According to Frost & Sullivan’s research in the Chinese vaccine market, the CAGR of the pharmaceutical industry in the next 7 years is expected to be around 4-5 percent, of which CAGR of the vaccine market is predicted far beyond that of the pharmaceutical industry at 14-15 percent. Frost & Sullivan strongly believes that there are great opportunities for vaccine producers with the rapid growth of the Chinese vaccine market. There are four key factors that keep driving the growth of the vaccine market. Firstly, stable demand guarantees the growth of the vaccine market. The children vaccine segment is, and will continue to be the most important part of the total vaccine market. In the year 2008, the number of newborns in China was 16,080,000 with a birth rate of 12.4 percent. The birth rate is expected to decrease gradually in the long run, but considering the country’s current larger population base comprising young productive ladies, the number of new born babies in next 5 years will remain at a stable and relative high level. In this way the demand of vaccine will up keep its increasing trend. Secondly, the public awareness for importance of vaccination is also on the rise. The recent H1N1 breakout actually increased the awareness of prevention through vaccination among the public. In addition, we have noticed that some pharmaceutical companies start to promote their vaccines on television and even outdoors in the form of public service advertisements, which also helps to popularize the awareness of disease prevention, hence increases vaccine consumption. Thirdly, the self-paid rate of vaccine is expected to increase. The usage rate of self-paid EPI (Expanded Programme on Immunization) vaccines is about 10 – 20 percent. POV doctors strongly recommend free vaccines. In the future, with the increasing healthcare expenditure of the Chinese people and the increasing awareness about vaccine features, the self-paid vaccines, which are usually of better safety profile, are expected to be used more widely and frequently. Last but not least, government support guides a promising development for the vaccine market. The Chinese government has paid and will pay more attention to prevention and immunization. In 2008, the government announced the enlarged immunization program, increasing the financing from previously 218 million RMB to 2.8 billion RMB. The policy from Central Government provides the whole industry with a strong confidence and good environment for further development.