Regional Studies of Bio-pharmaceutical Industry in China

YANG Bo, HUANG Tai-kang(.Research Center of Modern Social Pharmacy, Shenyang Pharmaceutical University, Shenyang 006, China; .China Food and Drug Administration, Beijing 0080, China)

Regional Studies of Bio-pharmaceutical Industry in China

YANG Bo1, HUANG Tai-kang2
(1.Research Center of Modern Social Pharmacy, Shenyang Pharmaceutical University, Shenyang 110016, China; 2.China Food and Drug Administration, Beijing 100810, China)

Objective To provide strategies for the development of bio-pharmaceutical industry in China. Methods The characteristics of regional distribution, the development of key bases and the development trend of regional bio-pharmaceutical industry were analyzed. Results and Conclusion It is suggested that bio-medical industry in China should establish an evaluation system of innovation, carry out regional overall planning, make good use of resources, encourage the division of labor, upgrade the environment of industrial zone and promote the development of enterprise clusters.

bio-pharmaceutical industry; regional development; industrial zone

Biotechnology is the main driving force for the development of international science and technology and it has become the focus of international competition and the leading industry as the information industry. Today, human society entered the era of bio-economy. Under the circumstance of economic globalization, China’s biopharmaceutical industry is facing with both the challenge and opportunity. Therefore, our government took biological pharmaceutical industry as the national strategic emerging industries in 2010. China’s bio-pharmaceutical industry will take advantage of this important opportunity to accelerate the development and layout adjustment in the future.

1 China’s regional distribution of biopharmaceutical industry

In order to promote the development of bio-industry, the National Development and Reform Commission has approved four batches of 22 National Biological Industry Zones since 2005. In addition, the Ministry of Science and Technology has also established 16 “Torch Program” bioindustry zones since 1997. After removing the repeated and the non bio-pharmaceutical zones, 35 industry zones were confirmed by the two Ministries. The number of national bio-industry zones has reached 21 among the 34 provinciallevel administrative units. Most of the newly developed high-tech industrial zones take the bio-pharmaceutical industry as the leading industry. However, the current bioindustry zones mainly locate in the eastern part of China and there is an uneven pattern of development, and this imbalance will be further strengthened in the near future. Among the 21 provinces, 17 are from eastern coastal areas, accounting for less than half of the total; 3 are from northeast region, 9 are from central region, and 6 are from western regions[1]. The overall distribution pattern is in the eastern coastal regions.

The distribution of bio-pharmaceutical industry in China gradually developed into dense clusters, forming a new pattern. This industrial spatial pattern included the Bohai area, Yangtze River delta and Pearl River delta. In addition, Bio-pharmaceutical industry zones in western regions have gradually come into being in Hunan, Hubei and Chongqing.

2 The development of key bio-pharmaceutical industry zones

2.1 Beijing has strong R&D capabilities, but weak transformation platform[2,3]

“One center and two zones”: Beijing National Biological Industry Base consists of three important parts, the Zhongguancun Life Science Park whose main function is the innovation, Beijing Economic and TechnologicalDevelopment Zone and Daxing Biomedical Industry Base focus on the production and manufacturing.

2.2 Shanghai is the biological medicine center[4]

“A core and five bases”: Pudong, Zhangjiang, Zhoukang, Xuhui and Minhang industrial bases were built as the center to undertake biomedical research and clinical outsourcing services. Meanwhile, Qingpu, Fengxian and Jinshan were taken as the biomedical manufacturing bases.

The internationalized research and development system was formed: Roche, Novartis, GlaxoSmithKline, AstraZeneca, Pfizer and other biopharmaceutical companies set up their branches or research center in Zhangjiang.

2.3 Taizhou and Tonghua[5]

Two national medical city-Taizhou and Jilin Tonghua Pharmaceutical High-tech Industry Development Zone were officially approved by the State Council in March 2009 and December 2013 respectively, and they became the two core areas of bio-pharmaceutical industry.

2.4 Wuhan is the biomedical research and development center in central China[6]

Wuhan National Biological Industry Base included East Lake High-tech Zone, Dunkou, Miaoshan and Wujiashan industry parks.

Wuhan has strong R&D capabilities and Wuhan University, Chinese Academy of Sciences, Wuhan Institute of Virology, Wuhan Institute of Biological Products, Hubei Pharmaceutical Industrial Technology Research Institute and other research institutes are all located in Wuhan city. There are a total of 17 National Key Labs, 6 National Engineering Research Centers and 7 National Biomedical Clinical Research Bases.

2.5 Shenzhen is the new genetic technology research and development center[7,8]

Shenzhen national biomedical industry base has expansion area and core area. Shenzhen High-tech Zone is the main core area, and public technology platform, service system construction and innovative research are its development goals; Guangming area and south area are the main expansion areas, and pilot base and industrial base are its development goals.

It has strong ability to develop gene technology. China’s first national gene pool was based on the gene pool of BGI Shenzhen Medical Company and it was also the fourth national gene bank all over the world.

2.6 The northeast is the biggest biological medicine manufacturing base[9]

The High-tech Zone and Economic Development Zone in Changchun are strong industrial clusters. Changchun National Bio-pharmaceutical industry is located in this city, and it is Asia’s largest gene drug and vaccine production base.

Tonghua Pharmaceutical High-tech Industrial Development Zone was founded in July 2005, and it was once called Jilin Tonghua Economic Development Zone. In August 2011, it was renamed Tonghua Medical Hightech Industrial Development Zone approved by the people’s Government of Jilin Province. In December 2013, it became the National High-tech Medicine Zone approved by the State Council. Tonghua Pharmaceutical High-tech Zone highlighted its characteristics and accelerated development, taking Chinese medicine industry as the core based on the academician workstation and other research institutions. It promoted the modernization of Chinese medicine. The hightech industries focused on the bio-pharmaceutical industry, and it was based on international technology transfer to promote the introduction and industrialization of high-tech achievements. Meanwhile, the high-end services relied on the health service, and its core was the international ginseng market, the Ministry of Science and Medicine e-commerce platform and the Ministry of Commerce demonstration platform.

Liaoning (Benxi) National Biomedical Science and Technology Industrial Base: It had about 205 square kilometers for the overall planning area and 75 square kilometers of land for construction, relying on three district offices of Shiqiaozi, Waitoushan and Zhangqizhai respectively. It has established three different industry zones and they were bio-medicine park, medical devices park and health services park, making great efforts to develop biotechnology and pharmaceuticals, medical equipment, modern medicine, high-end medicine, health products and functional foods.

3 The analysis of regional development trend of China’s bio-pharmaceutical industry

3.1 The imbalances in regional development were highlighted

Biological medicine is characterized by high risk,long R&D cycle, high investment and high returns. The main forms of industrial development include the following aspects: Concentrating on professional intelligence-intensive areas, the parks and the economically developed areas.

Through the analysis of layout for bio-pharmaceutical industry among different countries, we could find that the core of bio-pharmaceutical industry is based on research institutions and economically developed areas. During the “Twelfth Five-Year Plan”, China’s bio-pharmaceutical industries will flush into the eastern areas which have strong capacity of innovation and research institutes. A few will flow into the central cities of west, and the imbalances in regional development will be more obvious[10].

3.2 Division of labor is clearer in different regions

3.2.1 The biomedical technologies research and development will flow into Shanghai, Beijing

As to the biomedical technology and biotechnology industry, Shanghai takes the leading position in China, which has the greatest number of multinational biopharmaceutical companies and international financial institutions in China. Meanwhile, Shanghai is also the manufacturing, marketing, research and development and investment center of biotechnology industry, and it will become a guide city for the development of bio-pharmaceutical industry.

Beijing has many research institutes and abundant human resources, and it is the center of information, biomedical technology services and R&D. Compared with Shanghai, there is a big gap between the starting time and the industry financing environment. Moreover, Beijing’s biomedical R&D results have an obvious spillover effect.

3.2.2 Jiangsu and Shandong make great efforts to promote the manufacturing sector gathering

Now, the main body of biological pharmaceutical enterprises in China is the small and medium sized enterprises. They all have poor infrastructure and the backward production equipment, lacking supporting technology and industrial chain. Shandong and Jiangsu are at the forefront in the cultivation of industry leading enterprises, and they will become the important biomedical manufacturing bases.

Most bio-pharmaceutical enterprises in Jiangsu have strong development potential.

17 enterprises in Jiangsu ranked in China’s top 100 pharmaceutical enterprises. The sales revenue of biomedicines achieved 270 billion yuan in 2012, and Taizhou was regarded as China’s Medical City. Lianyungang, Suzhou, Nanjing and other cities had the layout of different bio-pharmaceutical industry.

Shandong province took the field of fermentation engineering, genetic engineering and marine drugs, new diagnostic reagents and biochemical drugs as the focus of development based on Freda, Qilu, Dongeejiao, Xinhual, Lunan and other well-known large-scale pharmaceutical enterprises. It constantly created a complete industrial chain of bio-pharmaceutical distribution and manufacturing. The output value of biological pharmaceutical enterprises in Shandong achieved 200 billion in 2010 and 230 billion yuan in 2012.

3.3 The hot spots of industrial development will emerge

3.3.1 Shenzhen, Wuhan will become new profit-growth cities

(1) Shenzhen

Now, there is a big gap in the level of biopharmaceutical development between Shenzhen, Shanghai and Beijing in that Shenzhen is lack of top talent. However, Shenzhen government vigorously promoted the establishment of the national gene bank, cloud computing and Internet information technology which will improve the biological information security and the life science research capabilities greatly and Shenzhen will turn into a research and development center of life science and information technology.

In 2012, Shenzhen had fostered a leading enterprise with an annual sales income over $ 10 billion, 25 enterprises with sales revenue over one billion yuan and 120 enterprises with sales revennue over one hundred million. By the end of “Twelfth Five-Year Plan”, Shenzhen will become the world’s most developed gene therapy industry base and the largest vaccine manufacturing center in Asia.

(2) Wuhan

Now, there is a big gap in industrial bio-medicine scale between Wuhan, Changsha and Changchun. Wuhan is still at the initial stage of development. However, Wuhan paid more attention to the development of biopharmaceutical industry, taking it as the focus of the city’s work.

Wuhan National Biological Industry Base is new town of biological industry, which integrates research, administration, logistics, production, housing and culture. Ithas introduced the global 500 as well as other well-known companies with significant projects. Now, Wuhan has signed 76 agreements with an investment of 10.2 billion yuan, and half of the projects are being established. WuXi AppTec, Shenzhenhuada, Changchun Changsheng Life Sciences Limited, Grand Pharma (China) Co. Ltd. and Sinopharm have also entered the bio-industry town one after another.

By the end of 2020, there will be 700 biological enterprises in Wuhan, and it will become the leading industry zone of outsourcing and bio-pharmaceutical manufacturing.

3.3.2 Taiyuan, Xiamen, Fujian and Lanzhou will become the regional hot spots

(1) Shanxi Province

It should promote the development of pharmaceutical raw materials in that Shanxi has rich natural resources and relatively good climate to ferment biological products. During the “Twelfth Five-Year Plan”, Shanxi has strengthed the logistics and distribution system of bio-medicine. Taiyuan has gradually become the center of biotechnology industry in the region, and Jinzhong, Houma, Datong and other places formed industrial clusters with different scales. (2) Gansu Province

To a certain extent, the continuous development of backbone enterprises drove the development of other companies in the region. Fuzheng, Lanzhou institute of biological products, Kudo pharmaceutical and other key enterprises are in the leading position in the field of foot and mouth disease vaccine, human vaccines and modern Tibetan medicine. Some even reached the world advanced level, which drove the development of other biotechnology industry.

(3) Fujian Province

Fujian has a good capacity of development for industrial base. Especially during the “Twelfth Five-Year Plan”, the biotechnology industry has made great achievement, and Haicang biomedical district of Xiamen has gradually formed a core area. Fuzhou biomedical plays an important role in focusing on the development of genetic engineering drugs and setting up more biomedical industry bases.

4 Improving the policy of biomedical industry structure

4.1 Strengthening the advantages of resources and promoting specialization and cooperation

The superior resources should be encouraged to cooperate with each other so that the capital, talent, technology and other resources can flow into biomedical park. Enterprises R&D centers, venture capital and financial institutions, research institutes and other resources should flow into the key areas as well. Different enterprises should intensify cooperation and specialization. First, to ensure that different enterprises could better deal with the current tasks, their cooperation and projects must be analyzed so that the industrial division of labor can be optimized.

4.2 Building an evaluation system of industrial innovation and promoting regional planning

The relevant departments of biomedical industry leading companies and industry associations can set up an evaluation system of industrial innovation capability according to certain procedures and experience from other evaluation system. They can accurately evaluate the implementation of key parks in the main regions, provinces and municipalities and understand the situation of the biomedical industry. It can lay a good foundation for the regional industrial layout.

Overall planning should be carried out vigorously to guide the progress and development of bio-pharmaceutical industry in the region. The development planning of biopharmaceutical industry should be made by the state or authorities. A reasonable entry standard should be developed to strengthen the industrial distribution and regional division of labor which could avoid waste and unhealthy competition.

4.3 Improving the environment of the parks to promote the formation of enterprise clusters[11]

The environment of the industrial parks should be improved continuously. Great efforts should be made to promote the public platform for pilot, transformation and technology. The industrial alliances and research cooperation system must be constantly optimized so that the market competitiveness of the park can be continuously improved and it can be achieved through professional cluster service.

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Author’s information: YANG Bo, PhD. Major research area: Social pharmacy. Tel: 15032132619, E-mail: yb76s@126.com