The Covid-19 pandemic caused overall greenfield foreign direct investment (FDI) project numbers to decline by 17.5% in 2020. However, as the world reopened in 2021, investors reacted quickly and FDI levels rose by 18.1%, according to our Global FDI Annual Report 2022

In 2021, most sectors witnessed a rise in the number of FDI projects. The clinical trials sector was no exception, particularly regarding investment activity coming from clinical research organisations and other providers of products and services supporting drug development.

Specifically, our FDI projects database shows that there were 43 projects in the clinical trials sector in 2021, up from 37 in 2020 and 40 in 2019. Among the projects announced or opened in 2021, 81% were new projects and the rest were expansions of existing facilities.

Where are the leading FDI destinations for clinical trials?

Western Europe was the leading region when it came to attracting FDI projects in the clinical trials sector in 2021, with 37.2% of all projects announced or opened globally. Asia-Pacific received the highest number of projects during the period 2019-21.

When it comes to the leading destinations for FDI projects, China and the US ranked at the top for this three-year period, with China receiving 17 and the US 16. In 2021, the US attracted five projects, up from three in 2020. However, China experienced a significant drop as it received only two projects in 2021, down from 12 in 2020.

The US is a key investor in China in clinical trials FDI

The US has been the key source country for clinical trials FDI in China, as US-based investors backed 15 out of the 17 projects that the country received across 2019, 2020 and 2021. It also received one project from Germany and one from Japan.

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Irish, French, and Canadian investors backed most of the projects, opened or announced in the US, during this period. The US also attracted projects from investors based in South Korea, Switzerland, Spain, the UK, China, Japan and Italy. Novadiscovery, a France-based healthtech company using in silico clinical trials to predict drug efficacy and optimise clinical trial development, opened its US headquarters in Boston, Massachusetts in 2021.

Several countries, including the UK, South Korea and Ireland, began to recapture inward clinical trial sector investment in 2021, having seen levels plummet in 2020. Other countries that received an impressive number of projects in 2021 include Poland, Australia and Belgium. Switzerland attracted three projects in 2020 and two in 2021.

What are the top FDI project business functions in clinical trials?

Business and professional services was the largest business function in terms of inbound clinical trials FDI projects in 2021, as it had been for the previous two years. China received most of these projects during this three-year period, followed by the US.

The second largest business function in 2021 was research and development (R&D), with China, the UK and the US all performing strongly in this area. R&D registered 14 FDI projects in 2021, up from five in 2020.

Where are the clinical trials investors located?

The US was the leading source market for outbound FDI in clinical trials projects in 2021, a position it also help in in 2019 and 2020. It was the source country for 51.6% of all clinical trails FDI projects announced or opened across 2019, 2020 and 2021.

Companies from the US invested in 15 projects in China, seven in the UK, and four in Poland and Australia across this three-year period. There were eight projects announced or opened by UK-based investors, while German and French investors backed six projects each.

The clinical trials sector not only managed to bounce back in 2021 from a Covid-hit 2020, but also received more projects than the year before the pandemic started. However, issues such as Russia's invasion of Ukraine, the global cost of living crisis, slow economic growth and continued supply chain disruptions mean that 2022 could be a bumpy year for FDI in all sectors.

Click to download the full Global FDI Annual Report 2022.