Architects of catch-up: a synergistic financial engine for China’s pharmaceutical industry

This paper investigates how China architected a mission-oriented financial policy mix to accelerate its catch-up in pharmaceutical innovation. It analyzes two national financial instruments and their synergistic linkage: the Major Project for Drug Innovation Program (MPDI) and the STAR Market’s Fifth Listing Standard. Using a mixed-methods approach combining quantitative analysis with interviews, the study demonstrates how these policies form a coherent ‘push-pull’ engine. The MPDI provides a top-down ‘R&D push’, setting national direction and de-risking early-stage science, while the STAR Market provides a bottom-up ‘capital pull’, enabling market-based selection and de-risking late-stage finance. This coordinated architecture offers a novel governance model for Mission-Oriented Innovation Policy, illustrating how a state can balance strategic direction with market dynamism and achieve cross-ministerial coordination to drive high-risk industrial transformation.