Cathy Tie

Post 3: What investors want to hear, and how to show it.   After dozens of conversations in Boston (#RESI, #LSX) with investors and other biotech leaders, I'm using the following checklist with my team. The five proofs: 1. Proof of biology, clear MoA, human relevance, and a line of sight to clinical translation. 2. Proof of value, the payer story, who benefits, how much, and when, presented before Phase 2. 3. Proof of execution, a lean plan to the next inflection, with the right CROs and governance. 4. Proof of capital efficiency, budgets, options for non-dilutive finance, and the discipline to say no. 5. Proof of market access, credible BD optionality, including why your program is partnerable.   Signals that build confidence: - A clean cap table and governance that can support a megaround if needed. This matches the prevailing market structure. - A realistic exit map, private M&A as the base case while IPOs are limited. Show who buys you, when, and for what evidence. - Awareness of global asset flows. Many large financings now back clinic ready assets, including programs sourced from China. Be ready to explain why your path to human data is similarly time efficient. - Discipline in public communication. Investors repeatedly say scarcity is an opportunity, for teams that prioritise and execute. I agree. Scarcity rewards focus.   My closing view This environment is hard, and that is precisely why it is investable. Fewer companies will reach value inflections, the ones that do will be the ones that show the proofs above, and reach them with less spend.

13

2 Comments

The Licensing Boom in Chinese Biotech: A Glimpse Beneath the Surface On paper, the surge in Chinese biopharma licensing deals in 2025 looks like a revival. In the first half of the year alone, Chinese companies signed over 48.5 billion dollars in outbound licensing agreements. That figure already surpasses the full-year total for 2024. Read the full article: https://lnkd.in/eRwV-D5Q Western pharmaceutical firms, under pressure to replenish pipelines, are increasingly turning to Chinese partners for oncology and immunology assets. Takeda, GSK, Pfizer, and others have inked landmark agreements. The scale of these deals suggests confidence, capital, and clinical depth. But that is the foreground. What lies behind it is more revealing. The rush of licensing activity is in large part a response to a weakened domestic venture capital environment. Since the 2021 peak, VC funding for Chinese biotech has contracted sharply. Foreign investors have pulled back due to capital controls and geopolitical pressure. Domestic VC funds are more cautious, often steered by policy mandates into industrial technologies. As a result, private biotech companies face a capital bottleneck. Licensing deals offer a workaround. By out-licensing global rights to promising molecules, Chinese firms can unlock large upfront payments and near-term milestones. These cash infusions are, for many, the only viable alternative to growth-stage equity. The deals are large, sometimes reaching billions in total potential value, but they are also defensive. They reflect an ecosystem adapting to capital scarcity rather than one experiencing investment exuberance. This shift has not gone unnoticed. Royalty investors such as Royalty Pharma have become more active in evaluating Chinese assets. Their model, exchanging present capital for a future stream of milestones or royalties, fits perfectly into this environment. For royalty buyers, China now offers a pipeline of discounted cash flows at attractive entry points. For Chinese developers, it provides another avenue to monetize long-tail agreements that might otherwise remain illiquid. The model is financially rational. It allows innovation to proceed, partnerships to deepen, and pipelines to advance. But it also externalizes upside. Chinese companies are increasingly funding innovation by selling the future. While that provides runway today, it could constrain independence and value capture tomorrow. Moreover, regulatory risks remain. Policymakers in the US are beginning to scrutinize biopharma cooperation with China, and any shift in that posture could chill this licensing flow.

20