2025 China Healthcare Industry White Paper by ECFC: Navigating the 12 Trillion RMB Market Amid Aging, AI, and Global IP Shifts

In the “2024 CEC Capital China Health Industry White Paper” released last year, we previously estimated that, as China fully emerged from the COVID-19 pandemic and taking into account factors such as domestic centralized procurement policies and anti-corruption campaigns in the healthcare sector, China’s health industry constituted a market worth RMB 13.3 trillion (approximately USD 1.8 trillion) in 2023. Of this, the pharmaceutical-related market size was approximately RMB 3 trillion; the market size related to medical devices and diagnostics was approximately RMB 1.2 trillion; and the market size for healthcare services, encompassing overall health services, digital health, and the broader wellness sector, increased to approximately RMB 9.1 trillion. After eliminating double-counted components, we estimate that the total market size of China’s health industry in 2023 was roughly between RMB 10.5 trillion and RMB 11 trillion (USD 1.4–1.5 trillion).

In 2024, as China’s economy has fully stabilized and the scope of the health industry continues to expand, we estimate the market size of China’s health industry as follows: The market size related to pharmaceuticals remains largely flat compared with 2023, at approximately RMB 3 trillion; the market size related to medical devices and diagnostics has seen a slight increase from 2023, reaching about RMB 1.4 trillion; given the accelerating aging of China’s population and the expanded industry boundaries driven by the application of new technologies such as artificial intelligence, robotics, and bio-manufacturing, we project that the combined market size of healthcare services, digital health, and the broader health-related market will reach RMB 10 trillion.After excluding double-counted components, we estimate that the total market size of China’s health industry in 2024 was approximately RMB 11.5–12 trillion (USD 1.5–1.6 trillion), representing a 9%–10% year-on-year increase from 2023.

AgingThis is a global trend, and it is more severe in China. China is currently undergoing the largest and fastest-growing population aging process in global history, and this process will continue to accelerate over the next 20 years.We believe that population aging presents both a challenge and an opportunity for China’s society and economy, serving as a catalyst for industrial development and social transformation.Population aging is placing unprecedented pressure on China’s healthcare and medical services industry, while inevitably giving rise to the “silver economy” and new industrial opportunities characterized by both scale and growth potential. According to projections in the Blue Book on the Silver Economy published by the China Research Center on Aging, the size of the silver economy is expected to reach RMB 30 trillion by 2035, accounting for approximately 10% of GDP. Within this sector, technology innovation and consumer demand related to health are poised to become key drivers of national economic growth.We believe that, in the face of the massive elderly care demands brought about by an aging population, scenarios and tools once confined to science fiction films—such as artificial intelligence, embodied robots, and brain-computer interfaces—will rapidly enter our real lives, offering new approaches and possibilities for Chinese society and families to address the challenges of aging.

The wave of reform and opening-up, which began in the late 1970s, transformed China into a manufacturing powerhouse with global competitiveness and influence over the course of forty years.Today, China is evolving from a global manufacturing powerhouse into a major player in global technological innovation, product research and development, and intellectual property output.In sectors such as new energy vehicles represented by BYD, chip manufacturing represented by Huawei, artificial intelligence represented by DeepSeek, and cultural IPs represented by Black Myth: Wukong and Ne Zha, China’s innovative capabilities are increasingly influencing and expanding into global markets. In the healthcare sector, China’s innovation, R&D, and intellectual property export capabilities are likewise contributing Eastern wisdom to the health and well-being of all humanity.We believe that China’s R&D capabilities in health technology and the global export of innovative intellectual property essentially represent a synergistic convergence of “technological confidence” and “demand-driven innovation.” This dynamic not only helps address the global imbalance in medical resource distribution but also accelerates China’s transformation from the “world’s factory” into the “world’s laboratory” and a “global source of innovation.”

In 1994, Professor William Kissick of Yale University proposed the famous“The Impossible Trinity of Healthcare”: High-quality, low-cost, and widely accessible medical resources are the expectations of every patient, but at most only two of these can be satisfied simultaneously.Throughout human history, high-quality healthcare has never been an equitable endeavor; it is a resource, and even a privilege that wealth alone cannot directly purchase. The most significant challenge facing China’s increasingly aging society is the scarcity of medical resources. This issue is particularly acute in non-tier-1 cities with large elderly populations and concentrated healthcare demands, whereas medical talent and resources remain heavily concentrated in tier-1 cities, resulting in a severe imbalance in the distribution of healthcare resources.Today, with the rapid development of AI and robotics (particularly embodied robots), the conflicts and contradictions within this “impossible trinity” may be partially alleviated and improved.In fields such as AI-powered consultations, medical imaging interpretation, surgical planning and execution, chronic disease follow-up, health monitoring, new drug development, postoperative rehabilitation, and elderly care, artificial intelligence (AI) and robotics hold immense potential for development and application.While AI and robots can never replace outstanding physicians and specialists, technological advancements will ultimately drive Chinese society to make steady progress toward the goal of “healthcare equity.” Although the task remains arduous and the road long, a glimmer of hope has already emerged.

Biomanufacturing, akin to artificial intelligence, possesses the attributes of an “infrastructure” industry and serves as one of the core drivers for the future upgrading of traditional industries.Over the next 5–10 years, biomanufacturing will fundamentally reshape the ecosystems of multiple global industries, including biopharmaceuticals, food, and agriculture. According to forecasts, the market size of the biomanufacturing industry is expected to grow from RMB 417.6 billion in 2023 to RMB 476.2 billion in 2024, representing a year-on-year growth rate of over 15%. By 2030, China’s biomanufacturing market size is projected to approach RMB 1.8 trillion, while the global biomanufacturing market is expected to reach USD 1.1 trillion (approximately RMB 8 trillion), with China accounting for nearly 23% of the global share.We believe that China’s leading position in foundational technologies and industrial infrastructure is becoming increasingly prominent. It is transitioning from being a “participant” and “contributor” to a “driver” and “leader” in global biomanufacturing, and will gradually emerge as one of the world’s key hubs for biomanufacturing. China’s status as a global powerhouse in industrial manufacturing will likewise extend to the biomanufacturing sector.

In 2024, there were approximately 148 mergers and acquisitions (M&A) deals in China’s health industry, with a total transaction value of RMB 75 billion. This marked a rebound from the decline in 2023, bringing the total transaction value close to the peak recorded in 2021 and making it the year with the second-largest M&A volume since 2019.The normalization of M&A activities in China’s health industry is a significant indicator of industrial development and capital market maturity, marking the beginning of a new cycle of rational consolidation.As the main force in China's M&A market, A-share listed companies dominate the market by leveraging their advantages in capital and industrial synergy.The logic behind mergers and acquisitions has shifted from a primary focus on market capitalization management to in-depth cultivation of the industrial chain.Meanwhile, amid the capital winter, valuation systems are returning to rationality, high-quality assets with strong cost-performance ratios are emerging, and transaction models continue to innovate. These factors will significantly boost the motivation for both parties to close deals.We believe that, at this stage, a clear M&A strategy, strongLargeM&A execution capabilities and refined integration capabilities are the key competitive advantages that enable industry leaders to navigate economic cycles and reshape the industry landscape.

1. Population aging is a global trend, particularly severe in China. China is currently undergoing the largest and fastest-paced population aging process in the world, and this trend is expected to intensify significantly over the next two decades. Aging in China presents both challenges and opportunities for driving social transformation.

1) China’s aging population exhibits a “double-exceedance” pattern in both scale and pace, placing sustained pressure on social security and elderly care services

The elderly population is exceptionally large.As of 2024, China’s population aged 60 and above reached 310 million (accounting for 22% of the total population), with 220 million people aged 65 and above (15.6%), indicating that the country has entered a stage of moderate aging.Over the next decade (2025–2035), the population aged 60 and above will see a net annual increase of more than 10 million, surpassing 400 million by 2035 and accounting for over 30% of the total population, thereby entering a stage of severe aging. Around 2050, the elderly population is projected to reach its peak at 487 million, representing one-quarter of the global elderly population. The aging rate will rise to 34%, which is twice the world average pace.

Population aging is accelerating at an unprecedented rate.From an aging rate of 10% in 2000 to a projected over 20% by 2025, and exceeding 30% by 2035, China will complete the transition from mild to severe aging in just 35 years—far faster than Western countries. The working-age population is shrinking concurrently: the number of working-age individuals (aged 20–64) is projected to decrease by 47 million by 2035 and by 124 million by 2050, intensifying the mismatch between labor supply and elderly care demand.

Severe population aging brings numerous challenges, with the old-age dependency ratio continuing to rise and surging demands for pension funding, healthcare, and long-term care. For instance, by 2050, the potential labor force required to care for disabled elderly individuals may reach 73.96 million, accounting for 11% of the working-age population. Significant urban-rural disparities exist: rural areas experience a higher degree of aging than urban areas, yet they suffer from a relative scarcity of elderly care resources. Declining birth rates and imbalances in population structure persist; although the number of live births in 2024 was 9.54 million, an increase of 520,000 from the 9.02 million recorded in 2023—ending the seven-year consecutive decline since 2016—the crude birth rate remained low at only 6.77 per thousand, and the total population continued to shrink. The compounded challenges of aging and low fertility have not been fundamentally alleviated, leading to a weakening of family-based elder care functions and a sharp increase in intergenerational pressure.

2) Population aging is exerting unprecedented pressure on China’s healthcare and medical services industry, while also spawning new opportunities. Supply-side and payor stakeholders are accelerating their adaptation to these changes. The “silver economy” is driving substantial incremental market growth and has become a focal point of socioeconomic attention.

■ Population aging presents the most direct development opportunities for healthcare-related subsectors, with particularly notable impacts in areas such as foods for special medical purposes (FSMP), chronic disease management, rehabilitation, and care for individuals with disabilities.

The market demand for foods for special medical purposes (FSMP) is experiencing explosive growth, driven by demographic shifts and the evolving disease spectrum.Under the influence of population aging, the high prevalence of chronic diseases in China has become increasingly severe. Data shows that among residents aged 40 and above, the total prevalence rate of four major chronic diseases—cardiovascular disease, cancer, and diabetes—reaches 34.3%, with 80% of chronic disease patients suffering from nutritional imbalances. Among hospitalized patients, the incidence of malnutrition in the elderly is as high as 65%, and the proportion of those losing more than 5% of their body weight during hospitalization reaches 42%, significantly increasing the risk of infection and length of stay. Foods for Special Medical Purpose (FSMP) effectively address this dilemma through precise nutritional intervention. Clinical data indicate that elderly patients who use FSMP in a standardized manner experience a 35% reduction in the rate of muscle loss, a 28% decrease in infection incidence, and an average reduction of 12 days in hospital stay. Taking diabetes-specific FSMP as an example, formulas containing resistant dextrin and dietary fiber can reduce postprandial blood glucose fluctuations by 40%, with the market size for related products exceeding RMB 7.5 billion in 2024. In the field of oncology-specific FSMP, formulas containing ω-3 fatty acids and arginine have helped increase the patient weight maintenance rate to 78%, representing a 26-percentage-point improvement over standard nutritional support regimens.

In terms of market size,China’s market for foods for special medical purposes (FSMP) is expanding at a compound annual growth rate (CAGR) of 30%, reaching RMB 23.42 billion in 2024 and projected to exceed RMB 80 billion by 2030, thereby establishing a new trillion-yuan growth pole within the silver economy. This sector is transitioning from a role as medical adjuncts to one of daily health management.

Policy support continues to release favorable signals for the industry,The 2023 revised “Administrative Measures for the Registration of Foods for Special Medical Purposes” has shortened the approval cycle to 18 months, with priority-review products achieving rapid approval within 30 days. In 2024, 196 domestically produced FSMPs were approved, covering all three major categories: complete nutrition, specific complete nutrition, and non-complete nutrition. Meanwhile, led by Wuxi, multiple cities are gradually incorporating FSMPs into the medical insurance coverage, thereby accelerating the increase in industry penetration rate.

This sector has also gradually attracted capital attention in recent years, with multiple large-scale transactions emerging. Driven by the dual forces of supply and demand,We recommend focusing on corporate innovations in the following three areas: first, breaking through industry technical barriers and demonstrating product R&DFirst, leveraging our strengths to achieve domestic substitution of niche products; second, achieving breakthroughs in the application of synthetic biology technology to gain a relative cost advantage; and third, integrating AI technology to develop AI-driven personalized nutrition solutions, thereby establishing differentiated competitive advantages in the industry.

The chronic disease management industry is undergoing a paradigm shift from passive treatment to proactive management.China currently has over 460 million patients with chronic diseases, with a prevalence rate of 62.3% among individuals aged 65 and above. Medical expenditures attributable to chronic conditions such as cardiovascular and cerebrovascular diseases and diabetes account for more than 70%, fueling the emergence of a health management market valued at hundreds of billions of yuan.

The chronic disease health management industry has a long history, with an ecosystem encompassing five major scenarios: pharmaceutical companies, hospitals, pharmacies, home care, and insurance. Existing players enter the market from different perspectives and resource points. For example, Alibaba Health and JD Health, representing pharmaceutical e-commerce,切入 the distribution segment and leverage their advantages in distribution to extend into service provision. Ping An Good Doctor, backed by insurance capital, enters the market based on its insured user base. Fangzhou Jianke leverages physician resources to切入 the consultation and medication purchasing scenario. Various players demonstrate their unique strengths to provide continuous in-hospital and out-of-hospital consultation and medication services to the vast population of chronic disease patients. Among these, the accumulation of patient numbers and the construction of a closed-loop business model across various segments are key indicators for assessing a player's competitiveness.

We believe that the rapid development of large AI models will inject new vitality into this sector, spark new opportunities in the internet-based health management industry, and help patients truly achieve proactive chronic disease management and intervention. For example, dynamic risk prediction systems built on AI models can leverage vast amounts of patient data to predict the risk of acute complications six months in advance, thereby reducing complications associated with chronic diseases. Another example is personalized behavior modification engines, which employ reinforcement learning algorithms to dynamically adjust intervention strategies. By analyzing patients’ dietary and exercise data, these engines generate customized intervention plans, enabling long-term adherence to healthy dietary habits among patients with chronic conditions.Large AI models in healthcare are driving chronic disease management into a new phase of modern medical practice characterized by predictability, prevention, personalization, and patient engagement. Enterprises possessing integrated capabilities in data, algorithms, and ecosystem are poised to dominate the market.

The rehabilitation medicine industry has become a golden track in the transition toward precision care.Rigid demand for rehabilitation medical services continues to be unleashed. The market size of China’s rehabilitation medical industry has exceeded RMB 700 billion, with elderly rehabilitation accounting for 58%. Statistical data indicate that 60% of the population aged 60 and above have rehabilitation needs (such as post-stroke recovery, post-fracture surgery, and cognitive impairment), resulting in over 145 million potential rehabilitation service encounters in 2024. Typical rehabilitation scenarios include: neurological rehabilitation—the golden window for stroke rehabilitation is 3–6 months after onset, yet only 38% of patients received timely systematic rehabilitation in 2024; post-surgical rehabilitation—rehabilitation needs for patients undergoing knee arthroplasty are concentrated within the first three months post-surgery, but the average waiting time for rehabilitation beds in public hospitals reaches 4.2 weeks; and geriatric syndrome rehabilitation—72% of disabled elderly individuals require comprehensive interventions combining physical therapy and cognitive training, but the current service coverage rate remains below 20%.

Current rehabilitation medical institutions are predominantly private, with a severe shortage of supply. In 2024, there were only 823 rehabilitation hospitals nationwide in China (152 public and 671 private), equating to just 6.1 rehabilitation hospitals per 10 million people, far below the OECD average of 15.3. The proportion of beds in rehabilitation medicine departments in China was only 1.8% (327,000 beds in 2024), whereas this figure reaches 12% in the United States.

The state explicitly encourages the chain-based development of private rehabilitation hospitals. The “14th Five-Year Plan for Digital Economy Development” clearly states, “Support social forces in establishing chain-based and group-oriented rehabilitation medical institutions, and promote the extension of rehabilitation medical services to communities and households.” The “Opinions on Promoting the Sustainable, Healthy, and Standardized Development of Socially Operated Medical Institutions” allow private rehabilitation hospitals to exceed regional total bed caps, and enable chain brands to apply for a “single license, multiple locations” filing system. Additionally, multiple incentives such as construction subsidies and tax preference guidelines are provided to encourage the active development of private institutions.

Therefore,We maintain a positive outlook on the development of private rehabilitation medical institutions over the next 3–5 years, with a particular focus on teams possessing refined operational management capabilities. Meanwhile, market demand for intelligent rehabilitation hardware and assistive devices continues to expand. The integration of emerging technologies—such as VR/AR, exoskeleton robotic assistance systems, and 3D printing—with AI algorithms is driving intelligent advancements in the rehabilitation assistive device industry.

Care services for the disabled have become a key focus in the drive toward professionalization and standardization.China’s population of disabled elderly has reached 45 million, with those experiencing severe disability accounting for 32%. The average care requirement period is 7.3 years, and annual nursing costs exceed RMB 50,000 per person, driving an explosive growth in market demand amid aging demographics. However, there is a severe imbalance between the supply and demand of disability care services. Based on a disabled population of 45 million, international standards recommend a nurse-to-patient bed ratio of 1:3 (i.e., one nursing bed for every three disabled elderly individuals). When additionally accounting for potential needs such as dementia care and postoperative rehabilitation, the actual demand for professional nursing beds is estimated at 8–10 million. According to statistics from the Ministry of Civil Affairs, China had approximately 3.2 million nursing-care beds in elderly care institutions nationwide in 2024, resulting a shortfall of more than 6 million beds.

Against this backdrop, the state is actively promoting private-sector investment and development in the integrated medical and elderly care sector. The National Health Commission has introduced a series of coordinated measures to boost the growth of private institutions providing integrated medical and elderly care services. These measures include streamlining approval processes by implementing a filing-based management system and merging the facility setup approval with the practice registration into a single license (“two certificates in one”) to enhance administrative efficiency. In terms of infrastructure development, there are no planning restrictions on the total number of privately operated integrated medical and elderly care institutions within a given region. Eligible medical facilities established within elderly care institutions are promptly included in the designated network for basic medical insurance reimbursement. Furthermore, local governments are encouraged to establish industrial investment funds to support the development of integrated medical and elderly care services.

Accelerating population aging has turned long-term care insurance and disability care into a trillion-yuan market, while the public sector’s shortcomings in service efficiency, technological iteration, and payment flexibility have created structural opportunities for private institutions. Leading enterprises with capabilities in chain operations, smart services, and industry chain integration are poised to capture over 70% of the market share by 2030.

■ As the primary payer, social medical insurance continues to face mounting pressure amid the aging trend, prompting the emergence of diverse payment mechanisms such as private pension insurance and commercial old-age insurance, thereby strengthening the overall payment system.

China’s medical insurance fund faces severe challenges in maintaining a balance between revenue and expenditure, having entered a turning point characterized by “declining revenues and rising expenditures.” Although the national employee basic medical insurance fund remains in surplus (with a surplus of RMB 416.4 billion in 2024), sustainability pressures on the resident basic medical insurance are becoming increasingly prominent. For instance, in Tianjin, the urban and rural resident basic medical insurance fund recorded revenues of RMB 5.88 billion and expenditures of RMB 7.24 billion in 2024, resulting in a deficit of RMB 1.36 billion; Beijing’s resident basic medical insurance also experienced an annual revenue-expenditure gap as high as RMB 526 million. The core driver behind these financial pressures is demographic structural change: the proportion of the population aged 65 and above has reached 13.5%, with their healthcare expenditures being three to five times those of younger individuals. Under the pay-as-you-go system, the declining number of young contributors coupled with enhanced benefits for the elderly has created a significant “scissors gap.”

Personal pension insurance completed its nationwide rollout by December 2024, marking the formal establishment of China’s third-pillar pension system, which complements basic medical insurance and enterprise annuities. However, actual contribution data indicates low public enthusiasm for participation. By the end of 2024, approximately 70 million personal pension accounts had been opened in China, accounting for 42% of active participants in the urban employee basic old-age insurance scheme, while the number of individuals actually making contributions represented less than 30% of account holders. This lukewarm response is primarily attributed to two factors: first, current tax incentives do not extend to individuals with annual incomes below RMB 96,000, dampening participation willingness among low- and middle-income groups; second, as closed-end investment accounts, personal pensions lack a significant yield advantage compared to other wealth management products, leading many residents to adopt a wait-and-see approach. In this regardWe believe that further easing may be introduced in areas such as tax incentives and optimized early withdrawal schemes to enhance the appeal of private pension insurance.

Meanwhile, the commercial pension insurance market continues to expand, driven by active national policy support. For instance, regions such as Shanghai and Shandong have successively implemented one-stop settlement for “basic medical insurance + commercial insurance,” covering over 1,000 public and private hospitals and reducing claims processing time to within two hours. Pilot programs for long-term care insurance are accelerating, with a mandate to cover 50% of prefecture-level cities nationwide by the end of 2025. These programs establish a cost-sharing mechanism among the government, enterprises, and individuals, and allow insurers to develop supplementary products that cover nursing care durations beyond policy limits and services provided by high-end nursing institutions. Additionally, the National Healthcare Security Administration is promoting the timely opening of basic medical insurance data to commercial insurers.We believe that commercial health insurance, as a supplement to basic medical insurance, is transitioning from merely providing financial coverage to offering full-cycle health management.

2025–2035 marks the “window period” for the transition from moderate to severe population aging. Before 2035, the retired population will consist primarily of younger seniors (aged 60–74), who generally enjoy better health and sufficient wealth reserves, making them the key demographic driving the “silver economy dividend.” From 2025 to 2035, the scale of China’s silver economy is projected to grow from approximately RMB 9–10 trillion to RMB 30 trillion, with a compound annual growth rate (CAGR) of around 12%–15%. This growth will be mainly driven by policy benefits, technological innovation, and consumption upgrades, while attention must also be paid to challenges arising from regional disparities and divergent payment capabilities.

Health-related consumption within the silver economy is becoming a key focus of market attention at this stage.Taking functional foods as an example, there is robust growth in demand for niche categories such as low-sodium and low-GI foods for chronic disease management; products containing ingredients like PS128 and Omega-3 to combat cognitive decline; and probiotic-related products aimed at improving gut microbiota health in response to age-related gastrointestinal deterioration. Technological improvements in age-appropriate products are also being increasingly implemented. For instance, high-pressure microfluidization is used to increase the meat fiber breakage rate to 80%, achieving “soft texture without compromised nutrition,” while nano-encapsulation technology boosts the bioavailability of lutein to three times that of conventional products. For the silver-haired population, product offerings have expanded from basic nutritional coverage to functional improvements in cardiovascular health, bone health, digestion, and cognition.

The silver-haired demographic continues to drive growth in China’s health and wellness tourism market. Statistics show that individuals aged 60 and above account for 28% of tourism consumption, with an average annual travel frequency of 3.2 trips—higher than the all-age average of 1.8 trips. In 2024, the market size of China’s health and wellness tourism reached RMB 90 billion, with a compound annual growth rate exceeding 20%, and is projected to surpass RMB 160 billion by 2029.

Integrated Health and Elderly Care: The Emerging FrontierThe integration of healthcare, wellness, and elderly care is becoming a new growth frontier. From January to August 2024, the Boao Lecheng International Medical Tourism Pilot Zone received over 260,000 medical tourists and introduced more than 440 types of specially permitted drugs and medical devices, promoting a new model of integrated medical and elderly care. Tourism companies, listed pharmaceutical firms, and real estate enterprises are actively entering this sector. For instance, Qidi Pharmaceutical plans to develop a traditional Chinese medicine wellness tourism park, Panlong Pharmaceutical intends to build a complex integrating medical treatment, rehabilitation, and wellness care, and OCT Group is laying out wellness and cultural tourism resort bases.

Overall, the consumption wave driven by the silver economy is still in its ascendant phase. We maintain a positive outlook on the future market performance of companies that possess capabilities in integrating medical resources, designing age-appropriate services, and developing innovative products.

3) The new wave of innovative development in technologies such as artificial intelligence (AI), brain-computer interfaces, and embodied robots offers new perspectives and possibilities for Chinese society and families to address population aging.

■ Breakthrough advances in artificial intelligence (AI) technology are injecting new momentum into the elderly care sector. A continuous stream of innovative technological applications is emerging, delivering significant efficacy in enhancing the quality of life for the silver-haired population, strengthening health protection systems, and reshaping nursing service models, thereby becoming a core driver in building an intelligent elderly care ecosystem.

Through the deep integration of technologies such as intelligent sensing, big data analytics, and human-AI collaboration, AI has not only achieved full-scenario coverage ranging from basic living support to personalized health management, but also reshaped the value chain of traditional elderly care services through an intelligent service network, providing an innovative pathway that combines efficiency with compassion to address the challenges of population aging.

Leveraging smart hardware devices to enable real-time, home-based monitoring of health indicators for the aging population, and providing multi-dimensional, personalized health interventions.By integrating physiological data, behavioral pattern characteristics, and genomic information from the aging population, precise health profiles can be constructed to enable more in-depth health management. For instance, VitalConnect, a U.S.-based startup, has launched wearable smart sensors capable of real-time monitoring of multiple vital signs and biometric parameters. As a leading player in dynamic cardiac monitoring, the company has continued to attract capital market investment, securing over $100 million in funding in 2025. Meanwhile, Zoe, a startup from London, collects blood or stool samples to assess lipid levels, blood glucose, and gut microbiome health, providing customized nutritional plans based on the data; the company is valued at over $300 million. By combining AI learning models with smart wearable devices, manufacturers can predict the progression trajectories of chronic diseases and adjust dietary and nutritional combinations accordingly, enabling proactive interventions. This will become one of the key scenarios for practical product application.

By integrating digital AI technologies such as video consultations and intelligent sensors, a remote medical service system covering home-based elderly care scenarios has been established.Leveraging wearable devices and home environmental sensing terminals, the elderly population can transmit vital sign data in real time to cloud-based diagnostic and treatment platforms. This enables remote condition assessment and electronic prescription issuance by experts from tertiary hospitals, establishing a closed-loop service model of "data collection–intelligent analysis–cloud consultation." Concurrently deployed AI emergency response systems utilize multimodal sensors to capture abnormal physiological signals in real time (such as sudden heart rate spikes or abrupt changes in posture indicative of falls). By integrating medical knowledge graphs, these systems achieve second-level identification of critical conditions and coordinate with emergency centers and community grid networks through a tiered early warning mechanism, reducing the response time for the golden hour of rescue by over 40%.

Intelligent companion robots provide emotional support and cognitive interaction training for the aging population.Powered by large language model technologies represented by ChatGPT and DeepSeek, AI-powered interactive terminals are evolving and iterating at a rapid pace. These devices not only facilitate everyday conversational exchanges and respond to information inquiries but also enable all-weather interaction with the elderly population through modules such as cognitive training games and personalized entertainment activities. By integrating algorithms that perceive the psychological states of older adults, these systems provide emotional counseling and intervention, effectively alleviating potential loneliness associated with living alone and mitigating cognitive decline. There have been numerous practical applications both domestically and internationally. For instance, Intuition Robotics launched Eliq, an elderly companion robot designed to provide daily companionship support, combat loneliness, and help seniors maintain healthy, independent lives. The company has secured cumulative financing exceeding USD 100 million, receiving continued investment from Japanese capital sources such as the Toyota AI Fund.

AI Technology Facilitates the Intelligent Upgrade of Home Environments, Reducing the Risks of Solo Living for the Elderly.Build an intelligent home sensing system based on the Internet of Things (IoT). For instance, smart mattresses can monitor sleep status and automatically adjust firmness to improve sleep quality, while mechanized adjustments for raising and lowering the mattress facilitate turning and sponge baths for bedridden elderly individuals, helping to prevent pressure ulcers. Intelligent lighting sensor systems provide precise and responsive illumination control to prevent falls when the elderly get up at night. By leveraging AI technology, we can achieve deeper age-friendly renovations of home environments, creating livable spaces tailored to the silver-haired population.

■ Brain-computer interfaces (BCIs) are widely recognized for their significant potential in treating age-related degenerative diseases. Early conceptual successes have already been achieved, particularly in the areas of motor function restoration and neurocognition. With ongoing technological iterations and the advancement of clinical trials, we anticipate broader clinical implementation in medical practice within the next 3–5 years.

The brain-computer interface (BCI) industry is in a phase of explosive growth,The global market size is projected to grow from $2.44 billion in 2024 to $6.52 billion in 2030, representing a compound annual growth rate (CAGR) of 18.1%. Non-invasive BCIs accounted for 85.9% of the market in 2024, dominating the brain-computer interface sector. On the device side, EEG caps are the primary form factor, widely used in consumer applications. In contrast, invasive BCIs are currently limited mainly to medical rehabilitation scenarios due to surgical risks and high costs.

Taking Alzheimer’s disease (AD) as an example, in the realm of early diagnosis and intervention, monitoring electroencephalogram (EEG) signals can capture AD-specific EEG abnormalities (such as changes in theta and alpha wave rhythms), thereby assisting in the identification of early cognitive impairment. Additionally, integrating AI algorithms can help identify the evolutionary activities of disease-related biomarkers, enabling physicians to conduct early screening and intervention. For instance, the headphones launched by Neurable are currently used for attention monitoring in AD patients and are planned to be expanded to early dementia screening. During the disease progression stage, corresponding cognitive training programs can be developed to reinforce and mobilize activity in specific brain regions through training. Invasive products can also precisely stimulate the hippocampus or prefrontal cortex, attempting to repair damaged neural circuits, slow cognitive decline, and delay disease progression. For example, a team at the Massachusetts Institute of Technology (MIT) has developed a BCI-based neural prosthesis that improves short-term memory in mice through electrical stimulation of the hippocampus, offering new insights for AD treatment. In the late stages of the disease, although the potential for interventional therapy is relatively limited, assistance can still be provided in areas such as language expression and functional control by converting brain signals into speech or other forms.

Furthermore, the application of brain-computer interfaces (BCIs) in treating motor paralysis caused by spinal cord injury, stroke, and amyotrophic lateral sclerosis (ALS) is currently a key focus area for industry development.Brain-computer interfaces can help patients regain motor or environmental control capabilities by bypassing damaged neural pathways and establishing direct communication between the brain and external devices.

At present, governments around the world are actively funding brain-computer interface (BCI) projects to accelerate the implementation of clinical trials. For instance, the U.S. BRAIN Initiative continues to fund projects related to neuromodulation and stimulation, with its R&D focus shifting from initial proof-of-concept for modulation technologies to clinical validation starting in 2024. The Blueprint Medtech program, launched by the National Institutes of Health (NIH) in 2024, is facilitating the market deployment of BCI devices. Meanwhile, the European Union’s new scientific and technological policy benchmark, the Horizon Europe program, added 18 new BCI projects in 2024, covering areas such as the development of related neuroprosthetics and the screening and evaluation of BCI biomarkers. Against this backdrop, overseas BCI applications have achieved breakthrough progress in clinical settings. Several leading companies initiated clinical trials in 2024; for example, Neuralink’s invasive BCI device has completed three clinical implants, with plans to perform an additional 20–30 cases in 2025, aiming to implant more than 22,000 patients by 2030. Synchron’s BCI product for treating paralysis also began large-scale human trials in 2024 and has completed 10 implants to date.

■ The pressure of elderly care and health support brought about by an aging society will become an incremental market demand for embodied robots

Since Alan Turing first proposed the concept of “embodied intelligence” in the 1950s,Embodied robots, backed by more than half a century of technological accumulation, are reshaping the technological landscape of human society at an exponential pace.Phase I (1950s–2000s): Embodied AI was in a period of theoretical exploration, dominated by bionic robotic arms and early AI algorithms. For instance, Honda’s ASIMO robot achieved basic motion control but, constrained by computational power and perception technologies, could only execute pre-programmed actions.Phase II (2010s–2019): The deep learning revolution propelled embodied AI into the era of “perceptual awakening.” Boston Dynamics’ Atlas robot accomplished complex maneuvers such as parkour through reinforcement learning, marking a transition in robotics from “mechanical execution” to “environmental interaction.”Phase III (2020s–present): The integration of large language models and multimodal technologies has sparked an explosion of “action intelligence.” Products like Tesla’s Optimus and UBTECH’s Walker have achieved commercial deployment in industrial manufacturing and home service scenarios, with the global market size projected to exceed one trillion U.S. dollars by 2030.

From the perspective of economic models, industrial scenarios will mature earlier than consumer scenarios. As production volume increases, robot costs will decrease while performance improves. From a long-term perspective, amid demographic shifts driven by population aging,The shortage of manufacturing labor is an irreversible trend, and embodied robots may serve as an effective supplement to the workforce.

Taking health and wellness care as an example, embodied robots can assist or even replace human labor, thereby improving the efficiency of elderly care and alleviating the shortage of caregivers.For instance, at the 2024 International Conference on Robotics and Automation (ICRA), the GARMI care robot, showcased by the Institute for Robotics and Machine Intelligence (MIRMI) at the Technical University of Munich, leverages ChatGPT to interpret commands and autonomously performs 20 high-frequency nursing tasks, such as repositioning, feeding, and cleaning. This liberates caregivers from routine, repetitive duties, allowing them to focus on emotional support and emergency medical response, thereby enhancing the quality of care. Meanwhile, some Japanese companies in the industry are also developing transfer-assist care robots to enable safe and convenient transfers of bedridden patients, reducing the incidence of pressure ulcers and minimizing the risks and accidental injuries associated with traditional manual handling.

Technological breakthroughs and policy drivers have also resonated with each other.Since 2023, cities such as Shanghai, Beijing, and Guangzhou have successively launched pilot programs to include devices like exoskeleton robots and smart monitoring mattresses in the coverage of long-term care insurance (LTCI), with reimbursement rates ranging from 30% to 50%. Taking Shanghai as an example, the “Implementation Opinions on Further Improving the City’s Long-Term Care Insurance System,” issued in 2023, explicitly stated that “eligible smart nursing devices (such as exoskeleton robots and non-invasive monitors) are supported for inclusion in the LTCI payment scope.” Furthermore, the “Construction Plan for Demonstration Zones of Smart Elderly Care Scenario Applications,” released by Pudong New Area in 2024, clearly incorporated “nursing robot rental services” into the LTCI payment pilot, with a monthly reimbursement cap of no more than RMB 800 per device.

The application of embodied robots in consumer scenarios faces certain challenges; high development and manufacturing costs have limited their practical deployment, but pilot policy initiatives will serve as a positive and favorable signal.We believe that, with the exploration and innovation of a “device leasing + insurance reimbursement” coverage model, the application of embodied robots in the healthcare and elderly care sector will continue to deepen, driving broader adoption and popularization, alleviating the labor shortage in this field, and improving the cost structure of care institutions. This represents one of the key solutions for addressing population aging in the future.

2. Generative AI and robotics are reshaping the global healthcare landscape by enhancing diagnostic and therapeutic precision, accelerating drug R&D efficiency, and improving healthcare accessibility. China boasts advantages in massive data resources and scenario-based innovation, yet faces foundational bottlenecks such as data silos, algorithmic dependency, and lagging regulation. Future efforts must break through in intelligent medical devices, compliant data circulation, and differentiated innovation, establishing a synergistic “technology–institution–humanities” framework to drive the transition of healthcare resources toward a distributed model.

As the underlying technological driver, AI’s most significant advantage lies in its ability to rapidly enhance precision and efficiency across various medical applications, replace manual efforts in quickly integrating personalized solutions, and substantially improve healthcare accessibility, ultimately driving industrial transformation. In the medical field, AI empowers breakthroughs in drug development and imaging diagnosis, while technologies such as surgical robots and brain-computer interfaces are advancing surgery and rehabilitation toward greater precision. Meanwhile, robotics is evolving from automation to intelligence, enabling innovative scenarios such as customized health check-ups and personalized health management. Furthermore, the inclusive nature of AI helps bridge the gap in medical resource distribution by enhancing the service capabilities of primary care hospitals through auxiliary diagnostic systems. However,The practical implementation of this technology still faces real-world challenges: its highly regulated nature necessitates a prolonged validation cycle for medical AI, the core decision-making role of human experts remains irreplaceable, and current technologies primarily serve as efficiency tools within healthcare settings.

Focusing on the comparison between China and the United States, China possesses unique advantages in the scale of data resources (accumulated medical data from a population of 1.4 billion) and innovation in application scenarios (such as AI for medical imaging and chronic disease management). However, significant shortcomings remain at the foundational level: stringent regulatory restrictions, reliance on foreign databases for scientific research data, dependence on external parties for infrastructure such as algorithmic frameworks and medical facilities, prominent data silos across medical institutions, and an immature innovation ecosystem for the coordinated development of pharmaceuticals and medical devices.

In the future, China must strengthen its computing infrastructure and promote compliant data circulation while refining regulatory measures. It should prioritize breakthroughs in differentiated sectors such as intelligent medical devices and AI-assisted new drug development, thereby establishing a healthcare technology development pathway with distinct local characteristics.

1) AI Brings Profound Transformation to the Healthcare Industry:

Generative AI and robotics are deeply integrating with the healthcare industry, driving end-to-end transformation through the resonance of technology, policy, and clinical demand: intelligent medical devices are achieving breakthroughs in domestic substitution, generative AI is disrupting drug discovery paradigms, distributed healthcare systems are reshaping resource allocation, and automated testing is penetrating grassroots levels. Rehabilitation robots are breaking through barriers via health insurance reimbursement mechanisms, shifting focus toward home-based health management and fostering a new “device-data-service” ecosystem.While China leads in application scenario innovation, it still needs to overcome bottlenecks such as insufficient penetration of intelligence at the primary care level and a lagging payment system, thereby establishing a development path characterized by “technological iteration–institutional adaptation–ecosystem synergy.”

■ Resonance of Technology, Policy, and Clinical Needs Triggers Transformation Across the Entire Industry Chain

Breakthroughs in AI and robotics do not exist in isolation; they are the result of a deep coupling among policy guidance, the demands of an aging society, and foundational technological innovations.At the policy level, the state has elevated “AI + Healthcare” to a strategic direction, clarifying the boundaries of technological application through documents such as the Reference Guidelines for AI Application Scenarios in the Health Sector, and promoting the development of large healthcare models. On the clinical front, shortages in primary care resources and the pressure of diagnosing and treating complex diseases are forcing intelligent upgrades; for instance, the role of AI-assisted diagnostic systems in county-level hospitals has shifted from mere tools to decision-support partners. Technologically, multi-modal data fusion capabilities (such as cross-analysis of imaging, pathology, and genomic data) are breaking through the limitations of traditional single-point optimization in healthcare, forming a closed-loop chain encompassing “prevention, diagnosis, treatment, and rehabilitation.” The synergy of these three factors is driving the healthcare industry’s transition from “equipment dependence” to “data-driven” operations, although data silos and fragmented computing power remain key constraints.

■ Intelligent Upgrading of Medical Devices: The Tipping Point from Substitution to Surpassing

The wave of domestic substitution has extended from low-value consumables to high-end equipment, with the core logic lying in intelligent technologies complementing traditional precision manufacturing capabilities. For instance, AI navigation systems have broken through the precision limits of robotic arms via dynamic compensation algorithms, enabling domestically produced laparoscopic robots to achieve sub-millimeter operational accuracy and shortening the surgical learning curve for primary-care physicians by 70%. Similarly, flexible sensing technology has reduced the cost of electromyographic (EMG) monitoring to one-fifth that of imported alternatives, facilitating the transition of rehabilitation exoskeletons from laboratories to community settings.The Essence of Intelligent Upgrading Is to Reconstruct the Product Value Curve—By Adopting a “Standardized Hardware + Customized Software” Model, Devices Are Transformed from Functional Carriers into Data Entry Points, Creating a Value-Added Ecosystem of “Hardware Sales–Data Services–Outcome-Based Payment.”However, the fact that the idle rate of equipment in county-level hospitals exceeds 30% suggests that intelligentization must be advanced in tandem with the optimization of clinical pathways.

■ Revolutionizing R&D Efficiency in the Pharmaceutical Industry: Generative AI Breaks Through the Traditional “Three Highs” Dilemma

Generative AI is upending the foundational logic of drug discovery: The LucaProt model leverages multimodal feature extraction to boost RNA virus discovery efficiency by 30-fold, while large language models for target prediction have compressed the preclinical timeline from five years to just 14 months, breaking through traditional trial-and-error paradigms. This paradigm shift rests on three pillars: first, cross-disciplinary data integration capabilities (such as the closed loop between protein structure prediction and virtual screening); second, the centralized deployment of computing infrastructure (such as regional medical supercomputing centers); and third, innovative incentive mechanisms (such as data property rights trading mechanisms).

■ Restructuring healthcare service models: shifting from centralized to distributed care to facilitate the downward flow of high-quality medical resources

The Decentralized Healthcare System Is Being Deconstructed: Remote Surgical Robots Break Through Spatial and Temporal Constraints, Achieving a Success Rate of Over 95% in Cross-Regional Surgeries Spanning 5,000 Kilometers; AI Health Management Platforms Enable Real-Time Monitoring of More Than 10 Physiological Indicators via Wearable Devices, Raising the Accuracy of Chronic Disease Complication Alerts to 89%. WeDoctor’s Tianjin Digital Health Community Has Validated the Feasibility of the “Primary Screening–Intelligent Diagnosis–Treatment Efficacy Tracking” Closed Loop, Boosting the Efficiency of Primary Diabetes Management by 300%.The profound significance of this transformation lies in restructuring the pricing system for medical resources—shifting from “equipment procurement costs” to “health management value.” However, lagging payment systems (with only 12% of AI services included in DRG) and a persistent reliance on subsidies at the primary care level remain obstacles to large-scale implementation.

■ AI Diagnosis + Robotic Automation Reshapes the Paradigm of Medical Testing: Exploring the Path from an Efficiency Revolution to Inclusive Access at the Grassroots Level

The integration of AI and robotics is driving a leap in medical testing from “single-point optimization” to “end-to-end intelligentization.” Leading domestic companies have accelerated the large-scale clinical adoption of intelligent diagnostic tools by securing Class III medical device approvals for AI-assisted diagnostics. Their core value lies in distilling physicians’ expertise into reusable algorithmic models, significantly enhancing diagnostic consistency and efficiency. Meanwhile, mainstream manufacturers in the IVD sector have fully shifted toward laboratory automation assembly lines, integrating robotic arms, intelligent transport systems, and AI-based quality control modules to achieve an unmanned closed loop for sample processing, testing, and analysis. However, this wave of upgrades remains heavily concentrated in tertiary hospitals; primary healthcare institutions face challenges such as dispersed sample volumes, insufficient operational training, and high equipment maintenance costs, resulting in an intelligence penetration rate of less than 20%. To address this disparity, the industry is exploring two major pathways:First, by leveraging regional medical laboratory centers and adopting a “central laboratory + grassroots outlets” model to centralize testing demands, thereby reducing the idle rate of equipment at the grassroots level; second, by developing lightweight, low-cost AI-assisted systems, such as POCT combined with AI diagnostics, which can operate on basic hardware, gradually achieving an ecological closed loop of “empowerment from tertiary hospitals to feedback from grassroots institutions.”

■ Accelerated Substitution by Domestically Produced Surgical Robots: Synergistic Breakthroughs Through Technology Accessibility and the Decentralization of Surgical Procedures

Domestic surgical robots are entering an “accelerated substitution phase,” underpinned by concurrent improvements in technological maturity and payment capacity. As domestically produced laparoscopic and orthopedic robots match imported products in core metrics such as operational precision and force feedback, the inclusion of robotic surgery consumables in medical insurance coverage (e.g., Beijing and Zhejiang have incorporated them into reimbursement lists) has directly lowered the threshold for procedural adoption, facilitating the decentralization of complex surgeries from top-tier tertiary hospitals to county-level institutions. The key to this process lies in the synergy of three elements: “technology, payment, and training.” On one hand, domestic equipment reduces maintenance costs through modular design, aligning with the actual budgets of grassroots hospitals; on the other hand, leading enterprises are co-establishing training bases with regional medical centers, compressing the learning curve for complex procedures from months to weeks. However, deep-seated contradictions persist—grassroots hospitals lack continuous technical support teams and overly rely on manufacturers’ on-site engineers, resulting in significant fluctuations in equipment utilization rates. The direction for industry innovation has become clear:First, develop a “robotic surgery service subscription” model, where primary hospitals pay fees based on the number of surgical cases, thereby avoiding the financial burden of high-cost equipment procurement; second, build a remote expert collaboration network, enabling “senior hospital surgeons to perform operations” through 5G + AR technology- The mixed reality surgical model for "grassroots hospital procedures" fundamentally breaks through the talent bottleneck.

■ Insurance Coverage Breakthrough for Rehabilitation Robots: Home Settings Emerge as the Primary Battlefield for Commercialization

The commercialization of rehabilitation robots is undergoing a paradigm shift from “hospital-centric” models to “accessible home-based” solutions. Breakthroughs in medical insurance reimbursement policies (such as pilot programs for rental reimbursements in Shanghai and Nanjing), combined with lightweight product designs, have for the first time made it possible to introduce devices such as exoskeletons and upper-limb rehabilitation robots into home settings. The core logic behind this transformation lies in redefining the value of rehabilitation—shifting from “therapeutic intervention” to “continuous health management”—thereby improving patients’ quality of life through high-frequency, low-intensity home-based training. Currently, the industry faces dual challenges:First, home-based scenarios demand higher adaptability, requiring solutions to issues related to device safety, ease of operation, and spatial compatibility. Second, the payment system still relies on regional pilots and has not yet established a sustainable cost-sharing mechanism among basic medical insurance, commercial health insurance, and individuals.A path to breaking the deadlock is emerging: leading companies are beginning to explore a bundled “hardware + services + insurance” model. For instance, they offer annual remote rehabilitation guidance services with the purchase of rehabilitation robots and collaborate with commercial insurers to develop specialized insurance products that cover risks such as equipment damage and suboptimal therapeutic outcomes.In the future, competition among rehabilitation robots will transcend hardware specifications and shift toward ecosystem integration capabilities—specifically, the ability to establish a closed-loop home health management system encompassing “devices–data–services,” thereby truly realizing the vision of “taking rehabilitation beyond the hospital.”

2) Bottlenecks and Future Prospects for the Development of AI + Robotics in China:

China’s AI+Healthcare demonstrates advantages in empowering the entire pharmaceutical R&D chain and driving scenario-based innovation, yet significant weaknesses persist at the foundational layer:Data silos, reliance on overseas algorithms, and target homogenization have resulted in significant gaps compared to the United States in foundational ecosystems such as open data and computing power subsidies. Although breakthrough opportunities are emerging in areas like AI-enabled organ-on-a-chip technology and virtual clinical trials, three major barriers remain: data governance, penetration into primary care clinical settings, and ethical certification. Moving forward, it is essential to promote foundational innovation and ecosystem maturity through mechanisms such as data property rights trading, collaborative R&D between medical institutions and enterprises, and tiered liability frameworks.

■ AI has achieved full-chain empowerment in pharmaceutical R&D, and policies will be aligned with industry realities through continuous reforms

In the target identification phase, DeepMind’s AlphaFold has seen widespread adoption across pharmaceutical companies by predicting the structures of over 200 million proteins. Generative AI technologies are revolutionizing drug design logic; for instance, Insilico Medicine utilized its AI platform, PandaOmics, to identify the TNIK target, completing the process from target discovery to preclinical candidate nomination in just 18 months at one-third the cost of traditional methods, making it one of the fastest-moving AI-driven drug programs globally. AI is also further optimizing clinical trials. Flatiron Health, by analyzing cancer patient data, identified novel biomarkers for predicting drug responses, reducing patient recruitment time from months to days. Taimei Zhiyan’s “Internet + AI” recruitment model supports over 1,200 projects, improving efficiency by 45%, while using Robotic Process Automation (RPA) to automate adverse drug reaction reporting, thereby reducing manual workload by 37%. Although no AI-discovered drugs have yet been approved for market launch, the global pipeline exceeds 300 candidates. With advancements in data sharing, human-AI collaboration, and refined ethical frameworks, these therapies are poised to cross the “valley of death” and achieve breakthroughs. Recently, the U.S. FDA announced initiatives to reduce, refine, or replace animal testing requirements in the development of monoclonal antibody therapies and other drugs, offering greater policy support for innovative approaches.

■ China’s medical AI sector exhibits significant weaknesses in its foundational layer, limiting deep industrial application, with a pronounced gap between China and the United States in certain areas.

China possesses unique advantages in the scale of data resources (such as the accumulation of medical data from its 1.4 billion population) and innovation in application scenarios (including AI for medical imaging and chronic disease management). However, significant weaknesses persist at the foundational layer: stringent regulatory restrictions, reliance on foreign databases for scientific research data, dependence on external providers for algorithmic frameworks and medical infrastructure, prominent data silos across healthcare institutions, and an immature innovation ecosystem for the integrated development of pharmaceuticals and medical devices.

The United States boasts significant advantages in the foundational ecosystem of medical AI: high openness of public datasets (e.g., the NIH has released over 1 million clinical imaging cases), cloud computing giants such as Google and NVIDIA provide a 50% subsidy on computing power to pharmaceutical companies, and the target innovation rate reaches as high as 43%. In contrast, China’s drug target homogenization rate stands at 67%, with 92% of its algorithms relying on overseas open-source frameworks.

■ The AI + robotics industry has seen breakthrough opportunities, but still needs to overcome three major hurdles: data governance, clinical adoption, and ethical accountability

Clear opportunities have emerged in pharmaceutical R&D, the democratization of healthcare, and ethical breakthroughs. Pharmaceutical R&D: The integration of AI with organ-on-a-chip technology is accelerating the construction of complex disease models, and virtual clinical trials are projected to replace 30% of traditional trials. Healthcare Democratization: The coverage rate of AI-assisted diagnostic systems in primary care settings aims to reach 80% by 2027, narrowing the disparity in diagnostic and treatment standards between urban and rural areas. Ethical Framework: GDPR-style cross-border medical data regulations and a tiered liability determination mechanism for AI misdiagnosis may take shape in 2026.

The industry has laid the foundation for explosive growth, but to achieve a true breakout, the following obstacles must be overcome:At the data governance level,The compliance rate for data de-identification in medical institutions is less than 45%, and doubts about the authenticity of historical data limit the generalization capability of models;At the level of clinical adoption,90% of primary-level projects rely on government subsidies, with less than 50% completion rate for equipment operation training;Ethical considerations,65% of medical AI misdiagnosis disputes lack standards for liability determination, while technologies such as mind control and neuroenhancement have sparked bioethical controversies.Breaking the deadlock requires building a “technology-institution-humanities” collaborative framework: establish a property rights trading mechanism for training data of large medical models, promote the establishment of joint R&D centers between tertiary hospitals and enterprises, and improve the tiered liability determination system for AI-related medical malpractice.

3. The globalization of Chinese intellectual property (IP) rights is accelerating, with China’s industries currently undergoing a transition from “Made in China” to “R&D in China” and “Chinese IP.” The NewCo transaction model in the pharmaceutical sector is rapidly emerging as a new paradigm for the international expansion of innovative drugs and even medical devices.

1) As China’s capabilities in fundamental R&D across multiple fields continue to advance, we are witnessing a transformative shift from “Made in China” to “R&D in China” and “Chinese IP,” along with a restructuring of the global industrial supply chain.

From 1980 to 2010, China achieved industrialization by leveraging its abundant labor force. The "engineer dividend" facilitated national industrialization and the development of foundational capabilities. By 2009, China's manufacturing sector accounted for approximately 30% of its total GDP. The country's industrial structure upgraded from labor-intensive to capital-intensive, and then to technology-intensive industries, establishing the "Made in China" brand in sectors such as electronics, automobiles, home appliances, and pharmaceuticals. Entering the second decade of the 21st century, as the Chinese government vigorously promoted an innovation-driven development strategy, scientific and technological investment increased significantly. Coupled with the accumulation of basic scientific research, China reached a critical tipping point for qualitative change. According to the World Intellectual Property Indicators report released by the World Intellectual Property Organization (WIPO), China filed 1.59 million patent applications in 2021, accounting for approximately half of the global total and ranking first in the world for the 11th consecutive year. Furthermore, in 2021, the number of valid patents in China reached 3.6 million, surpassing the United States for the first time to become the country with the largest number of valid patents globally, as well as the largest source country for patent applications.China’s investment in high-tech, basic research, and frontier technologies has turned the “research dividend” into a new engine of economic growth. Characterized by high input, high risk, and high returns, this trend is spearheading a transformative shift from “Made in China” to “R&D in China” and “IP Created in China.”

In the pharmaceutical sector, during the early stage of China’s pharmaceutical development from 2000 to 2015, Chinese pharmaceutical companies primarily focused on the production of active pharmaceutical ingredients (APIs) and generic drugs. Leveraging China’s cost advantages in production, they rapidly entered the international market and gradually established the “Made in China” label. To date, China’s share of global API supply approaches 30%, making it the world’s largest supplier of APIs. In 2015, following China’s accession to the International Council for Harmonisation of Technical Requirements for Pharmaceuticals for Human Use (ICH) and the systematic revitalization of new drug review by national regulatory authorities, the golden age of innovative drugs in China dawned. After a decade of rapid development, China has now emerged as the second-largest country globally in pharmaceutical research and development. According to the “2025 Annual Review of Pharmaceutical R&D” published by Citeline, in 2025, the number of new drug pipelines under development in China accounted for 29.5% of the global total, second only to the United States. According to data from DealForma, in 2023 and 2024,Among the innovative drugs introduced by multinational corporations, 29% and 31% of the products originate from China. The pharmaceutical industry is undergoing a transition from “Made in China” to “R&D in China” and “Chinese IP.”

2) In the field of new drug R&D, NewCo transactions—underpinned by the deal logic of U.S. investors buying out the intellectual property (IP) of Chinese biotech firms—have rapidly emerged, signaling that China’s capabilities in novel drug development are increasingly drawing global market attention.

Early this year, an article in The Wall Street Journal titled “The Drug Industry’s DeepSeek Moment” pointed out that Chinese biotech companies are now developing drugs faster and at lower costs, signaling that the global biomedical industry is entering a “DeepSeek moment.” In 2023, China’s biomedical sector saw a surge in overseas expansion, with the number of outbound licensing deals surpassing inbound licenses for the first time. In 2024, Chinese innovative drugs further advanced in both the number and value of overseas transactions, with total upfront payments exceeding total financing amounts for the first time. By the first quarter of 2025, the number and value of transactions involving Chinese innovative drugs had nearly tripled compared to the same period last year, forming a diversified overseas expansion model featuring both License-out and NewCo structures.

■ NewCo is rapidly emerging as a combined model for global expansion, integrating product licensing with equity participation

NewCo (Newly Created Company) is a transaction model in which a company licenses the overseas rights of specific drug pipelines to establish a new entity with overseas capital. This structure leverages the international advantages of foreign capital to build a globally oriented management team, aiming for an exit through an overseas listing or merger and acquisition. Typically, investors hold more than 50% equity and are responsible for the company’s primary operational management.

In May 2024, Hengrui Medicine licensed the overseas rights to its GLP-1 product portfolio to Kailera (Hercules), a U.S.-based company, receiving a $110 million upfront payment and near-term milestones, along with a 19.9% equity stake in Kailera. The total transaction value exceeded $6 billion. Meanwhile, Kailera completed a $400 million Series A financing round led by Atlas Venture, Bain Capital, RTW Investments, and Lyra Capital. This NewCo transaction enabled Hengrui Medicine to secure substantial upfront and milestone payments while deeply participating in the future monetization of the pipeline through equity alignment, whether via commercial launch or M&A, thereby safeguarding its core interests. Investors, on the other hand, acquired high-quality pipeline assets and operational management control, fully unlocking product value and maximizing returns. This deal triggered a chain reaction, rapidly popularizing the “license-plus-equity” model, where overseas investors establish NewCos with innovative drug IP as core assets. Within just six months, numerous prominent companies—including Conmed Biosciences, Yiteng Jiahe, Biocytogen, Elpiscience, and Vena Therapeutics—joined this trend. By the first quarter of 2025, Chinese pharmaceutical companies had completed 13 NewCo transactions, with a total transaction value exceeding $10 billion.

■ The rise of the NewCo model is essentially a new attempt by Chinese innovative drug assets to enter the global market amid the pharmaceutical winter and intensifying Sino-U.S. rivalry.

The capital winter in China’s pharmaceutical sector has yet to abate, with Chinese biotech companies still grappling with financing challenges. Exit pathways for innovative drugs remain unclear: on one hand, IPO prospects for innovative drug enterprises are unresolved; on the other, the current pricing mechanisms and reimbursement systems are insufficient to support capital exit through dividends.

However, as China’s pharmaceutical R&D capabilities continue to advance, Chinese innovative drug companies have shifted from early-stage fast-follow strategies to the development of global Best-in-Class (BIC) products. A cohort of BIC-focused players, including BeiGene and Akeso, has emerged, clinically demonstrating that Chinese pharmaceutical enterprises possess the capability to develop global BIC products. Furthermore, due to intensifying geopolitical tensions between China and the United States,“NewCo“Model” partially isolates core assets from potential legal risks, returning to a Biotech development model led by overseas capital. This ensures that the handling of sensitive information complies with local regulatory requirements, enabling Chinese assets to flexibly navigate the complex international regulatory landscape.

NewCo leverages a unique “product licensing + equity” joint overseas expansion mechanism, enabling Chinese pharmaceutical companies to secure financial support while retaining partial equity to share in long-term returns. Investors not only provide capital but also engage deeply in NewCo’s incubation, management, and overseas clinical development of products, thereby mitigating the impact of escalating Sino-U.S. geopolitical tensions and significantly accelerating the globalization of these products.

■ NewCo May Usher in an Era Where Chinese Biotechs Target M&A by Multinational Pharmaceutical Companies

Historically, Chinese innovative drug companies have primarily relied on initial public offerings (IPOs) as their main exit strategy. However, with the tightening of IPO regulations, the difficulty of pursuing this exit route has surged. In contrast, overseas biotech firms typically have two exit pathways: IPOs and mergers and acquisitions (M&A), with acquisition by multinational pharmaceutical companies being the ultimate goal for most. Over the past three years, the U.S. IPO market has remained sluggish, while the M&A market in the United States has stayed active, with both transaction value and volume rising significantly despite the broader market downturn.In the long run, mergers and acquisitions (M&A) are actually the primary exit strategy for overseas biotech companies (including those already listed).

NewCo serves as a critical bridging mechanism in this process. The target assets of a NewCo may be difficult to license directly to multinational pharmaceutical companies or be acquired by them in the early stages, necessitating further overseas clinical development and validation before acquisition by multinational pharmaceutical companies. The emergence of NewCo helps domestic enterprises share the risks associated with overseas development, while the international operational expertise brought by overseas capital significantly accelerates the path from NewCo formation to eventual acquisition.

As the market capitalization of domestic innovative drug companies in the secondary market rebounds and IPO regulations for innovative drugs show signs of easing, investment sentiment toward China’s innovative drug sector is gradually improving. The rise of the emerging “NewCo” model may become normalized, offering new insights to domestic biotech firms and investment institutions:Chinese biotech companies may no longer rely on IPOs as their primary exit strategy, but instead adopt a parallel approach combining IPOs, M&A, and BD to achieve capital exits.

3) We anticipate that the NewCo transaction model in the new drug sector will also be replicated in the medical device sector.

Amid the current wave of globalization, international markets are presenting Chinese medical device companies with unprecedented opportunities.China’s medical device industry currently embodies the dual attributes of “Made in China” and “R&D in China,” and is undoubtedly poised to become a highly sought-after favorite in the international market.By leveraging existing international capital platforms or commercialization channels through the NewCo model, companies can accelerate their internationalization process and maximize the global strategy and value of their products. Meanwhile, amid the intensifying US-China trade war, medical device companies can effectively mitigate geopolitical risks by adopting the NewCo model for intellectual property (IP) transactions. We anticipate that the NewCo transaction model, which has gained traction in the innovative drug sector, will also spark a new wave in the medical device industry.

■ The urgent demand by Chinese medical device companies for global rights essentially stems from pressures within the domestic market, particularly as uncertainties facing these enterprises have increased significantly under the volume-based procurement (VBP) regime.

The “squeezing effect” of centralized procurement and the “pulling effect” of the global market jointly drive Chinese medical device companies to expand overseas. The cliff-like price drops caused by centralized procurement have placed immense performance pressure on domestic medical device companies. For example, following the 2020 national centralized procurement, the average price of coronary stents plummeted from RMB 13,000 to RMB 700, representing a 94.6% decrease. In contrast, overseas markets, particularly in developed countries with high healthcare expenditure systems, offer optimistic pricing potential, which has become a key factor attracting Chinese manufacturers to go global.

Meanwhile, according to Statista data, the global medical device market reached $566.2 billion in 2023, more than ten times the size of China’s domestic market, with a projected compound annual growth rate (CAGR) of nearly 5% from 2023 to 2029.Driven by the pull of this market size and the pressure of intensifying domestic competition, a large number of Chinese medical device companies will more actively accelerate their expansion into overseas markets.

■ The domestic medical device market exhibits structural contradictions, and Chinese medical device enterprises urgently need to validate their technological capabilities through internationalization

In China, the low-end product market is characterized by intense homogenization competition, trapping domestic enterprises in price wars. However, imports still monopolize certain products with high technical barriers, resulting in extremely low localization rates; breaking this foreign monopoly is difficult in the short term, as evidenced by the fact that all femtosecond laser systems currently available are imported brands. Consequently, Chinese companies are eager to validate their technological capabilities in overseas markets to enhance their competitiveness domestically, or to acquire innovative technologies from abroad to achieve generational product iteration and secure a competitive edge for the future.

■ Actively explore the prospects of the NewCo model in the medical device sector, with potential implementation in technology-intensive products featuring global patent portfolios.

The “NewCo model” has gradually matured in the new drug sector. This approach involves establishing independent subsidiaries to operate new projects, thereby attracting international capital and focusing on the R&D, production, and commercialization of these new initiatives. The model effectively mitigates brand bias associated with the parent company and allows for flexible integration of local overseas resources. However, since most medical device products compete primarily on production costs and have relatively low demands for R&D investment, the NewCo model is difficult to replicate in the medical device industry in the short term. Nevertheless, for projects involving high-end medical devices or emerging technologies, the model may hold certain replicability. It helps form specialized R&D teams, reduces internal resource conflicts and integration challenges, and, through independent operations, facilitates external investment and enables quicker responses to market changes.

4. Biomanufacturing is a “platform industry” that is driving disruptive upgrades and transformations across multiple pillar industries critical to public welfare. China is rapidly emerging as a “key pole” in the global biomanufacturing sector, gradually becoming an industry “driver” and “leader.”

1) In 2024, the estimated market size of China’s biomanufacturing industry reached RMB 476.2 billion, with an annual growth rate exceeding 15%, marking a substantial increase compared to 2023. China’s leading position in foundational biomanufacturing technologies and industrial infrastructure is becoming increasingly prominent, as it transitions from being a “contributor” to a “driver” and “leader” in global biomanufacturing, gradually emerging as one of the world’s key hubs for biomanufacturing.

It is estimated that the market size of China's biomanufacturing industry will grow from RMB 417.6 billion in 2023 to RMB 476.2 billion in 2024, representing a year-on-year growth rate of over 15%. The overall scale of China's biomanufacturing industry is projected to approach1.8 trillion yuan.Correspondingly,The global biomanufacturing industry is projected to reach a scale of $1.1 trillion, equivalent to approximately RMB 8 trillion, with China accounting for nearly 23%.，China is gradually becoming one of the global centers for biomanufacturing.

We predict that over the next five years, leveraging its scaled production capacity and cost advantages, China is poised to dominate the Asia-Pacific market and reshape global biomanufacturing rules by breaking through foundational technologies, perfecting the industrial chain ecosystem, and expanding global cooperation. This will enable a true transition from being a “contributor” to a “driver” and “leader.”

2) Biomanufacturing is a “platform-type” industry akin to artificial intelligence, possessing “infrastructure” attributes and serving as the core driver for the upgrading of traditional industries in the future. Unprecedented disruptive transformations will occur in certain fields within the next five years, and the global industrial ecosystem across all sectors will be fundamentally reshaped within the next decade.

In our 2024 white paper, we stated that 60% of global material production could be achieved through biomanufacturing within the next 5–10 years. In other words, the vast majority of manufacturing industries and finished products are likely to be reshaped by biomanufacturing in the foreseeable future.Based on our observations, the pace at which biomanufacturing is driving industrial upgrading has far exceeded expectations. Biomanufacturing has permeated various sectors and is currently bringing about disruptive transformations in six key pillar industries vital to people's livelihoods, including: healthcare, industrial chemicals, food and health supplements, medical aesthetics and daily chemicals, biological agriculture and animal husbandry, and bioenergy. The extensive coverage across these sub-sectors fully demonstrates biomanufacturing’s role as a “platform-typeindustry.”

3) China and the United States will emerge as the two global hubs for biomanufacturing. Significant differences between the two countries in terms of market demand, regional advantages, and even historical development have led to distinctly different development logics. Leveraging its existing foundation and strong policy support, China’s biomanufacturing market has already achieved global breakthroughs in multiple niche sectors. Competition coupled with cooperation between China and the United States will persist over the long term, and this “coopetition” will drive a new wave in the bioeconomy.

Biomanufacturing is emerging as a key growth driver for technological innovation, industrial transformation, and economic development among the world’s major powers. China and the United States are on divergent development trajectories.

The United States in synthetic biology, gene editing, and otherLeading the world in technological innovation,Driven by government policies such as the “National Bioeconomy Blueprint,” numerous biotechnology giants and venture capital firms are taking the lead.

Although China’s bio-manufacturing sector appears to have started later than that of the United States, it boasts a globally leading industrial foundation and accounts for more than 70% of the world’s fermentation capacity. The “2025 Government Work Report” issued by the State Council explicitly calls for fostering future industries, including bio-manufacturing. Furthermore, China’s vast population of 1.4 billion provides substantial market demand for the bio-manufacturing industry.China is on a high-speed development trajectory that is “product demand-driven.” Compared with the United States, China’s pace of development is faster and its sustainability stronger.

4) In China, biomanufacturing has permeated various industries. Biomanufacturing is fundamentally a “manufacturing” sector, and the pace of industrial convergence depends on the severity of technological “bottlenecks” and the urgency of “innovation iteration.” We anticipate that in industries represented by industrial chemicals, the scope of substitution by biomanufacturing will be more profound than expected, while in industries represented by food and health supplements, the rate of upgrading and transformation through biomanufacturing will be faster than anticipated.

In industries represented by industrial chemicals, the scope of substitution by bio-manufacturing is more profound than expected.The impact on the traditional industrial chemicals sector extends beyond technological innovation, reaching into supply chain restructuring, policy shifts, and changes in the global competitive landscape. Representative scenarios include the large-scale substitution of petrochemical plastics with bio-based materials, biosynthesis of high-value-added chemicals, feedstock diversification, and carbon cycling. Industry experts project that by 2030, bio-based polymer production capacity will meet 85% of traditional plastic demand, while the replacement rate for biodiesel will exceed 20%.

In industries represented by food and health supplements, the pace of biomanufacturing upgrades and transformations is faster than expected.From policy to industrialization, the pace of upgrading is accelerating. In October 2024, the National Health Commission’s approval related to human milk oligosaccharides (HMOs) indicated that regulatory pathways for safety and efficacy validation of fermentation-derived raw materials are gaining increasing recognition. With dual advancements in both regulatory review and technology, the substitution rate of biomanufacturing in the food and health supplement sectors is far exceeding expectations.

5) “Going Global” and “Integration” are profoundly reshaping the landscape of the biomanufacturing industry. On one hand, it is an opportune time for Chinese enterprises to “go global” and overseas companies to “enter China,” with both directions gaining momentum. On the other hand, industrial giants from the global manufacturing, agriculture, food, and daily chemical sectors are crossing traditional boundaries to enter the biomanufacturing field in pursuit of new growth drivers.

The international market offers distinct price advantages and significant capacity potential. Expanding overseas is an inevitable choice for shifting from the “1.4 billion domestic market” to the “8 billion global market.” Meanwhile, the payment capacity of overseas enterprises and individual customers is significantly higher than that in China, enabling Chinese companies to achieve greater returns through global expansion. Correspondingly, China boasts globally leading efficiency and cost advantages; establishing operations in China can help leading overseas enterprises enhance product profitability and overall corporate performance.

An increasing number of enterprises are transforming and diversifying into the biomanufacturing industry. Biomanufacturing has become a new growth engine for traditional companies, enabling them to navigate cyclical downturns and shifting demand in their core sectors by strategically deploying synthetic biology technologies and products through cross-industry integration.

We believe that biomanufacturing is the most suitable field for “replicating” new drugs.NewCoIndustries with transactional business models.Global collaboration and mutual reinforcement are required across the entire value chain of biomanufacturing, from raw materials to market access; this is an essential pathway to driving scalable and sustainable development of biomanufacturing worldwide.

6) As we predicted, in 2024, state-backed funds and local governments achieved deep involvement in the biomanufacturing sector and initiated “ecosystem-oriented” layouts. In contrast, listed companies and large enterprise groups adopted a more cautious approach in the field of biomanufacturing.

In the 2024 White Paper, we noted that state-owned capital plays a pivotal role in the development of the biomanufacturing industry. Local governments are promoting industrial implementation by establishing funds and employing an “investment-recruitment linkage” model, while also clarifying their own industrial positioning through policy guidance to accelerate the formation of locally distinctive industrial clusters.

Amid the cooling capital market, listed companies and large corporate groups are under financial pressure and tend to favor enterprises that offer industrial synergy, boast high technological maturity, possess production capacity of 10,000 tons or more, and align with their investment logic in terms of financial metrics. This has led listed companies and large corporate groups to extend their evaluation periods for partnerships, adopting a “want this, want that, and want more” approach to enhance “security"Full Pad."

5. China’s health industry is entering an era of major consolidation, with mergers and acquisitions shifting from capital-driven expansion to industrial synergy as the primary focus. Against the backdrop of hindered IPO exits and a restructuring of valuation frameworks, supply chain integration led by A-share listed companies is accelerating, highlighting distinct buyer’s market characteristics. The interplay between innovative transaction models and the demand for supply chain localization is shaping a new landscape for industrial upgrading.

1) The normalization of mergers and acquisitions is a significant indicator of industrial development and capital market maturity, with strong evidence provided by the experience of mature markets.

Experience from mature markets indicates that mergers and acquisitions (M&A) integration is an inevitable process for industry consolidation and capital market maturation. The development trajectories of advanced markets such as the United States and Europe clearly demonstrate the critical role of M&A in optimizing industry structure, enhancing industrial efficiency, and reshaping the competitive landscape. China’s health industry is no exception; M&A will gradually become a core driver of industrial development.Currently, M&A transactions in China’s health industry are becoming increasingly normalized, with growing frequency and scale. This trend not only drives corporate expansion but also effectively enhances the overall competitiveness and risk resilience of the sector, thereby promoting the optimized allocation of industry resources.

2) IPO Exit Channels Blocked, “Capital Frenzy” Cools Down, and the Era of M&A Integration for Existing Assets Arrives

In the past few years, capital infusion drove rapid expansion in the primary market of the healthcare industry. However, as market sentiment cooled and IPO channels narrowed, a vast stock of existing assets has faced significant pressure to exit. With limited new capital entering the market, mergers and acquisitions (M&A), as the primary mechanism for the circulation of existing assets, have become increasingly prominent. The market has officially entered an M&A era dominated by the consolidation of existing assets.At this stage, investors are more inclined toward pragmatic and rational investment strategies, no longer blindly chasing scale and valuation bubbles, but instead focusing more on the business synergy, strategic value, and cash flow performance of M&A targets.By leveraging refined resource integration and optimized allocation, enterprises will more effectively mitigate risks arising from market volatility and capital tightening, thereby achieving more robust and sustainable development.

3) A-share listed companies are leading the M&A trend, with their rationale maturing from an early focus on market capitalization management to a current emphasis on industrial consolidation.

After years of development, A-share listed companies have gradually become the core force in the health industry’s M&A market. Particularly as U.S. dollar-based financial investors have significantly reduced their investment intensity and gradually withdrawn from the market, A-share listed companies have rapidly filled the void by leveraging their capital advantages, industry expertise, and strategic synergy capabilities. They have emerged as a key driving force in M&A transactions and are expected to maintain this dominant position for a considerable period in the future. The focus has gradually shifted from early-stage simple market capitalization management to a logic centered on industrial development.A-share listed companies place greater emphasis on the strategic synergy and long-term value creation of M&A targets,Driving the health industry toward more refined, higher-quality development has become the mainstream investment force in the future M&A market.

4) The capital winter reinforces buyer’s market characteristics, while adjustments in the valuation system bring high-quality assets to the fore

5) M&A models continue to adapt to industry transformation and China-specific characteristics, with innovative transaction structures continually emerging

As the capital market environment tightens, financing channels narrow, and regulatory policies become increasingly stringent, traditional transaction models in health industry mergers and acquisitions (M&A) are gradually failing to meet enterprises’ growingly complex and diversified strategic needs. In this context, companies are compelled to seek more creative and flexible M&A deal structures to achieve resource integration, risk management, and value creation more efficiently. Innovative M&A models—including share-based payments, asset swaps, NewCo structures, involvement of financial capital, and even controlling stakes by local state-owned assets—not only enhance transaction flexibility and execution efficiency but also provide enterprises with diverse strategic tools and participants to cope with market uncertainties. These innovative measures promote efficient allocation and deep synergy of resources across the upstream and downstream segments of the industrial chain, further boosting the overall competitiveness and sustainable development capabilities of the industry.

6) Geopolitical Conflicts Drive New M&A Trends: Supply Chain Localization and the Accelerated Global Expansion of Chinese Technological IP

Amid escalating global geopolitical tensions and supply chain uncertainties, Chinese health industry companies are accelerating the adjustment of their global strategic layouts.Mergers and acquisitions, as the most efficient and impactful strategic tool at present, are increasingly becoming a dual engine for enterprises to achieve “self-reliance and controllability” and “overseas expansion.” On one hand, by acquiring upstream and downstream assets in key domestic links, enterprises are promoting the localization of their supply chains, enhancing the stability and risk resilience of their industrial chains, and building asymmetric competitive advantages for the future. On the other hand, market restructuring driven by geopolitical factors has opened new windows for Chinese companies to enter overseas markets and export proprietary technologies and intellectual property through mergers and acquisitions.