China's Drug Industry Embraces AI to Power Next Wave of Global Deals

China's pharmaceutical industry is undergoing a significant transformation, with cross-border deals for innovative drugs hitting an unprecedented $110 billion in the first half of 2026. This surge indicates a robust appetite for cutting-edge medical advancements originating from or involving Chinese entities.

Following this record-breaking period, the sector is now pivoting towards artificial intelligence (AI) as a key driver for the next wave of transactions. The focus is shifting to drug candidates developed using AI, signaling a move towards more efficient and potentially more successful drug discovery processes.

This strategic shift aligns with China's growing prominence in global drug development. According to Lan Gongtao, deputy director general of the Department of Drug Registration at the National Medical Products Administration, China accounts for approximately 30% of all new drugs currently under development worldwide, securing its position as the second-largest contributor globally. The industry's embrace of AI is expected to further accelerate this progress and attract more international investment and collaboration.

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China accounted for about 30 per cent of all new drugs currently under development worldwide, ranking second globally.