China has recently designated 15 cities as pharmaceutical export bases. As the drug industry in the country develops and the manufacturing base is modernised, exports of medicines have risen sharply. The number of domestic producers involved in the export sector has also grown rapidly, helped by increasing foreign investment in manufacturing units.

Recent data has shown drug production in China has increased at an average rate of 20% per year since 1978, outperforming the overall economy. In 2004, pharmaceutical output reached CNY367.6bn (US$45.5bn) while exports were valued at US$12bn.

China is also a leading producer of active pharmaceutical ingredients (APIs). The country produced over 1,500 different drug raw materials for use in western medicine in 2004, with output reaching 900,000 tonnes. This represents roughly 22% of the demand for APIs from western drugmakers.

Of the fifteen export cities the majority are located in the industrialised eastern coastal region and will each specialise in different areas of the drug sector. For example, Beijing and Changchun focus on biomedicine, while Shijiazhuang and Hangzhou will focus on the export of chemical pharmaceuticals.