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#BIOCEO18: Paradigm Shift Creating New Opportunities in China

February 12, 2018

The past few years have been a time of tremendous change in the world’s second largest market for biopharmaceuticals: China. What these changes mean for biopharmaceutical companies looking to break into the market – or find a new potential source of investment capital – was the subject of a lively panel at the opening day of the 2018 BIO CEO and Investor Conference in New York.

Moderated by BIO Executive Vice President for International Affairs Joseph Damond, the panelists included:

  • Alex Jung, Managing Director, Parthenon-EY, Ernst & Young LLP

  • Michael Keyoung, MD, PhD, Managing Director and Head of North America, C-Bridge Capital 

  • Yuwen Liu, Founding Partner, BOHE Angel Fund; former Chairwoman & CEO, Suzhou Industrial Park Biotech Development Co. Ltd. (BioBAY)

  • Hummer Mars, Executive Director, China Group, Global Investment Banking Division, NYIC

  • Kimberly Nearing, Managing Director, Head of Life Sciences, Cedrus Group

  • Dan Zhang, MD, Chairman, Fountain Medical Development

BIO’s Damond summed up the shift in his opening remarks:

“One of the things we’ve been following a lot in the past couple of years is the fact that China has been doing a lot to reform its regulatory and drug approval regime from one that is under-resourced and lagged tremendously from approval dates in the US and Europe to one that is better resourced and more aligned with regulatory practices in the developed world. And this is part of China’s goal of developing the right conditions to do drug development in China.”

As Kimberly Nearing of the Cedrus Group noted, “Western companies that are sitting on the sidelines to see what’s going to happen in China, this might be the impetus to start including China in their plans. We hear from a lot of clients, and rightly so, that the value of their assets to potential partners in China just increased because of the reduction in development time.”

C-Bridge Capital’s Michael Keyoung observed that the changes have meant a shift from focusing on me-too products to true innovation. “If you’ve followed China in the last 5 years, there’s a big dynamic shift in the past 2 years… if you’re a VC investor you invested in a different type of Chinese biotech company these past 3-4 years,” said Keyoung. “You were focused on fast followers and a different type of drug development. Now with the change of regulation, you really have to focus on innovation.”

The panelists had a few pieces of advice for those looking to break into the Chinese market. First, do your homework. Ms. Nearing stressed the importance of thorough due diligence with any potential partner, and spelling out in lengthy and explicit detail the division of labor and decision-making structure for partnerships.

Several panelists also advised finding the right strategic advisor who can guide through the complex Chinese landscape, where a clear understanding of the regulatory and investment landscape is paramount for success.

Read more coverage of the 2018 BIO CEO & Investor Conference.