One Platform, One Check, Two Paths for NewCo
May 09,2026
An entirely new corporate model is disrupting the traditional logic of launching Biotech companies.
Instead of building businesses on standout early scientific research or novel technology platforms, a growing number of startups adopt a lean team structure paired with large-scale financing, in-licensing one or two clinical-stage pipeline assets from China.
Dubbed the NewCo value creation model, this approach has existed for years. Now, as China’s pharmaceutical R&D industry enters a recovery and growth phase, the NewCo model anchored by Chinese pipeline assets is gaining unprecedented momentum.
So far, the model has delivered tangible results for investors. Kailera Therapeutics, focused on obesity, set a record for the largest Biotech IPO in history in April. In early May, Candid Therapeutics announced its acquisition by UCB for $2 billion. Shortly after, Windward Bio closed a $165 million cross-border financing to advance two China-originated investigational drugs for respiratory and dermatological diseases.
According to industry media Endpoints News, since early 2025, at least 18 private Biotechs have adopted this model. Collectively, these firms have raised no less than $2.3 billion, and the entire operation framework has become increasingly standardized and streamlined.
A partner at investment firm Forbion commented that in nearly nine out of ten NewCo ventures formed by management teams partnering with pipeline assets, the assets originate from China.
For a newly established Biotech, securing early Phase I or Phase II clinical data typically values the company at hundreds of millions of US dollars. By contrast, in-licensing the same-stage pipeline assets from China can be initiated with merely tens of millions of dollars in upfront investment. The Forbion partner noted that this model is more indirect yet prudent, better aligning investors’ initial capital outlay with risk-reward returns.
Multiple factors have reshaped the founding and growth trajectory of Biotechs: a prolonged funding winter across the biopharma sector, severe homogenization and internal competition over drug targets and technical tracks, investors chasing faster returns, capital crowding into major disease areas, and the substantial rise in industrial competitiveness of R&D hubs such as Shanghai.
01 、The "One-off" NewCo
Traditionally, most Biotechs originated from a foundational scientific breakthrough, spending years developing candidate drugs and advancing clinical trials around that innovation. Today, amid the surge of readily accessible clinical-stage pipeline assets from China, many companies skip these early in-house R&D stages entirely.
Many overseas NewCos in-license one or two clinical-stage assets from China to build their initial R&D pipelines, laying the groundwork for subsequent internal innovation. For instance, Prolium Bioscience focuses on its TCE candidate PRO-203, aiming to expand into multiple clinical indications with a single asset rather than developing additional pipeline programs. Originally co-developed by CanSino Biologics and Innovent Biologics, this anti-cancer drug is being redeveloped by Prolium for up to eight severe B cell-mediated autoimmune diseases.
The NewCo wave emerging around 2025 is dominated by the "one-off NewCo" narrative.
A one-off NewCo refers to an independent Biotech launched by overseas capital, which globally develops one or more core assets licensed from China, with IPO or M&A as the primary exit route. Nearly 20 NewCo firms established by institutions including Forbion, RA Capital, Novo Holdings and OrbiMed since early 2025 largely follow this playbook.
In the past two years, the model has prioritized speed. Leading investment institutions rapidly set up shell companies around a single blockbuster asset, creating a fast track from financing to exit.
Landmark cases continue to emerge. The most high-profile M&A deal in Q1 2026 was Gilead Sciences’ $2.175 billion acquisition of Ouro Medicines, whose core asset CM336 is licensed from CanSino Biologics. In November 2024, CanSino granted Ouro global rights (excluding Greater China) to CM336 in exchange for approximately a 15% equity stake and cash consideration. Ouro closed its Series A financing in early 2025 and was acquired by Gilead in less than a year and a half.
Another notable case involves Hengrui Medicine. In May 2024, Hengrui jointly launched Hercules (later renamed Kailera Therapeutics) with Bain Capital and other investors, out-licensing global rights outside Greater China for four GLP-1 assets, securing a 19.9% stake in Kailera and corresponding financial compensation.
Kailera raised a $400 million Series A in its founding year, followed by a $600 million Series B in October 2025, and subsequently initiated global Phase III trials for its core drug Rippeptide. In April 2026, Kailera listed on the Nasdaq, surging 63% on its debut. Though Hengrui’s equity stake diluted to 9.8%, the market value of its holdings soared to around $300 million — achieved in less than two years from the licensing deal to IPO.
Aiolos Bio serves as an industry textbook case: it in-licensed an asthma monoclonal antibody from Hengrui with a $25 million upfront payment, and was acquired by GSK for $1.4 billion just five months later, delivering a roughly 40-fold return on the initial investment. Its core team later founded Verdiva Bio to continue sourcing next-generation assets from China.
Additionally, Tortugas Neuroscience raised $106 million through a hybrid model of external in-licensing and internal R&D, with its core pipeline consisting of multiple Phase II neurological assets licensed from Hansoh Pharma and other Chinese firms. Alveus Therapeutics focuses on obesity, building its initial pipeline entirely on China-originated assets. Switzerland-headquartered Windward Bio closed a $200 million Series A in January 2025; its core asset WIN378, a long-acting TSLP monoclonal antibody co-developed by Kelun-Biotech and Harbour BioMed, features a once-every-six-months dosing regimen, with Phase II results for severe asthma expected within 2026.
02、 The "Reservoir-style" Strategy
Beneath these striking industry figures, the NewCo model itself is undergoing differentiation. While most investors adhere to the standard playbook — launching a new company, injecting a single Chinese asset, and pursuing an exit — K2 Therapeutics is taking a distinctly different path.
At the end of 2024, MPM BioImpact, a decades-old investment firm, founded K2 in Singapore. Unlike most single-asset NewCos, K2 is structured as a platform company adopting a hub-and-spoke model, with Ansbert Gadicke, Managing Partner at MPM, serving as Executive Chairman.
In April 2026, K2 entered a landmark collaboration with Acrux Bio with milestone payments of up to $730 million, securing exclusive global rights to ACR246, a first-in-class ADC targeting the 5T4 antigen currently in Phase I/IIa clinical trials in China.
K2 plans to build a diversified drug portfolio under its platform, targeting the advancement of no fewer than six pipeline projects.
Gadicke stated openly: “We aim to integrate the strengths of both sides to create synergy and complementarity, rather than turning pharmaceutical R&D between the two regions into pure competition.” In his view, K2’s priority is not market rivalry, but to integrate innovation assets with early clinical validation in China and bring them to the global market.
Another Managing Partner at MPM BioImpact further explained that many novel targets pursued by Chinese assets remain unexplored in the US. Given the higher risks associated with new targets, clinical data generated in China has bolstered the firm’s investment confidence.
Therefore, rather than establishing a temporary capital vehicle for a single asset, K2 operates as a long-term investment platform to systematically screen and integrate high-quality assets from China.
K2 sets up an independent subsidiary for each licensed asset, allowing Chinese partners to hold equity in the corresponding subsidiary. This structure addresses Chinese pharma’s demand to share in the global value appreciation of their assets, while paving the way for future spin-offs and M&A exits. After all, pharmaceutical giants may only be interested in one or two assets within K2’s portfolio, rather than acquiring the entire K2 platform.
MPM’s strong commitment to K2 is also reflected in its investment scale. The firm has poured over $60 million into K2, exceeding the typical $20–60 million range for conventional investments, marking an extraordinary capital commitment.
Oncology is K2’s core focus, alongside other major disease areas with significant unmet clinical needs. Beyond ADCs and TCEs, K2 is actively expanding into RNA therapeutics. In recent quarters, RNAi and siRNA have emerged as booming tracks for cross-border Sino-US pipeline collaboration.
MPM strategically located K2 in Singapore, which features a legal system and corporate governance framework aligned with the US, while sharing the same time zone as China — enabling efficient engagement with R&D teams and mitigating policy-related risks.
Conclusion
To understand the shifting role of China’s innovative pharmaceutical assets in the global landscape, the patent cliff serves as an indispensable macro backdrop.
Morgan Stanley estimates that by 2035, European and American pharmaceutical companies will lose $115 billion in revenue due to patent expirations, with a $40 billion gap needing to be filled before 2030.
China has emerged as an irreplaceable innovation ammunition depot for global players. A study published in Nature revealed that between 2020 and 2025, 11 top global pharma giants invested over $150 billion in innovation asset layout across Asia, with approximately 65% flowing into China. The value of licensing deals for Chinese assets surged from around $5 billion (accounting for 3% of the global total) in 2020 to over $500 billion (30% of the global total) in 2024.
The evolution of transaction models is equally noteworthy.
If the License-out deals around 2020 can be defined as "one-off premature asset sales", the explosive growth of the NewCo model since 2024 signals the formation of a new collaboration paradigm. According to statistics from Southwest Securities, the potential total value of transactions completed by Chinese pharma via the NewCo model reached $4.76 billion in 2025.
The integration of multiple Chinese assets into unified global clinical development systems demonstrates that overseas institutional investors have fully and systematically recognized China’s product R&D strategy.
Looking ahead, the gradual shift of overseas capital collaboration from one-off high-leverage transactions to sustainable platform-based cooperation is set to become a steady industry trend. As Chinese innovative pharma firms gain greater discourse power in technological breakthroughs, clinical development and cross-border collaboration, the structural balance of the global pharmaceutical innovation network may well tilt toward Asia’s largest emerging biopharma hub.
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