China’s rise in biopharma is often framed as a competitive challenge to the West. For Lingshi Tan, Executive Chairman of Caidya, that framing misses the larger point: drug development itself is becoming more multipolar.
In part one of our conversation, Tan explored how tighter capital, rising development costs, and the growing importance of early clinical data are changing the way biotech companies are funded and advanced. Here, he turns to China’s biopharma ecosystem – tracing its evolution from a largely generics-focused market into a globally influential engine for innovation, clinical development, and partnering. He discusses the regulatory reforms, returning talent, CRO and CDMO infrastructure, and integrated early development models – and what Western companies can learn from the rise of Chinese biotech.
How has China’s biopharma ecosystem evolved over the past decade?
When I moved from New York to Shanghai in 2005 to begin building Pfizer’s R&D capabilities there, the market was dominated by local generic producers who had grown serving the population’s need for basic drugs – mainly anti-infectives – and a handful of multinationals that had begun building commercial operations and local manufacturing during the 1980s with a focus on chronic diseases as these became increasingly important. Not surprisingly, the country’s domestic research was limited and its regulatory capability and system were rudimentary. Over the next 10 years, the drug industry, government policy, and the nation’s health care delivery infrastructure evolved in fits and starts.
In 2015, a rapid succession of radical changes started to unfold. Regulatory capabilities grew in both scale and depth. Timelines fell dramatically from a typical seven or eight years for approval of a novel foreign drug to acceptance of foreign data and bridging studies that whisked innovative therapies with proven safety and efficacy outside of China to local launch in a few short months. Today, companies get IND approved in 30 working days unless the NMPA objects or requests further data, much like the timeline in the US.
Innovative drugs were added to the government’s national reimbursement system following significant price cuts, with lower prices typically compensated by increased utilization and broader market access.
A handful of local innovative biotechs began to emerge, often led by founders who had returned to China after years of working in R&D at Western multinationals. China’s already well-developed pre-clinical development capabilities were supplemented by local CDMOs and Clinical CROs targeting the me-better and eventually first-in-class molecules emerging from both large local and start-up firms.
Today, only a decade later, China houses a vibrant integrated ecosystem driving high-speed innovation that includes increasingly well-funded academic research, patient databases linked to a half-dozen biotechnology centers that mix local biotechnology firms, multinational biopharma leaders, and large local biopharma companies with the supporting infrastructure of specialized service providers. China’s biopharma industry is operating at global scale and increasingly at the frontier of innovation.
Overall, the pace of change in China’s biopharma ecosystem has been extraordinary.
A combination of factors has enabled these developments: sustained investment, regulatory reform, a rapidly maturing clinical trial infrastructure, and importantly, a generation of globally trained talent returning to China and building companies with a very different mindset.
What I find particularly notable is how integrated the ecosystem has become. There’s a strong alignment between discovery, development, and execution, which allows for faster iteration and decision-making.
Is China reshaping the global drug development landscape? If so, in what ways?
China accounted for about 32.3 percent of global drug-development program originations in 2024. Among large pharma partnering deals, Stifel reported that 31 percent of major pharma’s innovative pipeline assets in-licensed in 2024 came from China. In its March 31, 2025 report, Stifel estimated that the figure had risen to 37 percent for big pharma licensing deals with upfronts of $50 million or more.
China is already recognized as a leader in developing specific modalities, including cell and gene therapy, antibody-drug conjugates (ADCs), and in bringing affordable AI tools to researchers.
This is only the tip of the iceberg: leading global biopharma companies are revamping approaches to leverage China’s innovation capacity more effectively. AstraZeneca recently committed $2.5 billion to create a second R&D center in Beijing, with much of the funding to support partnerships with innovative local firms. We continue to see not simply large investments by global leaders, but increased focus from both investors and biotech firms seeking to maximize speed, lower costs, and improve the probability of success via cross-border collaboration.
I think it’s important to frame this correctly.
It’s often presented as a zero-sum competition between the US and China. In reality, what we’re seeing is the emergence of a more multipolar system.
China’s impact is already visible in several ways. The scale of development activity has increased dramatically, and in some modalities, Chinese companies are operating at – or very close to – the leading edge.
But beyond scale, China is influencing how development is done. Faster timelines, more integrated execution, and a stronger focus on efficiency are challenging some of the traditional assumptions in Western systems.
In that sense, China is acting as a catalyst, forcing the global industry to rethink speed, cost, and productivity.
Your paper also discusses novel approaches to early clinical development emerging in China. How do these models differ from traditional early-stage development strategies in the US and Europe?
Let me try to answer at two levels: the exciting innovations we see at work today and the underlying characteristics of China’s innovation system that suggest current models may simply be the tip of a bigger iceberg.
In terms of specific innovations already deployed in China today, a sequence of steps is being configured to create a new model. The first links target identification with specific patient groups leveraging AI and deep and rich patient databases. While this approach is by no means unique to China, it has emerged as one of the fastest paths used by firms to identify and prioritize drug candidates and match them with ready-made cohorts of highly targeted study subjects.
This obviously simplifies and accelerates steps from discovery to development. But it also creates a new stage gate to human trials. Researchers and biotech have the regulatory flexibility to launch small-scale translational trials in both CGT (cell and gene therapy) and in exploring new indications for therapies already approved and marketed, in some cases bypassing the traditional IND process.
This preliminary human data helps design and de-risk subsequent development, providing invaluable data for regulatory applications as well as the foundation for fundraising, out licensing, and collaborative partnerships.
But the underlying historical context is equally important to understanding why China’s biotech innovation seems likely to accelerate further. The West’s historical model originated in the drive to develop safe and efficacious chemical therapies focused on a few hundred druggable targets. Vestiges of this thinking reside in Western regulatory frameworks as well as clinical and corporate guidelines and thinking. Having been codified into the education system, academic thinking, and the regulatory and legal frameworks, embedded assumptions can take more than a generation to change.
Even with the dramatic changes – both scientific and regulatory – that have transformed the US during my career, they fail to match the radical generational change in China. Even when I returned to China in 2005, the risk-averse arch conservatives who controlled Chinese drug policy, allocation of academic research resources, and who led state-owned pharma companies began to pass from the scene. Over the next decade – from roughly 2005 to 2015, a transitional generation, many of whom had been educated in the West, laid the foundations for accelerated change.
As in other areas of innovation, today’s new generation of Chinese policymakers, scientists, technologists, and entrepreneurs show a firm grasp of these “Western” basics but at the same time more readily cast-off traditional approaches in favor of alternative solutions based in good science that frequently challenge conventional thinking. As part of RDPAC’s R&D Committee (R&D-based Pharmaceutical Association Committee), I had an opportunity to watch the speed of the radical transition in Chinese regulatory as well as academic and scientific thinking that has helped spawn a new post-2015 generation throughout the biotech ecosystem.
One of the biggest differences is the level of integration and execution speed. In China, there is often closer alignment between sponsors, clinical sites, and operational partners, which can significantly accelerate study start-up and patient enrollment. In some cases, early-phase trials can be conducted meaningfully faster and at lower cost compared to traditional models. But what’s more interesting to me is the mindset. There is a strong emphasis on rapid iteration, moving quickly from initial data to protocol refinement and expansion. That creates a more dynamic approach to early development. In contrast, systems in the US and Europe can be more fragmented, with longer timelines driven by regulatory complexity and operational silos.
That said, each system has strengths. The opportunity going forward is to combine the speed and integration seen in China with the regulatory rigor and global experience of Western systems.
As companies increasingly run development programs across multiple regions, what are the biggest challenges in aligning regulatory expectations and operational strategies between agencies such as the FDA, EMA, and NMPA?
Progress toward global regulatory and ICH harmonization presents innovators with a much more conducive environment than we could have imagined even five years ago, with advances continuing on both fronts.
The biggest barrier I see today – at both Chinese and Western innovative biotechs – stems from simple lack of comfort and confidence operating across borders. We long ago passed the era when Western companies insisted Chinese regulators accept the same IND application forms, they had used with FDA or EMA. Or when Western regulators found numerous flaws in the quality of Chinese clinical data.
Today’s challenges reside in the nuances of navigating the unique and changing characteristics of each country’s regulatory and clinical development ecosystem. These can only be managed effectively with expertise and operational experience on the ground. Some global biopharma companies with extensive experience in China have mastered these skills while others are still developing this capability.
The vast majority of early-stage Western biotechs remain wary or outright intimidated by China. Similarly, Chinese biotechs share with each other tales of frustration at the high cost, slow speed, and unresponsive customer service from US partners, service providers, and regulators.
Cross border licensing, the popular short-cut used by larger Western firms and Chinese innovators or the NewCos favored by biotech savvy financial investors offer the most readily accessible frameworks for collaboration. But operationally, they often fall short unless an integrated team is familiar with and fully aligned on a global development strategy and execution plan interact daily with mutual trust and transparency.
As development becomes more global, aligning regulatory expectations and operational strategies is becoming one of the central challenges in the field. Regulatory agencies like the FDA, EMA, and NMPA are increasingly aligned in principle, but there are still important differences in expectations, whether around trial design, endpoints, patient populations, or data requirements. One of the emerging complexities is that pivotal data may increasingly come from a single region. That raises difficult questions about generalizability and whether bridging studies or additional trials are needed.
From a sponsor perspective, the key is to think globally from the outset. Designing a program that can satisfy multiple regulators simultaneously is far more effective than trying to adapt later. This is where experience really matters, the ability to understand not just the regulations, but how they are applied in practice across regions.
From your perspective, what should sponsors consider – or reconsider – when selecting CRO partners for complex early clinical programs?
During my last 11 years at Pfizer building a clinical capability fully integrated with the company’s Worldwide Research Organization and then committing the last decade to create a globally integrated CRO designed to bridge this gap, I know how challenging it has been and also how much more critical it is in today’s increasingly integrated global industry.
For complex early clinical programs, sponsors need to rethink what they expect from a CRO. It’s no longer just about execution. Early development is highly strategic, and it requires tight integration across clinical, regulatory, and scientific domains. So, the question becomes: can your partner help you make better decisions, not just run your trial?
Global capability is also essential, but it has to be meaningful. It’s not enough to have a geographic footprint. CROs need real, on-the-ground understanding of local ecosystems, whether that’s in the US, Europe, or China.
And finally, speed and adaptability are critical. Early development is inherently uncertain, so you need partners who can respond quickly, adjust in real time, and keep the program moving forward.
From that personal experience, several factors that I see being critical to cross-border and global clinical development.
Critically, CROs must demonstrate:
Speed and responsiveness: Agile execution and rapid decision-making are essential in early development, where timelines and early signals drive valuation and next steps. CROs must consistently emphasize faster activation, proactive risk mitigation, and real-time adaptability.
Innovation mindset: The ability to challenge conventional approaches, iterate quickly, and apply flexible trial designs is increasingly critical in a fragmented, innovation-driven landscape.
Ownership mentality and partnership approach: High-performing CROs operate as an extension of the sponsor’s team, bringing accountability, transparency, and shared commitment to outcomes, not just deliverables.
Applicable expertise: Equally critical is deep therapeutic and operational knowledge that enables a CRO to anticipate challenges, refine strategy, and guide smarter decisions at key inflection points. In complex early-phase programs, this level of expertise ensures not just efficient execution, but higher-quality data, stronger regulatory positioning, and a clearer path to downstream success.
Ultimately, sponsors should prioritize CROs that combine global integration, cross border expertise, speed, and strategic partnership that can navigate complexity while accelerating early decision-making and long-term success.
Looking ahead, how do you expect global innovation ecosystems and funding models for drug development to evolve over the next decade – and what lessons might Western biotech companies draw from the approaches discussed in your paper?
I cannot claim unique insight on the coming decade, but a few salient characteristics seem probable.
First, global biopharma firms have the greatest potential to play the central role – at least initially – in identifying, funding, and commercializing innovative drugs coming from biotech firms around the world. They appear to be the best organized and resource rich sources of both expertise and global experience across the product life cycle. The most likely to succeed will have to adopt many of the characteristics I described above. This will be a huge challenge for large, often bureaucratic firms, particularly those that have the bulk of their investment, organizational infrastructure, and revenues in the US.
Second, a fundamental shift in industry economics appears to be underway. Increased speed, lower cost, and higher efficiency have dominated this discussion so far. But the other side of this equation is a critical point that Rick Pazdur made in his March 2026 JAMA article:
“Facilitating and encouraging multiregional clinical trials – large trials conducted across multiple geographic regions – will be essential to ensure that evidence supporting new therapies is generalizable across populations and can support concurrent approvals across regions.”
While drug development costs continue to rise, pressure on prices – a longstanding issue in Europe and China with centralized pricing and reimbursement – seems certain to proliferate in the US as demonstrated by policies adopted by both the Biden and Trump administrations. Making innovative drugs available and affordable to patients globally suggests volume – rather than high margins in a single country – will become increasingly important.
For an innovative biotech – whether in the US, Europe, or Asia – it seems clear to me that success depends on looking beyond FDA approval as the goal post. Start with a global vision and metrics, explicitly defining the role your firm will play. Then find the requisite expertise and experience needed for success – initially in collaboration with one or more strategic partners or service providers at each stage of the development, regulatory, and commercialization process. In the process, you can create the cash flow that allows you to progressively build these capabilities in house or reinvest in fresh discovery and early-stage development opportunities.
Looking ahead, I think we’ll continue moving toward a more globally distributed innovation ecosystem. Innovation will come from multiple regions, and development models will become increasingly hybrid, combining capabilities across geographies rather than relying on a single center.
Funding will likely remain disciplined, with continued emphasis on early validation and capital efficiency. But we may also see more cross-border capital flows and partnership models that connect different ecosystems.
If there’s one key lesson for Western biotech, it’s the importance of speed and integration, not just moving quickly, but doing so in a coordinated and data-driven way. At the same time, I think it’s important not to view this as a competition with a single winner. A more multipolar system has the potential to make the industry more productive overall if it drives better decision-making, lower development costs, and faster delivery of therapies to patients. Ultimately, that’s the outcome that matters.
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