Your essential biotech, medtech, and pharma recap — no noise, just what matters.

⚡ Executive Takeaway

On Monday we set the week's question: would the industry keep signing China deals into the teeth of the congressional probe, with the July 17 deadline bearing down? We have our answer, and it is emphatic. AstraZeneca alone signed two China deals this week. Monday it was the CSPC kidney collaboration worth up to $1.77B. Today it licensed ex China rights to an inhaled respiratory drug from Sino Biopharmaceutical. Two deals, one week, from a company that watched the House Select Committee send letters to five of its peers. AstraZeneca is not among the five named, which is surely part of why it feels free to move. But the signal is unmistakable. Eight days before the deadline, with the political temperature rising, the pharma industry is treating Chinese science as too valuable to pause. This is exactly the read we gave in June and reiterated Wednesday: the deals already signed are safe, the political risk applies to the future, and the friction gets priced and paid rather than avoided. The deal flow bends around the obstacle. It does not stop.

The other story worth closing the week on is what happened to KRAS. We spent the week watching this field reshuffle in real time. Monday, Genentech's divarasib beat the approved standard in G12C lung cancer. Wednesday, Revolution showed three RAS drugs working in pancreatic cancer. And today, Bristol Myers Squibb's Krazati stumbled, with the drug plus cetuximab delivering shorter survival than chemotherapy in colorectal cancer. Put those together and the picture is clear. The first generation KRAS G12C drugs, Amgen's Lumakras and BMS's Krazati, are looking increasingly vulnerable, while the next wave, Genentech's divarasib and Revolution's RAS(ON) franchise, is pulling ahead. Forty years of undruggable, and now the field is moving fast enough that this week alone rearranged the leaderboard. If you hold Krazati or Lumakras exposure, this was not a good week. 👉 Read Full Analysis

🌍 China and Policy

AstraZeneca just signed its second China deal in a week, and that answers the question everyone was asking. AZN

AstraZeneca licensed ex China rights to TQC3721, an inhaled PDE3/4 inhibitor for chronic respiratory diseases, from Hong Kong listed Sino Biopharmaceutical, according to The Pharma Letter. It is AstraZeneca's second China deal this week, following the CSPC kidney disease collaboration we covered Monday, and its latest in a long run of Chinese licensing moves. The timing is the story. The House Select Committee on China has responses due July 17 from Merck, AbbVie, Lilly, Pfizer and BMS over their China clinical trials, and the Biotech Investment National Security Act would add Treasury review to deals like this one. AstraZeneca was not named in the probe, which gives it room to keep moving while the five named companies stay quiet ahead of the deadline. The broader point is the one we have tracked all week: the industry is not slowing its China engagement. It is pricing in the political risk and continuing.

🔬 Oncology

Krazati stumbled, and the KRAS leaderboard just got rewritten in a single week. BMY

Bristol Myers Squibb's Krazati (adagrasib) combined with cetuximab produced shorter median overall and progression free survival than chemotherapy in a colorectal cancer trial, according to BioSpace. It is a real setback for one of the two first generation KRAS G12C drugs, and the timing sharpens the contrast. This week alone, Genentech's divarasib beat the approved standard in G12C lung cancer and Revolution showed three RAS drugs working in pancreatic cancer. The first generation, Lumakras and Krazati, launched to enormous expectations in 2021 and 2022 and have underdelivered commercially. Now the clinical gap to the next generation is widening in public. For BMS, which paid billions for Mirati to acquire Krazati, the colorectal setback pressures an asset that was already struggling to meet its original promise.

🧠 Neuroscience

GSK gave up on a $2.2B neuro bet after both drugs failed. GSK

GSK walked away from its up to $2.2B neurodegeneration partnership with Alector after both drugs in the collaboration flunked their clinical trials, according to Fierce Biotech. The pact centered on progranulin boosting antibodies aimed at frontotemporal dementia and related conditions. Both failed to deliver. It is another entry in a brutal stretch for neuroscience, following Merck killing its Phase 2 Alzheimer's program for futility on Wednesday. Neurodegeneration remains the graveyard it has long been, where promising biology and clean mechanisms keep failing to translate into patient benefit. For GSK under Luke Miels, cutting a losing program quickly fits the disciplined capital allocation the company has shown all year. For Alector, losing its marquee partnership on failed data is close to an existential problem.

📊 Capital Markets

The money is booming at the top and drying up at the bottom.

Two facts from this week describe the barbell shape of biotech financing. At one end, four M&A deals this year have each cleared $10B in guaranteed proceeds, matching all of 2025, with Vertex and Crinetics the latest. At the other end, early stage venture financing is on track for its lowest dollar total in years, according to BioSpace, as funders keep avoiding risky early bets. Capital is flowing freely to de risked, late stage, or commercial assets, and thinning out for the preclinical and early clinical companies that feed the pipeline years from now. It is great news if you have a Phase 3 asset or an approved drug. It is a warning if you are a founder trying to raise a Series A on a promising idea. The near term looks flush. The long term pipeline is being underfunded, and that bill comes due later.

📋 The Week in Review

👉 Read Full Analysis

The House Select Committee's deadline is a week out, and this week's deal flow tells us how the industry is positioning. Here is how we see it playing out.

Scenario one, political theater. The five named companies respond with detailed compliance narratives, the committee holds a hearing or two, nothing legislative passes this session, and the China deal flow accelerates once the immediate spotlight moves on. This is the most likely near term outcome, and AstraZeneca's willingness to sign two deals this week suggests much of the industry already believes it.

Scenario two, slow squeeze. The Biotech Investment National Security Act advances, adding Treasury review to China licensing deals. It does not ban anything, but it adds months of process, legal cost, and disclosure to every transaction. Deal flow continues but slows, and the political premium on China assets rises meaningfully. This is the moderate case, and probability is climbing as the issue gains bipartisan traction.

Scenario three, hard decoupling. Congress passes binding restrictions that meaningfully limit new China licensing. This would reshape the pipeline math for the whole industry, since Chinese science now feeds a large share of Western late stage assets. We put this as least likely in the near term, because the economic and clinical case for the deals is strong and the lobbying against restriction is fierce, but it is not zero, and the trajectory is toward more restriction rather than less.

Our base case remains scenario one bleeding into scenario two. The deals already signed are safe. New deals continue at a rising political cost. The companies that built early China pipelines captured the best value, and latecomers will pay more, in both dollars and scrutiny. What this week proved is that even under active investigation, the industry's revealed preference is to keep going.

💊 The KRAS Leaderboard After a Wild Week

One week rearranged the entire KRAS landscape. Here is where the major players stand.

Genentech's divarasib is the week's biggest winner, beating the approved standard in G12C lung cancer and establishing itself as the potential best in class G12C drug. Revolution Medicines is the franchise leader, with daraxonrasib heading for a CNPV filing, zoldonrasib feeding two Phase 3 trials with response rates up to 82% in first line pancreatic cancer, and RM-055 behind them. Between them, these two now define the frontier.

The first generation is under pressure. Amgen's Lumakras opened the category in 2021 but has posted modest commercial results and now faces a superior G12C competitor in divarasib. BMS's Krazati, acquired through the multibillion dollar Mirati purchase, just delivered a colorectal setback with the cetuximab combination underperforming chemotherapy, compounding an already disappointing trajectory.

The read for anyone with exposure. The value is migrating from the first generation to the next. Divarasib and the Revolution franchise are where the momentum is. Lumakras and Krazati are increasingly the incumbents to be displaced rather than the leaders to beat. For BMS specifically, the Krazati setback raises hard questions about the return on the Mirati acquisition. The KRAS story that took forty years to start is now moving fast enough to reshuffle in a single week, and the direction of travel is away from the pioneers and toward the second wave.

📊 The Barbell and Why the Thin Middle Matters

Biotech financing has taken on a barbell shape, and the empty middle is the part worth worrying about. At the heavy end, capital is abundant: four separate $10B plus M&A deals this year, structured financings like BridgeBio's $1B, and a healthy IPO window for de risked names. At the light end, early stage venture is on track for its lowest dollar total in years.

This matters because early stage financing is the seed corn of the whole industry. The Phase 3 assets that big pharma is paying $10B to acquire today were early stage bets five to ten years ago. If the current early stage drought persists, the pipeline of de risked assets available for acquisition in the early 2030s thins out, and the M&A wave that looks so healthy today runs short of targets tomorrow.

The dynamic is rational at the individual investor level and dangerous in aggregate. Each funder is sensibly avoiding risk in an uncertain environment, chasing the de risked assets everyone else wants. But collectively, the industry is underinvesting in the early science that produces the next generation of drugs. For founders, the message is grim in the near term: raising a Series A on promising preclinical data is harder than it has been in years. For the industry, the thin middle is a structural problem that the booming top end masks but does not solve. The flush headlines and the starved early stage are two sides of the same risk aversion, and the second side is the one that bites later.

🎯 Catalyst Calendar

AstraZeneca signed two China deals in a week and answered the question we opened with: the probe is not slowing anyone. The KRAS leaderboard got rewritten, with Krazati stumbling as divarasib and Revolution pull ahead. And GSK cut a losing neuro bet. Next week brings the July 17 deadline itself. Have a good weekend. What are you watching? Reply to this email.

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