In March 2026, Pfizer CEO Albert Bourla delivered a blunt warning: for the first time in recent decades, “U.S. dominance in biotech technology is being challenged by a competitor, and that’s China.” He described China’s “meteoric rise of their scientific capabilities,” noting that 8 of the top 10 global research institutions on the 2025 Nature Index are now Chinese. Bourla’s message was unmistakable: China is no longer merely catching up—it has emerged as a leader in biotechnology—while the United States risks falling behind by focusing more on slowing China than on outpacing it. Former FDA Commissioner Scott Gottlieb has echoed the alarm, cautioning that “if we are not careful, every drug could be made in China.”
These statements mark a stunning reversal. As I wrote in a March 31st, 2015 Council on Foreign Relations analysis, China’s pharmaceutical industry at that time sat at the lower end of the global value chain. It was overwhelmingly a generics and active-pharmaceutical-ingredient (API) powerhouse—with the vast majority of its output consisting of generic compounds, bulk APIs, and modest “me-too” molecules, while nearly 90 percent of patented drugs came from foreign enterprises. True innovative drugs were exceedingly rare: since 1986, China had independently developed only about 40 chemical entities, and only 2—artemisinin and sodium dimercaptosuccinate—had earned meaningful international recognition.
Today, that picture has been transformed. China now dominates global generic API production across key therapeutic categories and, through its stranglehold on upstream chemical intermediates, has become an indispensable—if often invisible—foundation of the global pharmaceutical supply chain. At the same time, it has surged up the innovation ladder with remarkable speed, emerging as a rapidly maturing source of next-generation therapies that Western firms are increasingly licensing to replenish depleted supplies. China is no longer merely the world’s pharmacy workshop; it is becoming one of its leading drug developers.
This essay examines how China became a biopharmaceutical superpower, the drivers behind its rise, the implications for global health governance, the limits of its model, and the policy choices facing China and the United States. The stakes are high: China’s ascent promises greater affordability and access for patients worldwide, yet it also introduces new dependencies and strategic vulnerabilities in one of the most sensitive domains of national security and public health.
China’s Dual Dominance in Biopharmaceuticals
China’s emergence as a biopharmaceutical superpower rests on two mutually reinforcing foundations: near-monopoly control over essential supply chains and a rapidly maturing capacity for innovation.
At the base of the pharmaceutical value chain, China has achieved commanding dominance in key starting materials (KSMs) and APIs. An October 2025 analysis by U.S. Pharmacopeia found that nearly 700 medicines approved for use in the U.S. depend on at least 1 chemical produced solely in China—including widely prescribed antibiotics such as amoxicillin, whose 4 KSMs are manufactured almost exclusively there, as well as drugs for heart disease, seizures, cancer, and HIV. The picture is similarly stark at the intermediate level: roughly 80 percent of the intermediates used worldwide to manufacture APIs are produced in China, and in specific therapeutic categories the concentration is even higher—China accounts for 70 to 80 percent of global antibiotic API production and approximately 80 percent of global heparin supply.
For the United States, direct imports from China appear limited, but this understates true exposure. Nearly 41 percent of the KSMs used in U.S.-approved APIs are sole-sourced from China—more than twice the rate of any other country. And because India, the world’s largest generics producer, itself sources 70 to 85 percent of its API intermediates from China, effective U.S. dependence is significantly higher than direct import figures suggest. This matters acutely because generics account for roughly 90 percent of American prescriptions. China’s upstream grip thus creates structural vulnerabilities that run well below the surface of official trade statistics: any significant disruption—whether from geopolitical conflict, a pandemic, or export controls—can cascade rapidly and unpredictably through global supply chains.
At the same time, China has climbed decisively up the value ladder into high-end innovation. In 2023, China accounted for 23 percent of the global pipeline of innovative drug candidates versus 36 percent for the U.S.; by 2025, that gap had narrowed to just 2.5 percentage points—30.5 percent for China against 33 percent for the U.S.—making China the world’s second-largest source of new drug candidates. The licensing deals tell an equally striking story. Chinese biotechs generated a record $135.7 billion in license-out transaction value in 2025, nearly triple the $51.9 billion recorded in 2024; through the first half of 2025 alone, U.S. drugmakers signed 14 licensing deals potentially worth $18.3 billion with Chinese firms, compared with just 2 such deals in the same period a year earlier.
The quality of innovation now emerging from Chinese labs is increasingly hard to dismiss. In May 2025, Pfizer paid a record $1.25 billion upfront—the largest such payment ever made for a Chinese-origin asset—to license 3SBio’s PD-1/VEGF cancer immunotherapy. Akeso’s ivonescimab, a first-in-class bispecific antibody, beat Merck’s blockbuster Keytruda on progression-free survival in a head-to-head Phase 3 lung cancer trial—reportedly the first time any candidate had achieved a statistically significant PFS improvement over Keytruda in that setting. However, it should be noted that the trial was conducted only in Chinese patients and overall survival benefit remains to be established in a global study. Meanwhile, Innovent’s mazdutide—the world’s first approved dual GCG/GLP-1 receptor agonist, developed in China and approved by Chinese regulators in 2025 for both weight management and type 2 diabetes—illustrates that Chinese firms are now capable of delivering not just fast-follower molecules but genuine global firsts.
The Making of a Biopharmaceutical Superpower
China’s ascent from a generics-focused supplier to a biopharmaceutical superpower was neither accidental nor the product of market forces alone. It resulted from a deliberate, state-orchestrated strategy that combined regulatory overhaul, institutional coordination, and the mobilization of national resources on a scale few other countries can match. In the words of Bourla, China has “done all the right things over decades in a long-term strategic plan.”
The turning point came in 2015. Under the leadership of Bi Jingquan, then head of the China Food and Drug Administration (CFDA), Beijing launched a sweeping set of reforms designed to professionalize drug regulation and accelerate innovation. The first order of business was cleaning house: the so-called “722 Notice,” issued on July 22nd, 2015, required companies behind more than 1,600 pending drug applications to self-examine the authenticity of their clinical trial data. The results were damning—nearly 80 percent of applications were voluntarily withdrawn—but the exercise broke the back of what Bi himself called a “cancer” on the industry.
Simultaneously, the marketing-authorization-holder system allowed research institutions and companies to hold drug licenses independently of manufacturing facilities for the first time, unlocking a generation of asset-light biotechs. China joined the International Council for Harmonisation (ICH) in 2017, aligning its standards with global norms. The following year, a new implied-approval system for investigational new drug applications slashed review times from two to three years to 60 working days—if no objection was raised within that window, the application was automatically approved.
These reforms transformed a once-slow, scandal-plagued bureaucracy into one of the world’s fastest drug-review agencies. The results are measurable: the National Medical Products Administration (NMPA) reduced median new-drug review times from 28 months in 2015 to under 6 months for Priority Review designations by 2024. Average review times fell from 663 days in 2017 to approximately 105 days in 2024—an 84 percent reduction. That same year, China’s NMPA approved 83 new drugs versus the FDA’s 50, while FDA review times lengthened to 356 days.
These regulatory reforms extended well beyond final marketing approvals, dramatically accelerating the early stages of clinical development itself. On the clinical-trial side, pre-reform investigational new drug (IND) approval times that averaged 18.5 months have been transformed by the 2018 implied-approval (silent-approval) system and 60-working-day review clock. Many applications are now cleared within 1 to 3 weeks—making Phase I trial launches far simpler, faster, and significantly less costly than in the U.S. China now leads globally in clinical trial registrations, with over 7,100 listed in 2024 compared with approximately 6,000 in the United States.
This advantage is amplified by the country’s unmatched ability to recruit patients at scale—leveraging a population of 1.4 billion with high disease burden and highly concentrated urban hospital systems—which further compresses trial timelines. China’s share of global clinical trial activity surged from nearly 28 percent in 2022 to 39 percent in 2023 and continued its rapid ascent thereafter. The cumulative effect is a highly efficient system that can move promising candidates from discovery to clinic far faster—and at a fraction of the cost—than fragmented Western markets.
Underlying the regulatory changes was a deeper governance model: what the Chinese call the juguo tizhi, or ‘whole-nation system.’ In its contemporary form—relaunched by President Xi Jinping in 2019 as the ‘new-type whole-nation system‘ (xinxing juguo tizhi) that is explicitly applied to biotechnology and pharmaceuticals—it coordinates the full weight of the state across central ministries, provincial governments, state-linked capital, academia, and industry to pursue strategic priorities. These efforts operated within an explicit national industrial strategy: Made-in-China 2025, issued the same year as the CFDA reforms, formally designated biopharmaceuticals as one of 10 strategic sectors Beijing intended to dominate, providing the political mandate and sustained funding architecture for everything that followed. After 2018, as U.S.-China trade tensions escalated, Beijing largely stopped invoking the document by name—but the underlying policies continued without interruption, a telling illustration of how Chinese industrial strategy can persist beneath shifts in political optics.
The system channels funding at scale, drives infrastructure development through integrated chemical parks and dedicated biotech clusters—above all the Yangtze River Delta corridor anchored by Shanghai, Suzhou, and Wuxi. Suzhou’s BioBAY, opened in 2007 and backed by over ¥100 billion in guiding funds, has become one of China’s most mature biotech parks. It is home to companies like Innovent Biologics and BeiGene (now BeOne Medicines); Shanghai leads the broader cluster as its commercial and regulatory hub; and Wuxi anchors the region’s API and contract development and manufacturing organization (CDMO) infrastructure through its integrated chemical industrial parks.
The system also deploys talent repatriation programs, most prominently the Thousand Talents Plan launched in 2008, which recruited more than 7,000 overseas scientists and entrepreneurs across all disciplines within a decade. The life sciences cohort—over 1,400 strong, drawn from both academia and industry—became one of the program’s largest and most consequential groups, seeding the leadership of many biotech firms that would go on to define China’s durge in innovation.
To grasp the sheer scale of this coordinated national effort, one needs only visit a place like the Nanjing Biotech and Pharmaceutical Valley. Last summer, as my car entered the park to meet a friend who runs a biotech firm there, it took more than 20 minutes of steady driving from the entrance before we reached our destination. When I asked about the size of the complex, I was told it ranked only 8th among China’s largest biotech industrial parks.
These advantages do not exist in isolation. They are reinforced by a dense contract research organization (CRO) ecosystem, parallelized workflows, and large disease-specialized hospitals capable of enrolling hundreds of patients at a single site—infrastructure that compresses timelines at every stage of development. Domestic venture capital, supplemented by returning diaspora scientists and surging international licensing interest, has created a powerful cycle of innovation and investment that shows no sign of slowing.
The effects have been striking. Chinese biopharma firms run discovery programs at roughly one-third to one-half of global costs, and clinical development at 20 to 50 percent of U.S. levels—in Phase III oncology trials, for instance, the direct cost per patient runs around $25,000 in China compared to roughly $69,000 in the United States. Clinical trial recruitment in late-stage development runs 2 to 5 times faster than U.S. and EU benchmarks, and early discovery-to-IND cycles are 50 to 70 percent faster than the global average.
This model’s intensity impressed even seasoned observers. During a recent visit to China, Ambassador Craig Allen, former president of the U.S.–China Business Council, told the author: “In my 40 years of career, I have never seen a country so aggressively promoting innovation like this.”
Implications for Global Health Governance
China’s rise as a biopharmaceutical superpower is not necessarily a zero-sum threat to Western countries. Its distinctive “cheap and fast” model—more shots on goal at far lower costs—complements rather than replaces the West’s comparative advantage in original discovery. By compressing development timelines and slashing production expenses, China is accelerating the global pipeline and lowering barriers to entry for therapies that might otherwise remain prohibitively expensive.
This capacity positions Beijing to democratize access to cutting-edge medicine for the world’s poorest populations. During the COVID-19 pandemic, China was among the first countries to develop vaccines and publicly pledged to treat them as a “global public good.” Although most overseas shipments were commercial sales rather than outright donations, Chinese vaccines demonstrably narrowed global access gaps at a time when Western vaccine nationalism left many low- and middle-income countries (LMICs) behind. That precedent can now be scaled. Beijing is already channeling its manufacturing prowess and innovation pipeline into global health equity.
In 2016, Tsinghua University, with support from the Bill & Melinda Gates Foundation, launched the Global Health Drug Discovery Institute to focus on neglected tropical diseases such as tuberculosis and malaria. In September 2025, Shanghai followed with the Global Health Innovation Institute—China’s first nonprofit R&D hub dedicated to translating low-cost, high-speed biopharma capabilities into affordable treatments for TB, malaria, maternal-child health, and other LMIC priorities. If these efforts succeed, China could help deliver genuinely novel therapies to the Global South without the Western price tag.
The impact extends beyond medicines. Through its expanding “Digital South“ initiatives, China is also enabling LMICs to leapfrog outdated healthcare infrastructure. Building on the Special Fund for Digital Capacity Building, Beijing can expand support for AI-driven diagnostics, telemedicine platforms, remote-monitoring systems, and digital workforce training. Many low- and middle-income countries could thereby bypass decades of traditional hospital-centric development and move directly to modern, efficient, and resilient models of care—dramatically improving outcomes while containing long-term costs. The potential is already becoming reality in pockets of the Global South.
InferVision, a Chinese medical AI company, has deployed its AI-powered tuberculosis screening tool—which reads chest X-ray images without requiring a trained radiologist—across roughly 40 countries and 2,000 institutions, including remote mining communities in northeast Nigeria where workers had never previously undergone any medical screening. In June 2025, the WHO formally approved it as one of 6 globally certified AI tools for TB detection on chest X-ray’s. It is precisely this kind of low-cost, portable, connectivity-independent tool—developed in China to solve problems of scale and specialist scarcity that China itself faced—that illustrates how the country’s digital health emergence could translate into genuine leapfrog gains for the world’s most underserved populations.
Vulnerabilities in China’s Ascent
China’s biopharmaceutical ascent, though impressive, is neither inevitable nor free of significant vulnerabilities. Even the much-vaunted “whole-nation system” that has powered its rise has clear limits. The COVID-19 pandemic offered a revealing case study. Despite regulatory reforms, massive state funding, talent repatriation, and substantial technical capacity, China produced no domestically developed mRNA vaccine by the end of 2022. Its first home-grown mRNA COVID vaccine—developed by CSPC Pharmaceutical Group—received emergency-use approval only in March 2023.
The delay resulted from interlocking barriers: contested intellectual-property landscape surrounding lipid-nanoparticle delivery technology; severe disruptions from the Zero-COVID policy, which suppressed domestic infection rates to near-zero and forced clinical trials overseas, eliminating the trial populations needed to advance novel candidates at home; deep path dependency favoring established inactivated-virus and adenovirus-vector platforms; and geopolitical constraints that foreclosed meaningful international collaboration on frontier technologies.
These factors did not merely slow progress—they created a structural impasse in which each obstacle reinforced the others. The Covid-19 episode suggests that while the whole-nation approach excels at rapid scaling and iterative improvement of known technologies, it can falter when confronting genuinely novel platforms under crisis conditions—particularly when the crisis itself dissolves the domestic infrastructure on which development depends.
A second set of challenges stems from overcapacity and intense domestic competition. The PD-1/PD-L1 class—now standard-of-care in oncology—alone captures the scale of domestic crowding: 23 PD-1/PD-L1 products had been approved in China as of mid-2025—more than double the 11 approved in the EU—and the pace of new entrants has not slowed. This competitive intensity has structural consequences.
Volume-based procurement and national reimbursement negotiations in China have forced price cuts averaging around 58 to 80 percent—and exceeding 90 percent in some rounds—squeezing margins to levels that many firms cannot sustain domestically. The result is a powerful push overseas. Last summer, during a visit to a Shanghai-based biotech at the forefront of base-editing technology, the company’s CEO told us that their therapies were being developed for the U.S. market. It is an ambition widely shared—and one that runs headlong into a formidable set of barriers. Gaining meaningful traction in the United States or Europe remains difficult: the FDA rejected 2 Chinese PD-1/PD-L1 checkpoint inhibitors (sintilimab and sugemalimab) primarily because pivotal trials were conducted exclusively in China.
Without multiregional Phase III trials designed from the outset to satisfy FDA scrutiny, most Chinese innovations remain confined to the domestic market or are out-licensed to Western partners—a pathway that, while commercially significant at scale—leaves Chinese firms dependent on others to access the world’s most lucrative regulated markets.
Compounding these internal pressures are growing external headwinds from U.S. protectionist and securitization policies. Washington has moved aggressively to reduce strategic dependence on Chinese biotechnology, with consequences that directly raise the bar for Chinese firms seeking market access or partnerships in the United States. The BIOSECURE Act—signed into law in December 2025 as part of the National Defense Authorization Act—restricts federal procurement and grants involving biotechnology companies deemed of national security concern, with further designations pending.
Heightened FDA scrutiny of clinical data from China-only trials, and the agency’s limited capacity for on-site bioresearch monitoring (BIMO) inspections at Chinese clinical sites, have already blocked or delayed multiple market-entry attempts. Meanwhile, the U.S. has imposed 100 percent Section 232 tariffs—announced April 2nd, 2026—on patented pharmaceuticals and their associated APIs, with the default rate taking effect on July 31st, 2026 for 17 named large companies and September 29th, 2026 for all others. Generic pharmaceuticals are exempt for now, though the Secretary of Commerce is required to advise the President within one year on whether that exemption should be revisited.
For Chinese biopharmaceutical firms, the tariffs are particularly consequential: reduced rates of 20 percent or 0 percent are available only to companies that commit to onshoring U.S. production or enter into Most-Favored-Nation pricing agreements with the Department of Health and Human Services—conditions that effectively foreclose meaningful relief for Chinese manufacturers. These measures reflect a broader American effort to de-risk critical segments of the biopharmaceutical supply chain—one whose secondary effect, whatever the primary intent, is to slow Chinese firms’ advance into high-value regulated markets.
Taken together, these vulnerabilities—internal overcapacity, regulatory and trust barriers, and external de-risk efforts—suggest that China’s biopharmaceutical rise faces real and growing constraints. Sustained Chinese global leadership will require not only continued domestic investment but also greater regulatory transparency, alignment with international clinical and manufacturing standards, and pragmatic cooperation to overcome the mistrust its very success has provoked.
Toward Managed Competition and Mutual Resilience
A credible response to China’s biopharmaceutical rise requires more than unilateral decoupling or passive acceptance. Both Washington and Beijing face strategic choices that will determine whether this transformation becomes a source of global public goods or a driver of dangerous fragmentation.
For the United States, the central task is a supply-chain version of “deterrence by denial”: reducing Beijing’s coercive leverage by limiting the material gains it could extract from weaponizing pharmaceutical dependence. The goal is resilience, not replication—and certainly not an industrial policy that mirrors the one it seeks to counter. This requires confronting two difficult dilemmas. First, aggressive securitization measures—the BIOSECURE Act, Section 232 tariffs on patented pharmaceuticals, and tightened Committee on Foreign Investment in the United States (CFIUS) review of Chinese biotech investment—risk becoming self-defeating protectionism.
By raising costs and slowing access to promising Chinese-originated molecules, they could undermine U.S. competitiveness and delay pipeline replenishment at the very moment American firms face an estimated $230 billion or more in revenue losses from patent expiries between 2025 and 2030. Second, Washington must weigh whether the marginal cost of maintaining substantive U.S.-China health dialogue (thereby raising the threshold for Beijing to weaponize APIs) now exceeds the cost of full reshoring and diversification. The optimal path is therefore dual-track: targeted reshoring of high-risk generics (antibiotics and essential hospital drugs), supply diversification through allies (India, Mexico, and the EU), scaling of the Strategic API Reserve, and FDA regulatory reforms to accelerate non-Chinese supplier approvals—while keeping diplomatic channels open to make weaponization less attractive to Beijing. This combination builds redundancy: if dialogue fails, material resilience limits the damage; if resilience reduces leverage, it strengthens America’s negotiating position.
China, for its part, must recognize that growing capabilities carry growing responsibilities. Beijing should move beyond the largely commercial approach that defined its pandemic-era conduct and more proactively position its biopharmaceutical sector as a genuine global public good. This means scaling institutions such as the Gates Foundation-backed Global Health Drug Discovery Institute in Beijing—which focuses on neglected diseases including tuberculosis and malaria—and expanding technology transfer, open-access licensing models, and concessional pricing for LMICs rather than treating exports primarily as revenue streams.
At home, China should deepen domestic reforms to sustain innovation momentum. Building on the 2015 regulatory overhaul, further optimization of the National Reimbursement Drug List, expanded commercial health insurance coverage for innovative drugs, and continued digitalization of clinical trial infrastructure would help shift the sector from fast-follower crowding toward higher-value, differentiated innovation. Greater alignment with international clinical standards and manufacturing transparency norms would also reduce regulatory mistrust and ease market-access barriers abroad—serving China’s commercial interests as much as global public health.
For the rest of the world, the rise of Chinese biopharmaceutical capabilities presents both opportunity and urgency. Multilateral institutions and middle powers should encourage pragmatic plurilateral mechanisms—perhaps under the WHO or G20 auspices—that facilitate regulatory harmonization, joint research on neglected diseases, and supply-chain resilience without forcing a binary alignment between Washington and Beijing. In an era of heightened geopolitical tension, global health security is too consequential to become another arena of zero-sum rivalry. The goal should be managed competition: one that preserves innovation incentives while expanding affordable access to life-saving therapies for the billions who currently lack it.
