State-sponsored R&D: a case study of China's biotechnology

Abstract

This paper examines the model of China's biotechnology innovation. We apply the typology of entrepreneurial, partnership, and developmental state, to the Chinese biotechnology sector. Biotechnology development in China originates from state-sponsored programs. Chinese biotechnology research capacities experience fast growth. The state funding plays a crucial role in the latecomer situation. Geographically, biotechnology industries are concentrated in Beijing, Shanghai, Shenzhen and other major cities. The state promotes biotechnology development. However, such a model has its problems: the lack of sustained funding and under-developed venture capital, weak link between research and industry, and under-performed IP output. Faced with the funding constraint, contract research organizations (CROs) have recently become proliferated. Despite the strong role of state, we conclude that the Chinese model of biotechnology innovation is a hybrid one, rather than the classical one of developmental state, which combines various elements of different models.