The U.S. Treasury Department is drafting rules to preserve most licensing deals between American pharmaceutical companies and Chinese drug developers. This policy marks a significant departure from the stricter investment curbs placed on other technology sectors.
Major drugmakers including Bristol Myers Squibb and Pfizer increasingly rely on Chinese biotech for new drug candidates. Outside licensing deals in the Chinese biotech sector reached a total value of $115 billion last year.
The forthcoming rules will likely permit investments unless they involve pathogens or biotechnology with potential for weaponization. Industry analysts view the development as a major de-risking event amid rising U.S.-China economic tensions.