The U.S. may still be the world’s superpower, but its dominance in biopharma is eroding as China and India add more innovation to their booming life science industries. The result augurs years of growing competition for biopharma enterprises, and their jobs, just as all three nations are looking to the industry for future growth.
To be sure, the U.S. continues to enjoy the world’s largest biopharma industry by establishments (48,059; Battelle); public-company revenues ($61.6 billion in 2010; Ernst & Young); size of prescription-drug market ($307 billion; IMS); jobs (1.42 million; Battelle); venture capital ($4.733 billion last year; MoneyTree Report); R&D research (just over $100 billion in private and public spending); and patents (6,601 within classes 424, 435, and 514 last year; USPTO).
So Uncle Sam remains biopharma’s anchor—or more accurately, two anchors. California and Massachusetts are the top states in biopharma jobs, companies, venture capital raised, NIH grant funding awarded, and patents granted.
But India and China have grown faster. Both emerged more than a decade ago as offshoring havens driven by lower wages and less red tape. India capitalized on strong chemistry, generic drug development, and a services sector, while China invested heavily in biopharma infrastructure, attracting more than $1 billion in investment from global giants and hundreds of new startups.
“Both countries have a role to play in the global R&D footprint, and both countries have a role to play in the global commercial footprint as well. Obviously China is still the much larger commercial opportunity and will be, at least for the foreseeable future,” Simon Goodall, partner and managing director with The Boston Consulting Group (BCG), told GEN.
With annual growth averaging 22%, more than triple the 6.2% global average, China’s drug market rocketed from $33 billion in 2007 to $126 billion in the first seven months of 2011. The 12th Five-Year Plan (2011–15) commits 2 trillion yuan ($317.75 billion) to biopharma, one of seven strategic sectors expected to comprise a combined 8% of GDP. China hopes to expand its biopharma workforce from 250,000 to 1 million jobs by 2015.