In the first half of 2026, China's innovative drugs ushered in a historic turning point when they went out to sea - in just 60 days, three newcos, Ouro, kailera and candid, intensively completed their exits, with a total transaction volume of more than 5billion US dollars. Without exception, the core assets of these companies are all from China biotech.

This is not only a carnival of capital, but also marks the official landing of Newco 2.0 era: from "selling pipelines" to "selling companies", from license out to closed-loop equity capitalization, China biotech is participating in Global Asset Pricing with a new attitude.

With a number of Newco companies entering the cash stage from paper wealth, more and more biotech venture capital institutions have increased their stakes in this strategy. Since the beginning of 2025, forbion, RA capital, Novo holdings, orbited and many other institutions have participated in nearly 20 Newco companies.

In this wave, another heavyweight player emerged - MPM bioimpact, an old US biotech investment institution with more than 30 years of history and more than $3.5 billion in assets under management.

In June, K2 therapeutics and Deqi pharmaceutical reached a Newco cooperation to introduce all global interests outside the Greater China region of the solid tumor FIC pipeline atg-106 (cdh6 × CD3), with a potential total transaction amount of $960.5 million.

K2 is a cutting-edge platform set up by MPM bioimpact in Singapore at the end of 2024, which is another precise placement in China's innovative drug assets after it joined hands with ecorex (anti-5T4 ADC product acr246).

From ADC of ecorex to TCE of deqi pharmaceutical, K2 has completed several transactions with a low profile in the first half of this year. Around these transactions, tongfreehand interviewed Wu Jie, head of Asia Pacific region of MPM bioimpact and CBO of K2 therapeutics.

In her view, K2's path is clear and direct - it uses a global perspective to screen the assets with the most FIC potential, takes the global clinical development experience that the United States is good at as the engine, takes China's efficient target validation and innovation efficiency as the accelerator, realizes the maximization of overseas value through the hub and spoke architecture, and finally completes the exit from the closed loop.

This closed loop is run through by three progressive problems: how to screen the most differentiated assets from a global perspective? How to build an operational architecture that can be expanded and reused? In the context of increasingly complex cross-border cooperation environment, how to achieve long-term sustainable value creation through regional layout? The following is Wu Jie's disassembly one by one.

01、 "selection logic" behind the transaction

"From the perspective of the screening process, this is actually a relatively technical decision. ”When it comes to the latest deal between K2 and Deqi, WuJie comes straight to the point.

The core asset of this transaction, atg-106, originated from the second-generation antengager built by Deqi ® The differentiated TCE platform, which uses the unique steric hindrance masking technology, directly targets the pain points of the industry where the first generation TCE has insufficient efficacy in the treatment of solid tumors and high incidence of cytokine release syndrome.

In terms of transaction structure, this cooperation is different from the traditional path of isolated authorization of single assets of the initial generation of Newco, and adopts a dual pipeline binding architecture. In addition to the direct authorization of atg-106, the transaction also comes with the option of a preclinical TCE pipeline, forming a "one platform carrying multiple assets" mode of going to sea.

"We like many assets of Delphi at the same time, but for earlier assets, the risk will be relatively higher, and we will prefer option trading. ”In this regard, WuJie explained that K2 made the more mature atg-106 into a direct authorization, and another project adopted the option structure.

Similar dual pipeline strategy is also reflected in the transaction between K2 and ICRIS. In addition to the core anti-5T4 ADC product acr246, the two sides also signed a contract for an earlier preclinical project.

However, the specific considerations of ICRIS are different. "There is a subsequent iteration project around the 5T4 target of ICRIS. From the perspective of BD, we should also bring in potentially better next-generation products. ”TheWu Jie revealed that in the first half of this year, K2 has landed several single transactions, covering TCE, ADC and other popular tracks. Each transaction points to the same logic: "when we look at products, we always take data as the basis and require clear differentiation advantages."

In terms of funding rhythm, K2's strategy is that the higher the risk of the project, the less the early-stage investment, and the transaction structure will design most of the payment at subsequent nodes - only after seeing the clinical data will a large amount of money be invested.

This investment logic of "unlocking according to nodes" ensures that the risk is always under control, and also lays an asset foundation for the subsequent systematic operation.

02、systematizes and reconstructs Newco mode

"The bottom logic of Newco is to take out the things that are most easy to finance as a company. ”Wu Jie defines the essence of Newco in this way.

In her view, under the current environment, asset oriented companies are more likely to be favored. "Large pharmaceutical enterprises are also asset oriented when evaluating transactions. When the company has few main pipelines, such as the transaction between Gilead and tubulis, both pipelines are attractive and can directly acquire the whole company. However, if there are many pipelines, it is unlikely that each is of high quality. ”

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The K2 model is designed for this purpose. The goal of K2 is to have fiveorsix selected projects, and each asset is placed under an independent subsidiary, so that each subsidiary is asset oriented. The Chinese partner obtained equity in the subsidiary, leaving room for future M & A exit.

This is also the core logic of the hub and spoke system highlighted by K2: hub is responsible for resource planning and strategic decision-making, and various target subsidiaries (spoke/assetco) operate independently and share the capital, clinical and management resources of the hub.

Different from the traditional single pipeline Newco, this model allows multiple projects to be promoted at the same time, and the risk can be dispersed through capital operation - each project subsidiary can be raised separately or sold as an independent M & a target; If the R & D of a project fails, the risk is locked in the subsidiary and will not affect the central company or other subsidiaries.

"Take the 5T4 project as an example. If a large pharmaceutical company is interested in the project, it will probably hope to put its iterative products into the bag. The whole equity transaction is a very logical transaction structure. ”

At the same time, K2 listed global clinical development as its own advantage, "we are a company with clinical capability as its core competence. ”Wu Jie said, "the pre clinical assets will be promoted from the partner to the clinical stage; even for atg-106, we will not undertake toxicological experiments on our own after we authorize the introduction, and the partner will continue to promote. This is not our strength. ”

K2's strongest capability is the "relay" - after seeing the clinical data and confirming that it is a drug in research, it will promote the overseas clinical development with its own team and experience in the most efficient way: select the best indications, refine the implementation, and advance to the phase II proof of concept stage to realize the transaction value.

The clinical team was in place at the beginning of the project, including senior clinical executives in-house and MPM entrepreneurial partners with many years of clinical development background.

Frank Neumann, who is currently the chief medical officer of K2, is deeply involved in the field of cellular immunotherapy. He once served as the CMO of orna therapeutics and was involved in promoting orna and Eli Lilly to reach an acquisition transaction with a potential total consideration of up to $2.4 billion. Meanwhile, samit hirawat, the former chief medical officer of BMS, served as the independent director and consultant to provide clinical and medical strategic support for K2.
Judging from the current situation, with the gradual exit of the first batch of Newco companies, the market also has more specific ideas about the end point and project exit path of Newco.

WuJie stressed that withdrawal was not a temporary consideration, and a timetable had been set from the beginning of BD. "The docking with big pharmaceutical companies does not need to wait until the proof of concept data is available. We regularly exchange the progress of the product portfolio."

As for the exit mode, K2 sells part of assetco, and the remaining assets can be packaged and listed. Similar to the Cullinan model incubated by MPM, K2 has become a typical biotech company with continuous operation.

"This is the combination strategy of selling assetco and the final listing of K2. ”Wu Jie said, "no one can guarantee that each of the five or six asset subsidiaries can complete the exit within the expected time, but the exit must be realized within the expected time frame."

03、Is betting on China's innovation

Behind K2's continued increase in China's innovative drug assets is the systematic reshaping of MPM bioimpact's strategy in Asia.

In 2024, MPM further strengthened its Asian layout and set up a localization team MPM Asia in Singapore to more systematically find and undertake innovative asset opportunities in Asia, especially China. At the end of that year, MPM Asia further incubated and established K2 therapeutics, and began to put this set of company incubation, global development and exit design capabilities into China's innovation assets.

WuJie said frankly that when MPM Asia was established, geopolitical issues were no stranger, and the choice of Newco model itself was a structural evasion, and as a venture capital institution focusing on incubation, MPM's Newco model can give full play to MPM's incubation strengths.

There are also clear strategic considerations behind the choice to settle in Singapore. Singapore's legal system and corporate governance structure are highly similar to those of the United States, facilitating smooth convergence with the United States; At the same time, its geographical location and time zone are close to China, so it has become an ideal transit station in Sino US cross-border transactions.

"The way for Singapore entities to go public on NASDAQ is clear; from the perspective of BD, the hub and spoke system is not a one-off deal. We hope to run BD in China for a long time, find good projects and know more companies. Therefore, we cannot rely on long-distance flights for a long time and need to be closer to China. ”Wu Jie added.
In terms of the cooperation mode, K2 also emphasized "not breaking away from China".

K2 takes away the rights and interests outside China. After the transaction is completed, the two sides continue to cooperate around clinical development. "The Chinese partner can continue to push the clinical development in China, or the Chinese partner can bring the assets from preclinical to early clinical, and we will enter the next round of large investment."

In practice, K2 encourages Chinese partners to participate in the global trial: "we hope that we will never leave China. Chinese partners can perform the Chinese part of the global trial and bear the corresponding costs. At the same time, the Chinese part can also support the registration and declaration in CDE. ”

In terms of team configuration, K2 also made precise arrangements around "speed". The Singapore team is all bilingual and bicultural, and all have American work experience, especially at the implementation level, including clinical implementation, alliance management, etc., all equipped with bilingual and bicultural personnel, "we hope to achieve the goal of maintaining the speed of China after the asset is obtained. ”

On the whole, K2 has made full consideration at the design level from the choice of the company's establishment structure and registration place to the use of authorization or asset transfer in the transaction structure, so as to remove obstacles for cooperation as far as possible.

In terms of investment, K2 is one of the largest projects invested by MPM after the sale of orna, and it is also one of the few large-scale investment projects with an investment of more than US $100 million, which shows the importance MPM attaches to the layout of Asia.

At present, K2 is the first Incubation Platform of MPM in Asia, but MPM's Asian strategy is not static, and may be adjusted according to market changes in the future.
"In the future, it may not be Newco. There may be incubation platform companies, cooperation with colleges and universities, or equity investment. We not only consider the most appropriate model at present, but also hope to continue to work in China. Therefore, we maintain close cooperation and exchanges with clinical PI, biotech innovation companies and colleges. ”

When asked about the changes in China's biotech innovation capability, Wu Jie believed that the overall quality of China's innovative drugs has been significantly improved in recent years. "After experiencing this wave of downturn, we have learned a lesson from a fall, and it is difficult to get rid of me too assets. Many Chinese biotech founders have a good understanding of industry trends and a full understanding of real differentiation. ”

In her view, the scarcest thing in the industry in the past few years is enough mature capital. The K2 model provides an answer - connect innovative assets with global capital in a structured way, and turn China's innovation efficiency into global asset value with clinical development capability as the hub.

04、Innovative answers in the era of newco2.0

From the screening logic of multiple transactions to the refined operation of the hub and spoke model; From the design of the dual exit path to the strategic consideration behind Singapore's site selection - K2 therapeutics has built an extensible Newco template.

Its uniqueness lies in that it not only has the maternal support of more than 30 years of incubation experience of MPM, but also realizes the effective integration of cross regional resources through Singapore, a regional headquarters with both international vision and Asian tentacles; At the same time, assetco structure is used to leave enough independent exit space for each transaction, while retaining the imagination space for the overall listing of hubco.

At a time when the Newco model has entered a period of large-scale explosion and the cross-border cooperation environment has continued to evolve, the problem-solving ideas given by K2 may be worth pondering by the industry: de risking is not to avoid China, but to use the structural design as a lever to turn the speed of China's innovation and the certainty of global commercialization into a closed-loop value that can be realized eventually.