Big Pharma continues to entrench itself in China even as many other western companies flee amid declining U.S.-China relations, according to The Wall Street Journal.
Global pharmaceutical companies including Pfizer and AstraZeneca are continuing their reach into China’s massive medical market and are reaching multimillion-dollar licensing deals with Chinese companies, according to the WSJ. Companies outside of Big Pharma are fleeing China due to a struggling Chinese economy, souring relations with the U.S. and stringent restrictions in the semiconductor industry.
China is facing an aging population with widespread chronic lifestyle diseases, and its population has grown wealthier with more income to spend on their health, according to the WSJ. China has been pushing for greater healthcare and extended public coverage; the country spent $166 billion on medicines in 2022, a figure that’s projected to grow by almost $30 billion in the coming five years.
Merck & Co. and Johnson & Johnson have both struck potentially multi billion-dollar deals on experimental Chinese drugs, according to the WSJ. Bayer has announced a deal to work with Peking University in China, and Pfizer signed a deal in April with the Chinese state-owned Sinopharm to bring new drugs to the market by 2025.
Tensions have been high between the U.S. and China following President Joe Biden’s June comments referring to Chinese President Xi Jinping as a “dictator” after a Chinese spy balloon flew over the U.S. Secretary of State Antony Blinken, Treasury Secretary Janet Yellen and Special Presidential Climate Envoy John Kerry have all traveled to Beijing this summer in hopes of easing tensions through cooperation on a number of topics, including military communication, climate crisis claims and an ongoing trade war.
China’s economy is struggling after a poor growth report for the second quarter of 2023, with the country’s GDP only growing 0.8% for the quarter and 6.3% for the year.
The U.S. and China are competing in a technology war to gain an advantage in the production of semiconductors used for technological development and artificial intelligence research. The Biden administration put restrictions in place in October blacklisting multiple Chinese companies in the microchip industry from doing business with U.S. semiconductor manufacturers. On July 17 the Biden administration met with U.S. chip industry leaders to discuss whether greater restrictions for Chinese companies would be put in place, and the Chinese ambassador said July 19 that the country would retaliate against any new restrictions on the industry.
Pfizer, AstraZeneca, Merck and Johnson & Johnson did not immediately respond to a request to comment from the Daily Caller News Foundation.
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