Summary of Key Points
This article uses CanSino Biologics’ (Yivoxi monoclonal antibody) and Innovent Biologics’ (Oblinib) as case studies to illustrate the entire development trajectory of Chinese innovative drugs. From research and development breakthroughs (such as Yivoxi outperforming the globally renowned drug K), to expansion in medical insurance coverage (quickly addressing patient accessibility and achieving corporate profitability), and finally to globalization efforts (exporting products and securing independent supply chains), it demonstrates the crucial role of medical insurance in the commercialization of domestic innovative drugs. It also highlights the transformation trend of Chinese pharmaceutical companies moving from a “laboratory” phase to the global market.
Detailed Analysis
1. Medical Insurance: The “Market Accelerator” for Innovative Drugs
In the past, it took several years for innovative drugs to be included in medical insurance programs; now, some can get approved within as little as one year, and 80% of new drugs are covered by insurance within two years of their launch. This has directly resolved two major issues:
- For patients: Drug prices have significantly decreased. For example, Mr. Zhang, a patient with advanced lung cancer, only needs to pay around 2,000 yuan out of pocket per treatment course for Yivoxi (with over 70% reimbursement by medical insurance); for lymphoma patients, the cost of Oblinib is reduced to just 1,000 yuan per box after insurance coverage, which is more than half the initial price.
- For companies: Increased sales have driven revenue growth. CanSino Biologics’ product sales reached 3.033 billion yuan in 2025 (a year-on-year increase of 51.5%), and Innovent Biologics turned a loss into a profit for the first time (net profit of 640 million yuan). The main reason for this is the expansion of medical insurance coverage to lower-income areas, resulting in a several-fold increase in the number of patients using these drugs.
In short, medical insurance has transformed “expensive new drugs” into more affordable options, benefiting both patients and companies.
2. Medical Insurance Negotiations: Moving from “Price Cutting” to “Comprehensive Evaluation”
Medical insurance negotiations were once seen as a process of squeezing prices, but now the focus has shifted. The insurance authorities are more concerned with whether a drug is worth the cost, rather than just whether it can be made cheaper. Two key criteria are used for evaluation:
- Clinical value: For instance, Yivoxi’s new indication for first-line lung cancer treatment did not see a price reduction because it outperformed K in international trials, reducing the risk of death by 49%, making it a groundbreaking drug.
- Cost-effectiveness: Although the cost of Yivoxi’s “chemotherapy-free” treatment option is high, it reduces the need for frequent hospital visits and suffering from chemotherapy, resulting in lower overall medical expenses for patients. Such drugs that offer better value for money are more likely to be covered by insurance.
New mechanisms have also been introduced, such as Innovent Biologics’ ability to communicate with the insurance authorities in advance about a “reference drug” for pricing, reducing the uncertainty of negotiations. This gives companies more confidence to invest in research and development.
3. From “Startups” to Mature Pharmaceutical Companies
Both CanSino and Innovent began as startups founded by scientists. CanSino was launched in 2012 by four returnees in a 20-square-meter laboratory, while Innovent was established in 2015 under the leadership of Shi Yigong. They have now completed their transformation:
- Financing and Listing: They have raised funds through the Hong Kong Stock Exchange’s 18A rule (which allows unprofitable biotech companies to list), addressing the issue of high research and development costs.
- Independent Production and Sales: CanSino has established a technology park in the Bay Area (awaiting FDA inspection), and Innovent has a base in Guangzhou that has passed the Australian TGA audit, allowing them to produce drugs independently. They have also built their own sales teams to directly connect with hospitals and patients.
- Profitability: They have evolved from small R&D-focused companies into mature pharmaceutical enterprises (BioPharmas) that can control their own profits by managing all aspects of production and sales.
This step is crucial, as only by controlling these processes can companies ensure they make a profit without being dependent on others.
4. Globalization: More Than Just Selling Drugs – Building Strong Competence
For Chinese innovative drugs to succeed globally, it’s not enough to simply export them; they must also meet international standards:
- International Certification: CanSino’s production facilities are undergoing FDA inspections, and Innovent’s base has passed the Australian TGA audit, ensuring that their drugs can be legally sold in Europe and America.
- Independent Supply Chains: The localization of production equipment and consumables (such as disposable reaction bags and purification cartridges) has increased efficiency by nearly 40%, reducing costs and enhancing competitiveness in global markets.
The reason for globalization is that the domestic market has its limits, while European and American markets are much larger and more profitable. By meeting international standards, Chinese companies can earn more and demonstrate the strength of their innovative drugs.
Conclusion
Chinese innovative drugs have surpassed the initial stage of research and development breakthroughs and are now transitioning to commercialization on a large scale through medical insurance coverage. They are also moving towards the global market and becoming mature pharmaceutical enterprises. In the future, only those companies that can successfully expand in both domestic markets and gain a foothold in global markets will become true industry leaders. Behind this transformation is China’s growing confidence as a leader in the biopharmaceutical sector, from a follower to a pioneer.