China's innovative pharmaceutical industry is rapidly advancing into the era of outbound business development (BD).

In the first half of 2025 alone, Chinese pharmaceutical companies executed over 70 outbound licensing agreements for their pipeline assets, with total transaction values exceeding $60 billion—both figures setting historical records.

Notably, in June 2025, 3SBio licensed the overseas rights of its self-developed PD-1/VEGF bispecific antibody SSGJ707 to Pfizer for an upfront payment of $1.25 billion and total deal value exceeding $6 billion.

This transaction set a new record for single outbound licensing deals by Chinese innovative drug companies, ranking among the most significant transactions in global innovative drug pipeline trading history.

The core driver behind this industry boom is the high alignment and resonance between Chinese supply and global demand.

On one hand, numerous multinational pharmaceutical companies with substantial cash reserves face imminent "patent cliffs" for their core marketed pipelines over the next 3-5 years, urgently requiring external ready-made pipeline assets for supplementation.

Authoritative institutional analyses indicate that blockbuster drugs with annual sales exceeding $100 billion will reach patent cliffs in coming years, including core products like Merck's Keytruda.

On the other hand, numerous Chinese innovative drug companies have accumulated substantial high-potential pipeline assets through significant efficiency and cost advantages in early-stage pipeline discovery and clinical research. However, they lack sufficient financial resources and talent teams to advance all pipelines through development, particularly global multi-center clinical trials.

Under this naturally high-matching supply-demand dynamic, outbound BD transactions for Chinese innovative drug pipelines have completely exploded.

This trend is expected to continue long-term until multinational companies find more cost-effective sources of innovative pipelines.

According to a Morgan Stanley research report, by 2040, annual sales of innovative drugs originating from China will reach $220 billion, while 35% of FDA-approved innovative drugs will originate from Chinese pipelines.

From this industry trend perspective, outbound BD will be an extremely crucial positive driving factor for China's innovative drug industry for an extended period.

Capturing this industrial opportunity represents a critical development opportunity for current Chinese pharmaceutical companies.

This is fundamentally why pharmaceutical companies successfully completing outbound BD deals for innovative drug pipelines since 2025 have received extreme market admiration and pursuit.

The ability to systematically and continuously generate innovative drug pipelines suitable for outbound BD has become capital markets' aesthetic requirement and value judgment standard for innovative drug companies.

Currently, at least two major types of innovative drug companies meet these criteria.

One category is "large and comprehensive" Chinese pharmaceutical companies represented by Jiangsu Hengrui Medicine, characterized by leveraging abundant capital and massive R&D and clinical teams of thousands to cover virtually all popular targets, with BD transaction pipelines primarily in early clinical trial stages.

In an overseas media ranking of global pharmaceutical company pipelines for 2025, Jiangsu Hengrui Medicine ranked 13th globally with 173 research projects (including preclinical and clinical stages).

This explains Hengrui's repeated successes following the BD wave's arrival.

According to Hengrui's 2025 interim report, confirmed revenue from BD transaction upfront payments in the first half alone approached RMB 2 billion.

Hengrui's approach can be understood as a "heavy model" requiring massive capital and extremely large R&D team support—a high threshold most pharmaceutical companies cannot afford.

The other category is the "light model" represented by Biocytogen, which leverages its systematic resource endowments and unique efficiency and cost advantages to create the "Thousand Mice, Ten Thousand Antibodies" program, precisely positioning itself in the core innovative drug discovery segment. Through tight integration of technological and business model innovation, it has reconstructed the innovative drug industry's R&D value chain, equally shining in the innovative drug BD era.

**Building a Global New Drug Source**

Starting with genetically modified model animals, Biocytogen has become one of the industry's leading companies, continuously expanding boundaries across the entire innovative drug preclinical chain.

Beginning with customized services, the company astutely focused development efforts on high-technical-barrier humanized animal models, continuously expanding and accumulating the world's largest humanized mouse model library.

This strategy not only transformed model animals from a passive "make whatever customers want" role to a "shelf-ready" supply model—where customers can directly purchase and use immediately—but also promoted industry standardization and efficiency improvements.

Through leading advantages and high-standard quality control, Biocytogen became the first Chinese company to achieve large-scale reverse sales of model animals to European and American multinational pharmaceutical companies, truly establishing its core position in the global model animal field.

After addressing this key pain point in innovative drug evaluation, Biocytogen continued toward innovative drug source molecules.

In 2020, Biocytogen proposed the "Thousand Mice, Ten Thousand Antibodies" program, completely breaking traditional industrial positioning and division of labor, directly entering another core segment of the innovative drug R&D industrial chain.

The "Thousand Mice, Ten Thousand Antibodies" program involves Biocytogen using its proprietary RenMice series technology platform to obtain model mice targeting over a thousand potential drug targets in human bodies through target knockout ("Thousand Mice"), then immunizing each mouse type to obtain hundreds of antibody molecules targeting different epitopes of each target, ultimately creating a molecular library containing tens of thousands of candidate antibodies ("Ten Thousand Antibodies").

Through this extremely large-scale candidate antibody molecular library, Biocytogen completely reconstructed its business model.

For candidate antibody molecules selected through the "Thousand Mice, Ten Thousand Antibodies" program, Biocytogen employs collaborative development or molecular sequence licensing/transfer approaches, seeking partners to jointly advance clinical development and subsequent commercialization processes, obtaining upfront payments, milestone payments, and post-marketing sales sharing.

This entirely new "approach" completely revolutionizes existing R&D models in the innovative drug industry, bringing significant advantages across multiple core dimensions including time efficiency, R&D costs, and target coverage.

From a time efficiency perspective, in traditional pharmaceutical company R&D processes, from target discovery and validation stages to final innovative drug molecule PCC stage determination averages 5.5 years.

Under Biocytogen's "Thousand Mice, Ten Thousand Antibodies" program support, this process undergoes fundamental change.

Pharmaceutical companies can directly select high-quality antibody molecules meeting different R&D needs from Biocytogen's antibody shelf by paying limited upfront payments, directly entering internal testing phases.

The innovative drug industry's early drug R&D model transforms from previous post-project endless waiting for candidate molecules to "instant availability," shortening the average time from preclinical discovery to PCC to 12-18 months.

This will undoubtedly significantly promote antibody candidate drug discovery and development processes, substantially saving precious time for innovative drug R&D companies.

While improving efficiency, innovative drug companies' project initiation models also shift from "first determine R&D direction, verify feasibility 1-2 years later" to "first obtain first-hand validation data, then determine whether to initiate projects," greatly reducing customers' early-stage R&D risks.

From a cost perspective, Biocytogen's "Thousand Mice, Ten Thousand Antibodies" program partially replaces traditional drug discovery CRO and innovative drug companies' internal drug discovery team roles, but with significant cost advantages.

Industry data shows that within large pharmaceutical companies, average costs from zero to successfully obtaining one candidate molecule reach tens of millions of dollars, while obtaining PCC-level antibody molecules from Biocytogen's antibody shelf for testing phases obviously costs far less.

Regarding target coverage scope, the "Thousand Mice, Ten Thousand Antibodies" program undoubtedly possesses more unique advantages.

According to Biocytogen's 2025 interim report disclosure, the "Thousand Mice, Ten Thousand Antibodies" platform has established over 1 million diverse candidate antibody sequence libraries targeting over 1,000 human targets.

What concept do 1 million antibodies for over 1,000 targets represent?

As of end-2024, only about 100 monoclonal antibody drugs targeting approximately 70 targets had received US FDA and EU EMA approval globally.

Previously, due to R&D investment considerations and personnel limitations, innovative drug companies typically could only focus on limited numbers of targets and pipelines for development.

The emergence of antibody shelves based on the "Thousand Mice, Ten Thousand Antibodies" program enables innovative drug companies to achieve "target freedom" to some extent, allowing parallel comparison of multiple targets at costs far below previous internal R&D expenses, optimizing R&D decisions after rapidly obtaining first-hand data, significantly improving innovative drug R&D success rates.

Combining all these advantages reveals that if an innovative drug company chooses deep cooperation with Biocytogen, its internal R&D processes will undergo revolutionary reconstruction. Previously time-consuming and investment-heavy early drug discovery phases will no longer be bottlenecks in innovative drug R&D processes under comprehensive "Thousand Mice, Ten Thousand Antibodies" platform support.

As an open program, Biocytogen's "Thousand Mice, Ten Thousand Antibodies" platform opens to the entire industry, gradually becoming core industry infrastructure, while Biocytogen realizes its grand vision—becoming the global innovative drug molecule "origin."

**BD-Oriented Business Model**

Even globally, it's difficult to find another company with an equivalent scale candidate antibody library like Biocytogen's; similarly, it's hard to find another company with similar business models.

This represents a naturally "BD-oriented" business model.

Unlike traditional innovative drug companies that face choices between independent development or outbound BD for each pipeline, Biocytogen's strategy is clear: it doesn't plan to invest proprietary resources leading candidate pipeline continued development, with every pipeline targeting outbound transfer or licensing as ultimate goals.

Biocytogen chooses to focus on molecular discovery, maximizing its advantages in innovative molecular discovery to build industry-leading efficiency and cost advantages.

This represents typical "10,000-meter depth in 1-meter width" focused strategy, where competitive advantages and barriers generated by focus and concentration often remain unattainable for competitors.

In innovative drug molecular discovery, Biocytogen's comprehensive advantages' significant cost-reduction and efficiency-enhancement effects make virtually all pharmaceutical companies excited and unable to refuse.

For small biotechs, entire innovative molecular discovery phases can be built upon Biocytogen's "Thousand Mice, Ten Thousand Antibodies" foundation, with "gold mining" in this library of over 1 million near-PCC-level antibodies completely sufficient to support entire small biotech company R&D plans.

For large pharmaceutical companies, "Thousand Mice, Ten Thousand Antibodies" doesn't conflict with internal molecular discovery operations.

As an extremely beneficial external resource library, the "Thousand Mice, Ten Thousand Antibodies" program can provide highly differentiated supplementation and empowerment for large pharmaceutical companies' internal molecular discovery operations, even providing unexpected surprises at certain moments.

In summary, regardless of company type, the "Thousand Mice, Ten Thousand Antibodies" program can generate effects through appropriate methods: either organically integrating into existing R&D processes or completely providing disruptive optimization and reconstruction of R&D processes.

Biocytogen's quite unique business model firmly occupies the source of the "innovative drug molecules" river, with all downstream innovative drug companies potentially becoming cooperative partners sharing R&D benefits.

Once substantial R&D results emerge, Biocytogen can obtain multiple revenue streams including upfront payments, milestone payments, and sales sharing through licensing, transfer, joint development, and various other approaches.

From current actual implementation, this "BD-oriented" business model has demonstrated strong vitality and rapid development trends.

In the first half of 2025 alone, Biocytogen signed 80 new transactions, up nearly 60% year-over-year, cumulatively signing approximately 280 therapeutic antibody asset licensing collaborations with partners including Merck, Gilead, Neurocrine, IDEAYA Biosciences, ABL Bio, Hansoh Pharma, and Nanjing Chia Tai Tianqing among other renowned domestic and international pharmaceutical companies.

Among cooperating pharmaceutical companies, considerable portions choose repeat cooperation with Biocytogen.

On September 4, 2025, Biocytogen announced signing an antibody option evaluation agreement with global leading technology company Merck to advance development of antibody-conjugated lipid delivery solutions for nucleic acid drugs.

Under agreement terms, Biocytogen will provide fully human antibodies independently developed based on its RenMice® platform for Merck's evaluation of feasibility for antibody-conjugated LNP formulation services. Merck receives exclusive options for selected antibody asset rights, while Biocytogen receives corresponding fee payments, sales sharing, and re-licensing sharing.

This cooperation not only demonstrates Biocytogen's fully human antibody platform diversity but also showcases broad application prospects for fully human antibodies beyond traditional therapies.

This marks Merck's third collaboration with Biocytogen in new fields, with such high "repeat purchase rates" undoubtedly representing the most convincing "vote" for Biocytogen's antibody discovery platform's high quality and efficiency advantages.

Recently, as a multinational pharmaceutical company, Merck has completed several large-value pipeline BD licensing deals with multiple Chinese pharmaceutical companies, providing complete reason to expect spectacular results from future Merck-Biocytogen collaborations.

On September 8, 2025, NASDAQ-listed pharmaceutical company IDEAYA Biosciences disclosed at its 10th anniversary R&D Day that its collaboration pipeline with Biocytogen, IDE034 (B7H3/PTK7 bispecific ADC), will submit clinical trial applications in H2 2025.

Only about a year has passed since IDEAYA Biosciences obtained IDE034 option and licensing agreements.

This cooperation case also demonstrates that Biocytogen's outbound cooperation projects are not only considerable in quantity but also achieve very high advancement quality and efficiency post-cooperation.

**Potential Big Winner in the Innovative Drug BD Era**

Biocytogen's BD-oriented business model highly aligns with current innovative drug industry development trends, achieving the company's "class advancement" within the innovative drug R&D value chain.

After precisely positioning in the core innovative molecular discovery segment, Biocytogen becomes a crucial key R&D partner for innovative drug companies, sharing backend benefits with enormous imagination space from innovative drug R&D.

This open model also avoids previous drawbacks of each innovative drug company conducting isolated R&D.

Previously, if a pharmaceutical company abandoned a certain molecule, it typically shelved it with little chance for renewed attempts.

Under Biocytogen's innovative business model, for specific antibody molecules, if Company A achieves poor testing results in certain indications, that molecule returns to "for sale" status, potentially allowing Company B or C to retest the molecule in different indications using different approaches.

Theoretically, every specific antibody molecule in Biocytogen's molecular library has multiple opportunities for testing and development by different innovative drug companies with various backgrounds, approaches, and clinical application scenarios.

Therefore, individual molecule success probabilities significantly increase.

The entire innovative drug industry can share Biocytogen's "Thousand Mice, Ten Thousand Antibodies" molecular library. This open model significantly improves innovative drug industry R&D success rates while greatly enhancing Biocytogen's antibody molecule outbound BD probabilities.

This unique business model represents Biocytogen's commercial wisdom based on profound industry insights, serving as an important factor promoting innovative drug industry development. It adapts to rapidly changing market environments, successfully breaking through traditional industrial limitations while helping companies seize entirely new opportunities.

As the "Thousand Mice, Ten Thousand Antibodies" program continues developing and more outbound cooperation results materialize, Biocytogen will undoubtedly become a potential big winner in the innovative drug BD era.