This article reviews the results of the basic research about epidermal growth factor and its receptor, and the development of the novel drug, EGF eyedrop, that containing chemically synthesized EGF gene, the construction of EGF expression vector, the transformation of the host cells, the purification of the recombinant protein EGF, the preparation of three batches of the EGF product and identification, the preclinical and clinical trials. Relevant studies show that recombinant EGF consisting of 51 amino acids can be secreted into the medium under the control of the alpha factor leading sequence in the yeast cells. The EGF can accelerate the growth of corneal-limbal epithelial cells and the healing of an alkali burned corneal. The EGF can be used in curing oral cavity ulcer and skin burned wound. And it has the preventive effects on experimental duodenal ulcer of rat. The antiserum was made for test of the concentration of blood EGF and urine EGF by RIA. Data from studies demonstrate the inhibition effect of EGF on the growth of tumor cells, such as A431 and BT325 cells in the presence of high EGF concentration (> 10 ng/ml). The expression of EGFR and DNA ploidy in renal carcinoma has clinical significance. Crystallization and preliminary x-ray diffraction studies of the EGF has been made. The MW of the EGF product is 6000, and the pI is about 4.6 and it has correct N-terminal amino acids sequences, immunogenicity and biological activity. There is no vestige of the DNA of the yeast cells. Animal experiments reveal that there is no cumulation of the EGF in the body, and EGF can promote corneal epithelial healing. There is no toxicological effect during cornea wound healing of rabbit. A randomized, double-blind, placebo-controlled, multi-center clinical trial was conducted in four hospitals to assess safety, ocular tolerance and efficacy of an ophthalmic solution of EGF for 200 cases of cornea transplantation and 247 cases of nebulae. Unequivocal results were obtained as the eyedrop really accelerate the wounded cornea healing. So, the EGF eyedrop as a novel drug of class I is approved by the National Drug Administration, and this is the first gene engineering drug that come from yeast expression system in China.