GlobalData’s latest analysis reveals a significant shift in the pharmaceutical landscape: in 2024, large pharmaceutical companies sourced an unprecedented 28% of their innovative drug candidates through licensing agreements with Chinese biopharma firms—the highest proportion ever recorded.
This surge involved deals valued at around USD 41.5 billion, making licensing agreements the dominant channel for accessing new drug assets, surpassing acquisitions and other corporate transactions. The volume and scale of these agreements highlight Chinese biotech’s strategic ascent in global drug development.
Oncology emerged as the powerhouse in this wave of licensing: it constituted 55% of all deals and accounted for approximately 63% of upfront payments. The trend reflects a move toward biologics complexity—such as antibody-drug conjugates (ADCs), bispecific antibodies, and next-generation T-cell engagers. While small molecules and monoclonal antibodies still made up 48% of deals, they received just 29% of upfront capital; meanwhile, complex biologics—though representing 44% of transactions—commanded a commanding 66% of upfront funding (~USD 5.6 billion).
Therapeutic diversification extended beyond oncology: deals in immunology/inflammation made up 25% of agreements (26% of upfront funding), while obesity and cardiometabolic assets accounted for 10% and 7%, respectively. Notably, cell and gene therapy—which is rapidly advancing in China—was notably absent from outbound licensing deals, possibly reflecting Western firms’ cautious stance on their commercial viability.
The shift toward early‑stage innovation is also marked. In 2024, 71% of deal counts and 77% of upfront capital were devoted to preclinical or Phase I drug candidates. Although China’s clinical data still face regulatory constraints abroad, Western companies are expressing growing confidence in early‑stage Chinese science.
Major pharmaceutical companies from both the U.S. and Europe participated actively. While Western biotech and big pharma closed 22 and 19 deals respectively, European firms slightly outpaced U.S. counterparts in aggregate deal value (USD 4.6 billion vs. USD 3.5 billion).
Nevertheless, China’s biotech boom is not immune to financial headwinds. Domestic private funding declined to USD 4.2 billion in 2024—just 28% of its 2021 peak (USD 15.7 billion). Most of the licensed assets were backed by earlier investment rounds. Tighter regulations around IPOs and less early-stage funding may dampen future innovation capacity—but demand from global pharmaceutical groups, driven by looming patent expiries and regulatory pressures in the West, is likely to sustain the licensing trend.
Bottom line : GlobalData’s findings mark 2024 as a transformative year in global pharma dealmaking. China has claimed a significant role in supplying advanced, high-value drug candidates—especially in oncology and complex biologics—and is increasingly recognized as a dependable partner in early-stage innovation. While domestic biotech funding contraction could present challenges, sustained strategic interest from Western pharma ensures that China remains central to the evolution of the global drug pipeline.
