Common overseas financing/transaction models for internationalization of product pipelines:
Mode 1: NewCo
NewCo refers to a new company jointly established by Chinese pharmaceutical companies and capital. Chinese pharmaceutical companies authorize non Greater China equity to overseas new companies, and Chinese pharmaceutical companies invest in the new company with pipeline equity and receive cash, new company equity, and future revenue sharing. This model is particularly suitable for pipelines from Pre IND to Phase IIa clinical trials, with the maximum capital leverage effect. The Newco model bridges the technological value of Chinese assets with the capital operation capabilities of overseas teams.
Mode 2: BD Trading
Overseas partners are responsible for the regional sales, promotion, and commercialization of drugs launched in a certain country or region.
The most common modes are (a) general distribution or distribution; (b) Commercial authorization cooperation.
Mode 3: IP Authorization License
Based on the authorization and licensing of intellectual property (IP) usage rights, both parties cooperate in development, clinical practice, production, and even commercialization.
Common examples include (c) IP Out/in Licensing (Chinese name, IP authorization transaction, technology license transaction, etc.),
(d) R&D Collaboration (Chinese name, cooperative development, strategic cooperation agreement, etc.).
The aforementioned Mode 2 (b) commercial authorization cooperation can also be included in this Mode 3, but it is limited to IP authorization cooperation in the commercial stage.
Mode 4: M&A Mergers and Acquisitions
Acquisition transactions based on the ownership of assets or equity of the target company, including (e) equity acquisitions; (f) Asset acquisition.