The ongoing trade tensions between the United States and China have placed the biotech sector at a pivotal point. As U.S. tariffs target Chinese goods, biotech companies find themselves entangled in a web of economic repercussions. But what does this mean for you if you’re in the industry?
Recently, when the stock markets in mainland China and Hong Kong reopened after a holiday, the effects of these tariffs were clear. While many companies faced hurdles, some niche healthcare firms managed to thrive. For instance, Pacific Shuanglin Bio-pharmacy and Beijing Tiantan Biological Products saw impressive gains—anywhere from 10.6% to 16.6%—after Beijing announced a 34% reciprocal tariff, mirroring Washington’s moves.
China’s heavy reliance on imported blood plasma products, especially from the U.S., could lead to shifts in market dynamics. SWS Research highlights that blood proteins are among the top pharmaceutical exports from the U.S. to China, vital for numerous public hospitals across the mainland.
Cinda Securities analysts suggest that during this trade war, foreign exporters of albumin will likely face significant cost increases in China, which could boost the market share of local manufacturers. This could be a game-changer for domestic companies looking to expand their footprint.
In the global landscape, the United States stands as the largest healthcare market. Last year alone, it imported $19 billion worth of medical devices and pharmaceutical products from China. Albumin, a crucial blood plasma component, is widely used in treating various medical conditions, from severe blood loss to organ diseases. In 2021, China’s demand for albumin hit 645 tonnes, with imports making up 63% of that demand.
With albumin sales growing at a steady annual rate of 10.5% since 2020, it’s projected that sales could reach 42.5 billion yuan ($5.8 billion) this year. Leading the charge in exporting albumin to China are U.S. companies such as CSL Behring, Grifols, and Baxter.
For those of you navigating these turbulent waters, it’s essential to stay informed and adaptable. The landscape is shifting, and opportunities arise for those ready to seize them.
