As drugmakers face growth challenges in the U.S. and other developed countries, China is looking more enticing to one CEO. Novartis chief Joe Jimenez thinks the market is set for a boom period as the industry launches a wave of new meds in the country.
Already the second-largest pharma market in the world, Jimenez told Bloomberg that pharma sales in China could pass $300 billion by 2020. That will happen as regulators in the country push to offer new drugs to sick patients who’ve traditionally not had access to the world’s groundbreaking meds.
Last month, officials in China proposed a slate of changes to the country’s drug approval process to speed foreign drug approvals by loosening testing rules. Traditionally, drugmakers have faced high barriers to entry in China centered around local drug testing.
RELATED: China proposes new FDA rules to speed up foreign drug approvals
But with those laws set for a change, Big Pharma is taking notice.
Gilead, for one, hired a former Roche exec last fall to oversee hepatitis C drug launches in China, where there are about 30 million patients. Earlier this month, the company disclosed on a recruitment website it’s building its first ex-U.S. manufacturing site in the country, declining to disclose any other details.
For its part, Pfizer last fall started rebuilding a China sales outfit on the heels of a new approval for its megablockbuster pneumococcal vaccine Prevnar 13. The company previously abandoned its vaccines business in the country after officials there declined to renew an import license for the vaccine’s predecessor Prevnar.
RELATED: Gilead discloses China manufacturing plans on a recruitment website
Novartis recently won Chinese approvals for kidney cancer med Votrient and myelofibrosis med Jakavi, according to Bloomberg, while Roche secured an approval for melanoma drug Zelboraf and AstraZeneca gained a nod for lung cancer therapy Tagrisso.
With authorities in the U.S. and elsewhere keeping a keen eye on pharma pricing and costs, several drugmakers have enjoyed strong growth in China. Notably, AstraZeneca posted a 10% sales increase there in 2016 to $2.6 billion, while Novo Nordisk was able to notch a 5.9% increase to $1.5 billion.
According to the International Trade Association, the Chinese pharma market was worth $108 billion in 2015. The group says the country is “one of the most promising for U.S. exports in the long-term given its size and growth potential.”
RELATED: Pfizer looks to rebuild abandoned vaccines biz in China with brand-new Prevenar 13 nod
Of course, cost remains an issue in China, with more than 1.3 billion people living in the country and many of them with very low incomes. Government officials are continuously looking for ways to limit spending and drive costs down.