WuXi AppTec Co., Ltd.

Welcome back to Endpoints Weekly! This week’s recap kicks off with Andrew Dunn’s examination of the biotech playbook for surviving market turmoil. As former Alnylam CEO John Maraganore put it, recent events have “put biotech CEOs in a very difficult set of shoes compared to what we’ve had to deal with in the past.” See below for more details on how companies might handle the uncertainty. Meanwhile, our reporters tracked news on potential pharma-specific tariffs, which President Donald Trump said would be arriving “very shortly.” And a congressional commission is pushing for a big investment in the biotechnology sector to keep up with Chinese competition. If you’ve got a bit of downtime this weekend, grab a cup of tea and peruse our handful of Q&As out this week, including conversations with GLP-1 co-discoverer Jens Juul Holst, gene editing pioneer David Liu and Leerink Partners senior managing director David Risinger. See you on Monday! — Nicole DeFeudis It’s a tough market for biotech companies, but the sector has been here before. Endpoints News’ Andrew Dunn reports that the playbook remains largely the same. Take a look here at the 10 moves Dunn said biotech CEOs are likely considering, including: 🪓 Buckle down and extend the cash runway: Drug programs on the chopping block can be out-licensed or spun into new subsidiaries. Or they may be ultimately shut down. The goal is to extend cash to make it through to catalysts for the most promising drug programs, Dunn reports. 💰 Selling royalty rights: For biopharmas with a potential approved drug in sight, royalty deals can raise capital without diluting shareholders. But they give away a chunk of future upside. 🤝 Pharma partnerships: They bring in cash, keep research going, and provide a credibility boost. But as former Vertex Pharmaceuticals CEO Joshua Boger told Dunn over a year ago: “Realize they’re going to be painful, it’s going to be horrible, and you need to do it.” Read the whole playbook here. And click here for more insight from Drew Armstrong and Max Bayer’s Q&A this week with Leerink Partners senior managing director David Risinger. “In a typical financial crisis, corporations have to think about their cash flows and balance sheets,” Risinger said. “But then the FDA-specific turmoil that is happening really makes it difficult for corporations to plan for the future.” 🌎 Much of the world got a reprieve from President Donald Trump’s tariffs this week. But the president said earlier in the week that pharma-specific tariffs would be arriving “very shortly.” Analysts weighed in on what a potential rollout could look like here. “We’re going to tariff our pharmaceuticals and once we do that, they’re going to come rushing back into our country,” Trump said at a National Republican Congressional Committee event. Trump has previously praised companies like Eli Lilly , Johnson & Johnson and Merck for boosting their US footprint. All three companies have announced multibillion-dollar investments to build or expand US factories. On Thursday, Swiss-based Novartis said it would invest $23 billion in American manufacturing and R&D over the next five years. A Novartis spokesperson declined to clarify how much of the $23 billion investment had already been planned or disclosed. Meanwhile, the European Federation of Pharmaceutical Industries and Associations warned of a potential “exodus” to the US. The group said in a statement on Tuesday that “unless Europe delivers rapid, radical policy change then pharmaceutical research, development and manufacturing is increasingly likely to be directed towards the US.” It called for “immediate action” on several fronts, including strengthening intellectual property provisions and “adopting a world leading regulatory framework conducive to innovation.” 💸 Amid the burgeoning trade war with China, a Congressional commission is looking to find a way for American biotechs to remain competitive. This week, the National Security Commission on Emerging Biotechnology — which is made up of members from both chambers of Congress as well as civilian experts — urged a $15 billion investment in the sector to keep up with Chinese competition. The timing comes amid cuts across the federal government, including at HHS, which laid out plans last month to cut thousands of employees. Sen. Todd Young (R-IN) recognized “the fiscal challenges associated with persuading colleagues to add new priorities to the list.” But he said the focus should be on setting the right priorities without needing to “fund everything.” This week’s recommendation echoes efforts of the Biosecure Act, a bill introduced last year. The legislation sought to ban US reliance on suppliers like WuXi AppTec, but didn’t eventually become law. Unlike the Biosecure Act, the commission’s report does not name specific Chinese companies. 💰 Merida Biosciences emerged from stealth this week with $121 million in its pockets . Their goal? Create and develop new medications for autoimmune diseases and allergies, with an initial focus in experimental drugs for a thyroid condition called Graves disease, food allergy and primary membranous nephropathy, an autoimmune kidney disease. Beating Xolair will be a challenge and may take years. Last year, the Roche and Novartis drug racked up $4.4 billion in sales, and other companies have tried to crack food allergy before. But CEO Adam Townsend thinks food allergy can be Merida’s “gateway into showing our science and how it works there.” 💬 Q&As with industry and academic thought leaders filled Endpoints’ newsletters this week, and what better way to start your weekend than by reading what they had to say? Elizabeth Cairns sat down with GLP-1 co-discoverer Jens Juul Holst to discuss the future of incretin-based drugs, and Ryan Cross had a conversation with gene editing pioneer David Liu about the economic and political turmoil in science. Both came from the sidelines of the Breakthrough Prizes in Life Sciences, also known as the “Oscars of Science.” We hope you enjoy.

A congressional commission is advocating for a $15 billion federal investment in America’s biotechnology sector, warning that the US could soon be eclipsed by China in a key frontier of innovation. In a report released Tuesday, the National Security Commission on Emerging Biotechnology urged a more proactive, coordinated role in developing biotechnologies that could reshape everything from medicine to manufacturing to national defense. The panel, made up of members from both the Senate and the House of Representatives as well as experts from industry, academia and government, warned that without focus and major investment, China could first reach a “ChatGPT moment” — a reference to a technological breakthrough so significant that it permanently shifts global power dynamics. “We could see ourselves outflanked, out-competed,” Sen. Todd Young (R-IN), the commission’s chair, told reporters. “It will not only undermine our material prosperity if that happens, but it will jeopardize our national security.” But the recommendations come amid the Trump administration’s deep funding cuts to the NIH , FDA and other agencies. Critics say the moves have weakened the very institutions needed to keep a US edge in science . Young acknowledged the fiscal challenge, but said reprioritizing, not just simply increasing spending, would be critical. “I’m in no way diminishing the fiscal challenges associated with persuading colleagues to add new priorities to the list,” he said. “My argument would be: eliminate some priorities. Set priorities right. Don’t fund everything.” Young said he plans to present the recommendations directly to President Donald Trump, whom he described as “enthusiastic” about the commission’s efforts. He added that he has already discussed the report with several key figures in the president’s orbit, including advisor Elon Musk, Commerce Secretary Howard Lutnick and Jacob Helberg, Trump’s nominee for undersecretary of economic growth, energy and the environment. “There seems to be a lot of interest in it among what are loosely being called the ‘tech bros’ within the administration,” Young said. He later added, “This is how you create abundance in manufacturing opportunities across what has been disparagingly called for years flyover country.” Still, some industry observers are skeptical that the recommendations will be taken up, especially given the Trump administration’s track record. “It’s hard to believe that recommendations around public investment have traction at a time when the current administration is so focused on cutting healthcare investments at institutions like NIH and FDA,” said Nick Shipley, founder of the biopharma advisory firm Cronus Consulting, in response to a reporter’s description of the report before its wider release. BIO CEO John Crowley said in an interview last week that the trade group provided ideas for the report. The US has long been a global leader in biotechnology, dating back to the industry’s early days in the 1970s. As recently as last year, the commission believed the US still held a competitive advantage over China. But upon closer inspection, the US is “falling behind in key areas of emerging biotechnology,” the report states. China’s rise is in part due to strategic state investment. Under President Xi Jinping’s “Made in China 2025” initiative, the government poured in money and streamlined drug approvals. The results: China has suddenly become a major source of new drug development , as evidenced by a surge in licensing deals with US pharmaceuticals. “There will be a ChatGPT moment for biotechnology,” the commission’s report states. “If China gets there first, no matter how fast we run, we will never catch up.” To avoid that scenario, the report outlines a long list of recommendations to overhaul the US approach. Among the recommendations, it proposes streamlined regulations, the creation of an “independence investment fund” aimed at scaling up technology startups, and a crackdown on certain Chinese biotech firms deemed security threats. While the report stops short of naming specific Chinese companies, the policy echoes the intent of the Biosecure Act. The legislation sought to ban US reliance on suppliers like WuXi AppTec, but ultimately didn’t win approval in Congress last year . The panel’s proposed road map focuses on six national priorities:

The U.S. risks losing a once-decisive edge over China in biotechnology unless the federal government prioritizes the sectors advancement with new funding and policies, a bipartisan commission warned in a report issued Tuesday.At minimum, the commission wrote, the U.S. should invest at least $15 billion over the next five years to strengthen the countrys biotech capabilities. It also called for a more proactive government strategy, including the establishment of a new National Biotechnology Coordination Office within the White House.China is quickly ascending to biotechnology dominance, having made biotechnology a strategic priority for 20 years, the report states. To remain competitive, the United States must take swift action in the next three years. Otherwise, we risk falling behind, a setback from which we may never recover.The report was authored by the National Security Commission on Emerging Biotechnology, which was established by Congress through defense appropriations legislation in 2022. Made up of 11 members, including lawmakers from both parties, the commission has spent the past two years studying the state of biotechnology competition between the U.S. and other countries, particularly China. Its recommendations are meant to provide the foundation for legislation, much as work by an earlier commission helped pave the way for the 2022 CHIPS Act, which was aimed at semiconductor manufacturing and research.The United States is locked in a competition with China that will define the coming century, said commission chair and Senator Todd Young, R-Ind., in a statement on the reports release.Biotechnology is the next phase in that competition.Young and the rest of the commission take alarm at the rapid acceleration of Chinas biotech capabilities, which they ascribe to its governments industrial policies as well as to the advent of new artificial intelligence tools that China has adopted quickly.They cite the strength of Chinese companies like WuXi AppTec, a contract manufacturer targeted in legislation that was proposed but ultimately dropped last year. And they warn that the Chinese governments close involvement in biotech could lead to policies designed to strategically weaken the U.S.We must not treat Chinese state-run companies as ordinary competitors in our market, even if it means using more expensive alternatives, the report states.In response, the commission detailed dozens of recommendations to bolster U.S. biotech. Notably, it calls for Congress to establish an Independence Investment Fund to support new startups, as well as to direct the development of a network of precommercialbioindustrial manufacturing facilities.It also recommends outbound investment rules to ensure that U.S. capital does not support Chinese development of biotechnologies that come with national security risks. Such rules could potentially complicate U.S. companies licensing of experimental new drugs developed by Chinese firms, although the report doesnt specifically suggest barring these kind of deals.Yet the commissions call for greater biotech investment comes at a moment when the Trump administration has ordered drastic cuts to research funding and sweeping layoffs across agencies that oversee biotech regulation, most prominently at the Food and Drug Administration. And the commissioners urge the U.S. to leverage its ability to attract talented scientists to its open innovation ecosystem just as the administration has sparked widespread alarm in academia by revoking student visas and targeting universities.U.S. companies are also watching carefully to see whether the Trump administration targets pharmaceuticals with sector-specific tariffs. The sector was exempted from the new duties President Donald Trump rolled out April 2, but taxing imports could be part of White House efforts to spur investment in U.S. biomanufacturing.The pharmaceutical companies are going to come roaring back, Trump said in a White House address on April 2, during which he cited recent investments by Eli Lilly and Johnson & Johnson to build new U.S. plants. '