After years of development, China's innovative drug R&D now significantly outperforms overseas markets in both speed and cost, with its global competitiveness continuously rising.
According to recent research data from institutions, as of July 25, 2026, the number of innovative drug pipelines under development in China accounted for 39% of the global total, and in the first half of 2026, the total value of BD deals by Chinese pharmaceutical companies reached 58% of the global total. As competition in the sector continues to intensify, why can China's innovative drugs achieve differentiated global advantages?
Why can China's innovative drugs achieve differentiated global advantages? Based on institutional research reports and professional analysis, multiple factors are currently working together to build the global differentiated competitiveness of China's innovative drugs.
1. Significant advantages in R&D cost and speed. Overseas analysis has pointed out that the cost for US and European pharmaceutical companies to develop an antibody therapy is about 2.7 times that of Chinese companies. Among these factors, R&D speed is the core driver, contributing about 40% of the cost advantage. In the early discovery stage, Chinese pharmaceutical companies need an average of only 36 months, nearly half of the 54 months required by Western companies. In addition, from the perspective of per capita clinical trial costs, according to Frost & Sullivan statistics, the per capita cost of domestic Phase I clinical trials is about USD 40,000-60,000, and Phase II/III is about USD 50,000-70,000; while the per capita cost of international multicenter clinical trials is generally USD 120,000-180,000, with Phase II/III slightly higher than Phase I.
2. Efficient coordination of the review and approval mechanism. In the IND (Investigational New Drug) application stage, China's standard review time limit is 60 days, while the pilot review and approval for innovative drug clinical trials has been shortened to 30 days, basically comparable to the US IND default 30-day effectiveness mechanism. In the NDA (New Drug Application) stage, China's standard review time limit is 200 days, and priority review is 130 days, both shorter than the US standard review of about 300 days and priority review of about 180 days. Overall, the efficiency of China's innovative drug registration and approval continues to improve, and may already be internationally competitive.
3. World-leading clinical resources and execution efficiency. China has abundant clinical resource reserves, and its clinical trial execution efficiency is globally competitive. Data from the National Medical Products Administration show that in 2025, the total number of domestic drug clinical trials exceeded 5,000 for the first time, setting a historic high and doubling the total compared with 2020; among them, there were 2,997 new drug clinical trials, accounting for 57.5% of all trials, a year-on-year increase of 18%, indicating that new drug clinical R&D remains active. From the perspective of clinical execution cycles, the FDA has published typical cycles for US Phase I-III clinical trials as several months, several months to 2 years, and 1-4 years respectively; while institutional research data show that the overall average time for completed domestic clinical trials is 85.7 days.
4. AI-driven upgrade of full-chain R&D efficiency. At present, China's AI pharmaceutical industry has gone through the embryonic stage and development stage, and since 2024 has entered a mature and deepened commercialization validation period. Today, AI technology has fully upgraded into a productivity tool covering the entire chain of "drug discovery—clinical development—commercialization—manufacturing supply," with its core value concentrated in cost reduction and efficiency improvement: the drug discovery stage can save 70%-90% of time, the preclinical and clinical stages can save 50%-80% and 50%-60% of time respectively, and cumulatively can reduce total R&D costs by about 50%.
Looking ahead, how should innovative drug investment be viewed? Some institutions believe that in 2026, the innovative drug and CXO industry chains will maintain high prosperity, overseas cooperation authorization income will become a new driving force for innovative drug companies, and the industrial trend of Chinese innovative drugs going overseas remains favored. It is worth noting that the current sector valuation is still at a historical low, and may offer significant cost-effectiveness. According to Wind data, as of September 28, 2026, the PE-TTM of the Shenwan Pharmaceutical and Biological Index was 33 times, at the 31st percentile since 2010.
For investors interested in the long-term investment value of innovative drugs, they may, within their own risk tolerance, pay attention to Yinhua's Hong Kong Innovative Drug ETF Yinhua (159567) and its feeder funds (Class A: 023929, Class C: 023930), as well as Innovative Drug ETF Yinhua (159992) and its feeder funds (Class A: 012781; Class C: 012782), which provide one-click coverage of core innovative drug assets in both the A-share and Hong Kong markets, helping to diversify individual stock risks while striving to capture long-term industrial growth opportunities.
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Regular fixed-amount investment is a simple and easy long-term investment method that guides investors to invest over the long term and average investment costs, but it cannot avoid the inherent risks of fund investment, cannot guarantee investor returns, and is not an equivalent financial management method to replace savings. 4. Risk disclosure for special types of products: 1. Investors are requested to pay attention to the risk of underlying index fluctuations and the unique risks of ETF (Exchange Traded Fund) investment. Feeder funds invest in the underlying ETF, and investors are requested to pay attention to the unique risks of feeder funds, such as tracking deviation risk, the risk of performance differences from the target ETF, other risks of investing in the target ETF, and the risk that tracking error control fails to meet the agreed target. 2. 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The CSRC's registration of this fund does not indicate that it makes a substantive judgment or guarantee on the investment value, market prospects, and returns of this fund, nor does it indicate that investing in this fund is risk-free. MACD golden cross signals have formed, and these stocks are performing well!
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