The "NewCo" model, where a new company is formed around assets licensed from an existing firm, is a key strategy for Western investors to access a deep well of innovation from Chinese companies like Heisco, which are largely unknown in the West but possess broad, innovative pipelines.

Forbion identified an arbitrage: promising biotech assets in China whose originators lacked global development expertise. Their strategy is to create new Western companies, in-license these assets, and install an experienced team to unlock their "rest of world" value, a model proven by a billion-dollar exit.

Rather than a traditional IPO, QXO acquired a small public company (SilverSun Technologies), appointed Brad Jacobs as CEO, and injected $5 billion of liquidity. This SPAC-like strategy provided immediate access to public markets and a massive capital base for acquisitions.

Instead of passively waiting for pitches, proactive VCs like Foresight Capital build new companies by acquiring promising assets. They actively source clinical or later-stage assets, particularly from Asia where market dynamics are favorable, and then build a new company around them with a proven entrepreneur from their network.

China has developed a first-rate biotech effort, enabling U.S. firms to buy or license preclinical assets more efficiently than building them domestically. This creates an arbitrage opportunity, leveraging China's R&D capabilities while relying on U.S. expertise and capital for global commercialization.

While innovation from China is increasingly integrated into Western pharma pipelines, there's little expectation of outright acquisitions of Chinese companies. The consensus is that licensing a specific asset is far simpler and avoids the significant political and regulatory complexities of a full M&A transaction.

To tap into public market investors, Adaptin Bio merged with a 'Form 10' public shell company. This distinct route is not a SPAC as it doesn't raise money in an IPO. Instead, it provides a faster path to becoming a public reporting entity to attract a wider investor base.

When traditional venture funding dried up for Madrigal Pharmaceuticals, they found an unconventional path to capital and a public listing. They pursued a reverse merger with Cinta, a public company that had recently failed a Phase 3 trial and was seeking an exit. This "bake off" victory secured Madrigal $41 million.

The acquisition of Oro highlights the success of the "NUCO" model, where Chinese biotechs like KeyMed spin out assets into new companies. These NUCOs are backed by Western VCs specifically to achieve global development and a lucrative exit, creating a repeatable pathway for Asian science to reach Western markets.