China Biomedical Investing Gaining Momentum – Interview with Greg Scott

Editor’s note – The following is an interview with our Executive Editor, Greg Scott, conducted by Interfax China and reprinted here with their permission. Interfax China pharma news is located at www.interfax.cn/news/pharma.

Investment in Chinese health care industry gathering momentum, but still faces challenges

By Lizzy Li, Interfax China

Shanghai. November 13. INTERFAX-CHINA - Though there is little doubt that investment in China's health care industry is gaining momentum, there are still several obstacles that are curbing investor enthusiasm, a U.S. investor, focused on investment in early-stage companies in the life sciences industry told Interfax during a phone interview yesterday morning.

"I think it's getting to be a good time to invest in China's health care industry," Greg B. Scott, an investor and also the president and chief executive officer of ChinaBio Accelerator, a non-profit organization created to accelerate the globalization of China's biotechnology industry, said.

However, Scott said there is still a significant problem with what he terms "product tinting".

"There's a perception that products from China may not be as high quality as they generally are," he said. "[Product quality] is improving, however, to the outside world, they don't see the improvement as it occurs." Nevertheless, Scott does not believe that this issue will be more than a minor setback for investment in the industry.

For early-stage investors, there is another challenge hindering investment.

"One of the issues is intellectual property - not IP protection, but the quality of IP," he said. "The legal system in China is just figuring out how to produce high-quality patents that can be accepted globally."

"However, there are some intricate timing and structuring issues between U.S. and China patents," he explained. "You can file for a valid U.S patent, but it will make your China patent invalid. So you have to be very careful when working with attorneys who are not very familiar with the global patent environment."

Despite these challenges, Scott still thinks investing in the health care industry in China is generally promising.

"It's a good time to start getting involved. China's biotech industry, right now, is still in its early stages," he said, adding that the outlook is looking brighter for investors in the industry. "Especially for early-stage investors, it's very good time to get involved," he noted.

Scott said the significant improvements in both the State Food and Drug Administration's policy perspective and intellectual property protection, as well as in the quality of work at pre-clinical trial-level, are catching the eye of investors.

Disclosure: none.