China Races Ahead in Biotech Trials. Is the U.S. Stuck in Second Place?

Fentanyl fears have played a significant role in U.S.-Chinese trade disputes, but soon legal drugs could be a greater threat from China. On May 29, Axios reported that China had surpassed the United States in the number of clinical trials held in 2024 — a result that reflects China’s growing share of global pharmaceutical research amid rising drug trial costs in the United States.

The achievement comes as American firms have expanded their investments into China’s pharmaceutical sector and reflects Beijing’s emphasis on biotechnology to undermine America’s scientific and technological leadership.

China Has Increased Clinical Trials and Laboratory Construction

China’s rapidly expanding biotechnology sector is the culmination of nearly a decade of state investment and regulatory reform. China’s growing share of single-country trials began shortly after Beijing introduced measures to spur drug discovery in 2015. This reform coincided with the launch of Made in China 2025, which set goals for the number of Chinese-developed medications registered in other countries.

This trend has been accelerated by China’s growing surge of laboratory construction, which now threatens to outpace the United States. In a report published in April by CBRE, a global real estate firm, both Beijing and Shanghai had more laboratory and research locations under construction in 2024 than any other global market, with Boston — America’s leader in life sciences — placing third. This growth has fueled China’s rise as a key source of global biological research, reflected in its global lead in issuing biotech-related patents.

U.S. Becoming More Dependent on China for Biotech Innovation

China has expanded its efforts to become a global leader in biotechnology within the next several decades. Viewing biotech as a key driver of economic growth and a future determinant in military conflict, Beijing has poured resources into the country’s life sciences sector, including basic research funding, firm-specific subsidies, and partnerships with the Chinese military. Along with allowing Chinese firms to become globally competitive, this support has also been directed toward the country’s military modernization, including reportedly conducting genetic experimentation on service personnel and improving dual-use defenses against biological warfare.

The American pharmaceutical sector has become increasingly reliant on China — both as a source for key ingredients and manufacturing, and increasingly, for conducting research and development. Due to its lower costs and limited regulatory environment, American biotech firms have turned to China’s growing contract research sector and clinical trial network to bring novel treatments to market. While contributing to greater innovation, such as pioneering the use of artificial intelligence in designing treatments, this dependency has also indirectly fueled China’s efforts to weaponize biotech innovation. Simultaneously, it has created significant vulnerabilities within the American supply chain.

Washington Must Strengthen Support for Domestic Innovation

The United States must expand its efforts to stymie the rise of China’s biotech sector. Congress should prioritize measures to cut off funding to China’s pharmaceutical sector, including contract research services, while embracing outbound investment screening measures to prevent American firms from directly supporting the country’s broader science and tech sector.

Washington should also strengthen support for its own research and development pipeline, both in biotechnology and related fields. Along with reversing cuts to the National Science Foundation, National Institutes for Health, the National Institute of Standards and Technology, Congress should prioritize funding programs that allow American biotech firms to scale more effectively. Looking to the future of biotech, Congress should work with the administration to expand support for the American AI sector — constructing more computing power, strengthening the electrical grid, and expanding the nation’s technology workforce.

Jack Burnham is a research analyst in the China Program at the Foundation for Defense of Democracies (FDD). For more analysis from Jack and FDD, please subscribe HERE. Follow Jack on X @JackBurnham802. Follow FDD on X @FDD. FDD is a Washington, DC-based, nonpartisan research institute focusing on national security and foreign policy.