Three questions for Dr. Annie Zeng on China’s biotech market

China’s biotech sector is becoming a global innovation engine, but public-market valuations still lag improving fundamentals and could re-rate as clinical, licensing and profitability catalysts emerge.

• China’s biotech market is worth about USD 130 billion and is projected to reach roughly USD 250 billion by 2036, implying approximately 6% annual growth versus low-to-mid single-digit growth for the similarly sized US market.
• Chinese companies now account for about 30% of new drugs in global clinical trials, up from almost none a decade ago, with more than 1,200 Chinese-originated drug candidates in clinical development.
• Outbound licensing deals exceeded USD 135 billion in 2026, with an average deal size of USD 1.3 billion, up 76% year on year and roughly six times the 2021 level; cross-border deals rose from 65 in 2021 to 186 in 2025.
• The sector remains volatile because biotechnology depends on binary clinical and regulatory outcomes, while Chinese stocks also face macro and policy noise; investors additionally apply a broad China discount and have recently preferred AI and robotics.
• Potential catalysts include oncology data at the World Conference on Lung Cancer from September 12–15 and ESMO from October 23–27, further licensing deals, profitability improvements at GenScript and WuXi companies, a recovery in medtech after volume-based procurement, and more supportive healthcare policy.

Takeaway: Bellevue sees the valuation gap as a buying opportunity, particularly in Innovent, Akeso, Kelun, Hansoh, GenScript, WuXi, and Mindray, but the thesis remains exposed to binary trial outcomes, policy developments and continued biotech volatility.