In 2025, China's innovative drug makers are no longer tentative passengers in the global pharmaceutical trade. They are charting routes, negotiating command, and in some cases, building fleets of their own.

What began years ago as sporadic licensing deals has evolved into multi-billion-dollar partnerships that rival the industry's biggest global transactions. Chinese pharmaceutical companies are moving from being peripheral contributors to becoming structural drivers of global drug innovation — a shift that is reshaping how capital, talent, and intellectual property flow across borders.

Behind this transition lies a fundamental strategic question: Should Chinese drugmakers "ride leased ships" by partnering with multinational pharmaceutical giants to share risk and monetize early, or should they "build their own fleet" by establishing independent global R&D and commercialization capabilities?

That question — once framed as a binary choice — is increasingly being answered with nuance.

At the 2025 T-EDGE Annual Conference industry leaders gathered for a high-profile roundtable titled "Innovative Drugs Going Global: From Riding Leased Ships to Building Your Own Fleet." The discussion brought together executives representing different segments of China's biopharmaceutical ecosystem, offering a rare look into how strategies are evolving in real time.

The panel featured Xie Xin, Executive Director and Senior Vice President of Sino Biopharmaceutical; Zhang Hao, Head of International Business at 3SBio; and Liu Weimin, Deputy President of Stellar Biotech. The discussion was moderated by Cao Shengyuan, Chief Editor for Finance (East China) at TMTPost.

Their insights underscore a broader industry reality: China's innovative drug sector has entered what many describe as "deep waters," where execution, cash flow discipline, and ecosystem collaboration matter as much as scientific breakthroughs.

From License-Outs to Strategic Alliances

China's pharmaceutical globalization journey has accelerated sharply over the past two years. Early outbound deals were typically limited to single-product license-outs, often valued modestly and structured primarily to offset R&D costs.

Today, that landscape looks dramatically different.

According to industry data cited during the forum, China-originated license-out deals now account for 30% to 40% of global pharmaceutical licensing activity, a share that would have been unthinkable just a decade ago. Some individual transactions now exceed several billion dollars in headline value, with upfront payments alone setting industry records.

A defining example is 3SBio's landmark bispecific antibody deal with Pfizer, one of the largest overseas partnerships ever signed by a Chinese biotech company.

"Whether it's 'riding a ship' or 'building one,' the ultimate goal is the same — to penetrate and secure overseas markets," said Zhang Hao of 3SBio. "China's pharmaceutical industry, despite its technological sophistication, has lagged behind sectors like gaming or consumer tech in globalization. But that gap is closing fast."

Zhang noted that Chinese innovative drugs still account for only 5% to 10% of the global market, leaving vast room for expansion. Partnerships with multinational companies allow Chinese firms to de-risk clinical development while securing early returns — a critical consideration given the soaring costs of global trials.

"Once you enter U.S. or European clinical trials, the cost curve changes completely," Zhang said. "Co-development allows risk sharing and ensures that some returns are realized early, rather than betting everything on final approval."

Building Ships Without Losing Control

While license-outs offer speed and capital efficiency, building independent global capabilities remains a long-term ambition for China's largest pharmaceutical players.

For Sino Biopharmaceutical, globalization has been a gradual, systems-driven process rather than a single strategic leap.

"Our internationalization started with high-end APIs and complex generics," said Xie Xin. "Today, our products reach more than 80 countries, largely through partnerships with local distributors."

In recent years, Sino Biopharmaceutical has accelerated overseas mergers and acquisitions to internalize advanced technologies. The company acquired a bispecific antibody platform in Cambridge, UK, and an mRNA platform in Ireland — moves designed to absorb not just assets, but talent and execution capabilities.

"Internationalization is not a slogan; it's a systems project," Xie said. "Through acquisitions, we can internalize capabilities much faster than building from scratch."

Yet even for industry giants, partnerships with global pharmaceutical leaders remain central.

Sino Biopharmaceutical previously licensed a liver disease treatment to Johnson & Johnson and more recently out-licensed a ROCK2 inhibitor to a U.S. biotech firm. These deals, Xie emphasized, are as much about learning global clinical and commercialization standards as they are about revenue.

"Working with companies like Johnson & Johnson teaches you how global trials are executed, how regulatory processes work, and how global sales networks operate," he said. "Our goal is not just to export products, but to become a true multinational pharmaceutical company."

Across the panel, one theme surfaced repeatedly: cash flow is the ultimate gatekeeper of innovation.

China's biotech sector has faced mounting pressure from tighter capital markets, especially in Hong Kong, where listings of pre-revenue biotech companies have slowed dramatically.

"Many biotech companies don't fail because they lack innovation," Zhang said. "They fail because they run out of cash."

The Pfizer deal, Zhang noted, provided not only record-breaking upfront payments but also a confidence boost to the broader sector. Since then, a series of follow-on deals by Chinese firms has helped lift biotech valuations and restore investor sentiment.

"The market needed proof that Chinese innovation has real global value," Zhang said. "Now that proof is there."

A Third Path: Regional Commercialization

While major pharmaceutical companies debate global fleet-building, Stellar Biotech has chosen a different course — focusing on regional, fast-monetization pathways in Southeast Asia and Greater China's periphery.

"For most companies, the core issue isn't whether they borrow or build ships — it's whether they have the capability to deliver value," said Liu Weimin.

Stellar specializes in helping Chinese drugmakers commercialize products in fragmented but high-demand markets such as Southeast Asia, where regulatory pathways, pricing systems, and patient needs differ sharply from Western markets.

"These are 'capillary markets,' not main arteries," Liu said. "But they're full of unmet demand."

By leveraging accelerated approval mechanisms such as Named Patient Programs and Hong Kong–Macau fast-track access, Stellar helps companies generate early revenue while navigating longer global registration timelines.

"This isn't about replacing U.S. or European markets," Liu said. "It's about survival, validation, and cash flow."

One of the clearest conclusions from the forum was that China's pharmaceutical globalization is shifting from individual heroics to ecosystem collaboration.

Large players like Sino Biopharmaceutical and 3SBio increasingly act as both strategic investors and platform builders, while service-oriented firms like Stellar fill operational gaps.

"Not every company needs to do everything," Xie said. "Specialization is efficiency."

Zhang echoed that sentiment, noting that China's top pharmaceutical companies are now active across the value chain — from early-stage investment to late-stage commercialization — creating a virtuous cycle of capital, talent, and innovation.

Looking ahead, panelists expressed cautious optimism that China's innovative drugs could move from global contribution to selective leadership.

In areas such as cell therapy, China has already demonstrated competitive advantages. Advances in AI-driven drug discovery and synthetic biology could further compress development timelines and reshape global R&D economics.

"If we keep following old Western playbooks, we'll never lead," Liu said. "But if China builds its own innovation paradigms, we could define the next era of global pharma."

Zhang predicted that 2025 would be remembered as an inflection point.

"From here, growth won't be linear — it will accelerate," he said. "China's pharma companies are just getting started."

Whether riding leased ships, building fleets, or navigating regional waterways, China's innovative drugmakers are no longer testing the waters — they are sailing with intent.

As global pharmaceutical giants increasingly turn to China for pipelines, platforms, and partnerships, the balance of innovation power is shifting. The destination is not simply overseas revenue, but global relevance.

And for patients worldwide, the payoff may be the most important outcome of all: faster, more accessible access to medicines born from China's rapidly maturing innovation engine.