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"Tsai Shen, God of Wealth"
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For every manager with a surefire strategy for China, William Keller has one piece of advice: "Let it go!" Keller should know.
He founded Roche's China affiliate in 1994 and built it into a market leader. In the meantime, he became an eminence whose
wisdom is sought industry-wide, from his role as spokesman for the Zhangjiang Hi-Tech Park, the world's highest concentration
of Life Science companies, to lobbying for Shanghai's successful bid to host the 2010 World Expo. "Don't try to control everything,"
Keller goes on, "and see what comes out. Some will fail, and some will get very good insights to go further. It's a journey
of exploration. Explorers have a different mindset than followers!"
Indeed, China's pharmaceutical journey has reached record heights. Just four years ago in 2009, China surpassed the UK, Spain,
Italy, and Canada to become the world's 5th largest market. Now it has exceeded both France and Germany to achieve 3rd place,
and by 2015 will leapfrog Japan to sit behind only the US as global #2. Behind the 20%+ compounded annual growth, structural
changes from the central government have put healthcare and innovation at the foremost of policy priorities.
From left: Sheryl Jacobson, Senior Partner, Monitor Group; Minister of Health Chen Zhu; Brian Mi, General Manager of IMS Health
Effective April 2011, the 12th Five Year Plan focuses for the first time away from pure growth, toward more sustainable and
equitably distributed initiatives, including billions of dollars in "Strategic Emerging Industries" (SEIs). These include
biotechnology, which will see RMB 12 billion (USD 1.9 billion) earmarked for new drug R&D from 2011-2015, out of a total RMB
4 trillion (USD 0.64 trillion) alongside other high value added like next-generation energy and IT.
"In China, we do believe the government will have an even bigger role to play, because of the way the country is set up, and
because of the stage the industry is evolving through," says Sheryl Jacobson, senior partner in Monitor Group's China Healthcare
practice, speaking to the role of innovation in the sector. "We're still at a stage where the MNCs (Multinational Corporation)
are USD 1 billion businesses at most, and primarily commercial entities. Local companies are anywhere, in terms of manufacturing
revenue, from almost nothing to USD 0.5 billion. The typical company that does innovation from the lab to in-patient trials
– the traditional US or European model – simply will not work in China."