The US Treasury Department is drafting new regulations to govern licensing agreements between American and Chinese pharmaceutical companies. The proposed framework aims to permit the majority of these partnerships, while specifically prohibiting transactions related to pathogens or biotechnology with potential military applications.
The scale of these collaborations is significant. According to GlobalData, Chinese biotech firms participated in licensing deals worth $115 billion in 2025, accounting for nearly half of all inbound pharmaceutical licensing activity that year.
Recent major agreements include a collaboration between Bristol Myers Squibb and Jiangsu Hengrui Pharma valued at up to $15,2 billion, and a deal between Pfizer and Innovent Biologics worth up to $10,5 billion for the development of 12 oncology treatments.
The draft rules follow the December 2025 passage of the Comprehensive Outbound Investment National Security Act, which previously excluded the biotech sector from investment screening. The formal announcement of the new Treasury policy is expected to follow a meeting between President Trump and President Xi Jinping.
