China's Future in Bioscience - Pharmaceutical Executive

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China's Future in Bioscience


Pharmaceutical Executive



George Baeder
When European scientists needed to quickly understand the genetic structure of a deadly new strain of E. coli bacterium sweeping through Germany this past summer, they turned for aid to what might have seemed, at first blush, an unlikely source: a company headquartered behind a truck repair depot in a former smuggler's village in Southern China.

Yet BGI, formerly known as the Beijing Genomics Institute, has quietly become one of the world's most powerful sequencers of genetic structures, a key skill that will help diagnose disease and build biomarker maps that could lead to breakthrough drug developments. Not only did BGI help European health officials decode the strands of the mysterious bacteria in a mere three days, its analysis also concluded that this strand—which killed 17 people and sickened more than 1,000—was both new and super-toxic.

Based in the Yantai district of Shenzhen, about an hour's drive from Hong Kong, BGI now houses the world's most concentrated array of powerful genetic sequencers, and aims to become the "sequencer of choice" for drug firms and disease fighters across the globe. It is also moving aggressively to develop a proprietary software platform that genetic scientists would call upon to unravel genetic mysteries and speed development of new drugs. "We intend to build the platform the rest of the world's scientists will use," explains Yang Huanming, one of BGI's founders. "Our goal is to sequence anything and everything in the world."

At a time when the life sciences industry in the West is beset by patent cliffs, rising regulatory hurdles, and the declining productivity of its research and development pipeline, China's life sciences industry is quietly gathering a critical mass of skilled talent, and savvy and focused venture investors, all tied to increased support from the Chinese government. While BGI remains a private firm, its top leaders candidly acknowledge they could not grow as quickly without the financial support of the government, which has grown to recognize that the life sciences industry offers the nation breakthrough opportunities in drug development and innovation.

New Investments in Life Sciences

Investments in new life sciences labs, biotechnology parks, and incubators fit nicely into its goal to see the nation transformed from a low-wage manufacturing power to a source of high-value "indigenous innovation." China's next five-year plan will allocate at least $1.5 billion to stimulate cutting-edge biological research. Provinces around the country are offering incentives to expand the more than a dozen life science research parks that are already up and running. At the same time, policymakers are looking at innovative ways to launch electronic medical records as a critical tool to manage patient needs, with an aspiration to create a vast source of clinical data.

Today, firms like BGI are able to win support from the Ministry of Science and Technology (MOST) for some of their most ambitious endeavors, even as they create partnerships with top domestic and foreign research laboratories. More than simply building hospitals and funding labs, however, the Chinese government is using its so-called "Thousand Talents" program to actively recruit top Chinese scientists and business experts who have trained in the West, incentivizing them to return to their homeland.

The effort to woo Chinese into returning home is taking place at a time when many Western firms are being forced to reduce their spending on R&D. A survey published last fall by Monitor Group estimated that at least 80,000 Chinese-born, Western-educated PhDs have chosen to return home after studying and working in Western pharma firms. With access to venture capital and business experience in the West, they hope to leverage China's raw talent and cost-effective laboratories to rapidly develop and test promising molecules.


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