The life sciences industry is continuing to evolve. The industry’s development is being supported by a number of factors. Of the more important elements, four include policy, industry growth, population demographic dynamics, and the level of innovation.
Policy
Over time, a number of important life sciences-related policies have been authorized and implemented in China. One of the more important ones is the 14th Five-Year Plan, which has promoted a solid public health system, the expansion of national healthcare insurance, and the further development of traditional Chinese medicine (TCM).
Life Sciences Industry Growth
Today, when making a global comparison, China’s biopharmaceutical industry maturity level, in terms of genetic engineering and innovative medicine research and development (R&D), has reached or even surpassed the level seen in many other mature-market countries. What’s more, according to estimates from Frost & Sullivan, the total healthcare expenditure in China reached RMB7.6 trillion in 2021 and is expected to achieve and maintain a stable growth in the future at a CAGR of 9.5% to reach RMB13.0 trillion in 2027.
Population Demographics
Population demographics in China are moving in a favorable direction for life sciences enterprises. As people age, more often than not, an increase in the level of individual healthcare is required. According to Eastspring China, by 2035, China’s aged population (aged 60 and above) is predicted to reach 409 million, representing a 28.5% share of the country’s total population. By 2050, as estimated by the UN, the proportion of ageing people in China will likely exceed that of young and working-age people.
The Level of Life Sciences Research and Innovation
Research and innovation are key to cultivating new business opportunities within any industry sector within a region, including life sciences. The foundation of research and innovation can be found in universities and the graduates they produce. Also important is the amount spent on the R&D of new products, and in the case of life sciences, these products could range from new medicines to new medical devices – and if these new products are truly ground-breaking, then this can lead to product innovation. China is now one of the world’s most important biopharmaceutical markets. By investing in related R&D, China is continually striving to make greater breakthroughs in the quality of medicine and medical equipment.
These four aspects and more will not just support business opportunities within the life sciences industry in China but will also positively affect demand for life sciences-related commercial real estate within the country and especially in the five city markets featured in our report.
