With the largest diabetic population and a pedigree in metabolic diseases, China is becoming one to watch in diabetes and obesity drug discovery. Diana Turner finds out about an increasingly competitive market.

Research by clinical research organisation ICON in late 2025 revealed that China is emerging as a ‘global innovation powerhouse’ in biotech. This has not happened by chance, but rather through considered effort on the part of the Chinese government to improve the quality and speed of drug discovery. In 2015 the State Council introduced policies to modernise innovative drug regulation, which clarified clinical development pathways and created an alternative route to first-in-human (FIH) studies. In addition to the traditional IND pathway, the policy treats experimental CGTs as medical technologies regulated by the National Health Commission, allowing qualified institutions and investigators to initiate their own trials without a sponsoring pharmaceutical company or going through NMPA (1). Investigator-initiated trials (IITs) enable researchers to efficiently generate early data in terms of safety – and sometimes efficacy – helping guide subsequent development decisions. 

As George El-Helou, Strategic Intelligence Analyst at GlobalData, comments on China’s biotech journey: “China continues to transition from ‘me-too’ to a global innovator, redefining the global drug development landscape.” 

Karan Verma, Associate Principal Healthcare Research and Data Analyst, China In-Depth, Clarivate (2), points to a structural transformation of China’s pharmaceutical industry over the last decade. “The inflection point came around 2017–2018, when regulators introduced a series of reforms that fundamentally changed the industry’s direction,” he explains. “The move toward more regular and transparent updates created a more predictable commercialisation pathway for innovative therapies. At the same time, the rollout of the national Volume-Based Procurement (VBP) program, beginning with the “4+7” pilot in 2018, significantly reshaped the generics market. Rather than competing solely on low-cost generics, firms increasingly began investing in R&D and innovative drug development. Immuno-oncology was one of the earliest examples of this shift. We are now seeing a similar evolution in the GLP-1 and obesity space, where Chinese companies are no longer just followers, but increasingly important innovators and competitors in the global pharmaceutical landscape.” 

China’s leading role in metabolic diseases

Metabolic disease is key therapeutic area for Chinese biopharma, due to high prevalence rates. In 2023, GlobalData reported that China is expected to record the highest diagnosed prevalence of non-alcoholic fatty liver disease (NAFLD) in 2029, representing 44% of cases within the 16 major pharmaceutical markets. As a result, the number of clinical trials conducted in the country for this indication is gradually increasing, driven mostly by international pharmaceutical companies. According to GlobalData’s Pharma Intelligence Center, China has the highest number of clinical trials that were initiated in NAFLD in the APAC region over the past decade. While most of these clinical trials were sponsored either by non-commercial Chinese sponsors or by international commercial sponsors, there are currently 10 pre-clinical assets in NAFLD from major domestic companies in China, such as Innovent Biologics, Sihuan Pharmaceutical Holdings and Shenzhen Chipscreen Biosciences. 

These markets are being driven by ever-increasing rates of obesity in China. National surveys indicate that about half of adults in China and 20% of children and adolescents aged six to 17 years are living with overweight or obesity, making China the country with the greatest number of people affected (3). Consequently, the China diabetes market is the largest globally, serving over 141 million patients (4). 

A competitive diabetes market 

Analysts Mordor Intelligence predict the Chinese diabetes drugs market to grow from $12.19 billion in 2026 to $16.38 billion in 2031 at a growth rate of 6.10% CAGR (5), fuelled by an ageing population and growing obesity rates, but also government reimbursement reforms that favour domestic products and expanding manufacturing capacity. 

As a result, both domestic and international pharmaceutical companies are vying for market share – data from the National Medical Products Administration (NMPA) indicates that over 1,200 diabetes drug trials were registered between 2013 and 2023, with many facing delays due to rigorous safety and efficacy evaluations (6).  

Insulin still holds the largest 46.02% slice of the China diabetes drugs market share, but its single-digit volume growth contrasts sharply with double-digit uptake of GLP-1 and dual agonists. DPP-4 inhibitors continue to gain traction as they offer effective glycaemic control with minimal side effects, making them a preferred choice for early-stage type 2 diabetes management. In addition, SGLT2 inhibitors are emerging as a transformative drug class, providing not only glycaemic control but also cardiovascular and renal benefits (6). 

Chinese researchers are also pursuing innovative diabetes treatments. In March 2026, a team from the Chinese Academy of Sciences’ Center for Excellence in Molecular Cell Science achieved a medical breakthrough by using endoderm stem cell-derived islet-like tissues (E-islet) to restore pancreatic islet function in patients with diabetes (7). A study published in The Lancet Diabetes & Endocrinology shows that the team successfully treated three patients with type 1 diabetes using E-islet. The new procedure reconstructed islet-like tissue using stem cells, or an endodermal branch, bypassing the prolonged differentiation process needed for traditional pluripotent stem cells. This reduces cultivation time from 40 days to just 14 days and minimises the risk of tumour formation, as endoderm stem cells themselves do not proliferate in vivo. 

In the same month, a team at Shenzhen Hengsheng Hospital announced they had successfully enabled 30 patients with type 1 diabetes to achieve functional remission using an immune blockade and β-cell redifferentiation approach. Unlike stem-cell-based regenerative islet transplantation therapies, the integrative therapy focuses on interrupting autoimmune attack against pancreatic β-cells to achieve functional remission. Through β-cell redifferentiation, the protocol seeks to reactivate and repair residual endogenous islet function, aiming toward structural restoration. 

The growing popularity of GLP-1s 

The market for GLP-1 receptor agonists is growing rapidly in China due to their dual benefits of blood sugar control and weight loss, making them increasingly popular among obese diabetic patients.  

Non-insulin injectables account for 31.34% of 2025 revenue yet deliver the fastest 10.12% CAGR. More than 15 biosimilar versions of semaglutide from companies like Hangzhou Jiuyuan and Boan Biotech are poised to capture demand once patents lapse in 2026 (5). 

Verma expands: “Over the last five years, domestic innovation activity has accelerated significantly, especially in the GLP-1 space. One of the most notable recent developments has been Innovent Biologics’ mazdutide, a dual GCGR/GLP-1 receptor agonist that is already emerging as a serious competitor to semaglutide and tirzepatide in China.” In a 2025 Phase III trial, mazdutide, a glucagon-like peptide-1 (GLP-1) and glucagon (GCG) dual receptor agonist that was licensed from Eli Lilly, showed superior efficacy to semaglutide in both weight loss and glucose lowering.  

He continues: “At the same time, companies such as Jiangsu Hengrui and Hansoh Pharma are developing next-generation therapies, including oral GLP-1s and dual GIP/GLP-1 agonists. Over the next five years, the market is likely to evolve from simple GLP-1 monotherapy toward more advanced dual- and triple-agonist therapies, making the Chinese diabetes and obesity market far more competitive and innovation-driven.” 

Sciwind Biosciences is one Chinese company leading this domestic market. In 2026, the company released results of a Phase III study which showed that its ecnoglutide injection for type 2 diabetes, potentially the world’s first long-acting cAMP-biased GLP-1 receptor agonist, significantly lowered blood glucose with the added benefits of weight reduction and improvement of metabolic parameters. Following the results, Sciwind entered a collaboration with Pfizer, granting the US company exclusive commercialisation rights for the product in Mainland China for $495 million. Then in March, China’s National Medical Products Administration (NMPA) approved ecnoglutide injection for chronic weight management, making it the world’s first approved cAMP-biased GLP-1RA for weight management. 

The other four marketed GLP-1 receptor agonist obesity drugs include Novo Nordisk’s Wegovy (semaglutide), Eli Lilly’s Mounjaro (tirzepatide), Shanghai Benemae Pharmaceutical Corp’s Yishengtai (ecnoglutide), and Innovent Biologics Inc’s Xinermei (mazdutide). According to GlobalData Pharma Intelligence Center, 36 Chinese companies are involved in the clinical development of obesity drugs, with 41 GLP-1 drugs in clinical development in China: 12 drugs in Phase III, 15 drugs in Phase II, and 14 drugs in Phase I.  

Abhishake Peyyeti, Pharma Analyst at GlobalData, comments: “Sciwind Biosciences is solidifying its position in the rapidly growing GLP-1 market, supported by Pfizer’s commercial strength. With pivotal head-to-head data against semaglutide (Wegovy) on the horizon, Sciwind is well-positioned to enhance its competitive edge and potentially reshape the hierarchy in obesity treatment.” 

AstraZeneca is another big pharma player investing significantly in China. Its strategic collaboration agreement with China’s CSPC Pharmaceuticals, potentially worth up to $4.7 billion, was agreed to advance multiple therapies for obesity and type 2 diabetes across eight programmes. Under the agreement, AstraZeneca will receive exclusive global rights outside of China to CSPC’s once-monthly injectable weight management portfolio, comprising one clinical-ready asset, SYH2082, a long-acting GLP1R/GIPR agonist progressing into Phase I and three preclinical programmes with differing mechanisms. 

The future outlook 

Given the scale of development and the intensity of the competition, it looks likely that Chinese domestic biotech companies will become a major force in the GLP-1 market over the next few years. 

“One important advantage for Chinese companies is that many of these studies are conducted directly in Chinese patient populations, generating local real-world evidence that physicians are often more comfortable relying on,” says Verma. “In addition, there is growing policy and market support for domestic innovative drugs, which could further accelerate uptake.  

“Globally, however, the picture is more nuanced. Chinese biotech companies may become a major source of innovation, but not necessarily dominant commercial players. Many promising early-stage obesity assets developed in China are likely to be out-licensed to multinational pharmaceutical companies for ex-China commercialisation. In that sense, Chinese firms could become increasingly influential in global drug discovery and clinical development, while multinational companies continue to lead large-scale global commercialisation.” 

References 

1. https://visionlifesciences.com/insights/china-biotech-outbound-licensing-tracker

2. https://discover.clarivate.com/winds-of-change-chinas-biopharmaceutical-innovation-2-era 

3. Xiong-Fei Pan, Zhong-Ze Fang, et al. Obesity in China: current progress and future prospects. The Lancet Diabetes & Endocrinology 2026;14(2):178-186.

4. https://www.sphericalinsights.com/reports/china-diabetes-market

5. https://www.mordorintelligence.com/industry-reports/china-diabetes-drugs-market

6. https://www.credenceresearch.com/report/china-diabetes-drugs-market

7. Shi Y, Feng Y, Li T, et al. Autologous and allogeneic stem cell-derived islet therapy in three recipients with type 1 diabetes and complete loss of endogenous pancreatic Œ≤-cell function pretransplant. The Lancet Diabetes & Endocrinology, 2026;14:285-288. 

From DDW Volume 27 – Issue 3, Summer 2026 – Read the digital issue here