China deal?, page-39

That’s an interesting question. Generally western pharma companies enter into a JV or license their tech to a Chinese partner. There are still concerns about IP theft, but since the Chinese partner has exclusive rights to develop and sell the drug, they are backed by Chinese law but that doesn’t stop unscrupulous actors. In some of my brief reading on the matter, there exists a grey area when it comes to middle men in the Chinese pharmaceutical market, a certain amount of corruption as it were. Selling copies of drugs is not out of the question, but I don’t think the Chinese govt would act like gangsters and have a state owned enterprise churning out copies of drugs especially if an indigenous business held rights to the drug.

Drug formulations (excluding excipient ingredients) are public knowledge I believe once they have been filed with a regulatory authority so there’s not much in the way to stop a rogue entity producing illegal copies of drugs. However, there are quite a few large players operating in China as well as a host of many smaller US companies so the incentive is attractive enough to put trust in a local partner and sell the drug in the Chinese market.

Neuren may have some concerns, but the impression is they want to be in that market. The hire of Gerry Zhao who appears to have a deep business relationship with China signalled to me that Neuren is thinking about the Middle Kingdom more often than not.