Your ChinaBio™ Connection
China is Changing
While China is making great strides in biomedical technology and business infrastructure, it can still be a daunting place to do business, especially from 6,000 miles away. Despite the challenges, U.S. life science companies are launching R&D, clinical, manufacturing and distribution operations and partnerships in China.
The potential advantages of establishing business relationships or operations in China are three-fold:
- Cost Savings: Drug development costs are 80% less than those in the U.S., and outsourced manufacturing of drugs and devices can be less than 1/10 the cost;
- Technology: New, cutting-edge compounds and medical devices are now being developed here, and the technology is unfettered by the U.S.’s conservative political climate; and
- Market Size: China’s market for healthcare products is growing at 17%+ CAGR, and its population of 1.3 billion people is aging more rapidly than any other country.
Outsourcing manufacturing and support services to China is an obvious area for consideration. But China is also subsidizing the migration from manufacturing to
research and development to keep its growth engine humming. In addition, other factors contributing to biotechnology and medical device companies looking to China to leverage their research and development activities include:
- China is encouraging foreign investment in the life sciences by subsidizing foreign investment organizations and deregulating venture capital.
- Drug development costs are not only 80% lower than those in the U.S., they are at least 50% less than most other OUS markets.
- There is a large population of highly-educated scientists in China – estimates are 20,000 life science PhDs – available at 1/10 of U.S. salaries.
- China’s State Food and Drug Administration (SFDA) has been rapidly moving toward global GLP/GMP standards and has created approval processes that parallel the FDA’s clinical path.
- IP protection is improving, with patent laws now compliant with WTO/TRIPS requirements and increased legal enforcement supported directly by the SFDA.
Doing Business in China
Doing business in China is an exciting adventure than can reap significant rewards for those who execute properly and respect cultural differences. To others, it may feel like beating your head against the wall while making little or no progress.
The best way to ensure success is to get help. Select a partner who understands China’s rapidly changing biomedical industry and business environment and who can build trusted relationships (guanxi) with your potential partners. This will save you time and expense by quickly identifying viable business partners and establishing the initial contact on your behalf.
Your ChinaBio™ Connection
Centient has established key relationships in China that can help companies identify potential partners and create their own guanxi more quickly. We have also identified the credible companies leading the R&D charge and that providing outsourced services at significantly lower cost, saving our clients time and effort.
Incorporating our broad range of business services, Centient’s ChinaBio Connection™ helps U.S.-based life science companies cut through the noise to identify those opportunities that meet our client’s specific business objectives – whether they are identifying a promising compound, outsourcing GMP manufacturing or investing in promising R&D projects.
Whether it’s outsourced services, R&D partnerships or investment opportunities, Centient can assist clients with:
- Developing a clear China strategy
- Identifying promising opportunities
- Making introductions to companies and officials
- Selecting a partner or supplier
- Performing due diligence
- Addressing provincial and state issues
- Leading contract negotiations
- Recruiting China-based management
Last Updated: Jan 1, 2007 at 11:40 AM
© Copyright 2007 Centient® Consulting, Inc. All rights are reserved. Information subject to change without notice.
NOTICE: This information may not be copied and/or distributed without prior written permission of Centient Consulting, Inc. For information on this content, please contact us at info@centient.com.
