AstraZeneca, Merck, Novo deals boost Chinese biotech as global interest grows

AstraZeneca's investment of US$2 billion in Summit Therapeutics and Merck's US$2.13 billion deal with Shanghai-based SciBrunch Therapeutics are bolstering China's biotech sector as global interest in innovative drugs grows. Summit Therapeutics, which holds exclusive rights to develop and commercialize Akeso's immunotherapy drug ivonescimab outside China, announced it would start clinical trials to evaluate ivonescimab in combination with AstraZeneca's antibody-drug conjugates, including gastrointestinal cancer drug sonesitatug vedotin.

Akeso's Hong Kong-listed shares jumped 15.5% on Tuesday, while Summit Therapeutics surged more than 19% in after-hours trading on Monday. Novo announced a US$2.6 billion deal to license Hengrui Pharmaceuticals' oral GLP-1 weight-loss drug HRS-1596, with an initial payment of US$300 million. Merck's agreement to pay up to US$2.13 billion for SciBrunch's pre-clinical oral drug SPR2015, which targets the KRAS G12D mutation in cancer, highlights the global momentum in the biotech sector.

Founded in 2024, SciBrunch focuses on small-molecule therapies to treat mature targets in oncology. The Chinese biotech industry benefits from favorable domestic policies and easing geopolitical concerns, with out-licensing deals between Chinese and US companies expected to "ride on a high tide" following the US Treasury Department's withdrawal from pursuing sweeping restrictions.