Against the backdrop of globalization, an increasing number of Chinese pharmaceutical companies are actively exploring overseas markets. Different types of pharmaceutical products face different opportunities and challenges during the overseas expansion process. So, what are the main types of pharmaceutical products for overseas expansion? And what characteristics do they each possess?

Innovative Drugs

Characteristics: They possess independent intellectual property rights, require huge investments in research and development, and are highly technologically advanced. Innovative drugs usually have significant advantages in terms of efficacy, safety, or drug delivery methods, and can meet unmet clinical needs.

Advantages in Overseas Expansion: They have relatively high added value and competitiveness in the international market. Once approved by overseas regulatory authorities, they often bring high market returns. For example, according to Sina Finance's report on July 8, 2024, domestic innovative pharmaceutical companies saw a growing enthusiasm for overseas expansion in the first half of 2024. Just through the way of licensing out drug pipelines, the cumulative number of relevant domestic licensing projects reached about 30, with a significant increase compared to the same period last year, and the cumulative total transaction amount exceeded tens of billions of US dollars. Among them, antibody-drug conjugates (ADCs) were the mainstay in overseas expansion. Besides, the 2024 Blue Book on the Current Situation and Trends of China's Biopharmaceutical Overseas Expansion shows that there were 34 License-out events in China's innovative drug field in the first half of 2024. The down payment amounts of the top 10 events totaled 720 million US dollars, and the total transaction amounts added up to 20.21 billion US dollars. A certain Chinese pharmaceutical company's new anti-cancer drug, relying on its unique mechanism of action and good efficacy, was successfully launched in developed countries such as those in Europe and the United States, bringing substantial profits to the enterprise.

Challenges: The research and development and approval processes of innovative drugs are complex, requiring a large amount of time and capital investment. Meanwhile, regulatory requirements vary greatly among different countries and regions, which increases the difficulty of overseas expansion of innovative drugs.

Generic Drugs

Characteristics: They are drugs that are the same as the original drugs in terms of dosage, safety, potency, quality, effect, and indications. The research and development costs of generic drugs are relatively low, and their prices are also relatively inexpensive.

Advantages in Overseas Expansion: With the intensification of the global aging trend and the continuous increase in medical costs, the market demand for generic drugs keeps growing. Chinese pharmaceutical companies have a cost advantage in the production of generic drugs and can provide high-quality drugs at lower prices. For example, on April 1, 2024, in an expert column on Zhihu in the Shilin community, Dr. Garth Boehm, a special guest expert, introduced issues regarding the science, regulations, and business aspects of generic drugs in the United States, including the technical, compliance, and business factors that need to be considered when initiating generic drug projects, as well as the latest requirements and trends of the US Food and Drug Administration (FDA) in the supervision of generic drugs. Indian pharmaceutical companies have achieved great success in the field of generic drugs, and their products are sold well in many countries and regions around the world.

Challenges: The generic drug market is highly competitive, and there is great price pressure. Meanwhile, some countries are constantly raising the quality and approval requirements for generic drugs, so pharmaceutical companies need to continuously improve their own technological levels and quality management capabilities.

Traditional Chinese Medicine

Characteristics: It is made from natural herbs through traditional processing techniques. Traditional Chinese medicine has a unique theoretical system and treatment methods and has certain advantages in the treatment of some chronic diseases and difficult and complicated diseases.

Advantages in Overseas Expansion: As people's recognition of natural medicines continues to increase, the demand for traditional Chinese medicine in the international market is gradually rising. As the birthplace of traditional Chinese medicine, China has abundant resources of traditional Chinese medicine and a long historical and cultural heritage, which gives it a natural advantage in the overseas expansion of traditional Chinese medicine. For example, according to PricewaterhouseCoopers' Review and Outlook of Chinese Enterprises' Investment in the Medical Industry in Southeast Asia from 2015 to 2023, in 2020, the export volume of Tongrentang's Angong Niuhuang Pills increased by 38.4% year-on-year, with an export value of 29.383 million US dollars, mainly concentrated in Vietnam and Indonesia. Tian Shi Li's compound Danshen dripping pills, Yangxue Qingnao granules, and Andrographolide dripping pills and other traditional Chinese medicine products have also been approved in Vietnam. In addition, according to data from the National Administration of Traditional Chinese Medicine, traditional Chinese medicine has now spread to 196 countries and regions, and China has signed specialized cooperation agreements on traditional Chinese medicine with more than 40 foreign governments, regional competent authorities, and international organizations.

Challenges: The mechanism of action and quality standards of traditional Chinese medicine are difficult to be widely accepted by the international market. Regulatory policies on traditional Chinese medicine vary greatly among different countries and regions, and the overseas expansion of traditional Chinese medicine faces many regulatory and technical barriers. In addition, the protection of intellectual property rights of traditional Chinese medicine also faces certain challenges.

Biological Products

Characteristics: They include vaccines, blood products, monoclonal antibodies, etc. The research and development and production of biological products are technically difficult and require strict quality control.

Advantages in Overseas Expansion: Biological products have significant curative effects in treating some major diseases, and the market demand is strong. Chinese pharmaceutical companies are continuously increasing their investment in research and development in the field of biological products, and some products have reached the international advanced level. For example, according to the news on Eastmoney.com's stock bar on November 27, 2023, Fruzaqla (fruquintinib) of Hutchison China MediTech was approved by the US Food and Drug Administration (FDA) on November 8 for the treatment of treated metastatic colorectal cancer. The biologics license application of Toripalimab of Junshi Biosciences was also approved by the FDA, and the biologics license application of Efbemalenograstim injection of Yifan Pharmaceutical was also approved by the FDA.

Challenges: The research and development and production of biological products require a large amount of capital and technical support, and they also face strict regulatory approvals. In addition, biological products have high requirements for cold chain transportation and storage, which increases the cost and difficulty of overseas expansion.

There are various types of pharmaceutical products for pharmaceutical companies' overseas expansion, and each type has its own unique characteristics and advantages. During the overseas expansion process, pharmaceutical companies need to select suitable types of pharmaceutical products according to their own strength and market demand and formulate corresponding overseas expansion strategies. Meanwhile, pharmaceutical companies also need to continuously improve their own research and development capabilities, quality management levels, and market development capabilities to meet the challenges of the international market and achieve sustainable development.

About Glodom:

Glodom is a Global Top 100 Language Service Provider. It has accumulated profound professional knowledge in the field of game localization and has reached long-term and stable cooperation with many well-known game companies around the world. Glodom has more than 300 full-time employees, and its service network covers over 40 countries worldwide, supporting more than 150 languages. We always attach equal importance to innovation and service. With advanced technology and rich project management experience, we have successfully helped numerous enterprises achieve their global strategic layouts. Whether in the accuracy of localized translation or the efficiency of multilingual processing, Glodom has always been at the forefront of the industry.