CHINA Trends and Developments Contributed by: Binxin Li, Guangzhen Shang and Sally Wang, LeanWill Law Firm
Intellectual Property Litigation Development and Trends in China’s Life Sciences and Pharmaceuticals Industry The life sciences and pharmaceuticals sector in China has been undergoing an innovation trans - formation, re-shaping its position in the global market, driven by the advancing of technology and increasing market value. China ranks 11th in the Global Innovation Index 2024 issued by WIPO, and emerges as the country with the larg - est number of science and technology clusters. With the innovation transformation, intellectual property (IP) litigation has become a key battle - field in which the boundaries of IP legislation and judicial protection are being tested and clarified, thereby profoundly affecting the growth of Chi - na’s life sciences and pharmaceuticals sector. This article aims to provide a brief overview and analysis of the IP litigation landscape and trends within China’s life sciences and pharmaceuticals industry, exploring legislative changes, regula - tory amendments, judicial system advance - ments and landmark cases. These factors play a pivotal role in shaping the development of IP protection in this vibrant industry. Each section below will explore critical aspects that relate to or impact on IP litigation in this industry, and will offer insights on key issues that garner wide attention and concern in this sector in China. A Glance at the Development of the Life Sciences and Pharmaceuticals Industry China’s life sciences and pharmaceuticals industry is on an upward trajectory, with inno - vation transformation being propelled by strong research and development (R&D) capabilities as well as a fast-growing patient population. Some recent statistics underscore this growth and transformation:
• the total market capitalisation of the top five listed pharmaceutical and biological compa - nies surged from RMB550 billion in 2018 to RMB1.1 trillion in 2024; • the income of the healthcare sector increased from RMB8 trillion in 2021 to RMB9 trillion in 2024; • China’s innovative drug market scale exceed - ed RMB100 billion in September 2024, and China’s share of new drug R&D is close to 30% of the global share; and • the scale of licensing-out deals in China was close to RMB250 billion in 2024. The thriving of the industry has prompted a pro - portional rise in IP litigation. In particular, in light of the improving IP protection environment, IP litigation continues to rise in both amount and complexity. This escalation reflects the intricate nature of the industry and the competitive forces at play. IP Litigation Statistics in China A close examination of the IP litigation statis - tics in China reveals a compelling narrative. The White Paper on China’s IP protection reported an annual growth rate of 14.73% for first-instance patent infringement civil cases, reaching a stag - gering 44,711 cases in 2023. Furthermore, in 2023, the Annual Report of the IP Tribunal of the Supreme People’s Court (the “SPC IP Tribunal”) disclosed that the volume of cases involving strategic emerging industries pertaining to the pharmaceuticals sector increased to 1,582, with an annual increase rate of 18%. Trade secret misappropriation notably caused by employee departures constitutes 84% of all trade secret disputes, according to a report issued by the Beijing IP Court. Trade secret pro - tection remains a critical issue, and demands
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