though
innovation barriers and integrate own advantages into global value-chain of healthcare product development.
Keywords: China, Pharmaceutical industry, Obstacles, Opportunities, Global network, Innovation
Background
Pharmaceuticals are playing an extreme important role in
global health system by diagnosing, curing, treating, and
preventing diseases. In terms of dramatically increasing
R&D (Research and Development) expenditures and rela-
tively decreasing approvals of new drugs during recent
past, the decline in R&D efficiency has been the central
issue of discussing global pharmaceutical innovation
[1, 2]. Meanwhile, recent literature clearly points out
that emerging countries mainly involving China show
the increasing importance of pharmaceutical R&D
activities and investments in innovative research for
developing new drugs with the influence of R&D
globalization [3, 4]. In this context, it is of great signifi-
cance to understand pharmaceutical innovation in
China from the global perspective.
As one of the fastest growing markets among the
emerging countries, China received increasing attention
from around the world. Due to supporting national
polices, economic growth, aging population and global
trend, Chinas share of pharmaceutical industry output
increased nearly sevenfold, from 2.5% in 1995 to 18.3%
in 2010, and is expected to become the second-largest
pharmaceutical market in the world by 2020 [5, 6]. This
changing trend may also apply to the global healthcare
innovation networks as increased sales performance can
better support R&D.
It is obvious that China has ascended to a worldwide
leading position at an accelerated pace in terms of R&D
funding, scientific publications, and patents in recent
years [4]. With the perspective of switching from imita-
tion to innovation, R&D expenditure in Chinas pharma-
ceutical industry increased from $162.6 million USD
(USA dollar) in 2000 to $3249.2 million USD in 2011
[7]. The favorable condition created by the tremendous
investments made by Chinese pharmaceutical sector in
R&D has resulted in significant global share of scientific
* Correspondence: yuanjiahu@umac.mo
Institute of Chinese Medical Sciences, State Key Laboratory of Quality
Research in Chinese Medicine, University of Macau, Room 2053, N22,
Avenida da Universidade, Taipa, Macau, China
© The Author(s). 2017 Open Access This article is distributed under the terms of the Creative Commons Attribution 4.0
International License (http://creativecommons.org/licenses/by/4.0/), which permits unrestricted use, distribution, and
reproduction in any medium, provided you give appropriate credit to the original author(s) and the source, provide a link to
the Creative Commons license, and indicate if changes were made. The Creative Commons Public Domain Dedication waiver
(http://creativecommons.org/publicdomain/zero/1.0/) applies to the data made available in this article, unless otherwise stated.
Ni et al. Globalization and Health (2017) 13:21
DOI 10.1186/s12992-017-0244-6
publications and patents in recent years. The number of
articles published by Chinese scholars in peer review jour-
nals related to pharmaceuticals has leapt to the second
position in the world [8].
However, China is still weak in developing real innova-
tive medicines. Considerable pharmaceutical R&D input,
scientific publications and patents in China have not yet
translated into the ultimate outcome of innovative
pharmaceutical products recognized globally. For a long
time, pharmaceutical industry in China is known for its
mass-production of low-level generic drugs and as a
world factoryof active pharmaceutical ingredients
(APIs) with little mentioning of real innovative medi-
cines [9]. Studies have shown that China remains at a
weak position in the global drug innovation network
based on analysis of worldwide recognized innovative
drugs [1012].
It is no doubt that the pharmaceutical innovation sys-
tem in China is filled with obstacles which prevent Chinas
R&D capabilities from transforming into innovation
competencies and eventually pharmaceutical products to
generate market values [13]. With concerns about the
huge gap between strong R&D input/ paper output as well
as weak innovative medical products, this study aims to
provoke a more systematic analysis of obstacles and op-
portunities in Chinese pharmaceutical innovation system.
More understanding of pharmaceutical innovation system
in China will be helpful to provide the more opportunity
of discovering new medicines effectively in the world.
Obstacles to pharmaceutical innovation in China
Innovation is a system phenomenon, with multiple types
of individual and collective agents, including firms,
entrepreneurs, institutes for education and research,
policymakers, regulatory agencies, and many types of
services and intermediaries, interacting in a variety of
ways [14]. Based on prior literatures [15, 16], Fig. 1
demonstrates pharmaceutical innovation system, which is
comprised of R&D organizations, governments, pharma-
ceutical companies, finance and service institutions, re-
sponsible for knowledge innovation, policy innovation,
production innovation, and service innovation, respect-
ively. These innovations link together and generate new
medicine discovery under a favorable regulation, market,
finance, and technology transfer environments. Obsta-
cles to pharmaceutical innovation in China have been
observed at each of the above-mentioned counterparts
which will be discussed further in the following.
Academic organizations
It has been suggested that close partnerships among uni-
versities, institutions and companies are integral for the
new business model of pharmaceutical R&D in China
[17]. However, to maintain an effective collaboration be-
tween the science and the industry of pharmaceutical
has always been challenging. Pharmaceutical researchers
in universities and research institutes in China devote
very much to the research work which does not usually
take into consideration of the overall development of the
pharmaceutical industry. As a result, the research work
may not fully address and respond to the challenges and
changing demands of the industry [18].
Moreover, paper output, i.e. scientific publications and
patents, generated in the environment have been seriously
criticized by international society, as is clearly shown in
recent literatures [1921]. The Science Citation Index
(SCI) -based promotion scheme provides scholars with
great incentives in terms of personal honors and has
Fig. 1 Pharmaceutical innovation system
Ni et al. Globalization and Health (2017) 13:21 Page 2 of 9
successfully encouraged them to produce a large quantity
of publications and file many applications for patents.
However, the citation rate of academic papers remains at
a low level and the patent lives are short. As shown in
Fig. 2, the proportion of licensed patents gradually de-
clined, despite the rapid increase in the number of granted
patents during the past decade. The difficulty of patent
licensing by universities may imply a considerable gap be-
tween academic research and innovative products. Critics
start to review the benefits and possible downside of the
SCI-oriented research assessment criteria. It has been sug-
gested that, under the scheme, scholars have become more
oriented to personal achievements than the core value of
research work, which has lowered innovation quality
and slowed down the overall pharmaceutical innovation
development in China [19, 20]. Commercialization of
R&D output to real innovative drugs well thus falls
behind.
Pharmaceutical industry
In the context of industry, high fragmentation of the
industrial structure, weak R&D intensity and serious
product homogeneity are the major barriers to new drug
development in China. As of 2012, there were around
4500 domestic pharmaceutical manufacturers and 14,000
domestic pharmaceutical distributors in China, which
were attributed in three subsectors involving in chemical
drug (50%), traditional Chinese medicines (32%) and bio-
technology production (18%) [22].
As shown in Fig. 3, more than 70% of pharmaceutical
manufacturers are small-scale enterprises with employees
less than 300 and operating revenue less than $3 million
USD in China (according to Chinas Regulations on Small
and Medium- sized Enterprises (SMEs) Categorizing
Criterialast accessed in 2011) [23]. It is difficult for them
to sufficiently support R&D with all necessary financial
resources to pursue new drug discovery.
Meanwhile, current ratio of R&D investment to sales is
about 2.7% in most of the Chinese pharmaceutical
companies, which is significantly lower than that of US
counterparts ranging from range of 1520% [9, 24]. Due
to lack of R&D resources for new drug discovery and de-
velopment, most of the small-scale firms engaged mainly
in low-value-added activities such as manufacturing,
formulating, packaging and distributing generic products
rather than innovation activities. At most, these pharma-
ceutical firms usually opted for developing generic drugs
in order to obtain short-term revenue without going
through the burden of high technical innovation. Accord-
ing to the China Drug Review Annual Reportreleased by
the China Food and Drug Administration (CFDA) in
2012, the number of category 1.1 new drug applications
which reflect the status of innovative drug development
solely in domestic Chinese pharmaceutical companies
remained around 70 per year over the past few years. On
the contrary, applications of changing dosage form
and new generic drugs accounted for more than 50%
of chemical drug applications in China (see Fig. 4).
In addition, repetitive applications of generic drugs
without high technical innovation became a prominent
issue in the current pharmaceutical industry in China.
Figure 5 indicates the distribution of the Abbreviated
New Drug Application (ANDA) applications with exist-
ing approval numbers submitted in 2012. The vertical
axis represents the number of ANDA applications, while
the horizontal axis shows the intensity of repetitive
applications. There were 1272 applications of generic
drugs, each of which was repetitively submitted by dif-
ferent sponsors more than 20 times, accounting for
60.7% of the total in 2012. For example, in 2014, CFDA
Fig. 2 Granted patents and licensing percentage of Chinese universities. Data source: China Universities Statistics Yearbook
Ni et al. Globalization and Health (2017) 13:21 Page 3 of 9
released the first list of overproduction drugs (more than
500), 34 categories of drugs are manufactured by more
than 500 pharmaceutical companies in China, such as
aspirin, ibuprofen, metronidazole, norfloxacin and so on.
The excessive development of homogeneous generic
drugs resulted in over-capacity of the same products,
which catalyzed the unordered market competition. While
many manufacturers produced the same type of generic
drugs, each manufacturer incurred only single-digit profit
margin or might even experience financial loss [25].
Regulation and administration
The regulatory system of pharmaceutical products in
China has also contributed to the sub-development of
drug innovation in China. Firstly, due to insufficient
manpower of the Center for Drug Evaluation (CDE) and
excessive applications of generic drug products, the drug
approval time in China was often prolonged which
greatly discouraged pharmaceutical R&D. The average
waiting time for standard reviews was 12.3 months
(see Fig. 6) which could be prolonged much further
to a point of having an uncertain time for obtaining final
approval [26]. In contrast, for the Food and Drug Admin-
istration (FDA) in the U.S., the New Drug Application
(NDA) usually took 12.9 months after standard reviews to
receive an approval [27].
On the other hand, regulatory standards in China were
not consistent with international practices. As China did
not join the International Conference on Harmonization
of Technical Requirements for Registration of Pharma-
ceuticals for Human Use (ICH), innovative drugs which
already marketed in other countries had to undergo the
new drug registration pursuant to Chinas Drug Registra-
tion Regulation. Consequently, the entry of import drugs
to the local market could be delayed as many as 7 years
on average compared with the date the drug first mar-
keted in other countries [28]. For example, Gardasil
(Human papilloma virus (HPV) vaccines), which is used
to prevent infections by certain types of human papillo-
mavirus, has been first marketed by MSD company in
2006. However, this widely-used vaccine that has been
marketed in more than 130 countries and regions in the
world, has not yet approved by CFDA. Furthermore, for
registration purpose, it was necessary to repeat the clin-
ical trials of import drugs in China as the ChinasGood
Clinical Practice (GCP) was different from the GCP ac-
cording to ICH. In addition, pre-approval by the CFDA
was needed before clinical trials could be conducted,
which meant another several months or more waiting
Fig. 4 Number of chemical drug applications accepted by the CFDA
from 2009 to 2012. 1. Data source: 2013 China Drug Review Annual
Report. 2. Category 1.1 refers to new chemical drug which has never
been previously approved for marketing as a drug anywhere else in
the world. Category 3 of Chemical Drugs refers to a new drug which
has only been marketed outside of China. Category 4 refers to Drug
substance and its preparation with changed acid or alkaline radicals
(or metallic elements), but without any pharmacological change,
and the original drug entity already approved in China. Category 5
is defined as Drug preparation with changed dose form, but no
change of administration route and the original preparation
already approved in China. Category 6 refers to Drug substance
or preparation following national standard
Fig. 5 The distribution of ANDA applications. Data source: 2012
China Drug Review Annual Report
Fig. 3 The number of pharmaceutical manufacture enterprises and
percentage of large-medium enterprises in China. Data source: China
High-tech Industry Statistics Yearbook
Ni et al. Globalization and Health (2017) 13:21 Page 4 of 9
time. The international clinical trial multi-center might
offer some advantages as a quick channel for import
drugs but this only applied to drugs that were already
marketed or at least entered phase II clinical trial in
other countries [29]. As a result, simultaneous global
development of drugs faces great challenges in China.
Finally, unlike the practice of marketing authorization
holder (MAH) widely adopted in many developed coun-
tries, drug marketing authorization in China was only
granted to pharmaceutical manufacturers with produc-
tion authorization. This created significant threat to the
initiative of technology transfer between R&D players
and pharmaceutical firms. On one hand, R&D institu-
tions might lack the manufacturing facilities and thus
were not eligible for applying marketing approval of the
drug developed in-house. On the other hand, drug
manufacturers needed to shoulder the pressure of
massive financial investment for every new production
line when developing a new product. The potential
risk caused by overcapacity would further constrain
thefuturedevelopmentofenterprisesoreventhe
entire pharmaceutical sector.
Finance and service institutions
As a major component of innovation system, financing sys-
tem firstly poses significant challenges to drug innovation
in China. Improper funds arrangement was common and
usually resulted in inefficiency of new drug R&D. Public
investment was the key funding source for R&D institutes
in the pharmaceutical sector, of which more than 81%
R&D expenditure was accounted for with government
funding while private investment only accounted for 5.41%
in 2012 [30]. Although the central government had allo-
cated increasing resources into R&D institutions in recent
years, investment for basic research was insufficient. In
China, only 4.7% of R&D investment was used to improve
basic research which was little compared with the figure in
some developed counties (see Table 1). This was especially
problematic for pharmaceutical industry as preliminary
research was the source of new ideas important for fueling
subsequent innovation and had significant impact on the
performance of new drug discovery [31].
For new drug developers, contributions of venture
capital (VC) were limited in China. In particular, the
SMEs considerably relied on government investment to
Fig. 6 Average waiting time for technical review of chemical drugs. 1. Data source: 2013 China Drug Review Annual Report. 2. Figure 6 describes
the average waiting time for technical review of chemical drugs in four channels, including Investigational New Drug (IND), New Drug
Application (NDA), bridging clinical trial (abbreviated as BCT in Fig. 1) and Abbreviated New Drug Application (ANDA). Waiting time is measured
in month and calculated as the difference between CDEs reception date (the day CDE receives drug evaluation request of certain applications
from CFDA) and technical review starting time. The January 2012, December 2012 and December 2013 are three time points that CDE
commences technical review of certain applications
Table 1 International comparison of R&D expenditure
By types of Research % China USA Japan France Australia South Korea Russian
(2011) (2009) (2009) (2009) (2008) (2010) (2010)
Basic Research 4.7 19.0 12.5 26.0 20.0 18.2 19.6
Applied Research 11.8 17.8 22.3 39.8 38.6 19.9 18.8
Experimental Development 83.5 63.2 60.5 34.2 41.4 61.8 61.6
Data source: China Statistical Yearbook on Science and Technology
Ni et al. Globalization and Health (2017) 13:21 Page 5 of 9
support their innovation projects [18]. Since VC market
only started 30 years ago, VC activity and investment
level in the pharmaceutical sector was substantially
lower in China than in other developed counties. Ac-
cording to S&P Capital IQ estimates, 711 VC and pri-
vate equity (PE) funds had life sciences investments in
the U.S., whereas only 89 similar funds in China. More-
over, out of the 89 funds, only 19 made more than one
investment [32]. There were also other issues about finan-
cing for drug innovation. For instance, lack of an efficient
investment exit channel made it difficult for investors to
withdraw capital gains. As a result, a lot of VC only paid
attention to short-term and less innovative projects [7].
Volatility of stock markets, highly exaggerated price to
earnings ratios, and lack of sophisticated secondary mar-
kets were also detrimental to the financing for high-risk
new drug R&D projects [18, 33].
At last but not least, barriers often cited in the litera-
ture were also found to be the key factors influencing
drug innovation in China which included lack of prac-
tical and effective IP (intellectual property) protection
and enforcement strategies [34], growing of counterfeit
and substandard medicines, and undeveloped technology
transaction platform and intermediary agencies.
Opportunities for Chinas pharmaceutical innovation
As two sides of the same coin, Chinas pharmaceutical
innovation still has various unique opportunities, despite
of so many obstacles mentioned above. For instance,
during the stage of the Key Drug Innovation Project
from 2009 to 2011, 62 NDAs originated from this pro-
ject were approved by the CFDA and about 400 categor-
ies entered the clinical research stage [35, 36]. Moreover,
some positive efforts have been made in recent years.
For example, recruitment of Chinese scientists back
from abroad, China is embracing Thousand Talents
plan[37]. The latest news reported that The Chinese
Academy of Sciences (CAS), the heart of Chinas scien-
tific development, is making unprecedented structural
reforms to foster collaboration and to turbocharge re-
search [38]. The CFDA issued a draft amendment to the
Drug Registration Regulation, and is planning to revise
Drug Administration Law of China comprehensively.
The article further analyzes comparative advantages of
Chinas drug innovation system in the global context,
elaborated one-by-one as below.
Growing pharmaceutical market
The pharmaceutical market in China will continue to
grow for multiple reasons. The trend of globalizationin
healthcare industry accompanied by an increased needs
for better medications in developing countries are clear
[39]. Also, the pharmaceutical market in China is ex-
pected to see robust growth (see Fig. 7).
Nationally, as home to nearly 20% of the worldspopula-
tion, the senior population (over 65 years) in China will be
expected to be 9.7% in 2016 [40]. Together with economic
growth and more healthcare awareness, higher demand
for health care services including pharmaceutical products
can be expected. Moreover, the Chinese government is
prepared to put in $136 billion USD to develop the na-
tional healthcare system and to enhance the Basic Medical
Insurance (BMI) coverage from approximately 65% of the
population to 90%. Chinas healthcare expenditure will
have been rising more rapidly [40].
The dramatic growth of healthcare demand and ex-
penditure in China implies tremendous market oppor-
tunities in near future. For example, the prevalence of
diabetes in China escalated from 0.9% in 1980 to 11.6%
in 2010 [41], and China has the largest number of dia-
betes sufferers in the world at more than 96 million [42].
Currently, treatments for diabetes patients in China cost
around $ 2.7 billion each year, and the cost will continue
to increase. Consequently, all these trends are favorable
to significantly drive the development of innovation.
Increasing R&D funding
The R&D investment is considered as crucial fuels to
catalyze innovation. Consequently, the dramatic growth
of R&D investment in China generates enormous mo-
mentum to pharmaceutical R&D activity. On the eco-
nomic recession background, many developed countries
have reduced the budget on drug R&D. The U.S. cut
down R&D expenditures from 38% of the global total in
1999 to 31% in 2009 [6]. In contrast, China showed the
largest percentage increase of R&D investment in the
world (see Fig. 8).
In pharmaceutical sector, in order to create an
innovation-oriented environment, the China govern-
ment will increase the drug innovation funding by
Fig. 7 Pharmaceutical Sales in China from 2007 to 2013. 1.
Data source: 2014 China Pharmaceutical Market Development
Bluebook (Southern Medicine Economic Institute) 2. Exchange
rate: USD/RMB = 1/6.2291
Ni et al. Globalization and Health (2017) 13:21 Page 6 of 9
launching appropriate projects. For instance, the Key
Drug Innovation projectlaunched in 2007 was a not-
able example. During the entire 12th Five- Year Plan,
the project Key Drug Innovationwas supported with
about $16 billion USD from the central government
and more than $49 million USD from local govern-
ments [7]. As the second largest R&D performer, com-
parison of the global compound annual growth rate of
biomedical R&D expenditures by country, China
showed the most rapid rise, from approximately $2.0
billion in 2007 to over $8.4 billion in 2012 with a com-
pound annual growth rate of 32.8% [43].
Distinctive R&D source
Chinas major advantage in life science is the distinctive
R&D source in terms of large patient samples, wide dis-
ease spectrum, great biodiversity, and strong basis of
traditional Chinese medicine (TCM). In 2012, there were
1431 hospitals in China, of which 420 had GCP certifica-
tions and a rich source of patient enough for multiple
clinical R&D studies [44]. More importantly, distinct
multiple patient populations and wide disease spectrum
in China are beneficial to broaden the scope of new re-
search activities in the healthcare system. For example,
some specific diseases such as diabetes, liver cancer,
stomach cancer, and neck cancer have a relatively high
prevalence in Asian countries compared to the U.S. and
European countries. The patient pool in China allows
the development of specific knowledge such as bio-
markers, genetics and therapies [45].
Meanwhile, China is one of the countries with the
richest biological resources and diversities, which has
approximately 10% of the worlds biological resources
[46]. Additionally, with further research of active com-
ponents and pharmacological mechanisms, TCM will
serve the global health demands and broaden the pipe-
line of natural medicine discovery and development, in-
creasing the importance of Chinese herbal medicines in
therapeutic systems especially for cancer, HIV, diabetes
and cardiovascular disease therapies. The most famous
example is artemisinin, which is isolated from the plant
Artemisia annua, sweet wormwood, an herb employed
in Chinese traditional medicine. Artemisinin has been
recognized by international group as a standard treat-
ment worldwide for malaria [5].
Increasing international involvements
The favorable conditions mentioned above have attracted
more and more multinational pharmaceutical companies
to China. Cost advantage related to developing health
product in China has been attributed to the low-costs in
scientific talent, clinical trials and raw materials available
in the country, with the lowest figure estimated to be 10%
of similar costs in the U.S [5]. As a result, with exception
of pharmaceutical R&D outsourcing moving to China, the
linkage between domestic R&D organizations and multi-
national corporations has been increasingly prominent in
R&D activity. Meanwhile, the strategies of large-cap
pharmaceutical companies are steering to emphasize more
on the discovery and development of medicines for
China-specific and lifestyle-associated diseases. China has
become one of the top markets pursued by global
pharmaceutical companies to conduct R&D activities [3].
Increasing numbers of multinational pharmaceutical com-
panies has established their R&D headquarters in China.
For instance, AstraZeneca China has its headquarters in
Shanghai, with 23 branch offices in major cities across
China. Pfizers China Research and Development Centre
were established in 2005 to support global R&D by
partnering with clinical research organizations, bio-
technology companies and academic researchers. It is
beneficial for Chinas pharmaceutical innovation that
these high-quality multinational pharmaceutical com-
panies moving in China will play innovation together
with local institutions and further generate spillover
effects on the healthcare system [3, 47].
Conclusions
In summary, this study addressed the barriers and op-
portunities for pharmaceutical innovation in China. One
hand, Chinas pharmaceutical sector is confronted with
inevitable barriers hindering the pace of drug innovation,
including academic, industrial, institutional and financial
constraints. To reshape China and change the reputation
of made-in-China to discovered-in-China is highly chal-
lenging. On the other hand, China exhibits unique
advantages in the development of healthcare industry as
shown by the dramatic growth in terms of R&D invest-
ment, healthcare expenditure and international cooper-
ation. The increasingly intertwined relationship of both
competition and cooperation in the global healthcare
industry is of great significance to remove obstacles and
Fig. 8 Intramural Expenditure on R&D in Chinese pharmaceutical
industry. 1. Data Source: China Statistical Yearbook on High
Technology Industry. 2. Exchange rate: USD/RMB = 1/6.2291
Ni et al. Globalization and Health (2017) 13:21 Page 7 of 9
create more opportunities for Chinas pharmaceutical
sector. The most important thing is, to break though
innovation barriers and take advantage of the opportun-
ities that are currently available for improving drug
innovation in China, and further integrate self-advantages
into global value-chain of healthcare product develop-
ment. All of these will greatly facilitate the development of
pharmaceutical innovation in China. As a result, China
will play increasingly important role in the global
innovation network, and more extensively involved in
global healthcare innovation in near future.
Abbreviations
ANDA: Abbreviated New Drug Application; APIs: Active pharmaceutical
ingredients; BCT: Bridging clinical trial; BMI: Basic Medical Insurance;
CAS: Chinese Academy of Sciences; CDE: Center for Drug Evaluation;
CFDA: China Food and Drug Administration; FDA: Food and Drug
Administration in the U.S; GCP: Good Clinical Practice; ICH: Harmonization of
Technical Requirements for Registration of Pharmaceuticals for Human Use;
MAH: Marketing authorization holder; NDA: the New Drug Application;
PE: Private equity; R&D: Research and Development; SCI: Science Citation
Index; TCM: Traditional Chinese medicine; VC: Venture capital
Acknowledgements
Not applicable.
Funding
This research is supported by project MYRG2015-00145-ICMS-QRCM,
University of Macau.
Availability of data and materials
Not applicable.
Authorscontributions
JN conducted data collection, performed data analysis and drafted the
manuscript. YH conceived and designed this study, analyzed data and
revised the manuscript. JZ participated in data collection, analysis and
drafted the manuscript, COLU and HH participated in manuscript revision,
YW participated in research design, and reviewed the whole manuscript.
All the authors read and approved the final manuscript.
Competing interests
The authors declare that they have no competing interests.
Consent for publication
Not applicable.
Ethics approval and consent to participate
Not applicable.
PublishersNote
Springer Nature remains neutral with regard to jurisdictional claims in
published maps and institutional affiliations.
Received: 16 July 2015 Accepted: 9 March 2017
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Ni et al. Globalization and Health (2017) 13:21 Page 9 of 9
... However, China used to suffer from a lack of developing novel 'branded' medicines, yet focused on developing generic drugs and APIs. There is no doubt that the innovative pharmaceutical system in China suffered from many challenges which hindered the translation of the pharmaceutical R&D outcomes into valuable commercial drug products (Ni et al., 2017). Among these challenges; the lack of effective collaboration between the universities and research institutions with the pharmaceutical industries; and the difficulty of patent licensing that has led to a rise in the number of scientific publications and patents with no actual commercial translation, which produced virtually no genuine innovative drugs in recent years (Shi and Rao, 2010;Rezaie et al., 2012). ...
... Among these challenges; the lack of effective collaboration between the universities and research institutions with the pharmaceutical industries; and the difficulty of patent licensing that has led to a rise in the number of scientific publications and patents with no actual commercial translation, which produced virtually no genuine innovative drugs in recent years (Shi and Rao, 2010;Rezaie et al., 2012). The increased number of small and medium-sized enterprises (SMEs) as pharmaceutical manufacturers has contributed to a weak Chinese pharmaceutical industrial structure and insufficient R&D resources for new drug discoveries and development (Ni et al., 2017). In addition, the lack of effective intellectual property protection and prolonged regulatory reviews for drug products in China have also prevented the discovery of new drugs and have weakened the Chinese pharmaceutical innovation system. ...
... Nevertheless, the Chinese government has addressed all the barriers related to pharmaceutical innovation and has enforced some changes that have enhanced the opportunity to discover new medicines more effectively, for instance recruiting back the Chinese scientists from abroad, enhancing the drug innovation R&D investments, increasing the medical insurance coverage and healthcare expenses, and amending the drug registration policies. Most importantly, owing to the low cost of labor, scientific researchers, raw materials, and preclinical and clinical trials associated with new drug product development, many international pharmaceutical companies have been attracted to outsource their R&D activities in China (Ni et al., 2017). As a result, China has become one of the successful pharmaceutical markets in the world. ...
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... Furthermore, China has ascended to a worldwide leading position at an accelerated pace in terms of R&D funding, scientific publications and patents in recent years, contrary to its rather few innovative drugs recognised globally. The significance of this issue is underpinned in the huge gap between China's dramatically increasing economy and its weak drug innovation when China's pharmaceutical industry is well known for its mass-production of low-level generic drugs and the lack of globally recognised innovative drugs (Ni et al., 2017). In a word, for plethora of existing studies that examine the linkage between patents and financial firm performance, this work can serve as a key supplement by echoing the kind of patent-firm association in a unique field where three specific elements, that is, China, SMEs and pharmaceutical sector are put on the table for discussion. ...
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With the disruptive technology innovation time arrival, small and medium-sized enterprises (SMEs) have been the motor of innovation and played an increasingly major role in national economic development. As the shift towards an ‘open innovation’ paradigm, awareness of intellectual property rights has increased, and patents have been an important tool for Chinese pharmaceutical enterprises. Considering its mass production of low-level generic drugs, there are still many arguments about its lack of innovation. This article aims to identify if and how patents, as essential indicators of innovation, generate financial performance measured by SMEs in the pharmaceutical sectors. Patent data are a vital source of competitive intelligence. A positive association was found between annually added patents and gross sales. Many other patent indicators, such as the number of forward citations and patent transfer, were statistically significant. Moreover, the results suggested that there was a one-year lag between patent publication and financial performance. A series of patent quantity and quality indicators have shown significant effects on the financial performance of Chinese pharmaceutical enterprises. These patents generate a positive financial impact, which builds up a solid basis for keeping sustainable innovation capability in the Chinese drug industry.
... Al ser las actividades de innovación un proceso muy complejo y que involucra una multiplicidad de aspectos, requiere mucho esfuerzo por parte de las empresas, especialmente a nivel de las pymes, y por lo tanto, verse obstaculizado por diversos factores (ANII, 2009;Camacho et al., 2010;Sabuncu, 2014;Ni et al., 2017). ...
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El elemento clave de la competitividad organizacional es la innovación y las pymes no escapan de ello, en este sentido, el presente trabajo trata de responder, cuáles son las principales actividades de innovación y los obstáculos a esas actividades que más inciden en las empresas industriales uruguayas, y si la cooperación con otras empresas e instituciones y la participación en redes son importantes a la hora de superar dichos obstáculos. Se utilizaron microdatos de la encuesta que realiza la Agencia Nacional de Investigación e Innovación de Uruguay (ANII), que posibilitó elaborar una serie de descriptores estadísticos relacionados con las variables definidas en el estudio. La investigación pone de manifiesto que la principal actividad de innovación que realizan, tanto las pymes como las grandes empresas, es la adquisición de bienes de capital, junto con la I+D interna. Se verifica que los obstáculos más importantes para desarrollar actividades de innovación son aspectos relacionados a temas micro y meso-económicos. Se encuentra una mayor presencia relativa de grandes empresas en los acuerdos de cooperación para compra y desarrollo conjunto de tecnología y se detecta una reducida participación de empresas pymes en acuerdos o redes vinculadas a conocimientos científicos y tecnológicos, lo que indicaría que los mismos no necesariamente contribuyen a levantar algunos de los obstáculos para realizar actividades de innovación.
... 11 12 The same trend has been taking place in the private sector as well, with China being the top market in LMICs for global pharmaceutical companies to set up their research and development centres. 13 As a result, even today most of China's global health collaboration is with HICs. 14 15 China has produced a growing number of publications on health that have a global impact. ...
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