China captures 49% of global drug deals in 2025 amidst lower costs, faster timelines

This is an improvement from only 6% in 2020.

China’s biotechnology sector accounted for 49% of global drug out-licensing deal value in 2025, up from 6% in 2020 and 4% in 2015, marking a structural shift that now leaves execution, rather than deal volume, as the key decision signal for 2026, according to CGS International.

The report attributed China’s rise to lower drug development costs, faster timelines, and higher operational efficiency, which continue to draw multinational pharmaceutical companies seeking pipeline assets through partnerships.

CGS International said target crowding across popular modalities, including PD-1×VEGF, HER2, EGFR, and TROP2, is expected to limit further gains in China’s global out-licensing share in 2026, placing pressure on average deal sizes despite sustained interest from multinational buyers.

As a result, near-term sector performance in 2026 is expected to hinge on clinical trial readouts and milestone payments, rather than headline licensing announcements, with companies that have already secured multinational partnerships positioned more defensively, the report said.

CGS International maintained an Overweight stance on the China biotech sector, while flagging risks from China–US geopolitical tensions, US regulatory scrutiny of China clinical trial data, and intensifying competition in crowded targets, according to the report.