Goldman Sachs: Chinese Biotechnology Attracts Attention from Major Pharmaceutical Companies

Goldman Sachs reports that large pharmaceutical companies are increasingly acquiring assets from Chinese biotechnology as patents on drugs worth a total of $440 billion are set to expire by 2032. Salvin Richter, a leading biotechnology analyst at Goldman Sachs, notes that Chinese competitors may shorten product development cycles for Western manufacturers. China's five-year pharmaceutical industry plan, published on September 18, aims to achieve at least 25% of global innovative drugs by 2030. These drugs work through new mechanisms rather than improving existing medications. Last week, AstraZeneca agreed to invest $2 billion in Summit Therapeutics, a U.S.-registered company. Summit licensed its leading anti-cancer drug from Chinese company Akeso. This year, total overseas licensing volumes for Chinese drugs have exceeded $120 billion, up 36% compared to last year.

However, Richter notes that most Chinese developments still focus on improving existing drugs, which may oversaturate the market. She also points out that Chinese developers have targeted the obesity treatment market, which is behind the recent rise in Eli Lilly's shares. Richter indicates that buyers may pay smaller premiums to market value for biotechnology outside of China. She emphasizes that "I really think that best-in-class, first-class innovation worldwide will still be rewarded."

Additionally, Richter refers to the HARMONi-3 trials for lung cancer treatment by Summit against Merck's Keytruda, aiming to determine how data on drugs from China will be effective for Western patients. Summit expects the next data on squamous tumors, a subtype of lung cancer, in the second half of 2026. In the April interim analysis, no early victories were achieved, and Summit's shares opened 24% lower the next day. She adds that Chinese drug manufacturers already collaborating with Western companies may become the next multinational corporations.