China Biotech Licensing Set for Record Year as Global Pharma Hunts New Drug Pipelines
China’s biotechnology sector is on track for another record year in licensing activity as global pharmaceutical companies intensify their search for innovative drug candidates to offset looming patent expirations and rising research costs.
Data from industry tracker Pharmcube shows that out licensing deals involving companies in the greater China region reached a record 137.7 billion dollars in 2025, marking nearly a tenfold increase compared with 2021 levels. Analysts expect momentum to continue in 2026, with total deal values projected to climb even higher as multinational drugmakers expand partnerships with Chinese developers.
Out licensing allows a pharmaceutical company to grant development and commercialization rights for a drug candidate to a partner in exchange for upfront payments, milestone based fees and future royalties. The structure helps spread development risk while enabling global firms to replenish pipelines without bearing the full cost of early stage research.
Mainland China has become the focal point of this trend, supported by a maturing biotech ecosystem, improved clinical research capabilities and a growing pool of experienced scientists. Global players including Novartis, Merck and GSK signed major agreements with Chinese firms last year, reflecting confidence in the quality and scalability of locally developed assets.
The surge in activity is also evident in deal size. So far in 2026, the average licensing agreement has reached approximately 1.3 billion dollars, up 76 percent from last year and several times higher than averages recorded earlier in the decade. Recent headline transactions include a multibillion dollar weight loss drug collaboration involving AstraZeneca and CSPC Pharmaceutical Group, as well as a substantial oncology focused agreement between AbbVie and RemeGen.
Investment bankers and healthcare analysts attribute the boom to two converging forces. First, many blockbuster drugs in Western markets are approaching patent cliffs, pressuring large pharmaceutical companies to secure next generation therapies. Second, Chinese biotech firms have shifted from fast follower strategies to developing differentiated and globally competitive molecules, particularly in oncology, immunology and metabolic disease.
While some observers forecast that total licensing value could double over the next two years, others expect more moderate but still robust growth. Therapeutic areas such as oncology, which remain foundational in global treatment regimens, are expected to attract sustained interest.
So far this year, dozens of new licensing agreements have already been announced, suggesting that deal flow remains strong. With 186 out licensing deals recorded in 2025 and momentum continuing into early 2026, China’s biotech industry is increasingly integrated into the global pharmaceutical innovation network.
As research capabilities expand and international partnerships deepen, licensing has become a key channel linking Chinese laboratories to global commercialization pathways, reshaping the geography of drug development and investment.
