Contrary to seeking fully de-risked assets, pharmaceutical companies often prefer acquiring companies with some remaining clinical risk. This strategy allows them to leverage unique insights on early data to acquire assets at a better valuation, creating an opportunity for outsized returns before the value is obvious to others.

A successful acquisition strategy goes beyond the highest bid. It involves 'thinking like the molecule'—evaluating which buyer has the specific expertise, capabilities, and cultural alignment to best steward the asset's development. This reframes M&A from a financial transaction to a decision about the asset's future.

Syndax bypasses the lengthy initial lab phase by in-licensing promising science from external sources. This allows their internal experts to focus directly on clinical development in areas of high unmet medical need, a key strategy behind getting two drug approvals in two years.

To prepare for its internally discovered drugs, Eikon Therapeutics first in-licensed external programs. This allowed their newly-formed clinical team, led by a Merck veteran, to build cohesion and processes on existing assets, avoiding the risk of testing their teamwork for the first time on novel, internally-developed molecules.

Merck cited Cedara's extensive, pre-Phase 3 research on pricing and cost-effectiveness as a key factor in its $10B acquisition. This demonstrates that early-stage biotechs can significantly increase their M&A value by proactively building a robust commercial case alongside their clinical development.

The acquisition of Verona shows that a novel mechanism of action with a substantial clinical effect can make a company a prime M&A target. This holds true even with weaknesses like no composition of matter patent or an unfashionable drug delivery method, especially in disease areas lacking innovation.

Tortugas Neuroscience's startup strategy focuses on in-licensing new chemical entities that have already cleared Phase 1, bypassing early toxicity and IND risks. Their criteria demand that each asset be extensible to multiple indications within CNS, creating operating leverage and maximizing the chances of success.

Jade's strategy involves acquiring assets from Paragon, a company renowned for its protein engineering and half-life extension technology. This allows Jade to start with high-quality, potentially best-in-class antibody candidates without building the specialized discovery infrastructure in-house, accelerating its path to the clinic with a competitive advantage.

Ipsen avoids the high-risk, capital-intensive phase of basic research. Instead, its R&D strategy focuses on licensing promising drug candidates from universities and biotechs. The company then leverages its expertise in later-stage development, including toxicology, manufacturing scale-up (CMC), and clinical trials, to bring these de-risked assets to market.