China’s pharmaceutical market has been constantly growing in recent years. It is estimated to reach $161.8 billion by 2023 and take a 30% share of the global market. Due to low purchasing power and a robust local manufacturing sector, generic drugs ($85.3 billion) seizes a large share of China’s pharmaceutical market ($219.9 billion).

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Generic drugs are the mainstay of China’s pharmaceutical industry (60% of industry revenue). Due to large market demand this segment’s revenue is expected to increase strongly in future years. This is because China will likely continue to rely upon widespread prescription of generics in its public insurance plan to minimize overall healthcare expenditures. Increasing generic penetration as a means to reduce pharmaceutical expenditure will render generic drugs more important in total drug sales, driving growth in the pharmaceutical market.

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China has taken considerable steps to improve the domestic market environment, specifically in terms of regulation and licensing operations for international companies. In 2019, the Center for Drug Evaluation and the CFDA reformed the application process for INDs and NDAs, allowing for accelerated review timelines that will bring both domestic and foreign drugs to market faster than ever before.

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