China and Hong Kong should consider relaxing their listing rules for biotechnology companies to strengthen funding for innovation, according to a venture capitalist who argues that regulatory flexibility is essential for the sector’s growth.

The investor said that easing certain requirements for public listings could allow more early-stage biotech firms to access capital markets, helping them finance costly research and clinical development while competing globally in drug discovery and medical technology.

Biotechnology companies often operate for years without profits while developing treatments that must undergo lengthy testing and regulatory approval.

Because of this, venture capital funding and access to public markets play a crucial role in sustaining the industry through long research cycles.

Advocates of reform argue that the existing listing frameworks in mainland China and Hong Kong remain too restrictive for many innovative startups.

Hong Kong has already taken steps to support the sector.

In 2018, the city introduced a landmark rule allowing pre-revenue biotechnology companies to go public, opening the capital market to firms that had not yet generated profits.

The reform transformed Hong Kong into one of the world’s leading fundraising hubs for biotech companies and helped dozens of firms raise billions of dollars for research and development.

Further changes followed in 2025, when regulators launched the Technology Enterprises Channel, a specialised programme designed to streamline the listing process for biotech and other advanced technology companies.

The initiative also introduced confidential filing options that allow companies to begin regulatory review before publicly announcing their initial public offering plans.

Despite these reforms, some investors say additional adjustments could make the system more competitive with global markets.

They point to the United States, where biotechnology firms have historically relied on public listings even at early development stages.

According to this view, easing certain financial thresholds or expanding eligibility criteria could allow more promising companies to raise funds sooner.

The discussion comes as China’s biotechnology sector expands rapidly, driven by growing research capacity and a rising number of innovative drug approvals.

Hong Kong has increasingly served as a bridge between Chinese biotech startups and global investors, providing access to international capital while maintaining regulatory standards aligned with major financial centres.

Supporters of further reform argue that a more flexible approach to listing rules would strengthen that role and help accelerate scientific progress.

By enabling earlier access to funding, they say, both China and Hong Kong could deepen their position as major centres for biotechnology development and investment.