The weekly term sheet (36)

The first week of September 2025 saw a flurry of dealmaking in life sciences, with over $11.6 billion in potential transaction value announced across licensing alliances, royalty financings, and venture fundings. Notably, cross-border partnerships – particularly between Western firms and Chinese biotechs – took center stage, while classic M&A remained conspicuously quiet except for Japan's Shionogi completing its $1.1 billion acquisition of Torii Pharmaceutical.

From cardiovascular alliances to autoimmune royalty deals and oncology licensing, the week's activity spanned continents and therapeutic areas.

Deal Summary Table: September 1-7, 2025

Big Pharma Bets on Cardiovascular Innovation

Cardiovascular deals commanded the week's largest headline figures, underscoring big pharma's eagerness to bolster pipelines beyond metabolic blockbusters. In a multifaceted alliance, Novartis returned to partner with China's Argo Biopharma on RNA interference therapies for dyslipidemia. Novartis paid $160 million upfront and secured options on multiple siRNA assets, with milestones potentially totaling $5.2 billion plus tiered royalties. The crown jewel is an ANGPTL3-targeted siRNA in Phase 2 for high cholesterol, which Novartis may combine with its existing cardiovascular portfolio.

The deal expands on an earlier 2024 Novartis–Argo tie-up and is hailed as the first major overseas out-licensing of RNAi assets by a Chinese biotech. Argo's co-founders (alumni of Arrowhead Pharma) framed this as validation of China's growing role in global drug discovery. Novartis will also take an equity stake in Argo's next financing round, reflecting strategic commitment beyond typical licensing.

Meanwhile, Eli Lilly's absence from new cardiovascular deals that week was notable only because it had already made waves earlier in the summer by agreeing to acquire gene editor Verve Therapeutics for $1.3 billion (a deal closed in Q3). That context highlights Big Pharma's cardiovascular push beyond GLP-1s: Lilly's Verve buy brings in one-shot gene therapy for cholesterol, complementing Novartis's bet on RNAi.

Braveheart Bio, a startup led by ex-HI-Bio CEO Dr. Travis Murdoch, also jumped into the cardiology fray with a $65 million licensing of a Phase 3 hypertrophic cardiomyopathy drug from China's Jiangsu Hengrui. The deal grants Braveheart ex-China rights to Hengrui's selective myosin inhibitor HRS-1893, a rival to Bristol Myers Squibb's Camzyos and Cytokinetics' aficamten for obstructive HCM. Braveheart's payment is split evenly between cash and stock ($32.5 million each), signaling the young company's confidence in its own equity.

Hengrui is eligible for a near-term $10 million milestone and over $1 billion in future milestones for this potentially best-in-class myosin inhibitor. For Braveheart – founded just last year after Murdoch sold his prior startup to Biogen – the alliance leapfrogs it into late-stage development with a promising asset. It also continues Hengrui's recent string of partnering successes (GSK paid $500 million upfront for another Hengrui program in July, following Merck's $200 million deal earlier in 2025).

Cross-Border Licensing: China-to-West Deals Accelerate

Major Cross-Border Transactions

Cross-border dealmaking was a defining theme, as Western biotechs inked major licenses with Asian partners. Boston's Radiance Biopharma licensed a novel antibody–drug conjugate from China's Novatim Immune Therapeutics. Radiance paid $15 million upfront for global (ex-China) rights to KY-0301, touted as the first "bispecific nano-ADC," and offered over $1.15 billion in milestone payments (up to $150 million tied to R&D/regulatory events and $1 billion for commercial milestones).

The asset, now dubbed RB-601 by Radiance, is a Phase 1 bispecific ADC aimed at solid tumors like NSCLC, colorectal and head & neck cancers, promising deeper tumor penetration and improved safety over conventional ADCs. Radiance, led by industry veteran Dr. Marc Lippman (a founding board member of ADC-pioneer Seagen), will now launch global trials of RB-601.

UK-based OMass Therapeutics entered an exclusive collaboration with Genentech for inflammatory bowel disease treatments on September 2, with $20 million upfront and potential milestones exceeding $400 million plus tiered royalties. The OdyssION platform uses next-generation native mass spectrometry to identify first-in-class oral small molecules for the 8 million IBD patients globally.

Another East-West coupling earlier in the quarter underscores the trend: Sanofi's agreement to acquire China/U.K.-based Vicebio for $1.15 billion upfront (announced in July) brought non-mRNA vaccine technology for RSV and other respiratory viruses into the French pharma's pipeline.

And in the cell therapy arena, the week's news wasn't about a new partnership but an unraveling of an old one: Gilead's Kite unit quietly terminated its collaboration with Shoreline Biosciences, which had been valued at $2.3 billion for off-the-shelf NK cell therapies. The partnership, signed in 2021, had struggled – Shoreline had even laid off staff in January in anticipation – and formally ended in Q1 2025, as confirmed by Gilead.

Autoimmune Arsenal Grows via Royalty and Platform Alliances

Autoimmune & Platform Deals

While no mega-mergers materialized in autoimmune, creative deal structures are fueling late-stage programs. Zenas BioPharma, a cross-border biotech (Waltham, MA-based with Chinese ties), secured a $300 million funding deal from Royalty Pharma to push its lead autoimmune drug obexelimab through FDA approval. Under the Sept 2 agreement, Zenas receives $75 million upfront to support a planned U.S. launch in IgG4-related disease, and will get three additional $75 million tranches upon hitting a Phase 3 success and FDA approvals in IgG4-RD and systemic lupus (SLE), respectively.

In exchange, Royalty Pharma earns a 5.5% royalty on future obexelimab sales worldwide. This synthetic royalty financing – a hallmark of Royalty Pharma's model – gives Zenas non-dilutive capital to finish Phase 3 and prep commercialization. Zenas's CEO Lonnie Moulder (of Tesaro fame) noted the deal validates obexelimab's "franchise" potential as a first-in-class B-cell modulator in autoimmune disease.

In a related vein, Vertex Pharmaceuticals struck a platform alliance with Enlaza Therapeutics to expand into autoimmune diseases and improve gene therapy conditioning. Vertex will pay $45 million upfront (including an equity stake) and over $2 billion in milestones for rights to Enlaza's proprietary "War-Lock" platform for covalent biologics.

The four-year collaboration aims to create new T-cell engagers and small-format drug conjugates for undisclosed autoimmune targets, and to develop gentler conditioning regimens for Vertex's gene-edited therapies in sickle cell and beta thalassemia.

Poland's Polpharma Biologics licensed three major biosimilars to MS Pharma for the Middle East and North Africa region on September 3. The portfolio includes vedolizumab (PB016) for inflammatory bowel disease, ocrelizumab (PB018) for multiple sclerosis, and guselkumab (PB019) for psoriasis, with plans to transfer fill-and-finish manufacturing to MS Pharma's Saudi Arabia facility.

AI and Computational Platforms Take Center Stage

Eli Lilly announced a global licensing collaboration with Lila Biologics on September 4, though financial terms remain confidential. This University of Washington spinout from Nobel laureate David Baker's lab brings AI-driven protein engineering for targeted radioligand therapies in oncology. Lila's engineered mini-proteins enable precision radiotherapy for traditionally hard-to-hit solid tumors, with Lilly taking responsibility for IND-enabling studies and commercialization.

London-based CHARM Therapeutics closed an $80 million oversubscribed Series B on September 2, co-led by New Enterprise Associates and SR One. CHARM's DragonFold AI platform enables protein-ligand co-folding for precision oncology, with their lead menin inhibitor designed to overcome all known clinical resistance mutations in acute myeloid leukemia.

Venture Funding: Selective Glimmers Amid Funding Drought

Venture Capital Activity September 1-7, 2025

Though venture capital activity remains subdued industry-wide, this week brought targeted financings that hint at investor focus areas. Galvanize Therapeutics, a Silicon Valley medtech-biotech crossover, raised an oversubscribed $100 million Series C to advance its novel pulsed electric field (PEF) therapy platform in oncology and chronic lung disease.

The Sept 3 round was led by Sofinnova Partners with a syndicate of global investors joining in. Galvanize's Aliya PEF device delivers non-thermal electrical pulses to tumor or bronchial tissues, aiming to ablate disease cells and modulate biologic pathways without drugs.

In the UK, diagnostics startup Cyted Health secured $44 million in Series B funding (led by EQT Life Sciences with Advent Life Sciences) to fuel its U.S. expansion. Cyted has developed a minimally invasive molecular diagnostic for early esophageal cancer and precancer: an FDA-cleared cell collection device (EndoSign) combined with AI-powered biomarker analysis.

Even traditional biotech venture players signaled cautious optimism. Cambridge-based VC firm Atlas Venture announced it had raised a $400 million "Opportunity Fund" exclusively to support its existing portfolio companies. The fund – Atlas's third of this kind – will provide follow-on capital to the startups in Atlas's stable that need growth funding in a tough market.

Also of note, smaller seed-stage financings trickled in: Revalia Bio (a Bay Area startup using AI to streamline clinical trials) raised a $14.5 million seed round, and Europe's Ketryx secured $39 million for AI-driven compliance tools in life sciences. These modest raises underscore that while the funding drought continues (global biotech VC spending in H1 2025 was down ~16% year-on-year), investors are selectively funding platform technologies and AI that could rewrite the efficiency of R&D.

M&A Activity and Corporate Restructuring

The week saw limited but significant M&A activity. Japan's Shionogi & Co. completed its acquisition of Torii Pharmaceutical on September 1, 2025, for 160 billion yen (approximately $1.1 billion). This domestic consolidation makes Torii a wholly-owned subsidiary, significantly expanding Shionogi's presence in the Japanese pharmaceutical market.

French genomics software company SeqOne acquired UK-based Congenica on September 2, 2025, creating the largest global "software pure player" in clinical genomics. While financial terms weren't disclosed, the combined entity serves over 160 labs across 30+ countries with 125+ employees, expecting to enable 200,000+ patient genomic analyses in 2025—triple the 2024 volume.

Canadian company Optimind Pharma Corp. terminated its letter of intent to acquire Monjin Interviews Private Limited on September 4, 2025, with both parties mutually agreeing to end discussions.

Regulatory and Technology Transfer Developments

Eisai and Biogen announced progress on their LEQEMBI collaboration on September 2, with FDA granting Fast Track Status for a subcutaneous autoinjector formulation for early Alzheimer's disease treatment.

Between September 4-6, 2025, India's ICMR signed technology licensing agreements with 17 industry partners including Indian Immunologicals, Panacea Biotec, Biological E, and Zydus Lifesciences. The deals cover 9 technologies spanning infectious disease diagnostics, immunodiagnostics, and vaccine development including a multistage malaria vaccine.

Conclusion: Partnerships Fill the Void as Traditional M&A Stalls

In the first week of September, the absence of big-ticket pharma acquisitions (beyond Shionogi-Torii) was striking – yet it was more than compensated by an onslaught of partnerships, licensing deals and innovative financing. Pharma giants seem content to partner now, buy later: they are staking multi-billion-dollar bets on externally-sourced innovation without necessarily acquiring the companies outright.

This week's deals – heavy on upfronts and milestones – reflect an industry leaning into asset-centric collaborations in lieu of mega-mergers.

The therapeutic focus of the deals also speaks volumes about strategy: cardiovascular and metabolic disease programs attracted significant money (as companies look beyond the current obesity drug boom), while autoimmune disorders saw both platform and late-stage investment (recognizing the huge unmet need and scientific advances in targeting the immune system).

AI and computational platforms featured prominently across multiple deals, demonstrating continued strategic interest in computationally-driven drug discovery.

Geographically, globalization of biotech continues apace. Three of the week's largest licenses involved Chinese biopharmas supplying innovation to Western partners, underscoring China's evolution from "factory of generics" to source of novel IP. These cross-border deals, along with strong Asia-Pacific activity (as noted by industry analysts), indicate that capital and ideas are now flowing East-to-West as much as West-to-East.

Conversely, U.S. and European investors are increasingly targeting non-U.S. opportunities (such as UK's Cyted or multinational Zenas) and non-traditional modalities (devices, AI) to diversify their bets in a tight market.

Finally, the week's happenings highlight a sobering reality: venture capital remains cautious, but not closed. The fact that VCs like Atlas are raising internal funds to shore up existing startups, and that only select companies with truly differentiated technology (Galvanize's device, or Cyted's diagnostic) can raise sizable rounds, suggests a new equilibrium. Investors are demanding clearer proof of concept and nearer-term impact, favoring companies that address tangible clinical needs or enable efficiency gains.

This prudent capital deployment, combined with pharma's willingness to infuse cash via deals and royalties, might well signal a pathway through biotech's funding winter. As one might observe in Bartleby's wry tone: when traditional financiers take fright, strategic capital and creativity rush in to fill the void – ensuring that scientific progress, much like office life in a pandemic, finds a way to carry on.