Like any good relationship, the burgeoning love affair between China and the relatively small number of global companies known as ‘Big Pharma’ offers promise for both parties. For Big Pharma, there’s the chance to cut costs and expand into a wealthy, populous market. And for China, the influx of investment is an important stepping stone to fulfilling its long-held desires to create a robust domestic pharmaceutical industry.
The pharmaceutical value chain is composed of a number of key activities: drug discovery and development to identify promising pharmacological candidates, clinical trials to ensure the safety and effectiveness of these drugs in humans, and mass production of approved drugs. To date, much of this activity has been controlled by Big Pharma, but the business model that has driven their success has entered a period of considerable uncertainty.
Among the reasons for the upheaval in the drug industry and life-sciences sector are declining profits and rising costs, declining research and development (R&D) productivity, and an anaemic drug pipeline.
