On February 26, 2026, against the backdrop of preparations for the Dutch biomedical delegation's visit to China by the Dutch Embassy and Consulates in China to conduct exchanges, an online seminar focusing on the development of China's biomedical industry was successfully held. As an important pre-departure exchange session before the delegation's arrival in China, the seminar aimed to help Dutch biomedical enterprises and related institutions gain a deeper understanding of the development trends, industrial structure, and investment environment of China's innovative drug market. Members of the Dutch delegation, representatives of the Dutch Embassy and Consulates in China, and relevant industry professionals participated in this exchange. Frost & Sullivan (Frost &Jiang Tengfei, Executive Director of Life Sciences Consulting at Frost & Sullivan's Healthcare Business Unit in China (hereinafter referred to as 'Frost & Sullivan'), was invited as a keynote speaker and shared a special presentation on the development stage and market opportunities of China's biotechnology industry.
Jiang Tengfei introduced in his sharing that China's innovative drug industry is undergoing an important phase from capital adjustment to structural recovery, and global business expansionCooperation with BD) is gradually becoming the core driving force behind industry growth. Frost & Sullivan data shows that in 2025, the number of outbound licensing transactions by Chinese Biotech companies increased from 94 in 2024 to 157, a year-on-year increase of 67%; the total disclosed transaction amount rose from $519 billion to $1357 billion, an increase of 161%, with the average size of a single transaction rising to about $820 million. At the same time, the proportion of upfront payments in total transaction amounts decreased from 7.8% to 5.2%, reflecting that global pharmaceutical companies are paying more attention to risk control and long-term value realization while expanding cooperation scale. In terms of transaction structure, among the cumulative 340 outbound licensing transactions from 2023 to 2025, about three-quarters were contributed by Biotech companies, indicating that Chinese innovative companies have become an important source of global innovation supply. However, capital and cooperation opportunities are further concentrating on companies with differentiated technologies and clinical certainty.
From the perspective of capital source structure, the development model of China's innovative drug industry is also undergoing transformation.In 2025, in China's biopharmaceutical financing, upfront payments for license-outs accounted for 52% of the total financing sources, surpassing equity investment and IPO financing for the first time to become the industry's primary source of funds. This marks a shift from 'funding-driven growth' to a new stage of 'global cooperation-driven development' for Chinese Biotech. At the same time, the value hierarchy among different types of enterprises continues to expand: In 2025, the average upfront payment ratio for innovative drug license-outs by Chinese Biopharma companies reached 10.4%, while for Biotech companies it was only 4.2%. The market is re-pricing a large number of early-stage or homogeneous projects, and the real drivers for capital market recovery are blockbuster deals represented by multi-billion-dollar cross-border collaborations (such as San Sheng Pharmaceutical's 3SBio and Pfizer ——PD-1/VEGF bispecific antibody SSGJ-707, Innovent and Takeda ——PD-1/IL-2α-biased fusion protein IBI363, etc.). In 2025, the Hong Kong stock market's innovative drug sector clearly warmed up, with the Hang Seng Innovative Drug Index (normalized based on the first day of 2025) achieving a phased growth of about 2.7 times, indicating that international capital's confidence in China's long-term innovative drug development potential is gradually recovering. Overall, China's biopharmaceutical industry is entering a new development stage centered on globalization cooperation capabilities, asset quality, and commercial certainty, providing new cooperation windows for international enterprises to participate in the Chinese market.
As global pharmaceutical companies continuously raise asset screening standards, the innovative drug market is entering a more rational evaluation phase. Valuations of homogeneous projects are under pressure, and long-tail transaction risks are gradually clearing up. The quality of clinical data and global development potential have become the core criteria for cooperation and investment. Jiang Tengfei stated that China's innovative drug industry is entering a new stage of global competition, with corporate competitiveness shifting from mere R&D efficiency toWith BD capabilities and global collaborative development, capital has further concentrated on high-quality assets with platformization and internationalization potential. Against the backdrop of capital returning to rationality and continuous deepening of cross-border cooperation, Chinese Biotech is gradually integrating into the global innovation system, and the industry as a whole is accelerating its transition from 'transaction-driven growth' to a new stage of 'quality-driven growth'.
