China Shifts to Domestic Reagents Amid Tariff Pressures

Pharmaceutical research and development companies in China are increasingly turning to locally manufactured reagents, driven by a need to cut costs, reduce delivery times, and navigate trade uncertainties, according to industry executives.

For years, Western suppliers like U.S.-based Thermo Fisher Scientific and Germany’s Merck dominated China’s reagent market — key compounds used in laboratory testing, analysis, and quality control. However, rising import tariffs linked to the ongoing U.S.-China trade tensions, alongside long-term concerns about supply security and costs, have shifted demand toward domestic producers such as Shanghai Titan Scientific and Nanjing Vazyme Biotech.

According to UN Comtrade data, China’s reagent imports for laboratory and diagnostic purposes were valued at $5.76 billion in 2024, slightly down from $5.83 billion in 2023. Executives from Chinese pharma firms, including ChemPartner PharmaTech, say locally made reagents now meet most of their needs, offering faster delivery and competitive quality.

The change accelerated after April, when China raised tariffs on U.S. goods to 125%. Although these duties have since been lowered during ongoing trade talks, the uncertainty has prompted more than 90% of Vazyme’s customers to explore replacing imports with domestic products.

Broker forecasts suggest strong growth ahead for local suppliers. Titan’s revenue is expected to rise 22% in 2025 to 3.52 billion yuan ($490 million), while Vazyme’s revenue is projected to grow 15% to 1.59 billion yuan. Their share prices have surged 54% and 18% respectively since January, while shares of Merck and Thermo Fisher have fallen 21% and 8%.

Industry analysts believe there is still significant room for local products to replace imported biological reagent enzymes, indicating this shift is likely to continue.