Chinese firms prepare to take a piece of the weight-loss drug market

The weight-loss drug market is a golden opportunity for China to become a dominant player in global pharma. Aided by state support and domestic procurement, Chinese weight-loss products will first take over the domestic market (estimated at USD 10 billion by 2033), so that by the 2030s, they will compete in a global market expected to exceed USD 100 billion.

China’s innovation and industrial policy is designed for this. Now that the key innovation in weight-loss drugs has been made (targeting the GLP-1 receptor), China can concentrate on incremental innovation and economies of scale. This puts weight-loss drugs on a similar path to solar panels, digital hardware and electric vehicles. With global demand expected to increase by 20 percent annually over the next decade, weight-loss drugs are a growth market that foreign suppliers are already struggling to supply.

By 2026, Novo Nordisk’s patent in China for semaglutide, the diabetic drug also used for weight loss, will expire. Typically, this would prompt pharma companies to launch new products that are slightly different but significantly better. Chinese companies have already joined in this competition. At least 11 Chinese firms are in the final stages of clinical trials with generics and biosimilars. Of these Chinese firms, Hangzhou Jiuyuan already applied for market approval in April. Suzhou-based firm Innovent announced in July that the next-generation drug mazdutide, which it licensed from US drug company Eli Lily, had cleared the third of five planned Phase III studies.

Biotech might differ from hardware sectors. Clinical trials require more patience and deeper pockets. However, Novo Nordisk, Europe’s most valuable firm, should stop underestimating China.

MERICS Head of Program Jeroen Groenewegen-Lau says: “Chinese firms will become major players in the global weight-loss drug market by 2030, which will be a harbinger of China’s rising stock in global pharma more generally.”