(Yicai) June 24 -- China's significant progress in protecting intellectual property rights over recent years has led many multinationals, including pharmaceutical giants AstraZeneca and Bayer and construction toy maker Lego Group, to increase their investment in the country.

After AstraZeneca successfully defended a patent for its diabetes drug in 2021, the Cambridge-based firm invested nearly CNY9 billion (USD1.2 billion) to build new production lines and research centers in China.

The revision of China's Patent Law in 2021 extended the protection period of innovative drug patents, increased the corresponding punitive compensations, and significantly hiked the cost of rights infringement.

"China's strengthened IP protection relevant to healthcare and medicines has spurred foreign investors to hike their investment in the country," said Xu Feng, associate vice president of AstraZeneca's local arm.

"Besides Europe, the United States, and Japan, investors are also likely to include China into their list of prioritized markets after it introduces the compensation mechanism regarding the period for drugs' patent protection," said Liu Hongqiang, vice president IP of Bayer China.

Over the past five years, Bayer's drugs cumulatively secured approvals for nearly 30 new products or indications in China, with their market launch speed almost the same as globally, Liu pointed out.

Thanks to China's enhancement of its IP protection mechanism, Bayer was reimbursed CNY25.6 million (USD3.5 million) in the second round of its litigations against patent infringement between 2019 and last year. This was the biggest compensation received in patent disputes in the country's medical device sector and life sciences.

Lego has successfully safeguarded its rights in the Chinese market and has witnessed China's achievements in strengthening the protection of IPs, said Robin Smith, vice president and general counsel for China and Asia Pacific of the Billund-based firm.

In April, infringers were given a penalty of CNY600 million (USD82.6 million), with the principal criminal sentenced to up to nine years in prison, Smith noted, while adding that the USD550 million Legoland Shanghai Resor is expected to open soon.

Enhancing IP protection for foreign companies plays a significant role in Shanghai's development into a first-class business environment, according to Yu Chen, deputy director general and spokesperson of the city's IP Administration.

Over the past three years, the IP Administration collectively dealt with over 60 cases about the administrative adjudication regarding patent infringements and disputes of foreign companies, cracked down on more than 1,000 cases of trademark infringements and illegalities related to foreign firms, and included almost 100 foreign companies' trademarks into Shanghai's key trademarks catalog, Yu pointed out.

Editor: Martin Kadiev