The Great Rebalancing of Biotech R&D; Biggest Clinical Surprise of 2026 from AstraZeneca & Ionis; Summary of the first China BioPioneers-BioVerse Webinar
Asian Biotechies In A Bar; Issue 147; 2026-07-12
Summary
In this week’s issue,
Leon Tang highlights the widening divergence between US biotech’s dominance in M&A and China biotech’s increasing share in BD&L. These results may reflect the evolving formula for biotech R&D.
Angus Liu walks through the biggest clinical surprise this year.
Our summer intern Ella Charen summarized the first China BioPioneers/BioVerse webinar: China’s ADC rise over the past decade reflects a perfect convergence of timing, talent, and infrastructure that let Chinese biotechs iterate faster than the West on payload innovation and manufacturing — but closing the gap on global commercialization and drug delivery will require continued cross-Pacific collaboration.
BioVerse #33, in collaboration with Tonacea, will take place on July 14th at 9AM ET. This webinar is a pre-conference discussion for the first China Pharmaceutical Innovation Conference (CPIC) in Shanghai, July 22-24.
Anna French from Qiming Venture Partners USA, Andreas Penk from European Biopharma Therapeutics, and Dan Zhang from Fudan University will talk about the new West-East Biotech Relay model. Register for the webinar on Zoom here.
CPIC offers complimentary registrations to our newsletter subscribers. Learn more in the paid subscribers’ session.
We’re pleased to share a special benefit for our paid members. TellMed Strategies — a life sciences communications agency and past contributor to previous issue’s communication guidebook for Asian Biotechies — is offering:
A free one-hour consultation
10% off their standard fees for one year
Jiamin Zhuo, Angus Liu, and Leon Tang have been the proud writers and editors of this newsletter since 2023.
Email us at contact@iswtc.org to learn how to support or contribute to our newsletter.
The Great Biotech Rebalancing: Why the Trans-Pacific Relay Model is the Future of Biotech R&D
The first half of 2026 biotech deal-making has signaled a golden age of biotech deal-making and the start of a new biotech R&D model. This resurgence represents a fundamental pivot in market confidence. The sheer volume of capital deployment in H1 2026 underscores this shift:
M&A Resurgence: Total M&A transaction value reached $117 billion, a staggering 111% increase over H1 2025, according to a recent Oppenheimer report. At the current M&A cadence, 2026 is on track of setting a new annual M&A record.
BD&L Velocity and China’s Dominance: Strategic licensing and business development reached $8 billion in total global upfront payments, a 16% year-over-year increase. In a landmark shift, China has become the primary engine of this landscape, with assets originated there securing nearly $5 billion—~60% of all global upfront payments—and commanding an overwhelming 60% of total global BD&L deal value ($99.7 billion out of $166.4 billion), according to PharmCube database (Contact me for H1’ 26 China-originated BD&L analysis).
Chinese assets or platforms accounted for six of the top ten largest licensing upfronts in 1H’26. China has become the primary source of the global BD&L. To navigate this new reality, strategists must look beyond the figures to the distinct roles now played by US and Chinese biotech ecosystems.
The Dichotomy of Dominance: M&A vs. BD&L
The biotech ecosystem has bifurcated into two distinct engines of value: US-driven M&A exits and China-driven early-stage innovation sourcing via BD&L. This split is fueled by a critical scarcity of late-stage opportunities, a reality highlighted in recent Oppenheimer analysis that is forcing Big Pharma to look upstream toward earlier-stage Chinese assets.
US Biotechs, The M&A Exit Engine: The US biotechs remains the undisputed leader in M&A exits. The market continues to reward US firms for their ability to bring assets to global clinical development and the commercial threshold, with median upfront M&A payments hovering above $1 billion for the sixth consecutive quarter. Big Pharma remains the dominant acquirer, accounting for roughly 75% of total M&A transaction value.
China Biotechs, The Early Innovation Powerhouse: Conversely, China biotechs have become the indispensable source for BD&L. Rather than outright acquisitions, the market is turning to China for early-stage innovations and R&D capabilities.
The strategic implication is clear: while the market rewards the US for late-stage clinical development and commercial execution, it is increasingly looking to China for the arbitrage of preclinical and early-stage clinical efficiencies.
The McKinsey Thesis: Structural Efficiencies of China Biotech’s Early R&D
I recently proposed the “Trans-Pacific Biotech Relay” model—designed to capture the synergistic strengths of the US and Chinese biotech sectors—, which is validated by a recent McKinsey report titled Biopharma R&D: The evolving formula for discovery and development.
McKinsey’s structural analysis provides the essential framework to understand why different stages of the drug development lifecycle are migrating to specific geographic hubs, confirming the theoretical underpinnings of my hypothesis.
The China Advantage: China has established a significant lead in the efficiency of drug discovery and Phase 1 clinical development. These stages prioritize speed and the rapid iteration of First-in-Human (FIH) data—areas where Chinese hubs utilize specialized scientific talent pools to move faster than Western counterparts.
The US Advantage: The US maintains its dominance in high-risk, capital-intensive global Phase 2/3 development and commercialization. These stages require sophisticated market access expertise, a deep understanding of complex international regulatory landscapes, and a deep pool of venture capital that only the US investors are willing to deploy.
This finding justifies the “relay” model: China handles the early “sprint” of discovery and initial clinical proof-of-concept, before passing the baton to US-based expertise for the “marathon” of late-stage clinical trials and commercialization.
The Geopolitical Crossroads: Protection vs. Collaboration
As China’s biotech R&D prowess becomes undeniable, the US biotech sector finds itself at a psychological and strategic crossroads. The reaction to this rise is increasingly polarized.
The Protectionist View: Some segments of the industry are succumbing to “paranoia,” attempting to hide themselves from Chinese competition. This stance often cites China’s weak IP protection and China biotechs’ dominant reliance on “fast-follow” strategies that free ride on the US biotechs’ hard-won first-in-class innovations.
The Collaborative View: In contrast, some leading-edge firms are choosing to embrace China’s R&D speed and efficiency. These firms recognize that in an environment defined by a scarcity of late-stage assets, ignoring a region that controls over 60% of current BD&L transaction value is more than a missed opportunity—it is a structural disadvantage.
The “relay” is a structural necessity, not a political choice. Biotechs and investors that adopt the collaborative view are leveraging Trans-Pacific synergies to accelerate their pipeline R&D, while those who pull back risk higher costs and unfavorable market positioning.
Evidence Supportive of the “Trans-Pacific Relay” Model
The “Trans-Pacific Relay” is the industry’s most efficient path for value creation, optimizing the R&D process by utilizing China for discovery/FIH and the US for global clinical development/commercialization.
Strategic Case Study: Candid Therapeutics: The $2.2 billion exit of Candid Therapeutics, announced in May 2026, serves as an excellent “Proof-of-concept” case study. By leveraging China’s advantages in generating early First-in-Human data, Candid achieved an impressive exit, proving early proof-of-concept clinical data generated in China can be tremendously “de-risking” for biotech acquisition exit.
The BD&L Shift: Renting vs. Buying: Data from the 1H’26 period reveals a significant trend: 5 of the top 6 major China-originated deals include R&D collaborations (highlighted in yellow). This represents a shift in risk profile; Big Pharma is no longer just “buying a drug,” they are “renting an R&D engine.” This “relay” ensures that global capital is deployed where it is most efficient at every stage of the R&D.
Conclusion: The Competitive Mandate
The integration of China into the global R&D ecosystem is a fundamental structural shift that transcends quarterly financial metrics. For biotech leaders, acknowledging this reality is no longer optional—it is a competitive mandate.
The “Trans-Pacific Relay” represents a responsible path forward for the industry. Embracing this integration is the only way to bring innovative drugs to patients more cost-effectively by leveraging global strengths, and to maximize ROI to fulfill our fiduciary duty when allocating our capital.
In a globalized R&D market, the leaders of the next decade will be those who move past geopolitical friction to embrace cross-border biotech R&D synergy. The relay is already in motion; those who refuse the baton will find themselves unable to compete.
Leon Tang , Co-Founder of iSWT Community & Founder of InScienceWeTrust BioAdvisory
AZ, Ionis’ shock failure
In probably the biggest clinical disappointment so far this year, AstraZeneca and Ionis’ Cardio-TTRansform trial for Wainua (eplontersen) in transthyretin amyloid cardiomyopathy (ATTR-CM) failed to meet its primary endpoint, as the antisense drug didn’t outperform placebo on the composite outcome of cardiovascular mortality and recurrent CV events.
The outright failure of the study shocked investors. In the two days following Thursday’s announcement, AZ’s shares fell more than 9%, a pretty dramatic reaction for a Big Pharma company.
Ionis suffered even more badly. On the same day, words came out that Roche has halted development of two Huntington’s disease prospects. One of them was Ionis-partnered tominersen, which had failed in a phase 3 before. Ionis’ stock plummeted about 31% during the two days.
ATTR-CM carries blockbuster sales expectations for Wainua, which was thought to be a potential market disruptor.
Of the two approaches to ATTR treatment, Wainua and Alnylam’s siRNA therapy Amvuttra are gene silencers designed to block the production of the TTR protein. Pfizer’s Vyndamax (tafamidis) and BridgeBio’s Attruby (acoramidis) are TTR stabilizers which work by preventing TTR proteins from dissociating to stop the buildup of toxic amyloid fibrils.
Expectations were high heading into the Cardio-TTRansform (C-T) readout because Amvuttra had succeeded in the Helios-B trial, in which CV risk reductions were also observed in patients taking background tafamidis. AZ and Ionis had previously adjusted C-T to make it the largest ATTR-CM trial (1,432 patients) to date and extended its events follow-up time to 140 weeks.
The hope was once that C-T could offer a more definitive answer to the appropriateness of a silencer-stabilizer combination. After all, Helios-B was not statistically powered to prove a definitive clinical advantage within patients who were already taking tafamidis, and it imposed an artificial 40% cap on stabilizer uses at baseline. By comparison, C-T had unrestricted use of background stabilizer—eventually, 57% of patients in each arm got a stabilizer at baseline, and another 24% initiated a stabilizer during the study.
Now, C-T’s failure is being hailed as an undoubtful win for Alnylam and BridgeBio, as reflected in the gains of their share prices. However, I have a few reservations about its long-term implications for the ATTR-CM market.
First, C-T has been viewed as much a competitor to Alnylam as a potential confidence boost to the silencer class and a boon to the overall ATTR field.
ATTR-CM is an emerging disease category. Experts have suggested that it could be more prevalent than originally estimated. But its growth potential hinges on increased awareness and diagnosis. More players, especially someone like AZ, which boasts a large CV presence (Crestor, Farxiga), could help with that.
The C-T fail risks undermining doctors’ perception of silencers as a class, although some have immediately argued that siRNAs are simply better than ASOs. (If you have any hypothesis on whether ASO didn’t work here from a mechanism perspective, I’d love to hear: aliu@questex.com).
In a prespecified subgroup analysis of Wainua monotherapy in C-T, a nominally significant improvement of 29% was observed over placebo on the compositive CV outcomes endpoint. In Helios-B, this number was 33%. Not materially different, right? In the combo subgroup (on stabilizer at baseline), C-T reported “no treatment effect,” while Helios-B got a 21.5% benefit (nominal p-value 0.2701).
During a call after the announcement, Ionis management laid the blame in large part on tafamidis outperforming expectations in a relatively less severe population compared with Pfizer’s original ATTR-ACT study, according to Citi.
It naturally makes one wonder if Amvuttra got lucky. As patients are identified earlier in the disease course due to better diagnosis in the real world, does Amvuttra still hold value on top of stabilizer? That is one big question hanging over Alnylam.
C-T’s primary endpoint was assessed over 140 weeks, whereas Helios-B was across 156 weeks. The notion that longer follow-up could allow for a more noticeable benefit doesn’t work here, according to Ionis management, as cited by William Blair. That’s because more patients started taking tafamidis throughout the study.
Full data from C-T will be presented late August during ESC Congress 2026. Detailed results could “better illuminate the relative benefit of silencer monotherapy vs stabilizer monotherapy in as close to a head-to-head comparison as the clinical community might hope to see,” Citi analysts said in a July 9 note.
In addition, researchers are working on meta-analyses comparing results from C-T to Helios-B and other TTR studies to be highlighted at ESC, according to Citi.
Meanwhile, analysts have now grown increasingly cautious about Alnylam’s next-generation silencer, nucresiran, which is likely dealing with the same stabilizer-heavy population with very low event rates in its own trial. In their note, Evercore ISI analysts suspected Alnylam will amend its trial protocol.
For AZ, the C-T fail is poised to erase a big sales opportunity. But Jefferies analysts still argued that investors overreacted to the news. If anything, the stakes are now even higher for AZ and partner Daiichi Sankyo’s Avanzar trial for their TROP2 ADC, Datroway, in first-line non-small cell lung cancer.
— Angus Liu , Deputy Editor of Fierce Pharma and iSWT Community volunteer
China BioPioneers · International Edition Launches: Inside the ADC Conversation Reshaping Global Oncology
A recap of the inaugural episode, aired July 1, 2026
Moderated by our editor Jiamin Zhuo , the inaugural webinar featured:
Jiaqiang (JQ) Cai — Co-founder, CSO & Co-CEO, MediLink Therapeutics
Ziye Sui — CEO & Executive Director, Lepu Biopharma
Alexandra Snyder — SVP, Discovery Oncology and Translational Medicine, Merck (MSD)
Greg Dwyer — SVP, Business Development, Orum Therapeutics
Anshu Goyal — CEO & Co-Founder, XYone Therapeutics
Background: Why an International Edition, and Why iSWT
China BioPioneers has spent five years and over 100 conversations documenting the arc of China’s pharmaceutical innovation, hosting founders and CEOs from companies including Hengrui, Fosun, Innovent, and Ascentage. The International Edition — a collaboration between Healthcare Executive, Weijieyao, Asymchem, and iSWT Community — represents a natural evolution of that mission.
As China’s biopharma innovation has become increasingly integrated into the global landscape, cumulative license-out deal value has now exceeded $100 billion, and China is shifting from pipeline source to genuine co-creator in global drug development. Yet a communication gap persists: many Western observers still frame Chinese innovation primarily around cost and speed, while Chinese executives increasingly seek direct, substantive dialogue with global peers rather than one-way scrutiny. iSWT — built to bridge Eastern and Western biopharma ecosystems — was a natural partner to help close that gap, giving the series a platform for equal dialogue rather than a one-sided narrative.
Why ADCs: The First Episode’s Topic
The inaugural episode’s focus on antibody-drug conjugates (ADCs) was a deliberate choice — few modalities better exemplify the rise of Chinese biopharma innovation.
China’s ADC pipeline now exceeds 800 candidates, the largest regional ADC pipeline globally. Out-licensing activity tells an equally striking story: a handful of deals in 2019–2020 gave way to explosive growth in 2022–2023, with cumulative reported ADC deal value approaching $40 billion by 2025.
Key Questions Discussed:
1. Why Did China Succeed in ADCs?
The Perfect Storm — Right Time, Right People, Right Place. MediLink’s JQ Cai traced the inflection point to 2016: major Western pharma companies were pulling back from ADC programs amid clinical difficulties, just as novel Topo1-based payloads began to emerge as a real alternative to first-generation linker-payload systems (Immunomedics, Daiichi Sankyo). Even so, Chinese investment kept flowing — Lepu Biopharma’s 2018 acquisition of Miracogen being a case in point, made in pursuit of a synergistic IO + ADC combination strategy that has since become a standard-of-care paradigm across oncology. Simultaneously, highly trained chemists were returning to China from the West, investor capital was flooding into oncology to meet local demand, and China’s CRO ecosystem was scaling rapidly. As JQ put it, nothing mattered more than timing.
The “Triathlon” Modality Fit. ADCs are unusually complex, demanding seamless coordination across antibody engineering, linker-payload chemistry, and advanced CMC. China may not lead the world in any single discipline, but it holds strong, mature capabilities across all three simultaneously — a balanced strength that makes ADCs uniquely suited to the Chinese biotech ecosystem, even without being the single best “swimmer” or “runner” in the field.
Unrivaled Clinical Infrastructure. China’s clinical trial infrastructure allows companies to enroll large patient populations and generate human proof-of-concept data remarkably fast, dramatically accelerating the research-to-clinic iteration loop that underpins everything above.
2. Development Strategy: East vs. West
The Chinese Strategy — Speed, Scale, and Iteration. MediLink is a case study in operating under intense pressure to deliver quickly. JQ described starting the company with no cash and no validated linker-payload system — yet already committed to 60 monkeys for GLP toxicology studies and a secondhand 200-liter reactor. The strategy: design a highly stable, extracellularly-cleaving linker-payload platform, then source antibodies from a range of external partners to rapidly assemble roughly 10 clinical assets. Early BD deals — some licensing assets for startlingly low upfront fees, in one case around $1.5M — let partners fund and de-risk early clinical trials, generating the human readouts MediLink needed to prune its pipeline and scale to 14 clinical-stage assets today. It is a high-pressure-cooker model, but one that China’s clinical infrastructure makes viable.
The Western & Global Strategy — Targeted Risk and Depth. Orum Therapeutics’ Greg Dwyer described a different calculus. Rather than pursuing stepwise improvements on already-validated technology at scale, Orum placed a concentrated, high-risk/high-reward bet on molecular glue degraders (GSPT1) as an entirely new payload class — degrader-antibody conjugates, or DACs — rather than standard cytotoxics. Leveraging Korean funding alongside Cambridge/Lexington-based drug development talent, Orum built the translational depth to move a novel mechanism efficiently from concept into the clinic. The emphasis throughout: fully understand a small number of proprietary technologies rather than advance dozens of assets in parallel.
3. CMC and the Critical Role of CDMOs
Manufacturing emerged as one of the most consequential — and most expensive — parts of ADC development for any early-stage biotech. The panel agreed that integrated, end-to-end CDMOs have become genuine strategic game-changers, and that China’s CDMO ecosystem now leads the global market on this dimension.
Greg Dwyer offered useful historical context: in ADCs’ early days, companies had to build their own manufacturing facilities because third-party manufacturers were unwilling to handle highly potent toxins. Today, Chinese CDMOs lead precisely by offering integrated, end-to-end services — a single partner managing antibody production, linker-payload synthesis, and final conjugation, which dramatically reduces timeline risk when any one step inevitably slips.
Merck’s Alex Snyder emphasized that quality is the absolute priority, followed by flexibility (the ability to absorb clinical timeline shifts) and phase-appropriate capacity. Ziye Sui added color from Lepu’s own experience navigating China’s newly piloted segmented-manufacturing policy across multiple provincial regulators (Hubei and Jiangsu) for its EGFR ADC — complex, but a sign of a maturing regulatory system. Compounding the pressure, the push to reach approval within roughly five years of entering the clinic — versus seven to ten years a decade ago — places unprecedented demands on manufacturing readiness. JQ noted that once a biotech has multiple successful assets, building internal manufacturing capacity becomes essential for supply chain security, though it only makes economic sense at that scale.
4. Challenges and the Road Ahead
China still lacks global commercialization capability. Both Ziye Sui and JQ agreed that while Chinese biotechs excel at early-stage development, the largest and most profitable markets — the U.S. and Europe — remain firmly controlled by multinational pharma. For now, Chinese biotechs have little choice but to partner with MNCs for global commercialization; Lepu, for instance, has no near-term plan to sell beyond China independently. Building independent global sales infrastructure remains a massive, largely unmet hurdle.
The Topo1 payload war. With hundreds of Topo1-based ADCs now in clinical development, the field faces intensifying competition — and, JQ cautioned, real risk of drug resistance emerging across patients treated with mechanistically similar agents.
The delivery problem: less than 2% of active drug reaches the tumor. XYone’s Anshu Goyal offered the panel’s most sobering data point: even the most successful, approved ADCs on the market today deliver less than 2% of active drug to the tumor, with the remaining 98% wasted or contributing to toxicity. By his framing, the field remains in its infancy — and closing that gap will require sustained, global collaboration on delivery and therapeutic index, not incremental payload swaps alone.
5. Extra Advice for Small Biotechs Seeking Big Pharma Collaboration
Merck’s Alex Snyder closed with advice distilled from what she and her team look for when evaluating potential biotech partners:
Address a clear unmet need. Partnership conversations start from the clinical gap you’re closing — not the platform you’ve built. Big pharma is evaluating whether your asset solves a problem patients and physicians actually have today, not just a technically interesting mechanism.
Clarify the problem — and the tangible benefit. Be precise about the specific scientific or clinical problem your technology is trying to solve, and know exactly what data will prove you’ve solved it. What is the concrete, differentiated benefit your tech or drug brings to the table relative to what’s already in development or approved? Vague differentiation claims don’t survive diligence.
Anticipate the future treatment landscape. Don’t design for today’s market. By the time your asset reaches Phase 3, the standard of care may look very different — new combinations, new lines of therapy, new competitors. Understand where your molecule will actually sit in the treatment sequence years down the road, not just where it fits now. It may sound like reading a crystal ball, but every serious partner in this field is trying to anticipate that future and position their therapy as the next advance within it.
At the end of the day, disease has no borders. With substantial ADC work still ahead — on delivery, resistance, and global access alike — continuous, cross-Pacific collaboration remains the fastest path to getting life-saving treatments to patients.
China BioPioneers · International Edition is a collaboration between Healthcare Executive, Weijieyao, Asymchem, and iSWT Community.
by Ella Charen, iSWT Summer Intern.
