You know you're getting old when you start sentences with reflections from your childhood. But at the risk of sounding like my grandparents: When I was a child, China was a place where people were starving because I wouldn't eat my vegetables. Oh, what changes have been wrought within the last 42 years.
For decades, the "Made in China" brand was largely seen as an indication of cheapness, both in price and in quality. Over the last several years, however, that label has started to change as China has become a global force in electronics and engineering, selling high-quality goods such as refrigerators and televisions alongside the more traditional powerhouses of Japan and the United States. For the pharmaceutical and biotech industries, the interest in and move to China has been slower.
In the last couple of years, China has been seen largely as a good place to set up manufacturing and sales facilities that specifically target Asia-Pacific markets. In December 2004, technology giants Invitrogen and Thermo Electron made significant moves in China, dramatically expanding their operations in the Shanghai region and elsewhere.
In explaining the reasons behind his company's move, Ken Berger, president of Thermo Electron China, said: "Our businesses are global businesses and our strategy is to develop our capabilities so that we are as comfortable doing all aspects of business—marketing, sales, manufacturing, and engineering—in Asia as we are elsewhere."
Within the last year, however, there have been significant changes in the attitudes—perhaps, opening of eyes is more appropriate—of companies toward China and its role in the drug discovery process. More than simply a place to make high-quality goods at cut-rate prices, China is being seen as an active participant in the scientific process, supplying technological expertise that is equal to and in some cases, distinct from that offered by more traditional Western partners.
In November 2005, pharma giant Organon International signed a collaborative agreement with Shanghai-based HD Biosciences to develop assays to characterize several potential drug targets associated with central nervous system disorders. In an interview for a story in this month's Drug Discovery News, Organon EVP Global Research Dr. David Nicholson told me that this was just the first of many such deals for the company.
He noted: "This is boom time in scientific China. The rate of expansion of the biotech community there is amazing. I believe that over the coming years, they will have an increasing impact on drug discovery. For the next few years the impact in drug R&D will mainly be in research."
Trying to get ahead of the curve, Bayer recently went so far as to invite Chinese post-doctoral fellows and doctorate students studying in Germany to visit its facilities and to start conversations about future recruitment and/or collaboration of Chinese scientists with the pharma giant. Said Dr. Jürgen Dahmer, president of the Bayer Group in Greater China: "We are glad to have this opportunity to meet with this group of candidates, who clearly possess the innovative qualities we seek, and who show the passion and will to play an active role to shape the future of China's steadily ascending industries."
These examples are just a taste of what is happening in China. Beyond manufacturing, beyond sales, beyond research, companies are also starting to see the region as a good place to perform clinical trials.
The dragon is awake, and just as Chinese industry is impacting everything from fuel prices to textiles, so too will the economic ripples begin to impact the pharmaceutical industry. Just what that impact will be and how the world will respond remains to be seen.