In 2026, China's innovative drug outbound trade is undergoing a profound structural transformation. Officially designated as one of the "new three growth drivers," innovative drugs are rapidly shifting from a technology-licensing model ("borrowing a boat to sail") toward a new phase of global commercialization ("building our own ships").
I. Explosive Growth in Deal Value – Over $100 Billion in Half a Year
In the first half of 2026, China's outbound licensing deals for innovative drugs reached a historic milestone. According to the National Medical Products Administration (NMPA), a total of 81 cooperation deals were signed, with an aggregate transaction value of approximately $110 billion – already 80% of the full-year 2025 total and a new record high. The total upfront payments amounted to about $5 billion, roughly 70% of the entire previous year's figure.
The first quarter of 2026 was particularly noteworthy – outbound licensing deals surpassed $60 billion, approaching half of the full-year 2025 total. Momentum continued into Q2, with the half-year figure already exceeding the full-year 2024 level. Industry consensus expects 2026's full-year BD deal value to set yet another record.
At the broader pharmaceutical industry level, the value-added output of pharmaceutical manufacturing above designated size grew 6.4% year-on-year in H1 2026, with biologics posting double-digit growth. Export delivery value exceeded RMB 210 billion, up 9%. The export mix continues to improve – high-value-added products such as chemical preparations and biologics now account for nearly 20% of total pharmaceutical exports, marking a clear shift from API-dominant exports to higher-margin finished formulations.
In terms of new drug approvals, 38 innovative drugs were approved in the first half of 2026, of which 31 were domestically developed – accounting for 81.6% of the total. Domestic innovative drugs now occupy a dominant position.
II. Where the Deals Are Going – A Rapidly Expanding Global Buyer Map
Chinese innovative drugs are finding buyers across 20+ countries and regions, including the United States, the United Kingdom, France, and Italy. In terms of buyer structure, multinational pharmaceutical companies (MNCs) remain the dominant force – among the global top 10 pharmaceutical transaction values, Chinese companies occupy 8 spots.
The United States remains the core market. In H1 2026, multiple domestic innovative drugs received FDA approvals or designations: Haisco's independently developed Ciprofol Injection officially received FDA approval, becoming the first Chinese‑developed intravenous anesthetic to gain FDA clearance. BeiGene secured FDA approval for its Tislelizumab combination regimen as a first‑line treatment for HER2-positive gastric/gastroesophageal adenocarcinoma. Shiyao Innovation's EGFR-targeting Phase III study for lung cancer met its endpoints and was granted FDA Fast Track designation. A wave of Chinese drugs is collectively seeking FDA approval.
The EU also saw significant breakthroughs. In April, Henlius' pertuzumab biosimilar received marketing authorization from the European Commission (EC), becoming the first such biosimilar in Europe. Serplulimab (PD-1) gained two additional EU indications. Hansoh Pharma's Almonertinib secured EC approval in February, becoming the first Chinese-developed EGFR-TKI to enter the EU market. Qilu Pharma has now obtained market approval for 27 formulations in the EU and the UK.
Southeast Asia is emerging as a new growth engine. Xiamen Wantai's 9-valent HPV vaccine was approved in Thailand. Yifan Pharma completed initial government procurement supply of recombinant human insulin to Malaysia, with concurrent growth across Thailand, Vietnam, the Philippines, and Malaysia. In biologics, pertuzumab and denosumab injections were exported to the Middle East and South Asia for the first time.
III. Evolving Business Models – From Single-Asset Licensing to Deep Global Collaboration
What is more noteworthy than the deal value is the structural evolution of these transactions.
First, moving from single-asset to multi-asset "portfolio" deals. Major transactions in H1 2026 all featured multi-asset combinations. CSPC's $18.5 billion cooperation with AstraZeneca involved eight long-acting peptide drug candidates. Hengrui Medicine's $15.2 billion partnership with Bristol-Myers Squibb will jointly advance 13 early-stage projects across oncology, hematology, and immunology. Innovent's $10.5 billion collaboration with Pfizer covers 12 oncology projects. The procurement logic of MNCs has shifted from "buying one molecule" to "acquiring entire pipelines."
Second, moving from pure License-out to "Co-Co" (co-development, co-commercialization) models. In its H1 report, Innovent noted that among its 20 partnered projects with Pfizer and other MNCs, five are now in deep collaboration structures involving co-development and co-commercialization. Hengrui's global strategic partnership with BMS involves five co-development projects, with Hengrui participating in global commercialization. When major multinationals are willing to share profits and control, it signifies that Chinese pipelines have substantially increased their bargaining power across the global value chain.
Third, moving from late-stage assets to early-stage R&D. Hengrui's deal with BMS involves 13 early-stage candidates; Innovent's partnership with Pfizer covers 12 early-stage oncology assets. More striking, Haisco licensed out a preclinical autoimmune project to US-based Sentivera via a NewCo structure, securing ~$75.9 million upfront and up to $1.46 billion in milestones. Global life science capital is now engaging Chinese innovation assets at increasingly earlier stages.
Fourth, upfront payments are growing substantially. In 2026, two deals have already secured upfront payments of around $1 billion. CSPC received a total of $1.2 billion upfront from AstraZeneca; Hengrui received $950 million in upfront and near-term payments from BMS. The average upfront payment and average total deal value for BD transactions have reached $60 million and $1.06 billion respectively, up 38% and 22% year-on-year.
IV. Driving Forces – Supply -Demand Synergy
The explosive growth in innovative drug outbound deals is driven by forces on both sides of the equation.
On the demand side: MNCs face significant patent expirations over the coming years – blockbusters such as Keytruda (pembrolizumab) and Opdivo (nivolumab) are approaching loss of exclusivity. MNCs urgently need to bring in new products and pipelines to fill revenue gaps. Compared with in-house R&D, in-licensing external assets offers superior cost-effectiveness.
On the supply side: China's innovative drug R&D quality continues to improve. The country now accounts for roughly 30% of the global pipeline of new drugs. In frontier areas such as ADCs, bispecific antibodies, and GLP-1 agonists, Chinese assets have achieved world‑class competitiveness. At the 2026 ASCO Annual Meeting, a total of 94 Chinese studies were selected for oral presentations, with 12 designated as late‑breaking abstracts – both setting new records.
V. Policy Dividends Accelerating the Momentum
From the government work report at the start of the year designating biopharma as a "strategic emerging pillar industry," to the "pre‑application" mechanism introduced in the May adjustment of the dual national and commercial health insurance drug lists; from the July inclusion of locally developed Class 1 innovative drugs in the new National Essential Medicines List, to the inclusion of "full‑chain support for innovative drugs" in the 15th Five-Year Health Plan for the first time – policy support has evolved from piecemeal measures to a complete ecosystem covering the entire industry chain.
On customs and clearance, the General Administration of Customs has established "green channels" for cross‑border biological materials and products, addressing the time‑sensitivity of the biopharma industry. Clearance time has been compressed from 3 days to just 2 hours. In Tianjin and other pilot regions, a new "on-demand assessment and expedited review" model for special inbound/outbound biological items has been introduced.
VI. Outlook – From "Selling the Seedlings" to "Becoming Global Players"
Industry experts note that China's innovative drug sector is undergoing a fundamental role shift in the global industry landscape. The BD model has evolved from simple asset sales to risk-sharing, profit-sharing co-development arrangements, reflecting the deepening participation of Chinese innovation in the global biopharmaceutical value chain.
Going forward, the sector is expected to see structural divergence – companies lacking core revenue‑generating capacity will be gradually weeded out. Only those with both global commercialization capability and a strong domestic footprint will be able to navigate the cycles and go the distance. For foreign trade professionals focused on pharmaceuticals, the direction of innovative drug trade flows is shifting from "product exports" to a composite model of "technology export + IP licensing + global partnership." This trend warrants close tracking and strategic positioning.