Against a backdrop of China’s rapid economic growth, sharp increases in funding, improvements in medical outcomes and evolving demographics, the Chinese healthcare and pharmaceuticals markets have seen rapid advances over the past decade.

Learn more about UK-China collaboration in healthcare and biosciences at the UK-China Business Forum 2024 on 20 March. Click here to register

China’s healthcare market is now the second-largest in the world. Total revenue was estimated to be around RMB 10 trillion (approx. £1.09 trillion) in 2021, and the “Healthy China 2030” initiative, one of the government’s main blueprints for developing the healthcare industry, has set out an aim for the market to reach RMB 16 trillion (approx. £1.75 trillion) by 2030.

This growth, along with China’s sophisticated digital infrastructure, has laid a fertile ground for innovation in healthcare and life sciences.

The UK has a unique health and life sciences ecosystem, and its track record of scientific breakthroughs serves as a driving force for the next generation of life-changing treatments, technologies and services. Recent developments in China’s healthcare sector, including newly published regulations in central procurement and public hospital reform, have made the international business environment even more competitive for international businesses operating in healthcare and the life sciences. Despite growing competition internationally, the UK maintains a competitive position in China’s healthcare cooperation agenda.

The challenges facing the healthcare sector in China provide many potential opportunities for UK organisations. For example, China’s rapidly ageing population will need to be supported by innovative pharmaceutical and biotech solutions, as well as robotics and AI. Sales of home healthcare devices for older adults have already shown an increase during Singles’ Day in recent years, as have sales of dietary supplements and cosmetics with ‘anti-ageing’ properties. Indeed, many experts recommend that the best solutions to the problems of ageing are found much earlier in life, creating a need for innovative products that prevent chronic illness caused by environmental and lifestyle issues.

It is for this reason that, over the past decade, UK-China collaboration in healthcare has received unprecedented support from both governments, as well as leading companies in the industry. For example, in 2017, GlaxoSmithKline (GSK) and the British Council launched the UK-China Health and Economy Partnership, a higher education programme to promote knowledge sharing and research innovation in health economics between leading British and Chinese experts and institutions.

During the UK-China Business Forum 2024, a panel of experts will discuss how UK businesses are innovating and partnering in the Chinese market and how competition is driving healthcare forward in one of the world’s most dynamic economies. The panel includes Mark Hedley, Deputy Head of Investment Promotion at InvestHK; Sue Welburn, Vice Principal of Global Access & Professor of Medical & Veterinary Molecular Epidemiology at the University of Edinburgh; and Elinor Greenhouse, Senior Adviser, Tech and Innovation at the China-Britain Business Council (moderator). Click here to register.

Photo by National Cancer Institute on Unsplash

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“It’s hard to not be impressed by the progress that has been made in China over the last few years,” he said in April.

Some Western governments have been publicly decrying the threat of “economic coercion” from China, with countries including the US scrutinising Chinese investment into its biotech centre. However, for AstraZeneca, the geopolitics of the situation is secondary to the market potential.

“When you are a global company like AstraZeneca you have always to cope with geopolitical risk and you have to try to manage that without getting too involved,” Michel Demaré, the company’s new chair, told the Financial Times. As long as there were no legal or sanctions issues, he added, “you just try to take care of your patients and try to reach the most patients you can”.

AstraZeneca is the largest overseas pharmaceutical company by sales volume in China. A large, ageing population with chronic illnesses due to environmental and lifestyle issues ensures that China is a target market for many drug makers. AstraZeneca, however, is also interested in the scientific expertise in China and the financial support available. “The innovation power has changed,” Demaré told the FT. “It is no more ‘copy, paste’. They really have the power to innovate and put all the money in. There’s a lot of start-ups and we are a part of that.”

In 2021, AstraZeneca opened a major R&D centre in Shanghai and launched a health tech incubator in Wuxi the year before that. And last month, it signed a partnership worth up to US$ 600 million (£484.5 million) with Shanghai-based LaNova Medicines for the global licence for a potential cancer drug.

“When you are a global company like AstraZeneca you have always to cope with geopolitical risk and you have to try to manage that without getting too involved”

Since Soriot took over the company a decade ago, AstraZeneca has continued to invest in research and development in China and seen its success grow. Global executive vice-president Leon Wang, who joined in 2013, has also been credited for his innovative approach and has overseen the building of thousands of centres within hospitals to deliver AstraZeneca’s Pulmicort, a drug for asthma and chronic obstructive pulmonary disease.

Soriot said that AstraZeneca’s presence in China enables it to “tap into this innovation and help those companies develop and commercialise their products globally”.

AstraZeneca is not seen as a purely foreign company in China because of the sheer number of acquisitions and partnerships with local companies, and they create incubators that support local start-ups.

The Chinese approval process for getting new medicines onto shelves has reduced significantly in recent years, and the regulatory changes regarding insurance coverage have also helped pharmaceutical companies find success in China. Moreover, AstraZeneca’s ability to operate with freedom in China without restrictions from head office has enabled it to act in many ways like a local company. And without the distraction of geopolitics, AstraZeneca is going from strength to strength.

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