ING’s Stadig warns US-China biotech deals face more scrutiny and slightly fewer deals

Cross-border biotech deals between China and the United States are getting tougher to structure, and industry analysts warn a modest slowdown may follow. The reason is not a single clinical setback or a sudden change in drug science. It is politics, embedded directly into capital flows. Washington is stepping up efforts to restrict investment and technology transfers, and that shift is forcing more review, more risk-mapping, and more uncertainty around what can be done, and when.

Diederik Stadig, senior healthcare economist at ING Research, summarizes the dynamic plainly: “There will be more geopolitical scrutiny going forward. This scrutiny may lead to slightly fewer deals than without it,” he said. In other words, even if the appetite for biotech collaboration remains, the path to closing is likely to narrow. Some deals that might have proceeded in a less scrutinized environment could stall, be reworked, or be delayed long enough for counterparties to lose momentum.

To understand why this matters, zoom out to how biotech cross-border deals typically work. These arrangements often involve not just money, but also access to sensitive know-how. Even when a transaction looks like “just” an investment or partnership, biotech activity can touch research capabilities, platform technologies, and know-how that regulators may treat as strategic. When authorities increase scrutiny of investment links and technology transfer pathways, the friction shows up everywhere: term sheets need more guardrails, governance structures need more clarity, and diligence needs to focus harder on what is being transferred and how.

Stadig’s warning also signals a second-order effect that executives care about: deal complexity rises before deal volume visibly falls. In practice, that means teams spend more time navigating regulatory questions and structuring around restrictions, rather than negotiating purely on valuation or science. That can change how boards evaluate proposals, because timelines become less predictable and the “probability of closing” becomes harder to estimate. When you cannot confidently map regulatory outcomes, it is not just the current deal at risk. It is the pipeline math.

There is also an incentive shift. If the approval process becomes more variable, parties may prefer strategies that reduce exposure to cross-border technology transfer. That can include changing the scope of what is shared, adjusting who controls particular assets, or rethinking where specific research activities happen. Those adjustments may be achievable, but they often add cost and coordination overhead. Even without changes to scientific attractiveness, the operating reality can become more complicated, which is exactly what analysts are flagging in the first place.

The market implication is a modest slowdown, not a freeze. Stadig’s phrasing matters: “slightly fewer deals than without it,” not “no deals.” That distinction is important for decision-makers trying to plan resources. It suggests continued activity, but with more screening and more friction baked into each transaction. Executives should expect that geopolitical scrutiny becomes a standing constraint rather than a temporary wobble.

Finally, there is a strategic stake for peers watching from similar roles. If you are a CEO, CFO, or board member evaluating cross-border biotech opportunities, you are not only reacting to individual outcomes. You are making portfolio and governance decisions under a new baseline of regulatory uncertainty. The best time to prepare is before the next deal hits the “extra scrutiny” stage, because once that happens, teams are forced to make tradeoffs quickly: preserve value versus preserve optionality, move fast versus de-risk, and close now versus structure for compliance.

The take-home is simple. Washington’s stepped-up focus on restricting investment and technology transfers is making the cross-border biotech playbook harder to run. As Stadig notes, the likely result is more geopolitical scrutiny, and that scrutiny can mean slightly fewer deals than would occur without it. For leaders, the competitive edge will be in planning for complexity, not in hoping it goes away.