Merck won plaudits at the European Society for Medical Oncology for the first pivotal trial of sac-TMT, which it licensed from Chengdu-based Sichuan-Kelun Pharmaceutical and whose revenue Merck hopes will offset expiring patents on the world's best-selling drug Keytruda. At the same Madrid meeting, Guangdong-based Akeso showed data on ivonescimab, which its licensee Summit Therapeutics hopes will supplant Keytruda.

At a Jefferies healthcare conference in June, Pfizer CEO Albert Bourla said: "The way I see it, by 2030 my competition will not be Merck and Lilly -- it will be Chinese companies."

Almost 40% of drugs now in clinical trials -- and about half of the cancer drugs -- originated in China. American investors may be wondering how to catch a ride on China's wave of drug innovation.

Brokers can help you buy shares of Kelun, Akeso, and the other Chinese pharmas listed on Hong Kong's stock exchange. A few, like Zai Lab, have dual listings on Nasdaq.

For the foreseeable future, however, the answer will be right in front of you. America is where the world's drug companies make money. Regulatory and commercial savvy, not to mention geopolitics, will put much of the money from China's drug inventions in the pockets of the U.S.-listed companies that license and sell them.

That includes the big multinationals -- Merck, GSK, Pfizer, Eli Lilly, AstraZeneca, Roche Holding, Bristol Myers Squibb -- along with specialists like Summit. Many ventures made with Chinese ingredients will travel the world in a Western vehicle, like the Nasdaq-listed BeOne Medicines or Legend Biotech.

In September, China's government set a 2030 goal for a quarter of the world's breakthrough drugs to be Chinese, with at least five reaching blockbuster billion dollar annual sales.

Don't bet against them. In a decade, China's drug industry has gone from supplying chemicals and generic drugs to creating products that accounted for half of last year's global partnership or licensing deals -- worth some $135 billion. It is easier to get a drug into human clinical trials in China than in the U.S., so China is one of the first places to learn if a new molecule works in people.

Hundreds of top-notch biotech firms cluster around cities like Shanghai, and they work hard. On a September tour of Chinese biotech centers, Goldman Sachs analyst Salveen Richter visited a company in the evening.

"It was like 10 o'clock at night and the people were all still working," Richter says. "I think they work six to seven days a week."

However swift their scientific ascent, Chinese companies don't yet feel ready to tackle regulation, sales and insurance in the country where global drug companies make their best profits. The U.S. accounted for half of last year's global prescription drug sales, according to the industry researchers IQVIA, while Europe contributed about 25% and China just 7%.

China's low drug prices, and its oversupply of competing companies and molecules, leaves much of its biotech industry gasping for profits. That may result in a shakeout, like the one expected for China's electric-vehicle industry Few drug discoverers have the wherewithal to take their products global. Well-capitalized U.S. and European firms have lots of licensing opportunities.

"We didn't yet see any company in China that was saying, 'Hey, I'm going to start to commercializing myself globally,'" says Richter's Goldman colleague Asad Haider. "They have chosen to partner."

The fast-growing, profitable Innovent Biologics is frequently mentioned as one of China's most likely to succeed on the world stage. Its recent license deals with the likes of Takeda Pharmaceutical, Lilly, and Pfizer could bring in as much as $34 billion, and represented about 30% of Chinese out-licensing.

Yet its CEO Michael Yu told journalists in September that his company still feels like a start-up when it comes to handling American reimbursement, insurance formularies, medical affairs, distribution, and marketing.

To gain experience, Innovent has demanded co-development and co-commercialization arrangements in five recent global license deals. Over the course of those drug approvals and launches, the Chinese company will gain know-how and a bigger share of U.S. profits than China-based innovators have previously enjoyed.

Another way for China's pharma firms to gain experience, and capture U.S. profits is with the so-called NewCo model in which they license proprietary drug candidates to a new, independent company, says H.C. Wainwright healthcare analyst Arthur He.

Jiangsu Hengrui Pharmaceuticals has favored this strategy, in which it puts the foreign rights to a drug into an American business that is dormant but has a Nasdaq listing. Bolstered with fresh capital from venture backers like Bain Capital Life Sciences and Atlas Venture, the maneuver gives Hengrui a piece of what is essentially an American biotech start-up.

Earlier this year, Hengrui put its GLP-1 weight-loss assets into Kailera Therapeutics. An experimental drug for a genetic heart problem went into Braveheart Bio.

With this year's revival in biotech stocks, other Chinese firms are trying NewCos.

Hansoh Pharmaceutical Group is bringing a psoriasis drug to the Nasdaq-listed NextCure, which will become Avere Therapeutics. Qyuns Therapeutics put a Crohn's disease drug into Synlogic, soon to be renamed Caldera Therapeutics.

Wellington Management invested in private financing for Avere, Caldera and a few other firms. Such deals give Wellington access to Chinese innovation, says the money manager's head of private biotech investing, Nilesh Kumar.

These Nasdaq-listed plays will give public investors access, too.

The ventures aren't China-domiciled, so they may escape the geopolitical obstacles shadowing China-U. S. technology transfers. On Oct. 22, the U.S. Treasury proposed restrictions on American equity investment in Chinese biotech ventures -- with an exemption that allows technology acquisition and licensing. But an analysis last week by the law firm Sidley suggests that some NewCos could be barred by the proposed rules.

These international complications may help explain why the first companies to turn Chinese innovations into global blockbusters took care to plant their roots abroad.

Legend Biotech is a New Jersey-based pure play on a cell therapy invented in China. Partnered with Johnson & Johnson, it will share over $2 billion in revenue this year from the Carvykti cancer treatment.

BeOne should see $5 billion in sales this year from Brukinsa, the cancer treatment invented 10 years ago in the company's Beijing lab. Last year, BeOne changed its name from Beigene and redomiciled to Switzerland.

Apart from these few pioneers, it will take some years before China-based drug developers challenge Pfizer and the other multinationals in global markets. Until then, Pfizer and its peers will continue licensing from prolific Chinese innovators like Suzhou-based CStone Pharmaceuticals, to fill the holes left by their own expiring patents.

Investors will have ample opportunity to pick their plays. Molecules licensed from China fuel some of the highest hopes in Big Pharma's pipelines, and their clinical-trial results will be widely reported.

At last month's ESMO conference, GSK, AstraZeneca, Bristol, and Takeda Pharaceutical presented new treatments for lung and stomach cancers. Those drugs were licensed from China.

Merck is betting big on sac-TMT, the guided chemo drug it licensed from Kelun. At ESMO it presented the first of 18 Phase 3 trials on the drug. In patients with endometrial cancer -- an illness where available treatments do little good -- there were one-third fewer deaths in those treated with sac-TMT.

Goldman's Haider estimates that Merck's peak annual sales of sac-TMT could approach $14 billion, in a decade.

That would be a nice reward for Merck investors, and for cancer patients.