China's Pharma Sector Sees Surge in Drug Approvals and Out-Licensing in H1

China's pharmaceutical industry expanded its innovative pipeline and global commercial footprint in the first half of the year, according to state media reports. Regulators approved 38 innovative drugs during the period, with domestic firms developing 31 of them, including 11 based on novel targets or mechanisms. Driven by faster regulatory pathways, artificial intelligence tools, and smart manufacturing initiatives, the sector also reported $110 billion in out-licensing deal volume and a 6.4% rise in industrial value-added output.

The rapid increase in novel drug approvals and cross-border licensing transactions signals that China is transitioning from a bulk active pharmaceutical ingredient (API) and generic manufacturer into a major exporter of proprietary biopharmaceuticals.

China's pharmaceutical industry accelerated the development and commercialization of innovative therapies in the first half of the year, supported by policy incentives, faster review timelines, and technological upgrades, according to state media reports. During the six-month period, regulatory authorities approved 38 innovative drugs for the market. Domestically developed treatments accounted for 31 of these approvals, or more than 80% of the total. Notably, 11 drugs featuring novel biological targets and mechanisms were entirely developed by domestic firms, including several first-in-class therapies. Regulatory efficiency continued to improve, with China's first broad-spectrum targeted oncology drug transitioning from application submission to formal approval in eight months before entering clinical use at major hospitals. The domestic drug pipeline has expanded in parallel. By the end of 2025, China had 4,751 innovative drug candidates under development, representing roughly one-third of the global total and positioning the country as the world leader by pipeline volume. Industrial output has mirrored this research momentum. In the first half, industrial value-added for pharmaceutical enterprises above designated size grew 6.4% year-on-year. Sectoral upgrades have been aided by digital infrastructure; in Shanxi province, a newly established artificial intelligence biocomputing facility was deployed to evaluate millions of protein functional domains and filter out unviable molecules. Nationally, authorities have supported 21 pharmaceutical companies in establishing excellence-level smart factories and recognized more than 300 green manufacturing facilities. Global commercialization also expanded significantly. Pharmaceutical export delivery value rose 9% year-on-year in the first half, with high-value products representing nearly 20% of the total. Bolstered by novel candidates—such as a chemotherapy-free gastric cancer therapy that generated international licensing revenue prior to its domestic launch—total out-licensing transaction volume reached $110 billion during the period.