ABSTRACT
This chapter examines important changes shaping developments related to industrial upgrading in China's pharmaceutical industry. Addressing unprecedented social and medical needs, the Chinese government engages in a two-pronged approach: on the one hand, negotiating and managing the entry of foreign patented medicines; on the other, stepping up efforts to spur innovation in domestic pharmaceutical enterprises. While ongoing tensions exist between Chinese state actors and global pharmaceutical companies over the terms of market entry and the protection of intellectual property of patented drugs, new rules on biological drugs are being introduced, aimed at raising the standard of Chinese pharmaceuticals. Through collaboration with leading foreign pharmaceutical companies, several new domestic contenders are beginning to develop more innovative medicines to compete in the international market. Overall, reform policies in the sector are the product of negotiation and compromise among key players, driven by elite interests in political legitimacy and the bottom-up pressure of social needs, and conditioned by the diffusion of capitalist practices in a hyperglobalised economy which has buttressed the power and influence of global pharmaceutical companies.
