Patent Portfolio Landscape in China’s Orange Book : Size Achievements and Persistent Quality Gaps Between Domestic Firms and Multinational Corporations

Abstract

China’s 2021 Pharmaceutical Patent Linkage System, a significant alignment with U.S. intellectual property frameworks, transforms drug innovation dynamics in the world’s second-largest pharmaceutical market. Our study provides a systematic comparison of drug portfolio size, quality, and global reach between domestic firms and multinational corporations (MNCs) within China’s evolving regulatory landscape, while such an analysis is currently lacking for developing economies. Through analysis of 415 chemical drugs and 4,326 patents registered from July 4, 2021, to July 4, 2023, in China’s Orange Book, we identify structural asymmetries between MNCs and domestic firms. MNCs achieved a 49.0% expansion in patent portfolios following China’s 2015 drug regulatory reforms and maintained dominance in oncology drug approvals (67%), while domestic firms narrowed the gap in new molecular entity (NME) drug patent quantity (2.32 vs. 1.90 per drug, P < 0.05), driven by policy incentives like priority review (IRR = 1.82, P < 0.001), and led in cardiovascular (70%) and neurological (68%) drug approvals. However, substantial quality disparities persist, with domestic NMEs patents exhibiting narrower scope (14.26 vs. 18.05 claims, P < 0.01), less technical documentation (41.45 vs. 91.65 specification pages, P < 0.0001), and limited global patent coverage (8.83 vs. 28.94 patent family sizes, P < 0.0001). These findings reveal a quantity–quality paradox in China’s pharmaceutical patent landscape. China’s policy-driven NME surge masks vulnerabilities in patent quality and global competitiveness. Therefore, China should shift incentives from quantity-focused incentives toward measures promoting innovation quality, global patent governance, and strategic positioning in high-value therapeutic frontiers.