China oncology drugs: China oncology marketing recovered in July–August, while biosimilar VBP could bring deeper price cuts

Overview

This expert-call note examines recent sales conditions for China oncology drugs, focusing on the recovery in marketing activity after renewed anti-corruption enforcement, the likely impact of compliance rules and biosimilar volume-based procurement, and differences across drug categories.

Core views

Nomura held two sessions with experienced oncology-drug sales managers from Northern and Eastern China on 9–11 September. Both said marketing activity, which had weakened after the anti-corruption campaign intensified again in May, had recovered to 70–80% of normal in July–August from 50–60% in May–June. The experts nevertheless expect stricter compliance requirements for pharmaceutical promotion to become the “new normal.” In their view, this could lower pharmaceutical and biotechnology companies' selling-expense ratios by 5–6 percentage points, from the low-thirties percentage range to the high twenties. The experts were more cautious on upcoming volume-based procurement for biosimilars than Nomura's previous expectation of approximately 50% price cuts. One expert estimated average cuts of about 60%, while the other expected 80–90%, similar to prior procurement outcomes for chemical generics. This suggests that the scale of pricing pressure remains uncertain but could be materially more severe than the institution had previously assumed. On divergent 2Q26 results among pharmaceutical companies, the experts attributed variation mainly to product mix—including exposure to lung-cancer drugs and each key drug's life-cycle stage—and to how strictly individual companies adhered to compliance requirements during May–June. By drug class, they characterized PD-1 inhibitors as mature and with limited growth, noting that some companies have lost share to others. They saw higher potential in antibody-drug conjugates (ADCs). Lung-cancer and breast-cancer therapies were identified as major competitive areas for large pharmaceutical companies, with breast cancer important because of its market size. The experts also expect more multinational companies to grant local pharmaceutical companies commercial rights to mature drugs over time. This points to a potential shift in commercialization arrangements alongside continued competition in established and newer oncology categories.

Analysis framework

The note synthesizes qualitative evidence from two regional sales managers, then links their observations to marketing intensity, compliance costs, procurement pricing, product mix, drug-category maturity and competitive dynamics in China oncology.

Methodology notes

• Industry AnalysisSupply-demand framework

  Expert interviews on oncology-drug marketing activity, procurement pricing and category demand potential.

  Nomura uses regional sales-manager observations to assess how compliance enforcement and procurement may affect drug commercialization, prices and growth across oncology categories.

• Industry AnalysisVolume-price decomposition

  Comparison of biosimilar price-cut scenarios and differences in company performance by product mix and drug life cycle.

  The report separates potential pricing pressure from product-category and portfolio effects to explain sales and results variation.

Key data

• Marketing activity level70–80% of normalExpert estimate for July–August, versus 50–60% in May–June.
• Potential selling-expense reduction5–6ppExperts expect stricter compliance to reduce pharmaceutical and biotech selling-expense ratios from low-thirties to high-twenties percentage points.
• Biosimilar VBP price-cut estimates~60% and 80–90%Two expert estimates, both more pessimistic than Nomura's previous expectation of ~50% cuts.

Impact & implications

The report indicates that normalized marketing activity and structurally lower selling expenses could support operating efficiency, while deeper-than-expected biosimilar procurement price cuts could intensify pricing pressure. Product mix, drug life cycle and compliance execution remain important differentiators among companies.