《Stock Market Everlasting Words》The continuous aging trend of the population in mainland China is driving increased demand for pharmaceuticals. Guided by government policies setting targets and providing preferential measures for the "15th Five-Year Plan," coupled with domestic pharmaceutical companies reducing costs and enhancing technology through research and development, pharmaceutical licensing in mainland China has seen significant growth. Therefore, the outlook for the mainland pharmaceutical industry is optimistic.
*Growing elderly population drives pharmaceutical demand*
Data from research firm McKinsey & Company shows that mainland China has the world's largest elderly population (aged 60 and above), with the number expected to rise from the current approximately 310 million to 400 million by 2035. A joint report titled "Research Report on China's Elderly Population Pharmaceutical and Health Industry" released by Zhongkang Technology, a leader in big health data, and AgeClub, a think tank on the silver economy, indicates that as high as 75% of mainlanders aged 60 and above suffer from chronic diseases, with an average daily intake of two to three medications. Given the higher pharmaceutical demand among the elderly, research firm Frost & Sullivan estimates that the size of mainland China's pharmaceutical market will increase from approximately 19,627 billion yuan (RMB, same below) in 2025 to 26,245 billion yuan in 2030, representing a compound annual growth rate of about 6%. The market expects that as the elderly population in mainland China continues to grow, pharmaceutical demand will become increasingly urgent, benefiting the future performance of the mainland pharmaceutical sector.
*Policy-driven development of mainland pharmaceutical industry*
Mainland China is actively fostering the development of its pharmaceutical industry and has set goals for the next five years. On September 18, the Ministry of Industry and Information Technology of China, together with ten other departments, released the "15th Five-Year Plan for the Development of the Pharmaceutical Industry." The plan proposes that by 2030, mainland China will firmly rank among the world leaders in biopharmaceutical R&D and application. In terms of industrial value, revenue of designated large-scale pharmaceutical industrial enterprises is expected to exceed 3.5 trillion yuan, an increase of about 18.4% compared to 2.95 trillion yuan in 2025. For innovative drugs, the plan requires an average annual growth rate of over 20% in industrial scale, with the number of products achieving global annual sales exceeding 1 billion U.S. dollars reaching more than five. In addition to setting clear growth targets, the central and local governments have also introduced preferential policies to support pharmaceutical enterprises. In terms of policy support, China's National Medical Products Administration (NMPA) will compress the review time for clinically urgent drugs and medical devices by 50% to 70%. Furthermore, pharmaceutical companies can be exempted from import taxes on imported materials required for R&D. The plan not only sets future development goals for the mainland pharmaceutical industry but also provides supportive measures, paving the way for the industry's golden five years of successful transition "from large to strong."
*Cost reduction through R&D and technological advancement drive significant growth in mainland pharmaceutical licensing*
Mainland China's innovative pharmaceutical companies, leveraging efficiency and cost advantages, continue to experience strong momentum in overseas expansion. According to statistics from "Pharma Magic Cube," preclinical R&D time for mainland enterprises is 30% to 50% shorter than the global average, with R&D costs amounting to only one-third of those in the United States. Additionally, mainland R&D technology continues to improve significantly. Data from the American Society of Clinical Oncology (ASCO) annual meeting shows that mainland China submitted 95 oral presentations this year, an increase of about 30% year-on-year. Notably, a mainland pharmaceutical company, at the same conference, achieved clinical data on a lung cancer treatment drug surpassing that of a renowned overseas pharmaceutical company for the first time. In recent years, mainland pharmaceutical companies have assisted overseas pharmaceutical firms in R&D, resulting in an increase in both the number and value of outbound licensing deals. Data from "Pharma Magic Cube" and the NMPA show that mainland pharmaceutical companies completed 81 outbound licensing transactions in the first half of this year, nine more than the same period last year, with a total value reaching 736.5 billion yuan, an increase of 294.6 billion yuan year-on-year. With efficient R&D deepening global collaboration, mainland pharmaceutical companies are experiencing simultaneous growth in volume and value of outbound licensing, driving explosive growth in revenue and profitability for the sector, and the industry is expected to maintain a high-quality growth trajectory.
Source: McKinsey & Company, Zhongkang Technology, AgeClub, "Research Report on China's Elderly Population Pharmaceutical and Health Industry," Frost & Sullivan, Ministry of Industry and Information Technology of China, "15th Five-Year Plan for the Development of the Pharmaceutical Industry," National Medical Products Administration (NMPA) of China, "Pharma Magic Cube," American Society of Clinical Oncology (ASCO)
Author: Yip Chi Hang, Analyst, Securities Division, Industrial and Commercial Bank of China (Asia)
*Articles published in "Economic Times," whether signed or unsigned, represent the personal opinions of the authors and do not reflect the stance of "Economic Times." "Economic Times" serves as a platform providing free expression of views.
*Growing elderly population drives pharmaceutical demand*
Data from research firm McKinsey & Company shows that mainland China has the world's largest elderly population (aged 60 and above), with the number expected to rise from the current approximately 310 million to 400 million by 2035. A joint report titled "Research Report on China's Elderly Population Pharmaceutical and Health Industry" released by Zhongkang Technology, a leader in big health data, and AgeClub, a think tank on the silver economy, indicates that as high as 75% of mainlanders aged 60 and above suffer from chronic diseases, with an average daily intake of two to three medications. Given the higher pharmaceutical demand among the elderly, research firm Frost & Sullivan estimates that the size of mainland China's pharmaceutical market will increase from approximately 19,627 billion yuan (RMB, same below) in 2025 to 26,245 billion yuan in 2030, representing a compound annual growth rate of about 6%. The market expects that as the elderly population in mainland China continues to grow, pharmaceutical demand will become increasingly urgent, benefiting the future performance of the mainland pharmaceutical sector.
*Policy-driven development of mainland pharmaceutical industry*
Mainland China is actively fostering the development of its pharmaceutical industry and has set goals for the next five years. On September 18, the Ministry of Industry and Information Technology of China, together with ten other departments, released the "15th Five-Year Plan for the Development of the Pharmaceutical Industry." The plan proposes that by 2030, mainland China will firmly rank among the world leaders in biopharmaceutical R&D and application. In terms of industrial value, revenue of designated large-scale pharmaceutical industrial enterprises is expected to exceed 3.5 trillion yuan, an increase of about 18.4% compared to 2.95 trillion yuan in 2025. For innovative drugs, the plan requires an average annual growth rate of over 20% in industrial scale, with the number of products achieving global annual sales exceeding 1 billion U.S. dollars reaching more than five. In addition to setting clear growth targets, the central and local governments have also introduced preferential policies to support pharmaceutical enterprises. In terms of policy support, China's National Medical Products Administration (NMPA) will compress the review time for clinically urgent drugs and medical devices by 50% to 70%. Furthermore, pharmaceutical companies can be exempted from import taxes on imported materials required for R&D. The plan not only sets future development goals for the mainland pharmaceutical industry but also provides supportive measures, paving the way for the industry's golden five years of successful transition "from large to strong."
*Cost reduction through R&D and technological advancement drive significant growth in mainland pharmaceutical licensing*
Mainland China's innovative pharmaceutical companies, leveraging efficiency and cost advantages, continue to experience strong momentum in overseas expansion. According to statistics from "Pharma Magic Cube," preclinical R&D time for mainland enterprises is 30% to 50% shorter than the global average, with R&D costs amounting to only one-third of those in the United States. Additionally, mainland R&D technology continues to improve significantly. Data from the American Society of Clinical Oncology (ASCO) annual meeting shows that mainland China submitted 95 oral presentations this year, an increase of about 30% year-on-year. Notably, a mainland pharmaceutical company, at the same conference, achieved clinical data on a lung cancer treatment drug surpassing that of a renowned overseas pharmaceutical company for the first time. In recent years, mainland pharmaceutical companies have assisted overseas pharmaceutical firms in R&D, resulting in an increase in both the number and value of outbound licensing deals. Data from "Pharma Magic Cube" and the NMPA show that mainland pharmaceutical companies completed 81 outbound licensing transactions in the first half of this year, nine more than the same period last year, with a total value reaching 736.5 billion yuan, an increase of 294.6 billion yuan year-on-year. With efficient R&D deepening global collaboration, mainland pharmaceutical companies are experiencing simultaneous growth in volume and value of outbound licensing, driving explosive growth in revenue and profitability for the sector, and the industry is expected to maintain a high-quality growth trajectory.
Source: McKinsey & Company, Zhongkang Technology, AgeClub, "Research Report on China's Elderly Population Pharmaceutical and Health Industry," Frost & Sullivan, Ministry of Industry and Information Technology of China, "15th Five-Year Plan for the Development of the Pharmaceutical Industry," National Medical Products Administration (NMPA) of China, "Pharma Magic Cube," American Society of Clinical Oncology (ASCO)
Author: Yip Chi Hang, Analyst, Securities Division, Industrial and Commercial Bank of China (Asia)
*Articles published in "Economic Times," whether signed or unsigned, represent the personal opinions of the authors and do not reflect the stance of "Economic Times." "Economic Times" serves as a platform providing free expression of views.
