Chinas biotechnology industry has developed rapidly and has become a major force in the global research and development of new drugs. However, this new trend of industrial cooperation has sparked anxiety and concern in the United States.
The British Financial Times reported on May 31 that as the patents of popular drugs expire, global pharmaceutical companies are increasingly turning their attention to China. Some American politicians have taken this opportunity to advocate for restrictions on U.S. companies investments in Chinese biotechnology, citing national security as a reason. However, many industry experts argue that imposing such restrictions would not only go against the laws of industry development, but could also cause an unprecedented devastating blow to the U.S. market itself.
Pfizer has become the latest American pharmaceutical giant to reach a drug cooperation agreement with a Chinese biotechnology company. Last week, Pfizer announced a global strategic partnership with Suzhou Innovent Biologics. Both parties will jointly develop 12 innovative cancer drugs. The total transaction value could reach up to $10.5 billion. Specifically, Innovent Biologics will receive an upfront payment of $650 million, and it will also be eligible for milestone payments related to research, development, regulatory processes, and commercialization – i.e., payments based on key achievement milestones.
In fact, this is the second time in less than a year that Pfizer has reached a deal with a Chinese company regarding cancer drugs. In July 2025, Pfizer paid Sinopharm Group of Companies $125 million, including $100 million for equity investment.
According to reports, this latest deal has exacerbated the United States growing concerns over Western companies aggressive efforts to acquire control of the pharmaceutical industry in China. In other industries, such as automobiles, Western companies are increasingly relying on Chinese technology to manufacture vehicles. Earlier this month, the U.S. Chamber of Commerce even warned that countries have little time left before they must act quickly to counter Chinas expansion into global supply chains.
Today, the pharmaceutical industry has also become involved in this dispute.
On May 21, the notorious American Republican congressman who opposes China, John Mouleneal, wrote a letter asking Treasury Secretary Beasden to include biotechnology in the National Security Act of 2025. This act aims to restrict U.S. investments in countries like China.
Moulinar specifically mentioned the cooperation agreement reached on May 12 between the American pharmaceutical giant Bristol-Myers Squibb and Chinese pharmaceutical company Hengrui Medicine. This arrangement has shocked some people in the pharmaceutical industry.
According to the terms of the agreement, BMS will pay Hengrui Medicine approximately $950 million in payments. This amount includes a down payment of $600 million, a first anniversary payment of $175 million, and a second conditional anniversary payment in 2028, also worth $175 million. The potential total value of this agreement could reach around $15.2 billion (including the rights to jointly develop projects, as well as all milestones related to development, registration, and commercialization of these projects).
I am writing to draw your attention to the fact that American capital and technology are flowing into Chinas biotechnology sector in large quantities. This trend is very dangerous. In his letter, Murnier warned Besent, I urge the Treasury Department to pay special attention to transactions related to pharmaceutical intellectual property licensing.
Bristol-Myers Squibb, headquartered in New Jersey, declined to respond to requests from The Financial Times for comment.
Meanwhile, the U.S. International Trade Commission is investigating how the potential support provided by the Chinese government to biotechnology companies could affect American companies. At a hearing held in Washington on May 27, an official from the Chinese Chamber of Commerce criticized this investigation as unnecessary.
On August 11th, the worlds first plant-based recombinant human serum albumin product was officially launched in Guanggu. IC Photo
Faced with the pressure of patent expiration for best-selling drugs, pharmaceutical giants in Europe and America are increasingly turning to China for research and development resources.
In 2025, the number of overseas asset licensing deals concluded by Chinese pharmaceutical companies reached a record high. Official data shows that in that year, there were a total of 157 deals involving innovative Chinese drugs being licensed abroad, with the total amount reaching $135.7 billion. In comparison, in 2024, only 94 such deals were concluded, with a total amount of $51.9 billion.
The South China Morning Post previously quoted Wang Jin, a senior partner at McKinsey, as saying that in recent years, Chinas innovative drugs have not only seen an increasing number of them, but also there has been an improvement in both the depth and quality of these innovations. China has also introduced several policies to support innovation across the entire supply chain, which has greatly encouraged entrepreneurship in the pharmaceutical industry.
According to data from the pharmaceutical analytics firm Evaluate, since the beginning of this year, companies such as AbbVie, AstraZeneca, Eli Lilly, Novartis, and Sanofi have paid Chinese companies a total of $2.5 billion in upfront payments in exchange for rights to collaborate on the development of certain drugs.
These transactions do not involve equity investments themselves. However, if the drug achieves its intended goals, Chinese companies will also receive additional revenues worth billions of dollars in the future.
Some people in the American biotechnology industry are extremely worried about the pharmaceutical industrys dependence on China.
Based in Boston, the biotechnology investment fund Curie Bio has hired a lobbying team for the first time this year. They also distributed a document to Congressmen titled China is replicating its rare earth strategy into the new drug supply chain. China plays a dominant role in supplying rare earths required for many products, including electric vehicles, smartphones, military equipment, and more.
Curie Bios CEO, Zack Weinberg, declined to comment on this document. However, he said that he is currently working in Washington to lobby regarding how the United States can become a country better suited for drug development, while still maintaining high-quality and ethical standards.
The former director of the U.S. Food and Drug Administration also stated earlier this year that the biggest threat we face in the pharmaceutical industry is China. He also mentioned that the number of early-stage drug trials conducted in China has surpassed those in the United States.
In fact, during the Biden administration, the US tried to use administrative measures to respond to Chinas challenges in biotechnology. At that time, China emphasized that economic globalization is an objective reality and a historical trend. We hope that the US will respect the laws of market economies and principles of fair competition, and avoid artificially hindering global technological exchanges and trade interactions.
Obviously, the vigilance of American politicians towards cooperation involving China goes against market principles. This has also raised concerns among investors in biotechnology.
Peter Kolczynski, managing partner of RA Capital, a biotech venture capital fund that manages assets worth $14 billion, believes that including this industry in the National Security Act would have the opposite effect, causing an unprecedented devastating blow to the U.S. biotech market.
In his interview, he reminded, Washington is already discussing how to deal with Chinas influence in other industries and supply chains. Biotechnology is just the latest battlefield. Washingtons strategies regarding rare metals and chips should not be mistaken for strategies that can be applied to biotechnology.
Swiss asset management company Bellevues research director, Kyle Rasmusbach, said that Washingtons measures have made the company pay more attention to how the U.S. Committee on Foreign Investment (CFIUS) handles issues related to Chinese investments.
Lasbach said that people are worried that if certain transactions fall into gray areas or have room for interpretation, Chinese-owned companies may face the risk of being halted.
Everyones awareness has increased. When discussing investments in Chinese biotechnology, Rasmo said, Through our investment projects, we have been involved in the development of certain pharmaceutical molecules originating from China. We are always committed to finding the most advanced technical solutions. In some cases, we believe that these solutions indeed come from China.
