context: The age of COVID-19 presents a historical juncture for pharma innovation. The revamped pharma approval system will prioritise original R&D while rapidly expanding centralised procurement, pushing the industry towards innovation as profit margins narrow for generics. Ultimately, on the PRC’s path towards being a ‘global pharma powerhouse’, those with a lower capacity for breakthrough innovation will be weeded out.
The PRC’s pharma innovation has grown at great speed over the last few decades, reports Caijing. In the 80s and 90s, the cost of pharma R&D was a massive burden. Nonetheless, after a decade of research led by scientists like Nobel laureate Tu Youyou 屠呦呦, artesunate became the first-ever new drug to be approved domestically in 1987. It is now used all over the world for malaria treatment. The success of artesunate and the gradually improving policy environment gave the industry confidence to forge ahead. Now record numbers of innovative drugs are marketed every year.
A good case study is Fosun Pharma, a public company with over US$102 bn assets in 2019. It started with generics and is now gradually transitioning to cutting-edge innovative drugs. It approaches innovation simultaneously as independent and collaborative R&D. It co-launched American company Kite Pharma’s Yescarta®, an anti-tumour CAR-T cell drug that was approved in June 2021. At the beginning of the pandemic, it swiftly secured a strategic exclusive partnership with BioNTech and regulatory support to develop mRNA vaccines in China.
Currently, 70 percent of innovative drugs at Fosun actually result independent R&D, says Wu Yifang 吴以芳 Fosun CEO. Fosun's strategy is to learn and accumulate experience through cooperating with the best. To cement its status as an innovative company, Wu aims to increase the revenue percentage of their innovative drugs to over 50 percent and launch a product worth over US$5 bn in the next few years.