China's formula for biotech innovation

China has sought to balance its economic development with the need to invest in the well-being of its people, taking major steps to reform health care systems and extend vital services to its citizens. And China has focused on creating an innovation economy, notably pledging to increase investment in its biotechnology industry by more than US$300 billion in the next five years.

These commitments are transforming China's role as an innovator on the global stage. According to a new study by Battelle, a global research and development organisation, China's pharmaceutical output has increased by 719 per cent since 2000. Venture capital investments in the sector have grown from US$7 million to US$491 million over the same period.

The US biopharmaceutical industry - which I joined as a scientist 33 years ago - shares China's commitment to the development of innovative medicines to improve the quality of health care while controlling costs.

Members of the Pharmaceutical Research and Manufacturers of America support the development of an ecosystem to bolster innovation in China. This contains many interdependent components.

The first - intellectual property protection - is the lifeblood of any enterprise that derives value from ideas. It takes more than a decade, and well over US$1 billion, to bring a new medicine from the lab to the pharmacy, and companies need a fair chance to recoup their investment. China has made substantial progress here.

The second component is a policy that supports fair pricing and timely reimbursements of medicines. China's rising living standards are shifting the population's health care needs. More people require attention for non-communicable diseases such as diabetes. And more are able to take advantage of new treatments, as well as options for preventive care. Efficient reimbursement policies complement China's goals by ensuring citizens benefit from innovative products.