The uncomfortable truth is that the Western system can select winners without selecting for upstream process excellence. You can win by licensing the molecule, then outcompeting on reimbursement strategy, access, marketing, and distribution. That is profitable in the short term, but it quietly degrades the one thing that compounds: the industrial capability to discover, test, and make the next generation of drugs.
But systems still run on messy human capability. Biology is not a clean API. The loop only compounds if you own the ugly middle: how experiments actually get done, how failures get debugged, how quality is enforced, how intuition forms.
That’s why outsourcing is more than a margin decision. When you outsource enough of the wet work, you export capability IP. And it’s almost invisible because it shows up as OpEx, not CapEx. It doesn’t trigger alarms. It just compounds, until the industrial base you rented becomes the one that out iterates you.