Cross-border biotech deals grow more complex as US targets China investment links

Cross-border collaborations in the biotechnology sector between China and the United States are navigating a more complex landscape, with potential for a moderate slowdown. Washington's intensified efforts to restrict investment and technology transfers are introducing new challenges for these deals, according to industry analysts.

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There will be more geopolitical scrutiny going forward. This scrutiny may lead to slightly fewer deals than without it.

"There will be more geopolitical scrutiny going forward. This scrutiny may lead to slightly fewer deals than without it," said Diederik Stadig, senior healthcare economist at ING Research. Despite these growing regulatory hurdles, Stadig believes the fundamental trend of Western pharmaceutical companies seeking partnerships with Chinese biotech firms is unlikely to reverse.

"Given the rising importance of Chinese innovation, Western pharmaceutical companies will continue to strike deals with Chinese counterparts, and we expect this trend to accelerate in the years ahead," he noted. ING Research forecasts that the value of out-licensing agreements between Chinese biotech companies and Western drug makers will approach approximately $240 billion this year, a substantial increase from $136 billion in 2025.

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Given the rising importance of Chinese innovation, Western pharmaceutical companies will continue to strike deals with Chinese counterparts, and we expect this trend to accelerate in the years ahead.

Stadig further commented on the potential for even larger transactions. "There is room for these deals to become even larger," he said. "Only the largest pharmaceutical companies have the scale and resources to navigate the political environment. These transactions will increasingly remain the domain of Big Pharma."

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There is room for these deals to become even larger. Only the largest pharmaceutical companies have the scale and resources to navigate the political environment. These transactions will increasingly remain the domain of Big Pharma.