A little-known Chinese company made a drug that beat the world's biggest selling medicine

CNN

26-02-2025

China's DeepSeek shocked the world by delivering unexpected innovation at an unbelievable price. But this disruptive trend isn't confined to Big Tech: It has been quietly happening in the pharmaceutical sector.
In September, Akeso, a little-known Chinese biotech company founded nearly a decade ago shook up the biotech sector with its new lung cancer drug.
Ivonescimab, the new drug, was found in a trial conducted in China to have bested Keytruda, the blockbuster medication developed by Merck that has raked in more than $130 billion in sales for the American behemoth that has dominated cancer treatment.
Patients treated with Akeso's new drug went 11.1 months before their tumors began to grow again, compared to to 5.8 months for Keytruda, according to clinical data released at the World Conference on Lung Cancer, a top medical forum.
Over the course of several days in early September, shares in California-based Summit Therapeutics, Akeso's US partner, more than doubled to a record high, according to data from Refinitiv. The firm had licensed the right to commercialize the new drug in North America and Europe.
At the time, though experts said it was a watershed moment for Chinese pharmaceutical companies, it was little noticed outside the industry. All that changed following DeepSeek's exploits earlier this year, which put international attention on pockets of innovation in China — with growing global implications.
'I do believe the Chinese biotech industry will play an important role globally. And we [will] participate more and more,' Michelle Xia, the CEO of Akeso, said in an interview last month with BiotechTV.
In a statement sent to CNN, Akeso said it was an 'incredibly exciting moment' to see its drug beat Keytruda, the world's best-selling medication.
'Akeso's innovation is driven by a deep understanding of disease biology and protein engineering, while benefitting from the fast development time and the abundance of top-tier talent in China,' it said.
Until the 1980s, when China opened its economy, most of its pharmaceutical firms were state-owned. For most of the past 40 years, Chinese biotech companies were mainly replicating existing medications, known as 'me-too' drugs.
But over the past 10 years, they've begun to innovate with more advanced drugs that can compete directly with the Western offerings. And they've signed billions of dollars in licensing deals with Western partners to get their products to the rest of the world.
AstraZeneca signed a $1.92 billion deal with China's CSPC Pharmaceutical Group (CSPC) last year to develop cardiovascular medication, and Merck has a $2 billion agreement with China's Hansoh Pharmaceutical over an experimental weight loss pill.
'People were aware that the biotech industry was growing very fast in China, but very few saw it as a real threat to the top US innovators,' said Rebecca Liang, a pharmaceuticals analyst at AB Bernstein. 'Now the threat is getting real, because you do start to see these next generation drugs that are sort of a leapfrog.'
According to a research note published by HSBC Qianhai Securities earlier this month, China is becoming an innovation hub for the entire industry, with the number of licensing deals jumping from just 46 in 2017 to more than 200 last year. The total deal amount totaled just $4 billion in 2017 and rose to $57 billion last year, it said.
And figures from market intelligence firm Mergermarket indicated that large pharmaceutical transactions worth $50 million or more involving Chinese firms grew nearly 30% in 2024 compared to the previous year.
Cui Cui, managing director of healthcare research for Jefferies, said Chinese biotech firms' research capabilities and development efficiency are catching up, thanks to factors such as strong government support, foreign investment and a wealth of domestic talent.
'In the past, [Chinese biotech] are perceived to be only copycats, but in the future, it might be able to compete with the global best-in-class pharmaceutical companies,' Cui told CNN.
But while Akeso's achievement is making waves overseas, debate is raging in China over the quality of domestically produced generic drugs, which have the same active ingredients as patented drugs but are much cheaper.
Distrust over the track record of domestically produced medicine runs deep in China. Such concerns spiraled into public uproar last month over the alleged questionable quality of Chinese generic drugs, which has led to an official investigation.
China's health regulator subsequently defended the safety of the drugs, saying the probe found the quality concerns to be unsubstantiated. Several Beijing residents told CNN last week that they were not familiar with Akeso or its new drug and still preferred imported drugs.
'To be honest, I tend to choose the more expensive medicine. After all, you get what you pay for,' Gu Zhihao, a Beijing resident, told CNN.
US investors and regulators have previously questioned the quality of clinical trial data gathered in China. Liang said the US Food and Drug Administration (FDA) has rejected drugs developed in the country in the past because the trial setup was 'not rigorous enough.'
Akeso's new drug, which is not a generic, has been approved by China's pharmaceutical regulator for some lung cancer patients. But it is still years away from being sold in the US.
A global trial is now in the works for later this year, which could further prove its efficacy, according to Cui. If the outcome is sound, it would be further evidence of the strides China has made in developing cutting edge drugs.
CNN's Martha Zhou and Juliana Liu contributed reporting.