(Yicai) March 6 -- Insiders in the biopharmaceutical industry who are attending this year's Two Sessions, China's top political meetings, request bigger policy support amid the sluggish financing landscape.

China’s biopharmaceutical industry is struggling with a plunge in investment, and if companies continue to lack confidence they may not be able to secure new funds, which leads to broken capital chains, Ding Lieming, chairman of Betta Pharmaceuticals and a member of the National Committee of the Chinese People’s Political Consultative Conference, told Yicai.

Biopharma firms are experiencing a "financing winter" and many small and medium-sized enterprises will not survive in the next two years if they fail to achieve sufficient cash flows without venture capital investments or bank loans, warned Yuan Yuyu, chairman of Medprin Regenerative Medical Technologies and a deputy to the National People’s Congress.

Innovative drug companies raised CNY32.1 billion (USD4.5 billion) from the primary market (including pre-initial public offering fundraisers) last year, almost a third lower than in 2022, according to statistics from Zheshang Securities. IPO financing totaled CNY11.1 billion, less than half of that of 2022.

Ding from Betta Pharma suggested to the political advisory body that market regulators could relax their review rules for IPO and refinancing cases so that companies could raise funds more easily from the secondary market to accelerate innovative drug development. Regulators should also support leading biopharmaceutical companies to carry out mergers and acquisitions by issuing shares to purchase assets in order to increase industry concentration and enhance innovation and international competitiveness among the remaining players.

Moreover, Ding proposed that local governments could set up industry-specific investment funds to support local biopharmaceutical companies along with venture capital funds to bolster their research and development efforts to come up with innovative drugs.

Yuan from Medprin approached the NPC to suggest that the highest organ of state power could enhance policy support and financial subsidies for small and medium-sized biopharma companies of high quality to create a better environment for innovation.

Finally, Ding urged regulators to allow enterprises to independently determine innovative drug prices to leverage the market’s decisive role in pricing. They should also organize medical insurance negotiations with developers of new innovative drugs as early as during the final stages of regulatory approvals to help these medicines enter the centralized procurement program as soon as possible.

Editors: Tang Shihua, Emmi Laine