Commercial Success in Pharma and MedTech Starts with R&D, Relies on Talent, and Demands Global Expansion

In May, during the first afternoon panel discussion at the main forum of the “2023 HongShan Global Medical Health Industry Summit,” Chen Juan, Chairman and General Manager of Xintai Medical; Jiang Hua, Chairman and CEO of Boan Biologics; Tao Huan, Founder and General Manager of Sailue Medical; Wu Zhicai, CEO of Abclonal Technology; and Zhu Tong, Chief Operating Officer of Simcere Zaiming, explored the pathways for medical health enterprises to successfully achieve commercialization. Drawing on their respective companies’ development histories, they discussed the theme “Pathways to Commercialization: Successful Experiences of Medical Health Enterprises.” VCBeat has compiled the highlights from their discussions.

Roundtable Forum: “Path to Commercialization: Success Stories from Healthcare Companies”

Q: The theme of this conference is “Begin with the End in Mind, Go Far and Attend to the Minute Details.”How Can Pharmaceutical and Medical Device Companies Implement “Begin with the End in Mind” Systems Thinking and Practical Experience, and Improve Commercialization Success Rates?

Chen Juan:“Begin with the end in mind” closely aligns with the developmental patterns of the medical device industry, as the ultimate goal of all healthcare is to safeguard human health. Medical technology exhibits a spiral upward trajectory driven by advances in biomaterials and engineering devices. Given that the R&D cycle for a single device often exceeds ten years, medical device companies must fully account for market shifts and technological innovations a decade into the future, thereby avoiding the scenario where a device becomes obsolete upon completion of its development, but ratherTreat the culmination of R&D as the starting point for new products, establishing a continuous product commercialization strategy.

Jiang Hua:Project management is particularly critical. Behind every successfully commercialized drug lies meticulous planning that begins in the R&D phase. Every aspect of the pharmaceutical supply chain—including procurement, cost management, and market access—must be synchronized with the overall product launch process to enable a rapid transition from regulatory approval to market availability.

Tao Huan:Patients are the direct beneficiaries of advances in medical technology. The recent volume-based procurement (VBP) of dental implants has driven companies within the industry into intense competition over pricing and product offerings, but I believeUpstream competition will ultimately benefit downstream patients, as “involution” can enable more patients to access dental implants that are both more affordable and of higher quality., and enjoy the benefits of advances in medical technology.

Wu Zhicai:The upstream sector of the biotechnology industry comprises life science tools, encompassing more than 200 niche segments. Although companies in each segment have gone public, many critical “chokepoint” products remain to be addressed; for instance, there are currently no domestically produced flow cytometry antibodies available in China. Consequently, Abclonal Biotechnology has shifted its strategic focus away from its early emphasis on mRNA raw material enzymes, adopting a strategy of “reaching far by attending to the minute.”Investing in Flow Cytometry Antibodies with Longer R&D Cycles, Greater Challenges, and Higher Costs。

Zhu Tong:In the past, many biotech companies and investment firms placed greater emphasis on the “0 to 1” stage of R&D rather than product commercialization. However, for pharmaceutical companies with only a single pipeline, the opportunity window for their products is often limited to just two to three years. How to achieve higher sales volume within this constrained product lifecycle is a critical challenge affecting the survival of such enterprises. In fact, the commercial outcome of a product begins to take shape during the R&D and design phase; factors such as early-stage cost control and team collaboration directly influence the final commercial performance. Therefore,Full-cycle commercialization capabilities are crucial for pharmaceutical companies with only a single R&D pipeline.

Q: Domestic innovative pharmaceutical companies are currently at a turning point from clinical development to commercialization,How to Achieve the Transformation and Enhancement of Corporate Organizational Capabilities to Ensure Commercial Success?

Jiang Hua:The key to organizational capability transformation and enhancement lies in the team's execution, which is essentiallySelection and Recruitment of Key TalentA scientist’s primary competency lies in their technical expertise, while the ability to translate theory into practice is equally critical. This capability is a key consideration for innovative pharmaceutical companies when selecting personnel—for example, assessing whether a scientist can transform patented cell lines into high-yield production cell lines, thereby enhancing the likelihood of successful commercialization.

A successfully commercialized drug is often referred to as a “blockbuster,” but whether a drug can achieve blockbuster status depends on three factors: first, the drug’s market potential; second, whether the drug targets the correct indications; and third, the drug’s accessibility, which includes product pricing and market access eligibility.

Q: Domestic pharmaceuticals are currently undergoing a transition from imitation to innovation. What recommendations do you have for pharmaceutical companies in terms of commercialization strategies during this transformation?

Zhu Tong:The overall development-to-launch cycle for generic drugs is relatively short; however, due to their lack of innovation, their market lifecycle is also shorter. Therefore, companies seeking to successfully transition from generic drugs to innovative therapies must adopt an entirely new commercialization rhythm.

First, the early stages of transformation are often accompanied by a decline in business volume, and the ultimate success of the transformation remains unpredictable. This necessitates that pharmaceutical companies undergoing transformation lay adequate groundwork in medical affairs, marketing, and other areas during the initial phase, ensuring that while inevitable fluctuations occur, the overall pace of transformation remains steady and forward-moving.

Second,The key to commercialization still lies in the differentiation and efficacy of pharmaceutical products.In the early stages of drug development, if a product demonstrates significant future market potential, companies may choose to absorb higher upfront costs, maintain a steady pace of transformation, and focus exclusively on the research, development, and commercialization of new products.

Third, pharmaceutical companies in China often initiate commercial planning only after product approval, resulting in a disconnect between R&D and commercialization. For instance, the annual National Reimbursement Drug List (NRDL) negotiations target drugs approved before July 1. If a drug is launched in October, the delay incurred is not merely three months but an entire year. Therefore, transforming pharmaceutical enterprises must engage in purposeful planning across the entire process from R&D to market launch.

Q: What opportunities and challenges have you encountered when expanding into overseas markets, and what strategies have you adopted to address them?

Chen Juan:In recent years, with changes in national healthcare reform policies, domestic market competition has gradually intensified. For Chinese enterprises, expanding overseas has become a normalized trend and an imperative question that must be addressed for corporate development. In particular, Chinese companies have accumulated significant innovative capabilities in the domestic market in recent years, which will serve as the confidence and strength underpinning their expansion into overseas markets.

Although global expansion is an imperative, companies must also consider three core questions before laying out their overseas market strategies:

First, do the company’s products and market advantages align with the broader international environment? If so, expanding overseas becomes an imperative for the enterprise.

Second, is the drug a generic or an originator product, and does it possess a price advantage? Generic drugs going global will face greater competitive pressure, whereas innovative drugs can establish their own product advantages through intellectual property protection, pricing advantages, and technological innovation.

Third, what is the long-term strategic direction for enterprises? As China transitions from a nation with a vast labor force to an aging society, companies must adjust their therapeutic areas and pipeline portfolios in response to demographic shifts. However, no matter how large it is, the Chinese market represents only a part of the global landscape. Therefore, to sustain rapid and continuous growth, enterprises must adopt a global perspective, and it is better to establish a presence in overseas markets early rather than late.

Tao Huan:Emerging markets can serve as the preferred destination for startups embarking on their initial international expansion. These markets offer abundant opportunities and exhibit greater sensitivity to product pricing, making them an ideal first step for going global. After accumulating certain R&D capabilities and manufacturing process advantages in emerging markets, companies can further expand into developed countries.

Wu Zhicai:Scientists are typically at the forefront of a company’s global commercialization efforts. By leveraging them as the core, enterprises can build a global network of customers and partners. In contrast, marketing, finance, human resources, and sales teams usually follow behind. For companies expanding overseas, establishing overseas offices and effectively managing global brand teams and management systems pose significant challenges.

A Message and Advice for Early-Stage Founders on Future Commercialization

Chen Juan:I believe that whether for startups or mature enterprises, the ultimate focus should be on the market end-user, the patient as the end-user, and facilitating ease of use for physicians. Companies should strategically realign their production lines, technologies, and markets at the conclusion of each development stage and continue to advance steadily.

Jiang Hua:In the process of biotech companies expanding into the biopharma sector, building organizational capabilities is crucial. An individual may not go far, but a team can achieve a Long March and reach a new era of success.

Tao Huan:I believe startups should pay greater attention to return on investment (ROI), evaluating the launch and commercialization of each product from an ROI perspective.

Wu Zhicai:Do the difficult things, do the right things, and do the long-term things. Short-cycle endeavors often lack sustainability, whereas long-cycle initiatives represent a long-tail market; therefore, pursuits with long-term value are the most worthwhile.

Zhu Tong:“Begin with the End in Mind”—The mission of the healthcare industry is to treat patients and extend their lives. Therefore, we should focus on product differentiation, pursue greater efficacy, and maintain a well-paced strategy. These are the key points I consider most important.