China's encouraging policies for the biological industry are supporting the biopharmaceutical sector's share prices, industry observers said.

The National Development and Planning Commission, China's top economic planner, issued its 12th Five-Year Development Plan for the Biological Industry early last month, showing that the biological pharmaceutical sector is one of the seven key industries that China will support by 2020. The plan stipulates that the annual growth of the sector should be 20 percent in the coming three years.

The average increase in the biopharmaceutical sector's stock prices was estimated at 2 percent on the Shanghai Stock Exchange last month. During the same period, the stock prices of many biopharmaceutical companies, such as Anhui Anke Biotechnolgy (Group) Co Ltd, Baotou Dongbao Biopharmaceuticals Co Ltd and Guilin Layn Natural Ingredients Corp, have even reached the 10 percent daily increase limit.

The government's development plan states that the growth of the biopharmaceutical industry should focus on research and development of innovative products, promotion of new technologies, application of academic research results and adjustment of the industrial structure.

Billions of yuan will be invested to support the development of biological medicine, chemical medications and modern traditional Chinese medicine.