Amid U.S. Supply Chain Decoupling, "Korean Pharma-Bio Needs Practical Cooperation with China"

As strategic competition between the United States and China accelerates the restructuring of the global bio supply chain, there is an emerging analysis that Korea’s pharmaceutical and biotechnology industry should strategically utilize China’s vast market and clinical infrastructure.

The Korea Institute of S&T Evaluation and Planning (KISTEP) stated on July 6, via a policy brief, that practical avenues for cooperation should be sought based on the two nations’ complementary strengths.

Although the United States is restricting transactions with China by including the Biosecurity Law in the National Defense Authorization Act (NDAA), China is simultaneously pursuing strengthened domestic innovation and increased openness in an effort to find a breakthrough. Recently, global technology exports by Chinese bio companies have grown rapidly, with the number of bio license-out deals from China reaching 157 last year, totaling USD 135.7 billion (approximately KRW 20.77567 trillion).

Chinese companies hold a significant share in the global clinical pipeline of advanced biopharmaceuticals, accounting for 48% of clinical-stage bispecific antibody projects, 51% of antibody-drug conjugate (ADC) clinical projects, and 48% of chimeric antigen receptor (CAR)-based cell therapy clinical projects. The average upfront payment for licensing deals between pharmaceutical and bio companies in the United States and Europe and their Chinese counterparts also surged by 230% from USD 52 million (approximately KRW 79.612 billion) in 2022 to USD 172 million (approximately KRW 263.332 billion) as of February this year.

Amid these trends, KISTEP pointed out in its report that “Korea-China bio cooperation should not be about comprehensive expansion or outright exclusion, but rather, should proceed step-by-step, starting with non-sensitive, problem-solving, and field-verification types of cooperation.” KISTEP further stated, “Korea holds a firm advantage in subcutaneous (SC) formulation conversion, long-acting drug delivery systems (DDS), biosimilars, and contract development and manufacturing organization (CDMO) capabilities.” The institute suggested, “In the pharmaceutical and bio sectors, it is necessary to prioritize contract-based collaborations such as technology transfer and licensing, as well as joint commercialization and market access, by designing cooperation that combines the strengths of both countries.”

Complementary convergence is also needed in the field of synthetic biology-based bio-manufacturing. The report analyzed that “applying synthetic biology-based biomaterials to high value-added applications is a practical entry route that can verify the potential for industrialization while reducing regulatory and security burdens.” To thoroughly manage external risks such as data leakage or regulations on human genetic resources, a selective approach that excludes sharing high-risk data—such as whole genome or patient-level raw data—is required. In this context, the report diagnosed, “Through such selective and managed approaches, Korea can strategically utilize industrial touchpoints with China, while securing strategic autonomy and trust-based competitiveness amid the restructuring of the global bio supply chain.”

KISTEP emphasized that Korea’s pharmaceutical and biotechnology industry should pragmatically leverage China’s strengths even amid U.S.-led supply chain decoupling. It also argued that Korea should not limit itself to bilateral cooperation, but rather, should reposition itself to an optimal place within the broader structure of Asian bio collaboration, utilizing Japan’s experience in basic research and Singapore’s role as a regional hub. KISTEP concluded, “Within the Asia bio cooperation framework, Korea should selectively utilize industrial touchpoints with China, while setting its role toward strengthening development, production, and demonstration capabilities that meet global regulatory and supply chain trust standards.”

This content was produced with the assistance of AI translation services.