McKinsey & Co. and the China Pharmaceutical Association forecast China’s retail pharmaceutical sales to increase 17% per year through 2020 to nearly CNY 1.9 trillion ($30.1 billion) in their base case scenario. In 2012, China accounted for 3.8% of sales on average for the top 10 multinational drug firms, compared with 3.0% in 2011. In a survey by Elsevier, BayHelix and McKinsey of 50 China-based pharmaceutical executives, 33% of respondents expect their firms’ mainland China businesses to account for over 10% of global revenues within five years. “Shifting demographics and growing disease prevalence” was rated by 46% as the most significant trend driving near-term growth of the country’s pharmaceutical market. Asked where the level of Chinese innovation will be in five years, 65% stated it would most likely to be a strong contributor. The annual growth rate of spending by respondents’ R&D organizations in China is expected to be 19% for the next five years. In the next 10 years, 32% of respondents expect biosimilars and biobetter to be “the innovation” coming from China, 25% expect it to be me-too drugs and branded generics, 23% expect it to be the same drugs but with innovative formulation or administration pathways, and 20% expect it to be novel compounds.

Source: McKinsey &Co.