In 1890 Louis Pasteur sent his colleague Alexandre Yersin to Asia to investigate the Bubonic Plague epidemic or “La Peste”, which was thriving in Asia. Four years later, in Hong Kong, Yersin discovered what would later be called Yersinia pestis, the causative agent of the Plague 1. It was a highly successful mission driven by Pasteur's vision that good science needs to benefit humankind. Since then diseases and science have evolved but the Pasteurian vision remains the same. Today, the Institut Pasteur Shanghai (IPS) with its partner, the Chinese Academy of Sciences (CAS), creates a new way of fighting diseases through the development of a China-based platform for global biotech products.
In today's China, the output and quality of science have improved dramatically, boosted by the tremendous economic success of a country that traditionally attributes high value to science and education. Chinese academia benefits from attractive and growing government research funding and incentives for companies that develop products to address the country's unmet medical needs. A testimony of the burst in creativity and China's ambition to become an intellectual powerhouse is the number of patent applications, which increased by 40%, totaling 1.22 million patents filed and 815,000 patents granted in China in 2010 2.
The biomedical sector in China is undergoing huge expansion and as with other sectors the scale of things make China unique. With a population of 1.34 billion the unmet medical need is huge and large patient pools are found in all major disease therapeutic areas, with 2.2 million cancer deaths, 170,000 deaths from cardiovascular disease, 90 million diabetics and 140 million chronic carriers of Hepatitis B and C reported in 2009 3, 4. Over the counter medicines (OTC) and traditional Chinese medicine still account for a large percentage of sales in the China pharmaceutical market but the market share taken by patented products is increasing rapidly 5. These products enter a market that is also transformed by the massive healthcare reforms led by the Chinese Ministry of Health, which injected US$ 123bn to create a healthcare system aiming at universal coverage and intellectual property law reforms 6.
Past progress in the Chinese pharma market have been impressive. Driven by an average compound annual growth rate of 19.3% p.a. over the past 10 years 7, China is to become the world's second largest pharma market by 2020, forecast at US$ 163 billion, representing 12% of the global pharma market vs. 7% today. When we take into account the development times of 10+ years, vaccines and drugs invented today will hit a market three times the current size. It makes sense that any company with strategic interests in China needs to initiate development in China today to benefit from that enormous demand in the future. With a strong governmental support to its own industry there is no doubt that products “created in China” will position better in the Chinese market place in the future.
Louis Pasteur developed the Rabies vaccine in 1888. Had he made this discovery today he would probably have created a biotech company, and raised funds to develop it to the human proof of concept. Institut Pasteur has a long standing history of translational research and its network institute in Shanghai is continuing this tradition. Institut Pasteur Shanghai, initiated at the governmental level, was created in 2004 and has quickly become the flagship of Sino-French cooperation in the field of life sciences. The objective of IPS's founding partners Institut Pasteur in Paris, the Chinese Academy of Sciences and the Shanghai Municipal Government, was to improve public health, particularly in China, through research and education. IPS consists today of 237 staff and students with 37 PhD scientists and it will grow up to 400 staff within the next 3 years when it relocates from the city center of Shanghai to its new 16,000 m2 building and 8,000 m2 BSL3 and ABSL3 labs in suburban Shanghai.
The rationale behind the for-profit, global biotech accelerator company “Advance BioChina” is to create a vehicle to enhance IPS's development capabilities and to see innovative products come to the patient. Rather than relying entirely on the development of spin-off companies, the Advance BioChina subsidiary aims to attracting global biotech companies in need of a reliable partner in China to optimally develop and protect the biotech company's most precious asset, i.e., its intellectual capital. Advance BioChina was designed to help companies develop products for the Chinese market through the critical steps up to clinical proof of concept. It will do so by hosting joint venture companies in Shanghai and allow them to benefit from IPS's infrastructure, talent pool, technology platforms and scientific cooperation with IPS and its CAS partners to help the biotech companies through high risk development steps with the highest scientific standards at lower cost.
Big pharma companies have realized that R&D spending in China will ultimately pay off and have invested massively into R&D in China. For biotech companies this has been more difficult to do in the past. Together with large number of high tech parks, incubators and public-private partnerships, Advance BioChina is an answer to how biotech companies can gain access to China efficiently.