Bristol Myers Squibb Partners With China's Hengrui Pharma on Early-Stage Drug Development and Discovery

Bristol Myers Squibb announced a partnership with Hengrui Pharma on Tuesday to develop about a dozen drugs together. Four of the drugs were discovered by Bristol Myers Squibb and will be sent to China for Hengrui to run early-stage clinical trials. The companies will also collaborate to discover new drugs, with each contributing assets to the potentially multi-billion dollar partnership.

The deal marks a shift from the typical pattern in which large drugmakers license experimental medicines that have already undergone early testing in China. Bristol Myers Squibb will instead carry out early drug development there, aiming to bring treatments to market more quickly.

U.S. Company on both existing compounds and new discoveries. A little more than half of large pharmaceutical companies' licensing deals have come from China so far this year, according to data from DealForma. That compares with 39% of such deals in 2025 and 5% in 2022.

American and European biopharmaceutical companies including Pfizer, Merck and AstraZeneca have increasingly turned to China in search of potential blockbusters. "It's a huge signal," said Michael Baran, head of private investments at Affinity Asset Advisors and a former partner at Pfizer Ventures.

Bristol and Hengrui will each contribute assets and will work together on developing new drugs, making China look less like a source of one-off molecules and more like a part of pharma's global research and development operating system, Baran said.

The partnership differs from many prior collaborations. It is similar to a recent deal Hengrui inked with GSK that gives the British drugmaker access to some of Hengrui's experimental drugs.

U.S. Company is acknowledging it can develop certain drugs faster and for less money in China while also working jointly to generate new ideas. "More and more companies are looking at this as a global mesh model where you say China is not a threat or a separate source of innovation, we've got to tap into it back in and out," said Lieven Van der Veken, senior partner at McKinsey and global leader of QuantumBlack, AI by McKinsey.

He noted that previous efforts have involved local teams or venture capital-based investments, describing the Bristol-Hengrui deal as the next level.

Michael Baran, head of private investments at Affinity Asset Advisors, said drugmakers have partnered with Chinese companies before, including Amgen's 2019 collaboration with BeOne. Bristol's deal is significant because it is more reciprocal, he said.

U.S. Drugmakers could carry out early drug development in China and that Chinese companies could become global powerhouses. Lieven Van der Veken, global leader of QuantumBlack, AI by McKinsey, described the arrangement as part of an evolving industry approach. , said the industry has reached a transformative moment.

He noted that twice as many drugs can be studied in China in half the time and at one-third of the cost.