Pharmaceutical sector ripe for innovation

Second, build a globally competitive workforce with skills in science and technology to ensure China retains its position as a rich pool of talent resources.

Third, create an internationally aligned regulatory system to support, protect and reward innovation and encourage competitiveness.

These steps can play a significant role in ensuring a significant global role for China's pharmaceutical industry.

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Chinese healthcare companies also need to build a corporate culture that says "yes" to bold endeavors when others would say "no." Pushing the boundaries in innovation is embedded in the Novartis DNA.

Worldwide, Novartis has more than 200 projects in clinical development. The company's success rate with new drug candidates is more than twice the industry median.

And sometimes it fails. More often than not, most new drugs and treatments do not make it to the clinical development phase. According to statistics from the InnoThink Center for Research in Biomedical Innovation, for every 10,000 compounds at the beginning of a drug discovery period, only 1,000 will get to the in vivo testing phase, only 10 of those will enter into clinical trials and just one will become registered.

Novartis Chief Executive Officer Joe Jimenez wrote about a failed R&D project for a disease with no existing treatments that ended up being unfruitful. "Taking risks is a big part of innovation," he said. "Taking risks means you might fail, but we shouldn't be afraid of falling short."

Moreover, a more collaborative culture should be encouraged so as to embrace and inspire the full capabilities of China's talent pool.

In China, the supply of talent has been significantly increasing. The pairing of Chinese talent with Western expertise can be spun into a dynamic R&D system that takes a long-term approach to developing medications and treatments for unmet medical needs.

This is an example of how collaborative R&D should be done and can produce great results, and provide the Chinese people with better health and an improved quality of life.

The author is president of Novartis Group (China).