As 2025 draws to a close, China’s rapid ascent in innovative medicines has captured global attention. Once known mainly for generics and “me-too” drugs, the country is increasingly focused on developing first- and best-in-class therapies across pharma and biotech.
China’s clinical trial ecosystem expanded quickly, with the country leading the world in study initiations in 2024, according to analysis by GlobalData. Faster investigational new drug (IND) processing has also shortened development timelines, supporting R&D acceleration in oncology, immunology and cardiometabolic health.
Western companies are pursuing deals with Chinese biotech and pharma to bolster pipelines with cost-effective, high-quality assets ahead of a looming patent cliff that GlobalData estimates will shave $230 billion from US drug sales between 2025 and 2030. Chinese innovator drug licensing deals accounted for 28% of innovator deals by large pharma in 2024, representing $41.5 billion in value.
High-value transactions have become more common. In 2023 there were 20 deals worth over $500 million; 2025 saw major agreements including Novartis’s $5.36 billion deal with Argo Biopharmaceutical, AstraZeneca’s $5.3 billion pact with CSPC Pharmaceutical and Zenas Biopharma’s $2 billion agreement with InnoCare Pharma.
Josh Smiley, president and COO of US-China biopharma Zai Labs, expects dealmaking between China and the West to continue growing, with volume rising even as prices for high-quality Chinese assets begin to normalise. “One of the main reasons that global companies are so engaged in China right now is the fact that you can find an early clinical programme for less total value exchange than in the US or Europe,” he said. Jeffries Asia healthcare head Cui Cui predicts 2025 licensing trends will persist into 2026, as companies confront pricing pressures and patent expiries. Dajun Yang, CEO of Ascentage Pharma, said the influx of investment and returning talent is ushering China’s pharma sector into a “2.0” era.
Oncology remains a primary driver of deal value, with firms such as AbbVie, Pfizer and GSK signing multibillion-dollar agreements. Antibody-drug conjugates (ADCs) developed in China have attracted particular interest for their rapid cycles of innovation around linker-payload combinations. Next-generation biologics including ADCs, bispecifics and cell and gene therapies (CGTs) continue to draw investor and big-pharma attention, and China has emerged as a major development hub for CGTs thanks to accelerated trial starts and timelines.
Immunology has also gained prominence, with several large deals incorporating immune-disease programmes, while cardiometabolic and obesity-focused projects have seen a notable uptick as companies target a competitive market.
Regulatory and geopolitical developments could affect the landscape. The BIOSECURE Act was reintroduced for inclusion in the FY2026 National Defense Authorization Act and was passed by the House on 11 December. Analysts warn the bill could influence Western engagement with Chinese companies, but industry leaders are cautiously downplaying immediate impact. Yang said that focusing on first- or best-in-class innovation should reduce concerns, and Cui added that positive clinical data from China will mute policy-driven “noise” as US partners rely on Chinese output to enhance pipelines and control costs.
Some Chinese firms are pursuing global self-commercialisation rather than the traditional multinational licensing model. BeOne Medicines, formerly BeiGene, took its immuno-oncology drug Brukinsa (zanubrutinib) to the US market after domestic success. Nonetheless, most Chinese companies currently lack the trial experience, global sales networks and full innovation capabilities to self-commercialise widely. Cui and Smiley both expect partnering with multinational companies to remain common in the near term, with Chinese firms relying on external capital and partner experience to build global capabilities.
Over the longer term, Chinese companies are likely to pursue more self-commercialisation, a shift that could prompt increased lobbying from US pharma seeking to limit competitive pressures. For now, licensing and partnerships continue to be the dominant route for Chinese innovation to reach global markets.
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