One of the main topics of conversation at the beginning of 2025 is how pharma companies should build their pipelines and the rising role that China is playing. A widely-cited report from Stifel showed that 30% of large pharma’s licensing deals now involve a Chinese biotech. This shows the growing interest in partnering in the region, in spite of political sensitivities that are affecting other high-tech industries. To cast further light on this trend, we have picked apart pharma’s R&D engine to reveal the companies and regions that are driving innovation.
Our analysis of Citeline’s Pharmaprojects database below shows the leading companies according to the number of new, innovative drugs added to their portfolios over the past three years. Reformulations and biosimilars are excluded, while candidates that have subsequently been discontinued are also shown.
As you might expect, the majority of the top spots are filled with leading multinational pharmaceutical companies, backed by large revenue streams, R&D budgets, alongside sizable internal drug discovery teams. Fascinatingly, the top spot is taken by Jiangsu Hengrui, and we’ll talk more about that in a moment.
For the major Western companies, there is a strong correlation between revenues, R&D budget, and number of new drugs added. From Pfizer in #2 to GSK at #12 in this analysis, these companies occupy the top positions for pharma R&D spend. The only exception is J&J, which has focused more on investing in its existing pipeline rather than building from the bottom up.
It is not until Moderna at #18 that the first traditional platform biotech appears, and Moderna’s story is certainly exceptional. Supported by a window of opportunity with COVID-19 vaccine revenues, Moderna greatly expanded its pipeline. It is often said that platform biotechs can create new candidates with great efficiency – and this certainly holds true – but Moderna aside, they lack the scale to progress multiple projects in tandem.
China is an enormous exception to the rule that sees pipeline creation match revenues and budgets. Rather, four out of the top 20 biggest R&D engines are owned by Chinese biopharmaceutical companies that each have comparatively small commercial footprints.
Jiangsu Hengrui leads the rankings in spite of revenues of ~$3bn that are dwarfed by the $50bn+ of majors in the US and Europe. The 87 drugs added span the breadth of therapy areas and modalities, and include two projects now in Phase III and a further 16 at Phase II. Jiangsu Hengrui’s degree of asset creation is unprecedented and will bring its own challenges of prioritization. Each program will be competing internally for resources, which necessitates strong governance and decision making. Nevertheless, there are undoubtedly lessons to learn in how this scale of R&D was achieved.
Jiangsu Hengrui is also joined by CSPC Pharmaceutical, Sino Biopharmaceutical, and Biocytogen within the top 20. As a collective, Chinese companies added more than 4,100 innovative new drugs to their pipelines since 2022, for 31% of the global total. This also exactly matches China’s share of recent clinical trial activity, which we explored in an article last year. The gap to the United States (35%) is narrowing rapidly, as the chart below shows.
South Korean biopharmas discovered more than 1,300 new drug candidates in the last three years, which is an impressive 10% of the global total. This is enough for third position and ranks South Korea comfortably ahead of notable R&D hotspots in the UK and Switzerland, as well as its near neighbor Japan. Much of this work is at the earliest stages of development, but the pipeline creation is shared by an impressive 321 separate pharma and biotech companies. Daewoong Pharmaceutical is the leader here, and its strategic pivot towards innovative new medicines and partnerships is indicative of the wider trend in South Korea. This has been supported by government initiatives and incentives that promote domestic R&D.
Although Japan has a much maturer market and companies with international reach, its combined drug creation activities are far lower than in South Korea. Over the last three years, Japanese companies discovered 330 new drugs that were added to our Pharmaprojects database, just missing out on fifth position. This is emblematic of a region that is focused more on clinical trials and commercialization, and has greater reliance on innovation hotspots elsewhere for early pipeline sourcing.
Source: Citeline, Pharmaprojects
The R&D engine analogy aside, there are parallels in the situation facing multinational pharmaceutical companies today and those in the automotive industry. Asian companies have consistently proven themselves as world-leaders in tackling scalability and lowering the costs of goods sold in high-tech industries, while not compromising on quality. Western carmakers are currently wrestling with the inconvenient truth that brand loyalty only carries so much weight against the potential for steep discounts. And as for pharma companies, they will be keenly aware that insurance coverage and out-of-pocket costs are huge drivers for treatment choice.
A protectionist approach that limits the ability of Asian companies to operate in the US and Europe may backfire in the long-term. Ultimately, patients would be deprived of innovative, best-in-class therapies. And without access to lucrative US and European markets, there is a ceiling to how much investment in R&D is sustainable, particularly for Chinese biotechs. Rather, the current business model of partnership and licensing strikes the right balance, allowing both ecosystems to flourish. The latest numbers suggest that around 30% of large pharma’s deals are with Chinese companies, and it seems that this figure will only rise. And in the meantime, pharma R&D decision makers will be keen to adopt the practices that enable Chinese and Korean companies to create new drugs at the speed and scale currently shown.
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