Spending on bio-IT products within China’s life sciences industry will grow at a CAGR (compound annual growth rate) of 42 per cent up to 2006 when the market will be worth US$344 million [M], according to research released Thursday by IDC.
Life sciences is one of the key industries identified by the Chinese government to help build a new economic structure for the giant Asian nation. China’s accession to the World Trade Organization (WTO) and its recognition of the economic value of developing its own intellectual property will help change the face of life sciences in China, IDC said.
Currently, the academic sector accounts for 34 per cent of China’s bio-IT spending and the government 19 per cent, according to IDC figures. Private biotechnology companies currently account for 15 per cent of the market but are increasing their spending rapidly and by 2006 will account for 32 per cent of all bio-IT spending, IDC said.
Building infrastructure through buying servers, server clusters and software dominates bio-IT spending in China at the moment. By 2006, professional and IT services will be the largest sector of the market, growing at a CAGR of 64 per cent over the next five years. This boost in spending on services will be driven by the increasing complexity of integrating bioinformatics and data management applications to meet scientific needs, IDC said.
The Chinese government is playing a key role in the country’s bio-IT market by allowing commercial ventures to be spun off from existing state-run medical and biotechnology research institutions, with over 100 such conversions happening in the last three years, according to IDC.