[China Shock, K-Industry on the Brink | Biotech] ② "Even One Deal Is Hard for South Korea"... Everyone Is Buying Chinese Technology: The Secret Behind $41.5 Billion in Deals

Hengrui Signs 8 Deals Worth $41.5 Billion in Three Years
CSPC, Hansoh and Innovent Also Land Major Deals in Succession
Churning Out Follow-On Drug Candidates Fuels a Virtuous Cycle of License-Outs

Editor's NoteAs China's industrial rise rapidly expands into new areas, its growing dominance in the biotech sector is becoming increasingly formidable. In particular, in licensing deals for drug candidates with global big pharma companies, Chinese firms have continually achieved unprecedented or highly unconventional results in recent years, comfortably overtaking competitors, including South Korea. This series examines where China's strength comes from and how South Korea, which once led China by building an advantage in trust across the global industry, should respond going forward.

① Big Pharma Sweeps Up Chinese Drug Candidates Wholesale

② Hard to Sell Even Once, but China Sells Again and Again

③ Chinese Drug Sold for $8.4 Billion: The Results Three Years Later

④ Can South Korea Weather the Long Haul of Late-Stage Development?

In September 2026, China's Hengrui Pharma transferred to Novo Nordisk the rights outside Greater China to HRS-1596, an early-stage obesity and diabetes drug candidate that was approaching the start of Phase 1 trials. The deal is worth up to $2.6 billion (about 3.7 trillion won). What stands out as much as the deal's value is the frequency of Hengrui Pharma's major licensing-out deals.

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Since 2024, Hengrui Pharma has signed eight licensing-out deals worth $1 billion (about 1.4 trillion won) or more with global big pharma companies, including its deal with Novo Nordisk for HRS-1596. The potential total value of these deals comes to $41.5 billion. These figures are based on an analysis by The Asia Business Daily, published on October 19, of 104 licensing-out deals worth $1 billion or more that Chinese biotech companies have made with global big pharma companies over the past three years, using relevant disclosures, announcements and other materials.

Hengrui Pharma's success is considered a symbolic example of the high regard in which China's biotech capabilities are held in global markets. And Hengrui Pharma is not the only company making a mark. Over the same period, CSPC secured seven licensing-out deals worth a total of $32 billion, Hansoh Pharma signed six deals worth $11.4 billion, and Innovent Biologics signed five deals worth $32.9 billion.

Together, these four companies accounted for 26 deals, or about 25% of all deals by China's biotech industry. By potential deal value, their share reached about 41%. Rather than concentrating nearly all their resources on a single promising drug candidate and stopping once they export the technology, these companies are leading the industry through a virtuous cycle: continuously identifying other candidates and going on to license them out one after another.

This stands in stark contrast to the reality of South Korea's industry, where companies attract attention even when they manage to sign just one licensing-out deal after waiting anywhere from a few years to well over a decade. According to figures compiled by the Korea Pharmaceutical and Bio-Pharma Manufacturers Association, no South Korean company signed three or more deals over the same period and at the same deal-value threshold. Three companies, including traditional pharmaceutical companies and biotech firms, did sign two deals each, but these largely involved the transfer of platform technologies, making them difficult to compare with cases involving the licensing out of multiple, distinct pipelines.

Behind the rapid advance of Chinese biotech companies is their overwhelming investment in research and development (R&D). Among the top 20 innovators selected from Clarivate's list of China's 100 leading biopharmaceutical innovators, the median R&D investment as a share of revenue in 2024 was 22%. By comparison, the median share of revenue invested in R&D by South Korean biotech companies over the same period was 12%.

Against this backdrop, the pipeline across China's biotech industry is growing rapidly. Clarivate estimates that 3,381 drug pipelines are in development in China, with 2,580 clinical trials underway. The pace of advancing candidates into clinical trials has also accelerated. McKinsey, a global consulting firm, found that the time from early drug discovery to the start of an investigational new drug (IND) application in China is 50% to 70% shorter than in other countries.

Patient recruitment for late-stage clinical trials is estimated to be two to five times faster than in the United States and Europe. Analysts say that the simultaneous expansion of large patient pools, clinical trial sites and the contract research organization (CRO) ecosystem has created a foundation for a single company to develop multiple candidates in parallel. This combination of high R&D investment and mechanisms that enable a race against the clock is seen as a driving force in improving the form and quality of licensing-out deals.

Hengrui Pharma's deal with GSK last year included up to 11 additional programs alongside HRS-9821, a candidate for chronic obstructive pulmonary disease (COPD). Hengrui Pharma identifies candidates and advances them through early-stage clinical trials, after which GSK decides whether to pursue further development. A deal signed with Bristol Myers Squibb (BMS) in May 2026 included 13 programs, combining existing candidates with drugs to be jointly discovered in the future. For global big pharma companies, this means they can secure not only individual candidates one at a time, but also candidates that have yet to emerge.

Areas of development have also expanded from antibody-drug conjugates (ADCs) to bispecific and multispecific antibodies, small molecules, ribonucleic acid (RNA), and obesity and metabolic diseases. According to the Boston Consulting Group (BCG), Chinese companies are developing more than 30% of global antibody and cell therapy pipelines. Nearly half of China's clinical pipelines are aimed at novel mechanisms of action for which there are as yet no Phase 3 trials or marketed products anywhere in the world, analysts say.

Notably, the growing number of candidates has been accompanied by greater diversity in targets and modalities. This gives companies more room to advance other candidates even if competition intensifies in one area. Market research firm IQVIA forecasts that global biotech and pharmaceutical industry revenue affected by patent expirations will exceed $230 billion by 2030 (about 307.74 trillion won).

This means companies have greater incentive to secure multiple early-stage candidates from a company they have already partnered with, then set development priorities based on clinical results, rather than repeatedly searching for new biotech companies, identifying candidates and conducting due diligence. In this environment, Chinese biotech companies may attract even greater attention.

Another biotech industry official said, "A single licensing-out deal can be made with one good drug candidate, but repeat deals are impossible without a solid foundation of R&D productivity. It is important to build a structure in which R&D continues even after a particular candidate is licensed out, leading to the accumulation of a second and third technology asset."

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