Wall Street capital targets Chinese biotech

By Daisy Edited by Yu Jing Beyond business development (BD) deals and direct acquisitions, Chinese innovative pharmaceutical companies are now being anchored by overseas capital in another way. In March, RA Capital Management filed a special purpose acquisition company (SPAC) listing application with the U.S. Securities and Exchange Commission (SEC), aiming to raise $50 million. Its objective is clear: to identify a Chinese biotechnology or healthcare company for merger. This move by the prominent Wall Street investment firm comes at a delicate juncture—on one side, China’s innovative drug BD deals continue to surge overseas; on the other, anxiety over the U.S. biotechnology industry’s competitiveness is intensifying. Just days earlier, data released by China’s National Medical Products Administration (NMPA) showed that outbound licensing transaction value for Chinese innovative drugs in the first quarter of 2026 exceeded $60 billion—nearly half of the full-year 2025 total. Meanwhile, senior FDA officials visited China earlier this year for in-depth exchanges with Chinese regulators; a recent U.S. Senate report bluntly stated, “The United States is losing the global biotechnology race.” With multinational corporations (MNCs) scaling back internal R&D and traditional IPO windows effectively closed, why has RA Capital chosen this moment to place its SPAC bet on China? And what kind of Chinese biotech company stands a chance of securing this ticket to Nasdaq? 01 “A Suitable Merger Target” A SPAC—short for Special Purpose Acquisition Company—is colloquially known as a “blank-check company.” It raises capital through an initial public offering (IPO) first, then seeks a target company to merge with, thereby enabling the latter to go public. As a listing vehicle, SPACs surged in popularity during 2020 and 2021, offering private biotech firms an alternative, faster route to the public markets—with comparatively lighter regulatory scrutiny than traditional IPOs. In subsequent years, however, SPACs fell out of favor due to underwhelming returns. Recently, however, they have re-emerged amid near-total closure of the biotech IPO window. The SPAC revival is partly attributable to the return of seasoned supporters with proven track records—and RA Capital is one such example. Over the past decade, RA Capital has launched two SPACs. One merged with Point Biopharma, a radiopharmaceutical developer acquired by Eli Lilly in 2023; the other, Research Alliance II, priced its IPO in 2021 but was later liquidated. In its latest SEC filing, RA Capital outlined plans for “Research Alliance III,” targeting a Chinese “target company” for acquisition or merger. RA Capital intends to sell 5 million shares at $10 per share in this SPAC, raising $50 million for the initiative. When planning this latest offering, RA Capital explicitly signaled its intent to once again leverage promising clinical-stage assets from China. China remains a major source of drug licensing transactions—and transaction volume continues to grow. The firm wrote in its IPO filing: “We believe that similar newly established companies will continue to emerge and may serve as suitable merger targets.”

Domestically developed oral small-molecule GLP-1 obesity drug succeeds in Phase 3 trial

At Week 52, the mean body weight reductions from baseline were −12.2% and −12.4% in the 120 mg and 160 mg dose groups of VCT220 tablets, respectively—both significantly greater than the −1.3% observed in the placebo group. Regarding safety, both dose groups demonstrated favorable overall safety profiles. Their safety characteristics were consistent with those of approved GLP-1 receptor agonists. The most common adverse events were gastrointestinal in nature, predominantly occurring during the initial titration phase and mostly Grade 1 or 2 in severity. No ≥Grade 3 nausea or vomiting occurred. The proportion of patients discontinuing treatment due to treatment-related adverse events was only 1.8% in both the 120 mg and 160 mg groups. No hepatic safety signals were observed throughout the study. According to a press release by Wentai Pharmaceutical, VCT220 is a small-molecule, non-peptide GLP-1 receptor agonist administered orally once daily, with no dietary, fluid intake, or fixed-time administration restrictions. Titration can be completed in as few as six weeks, and the drug requires neither refrigeration nor light protection—potentially offering overweight or obese patients a more convenient, accessible, and sustainable long-term treatment option, thereby improving patient acceptance and long-term adherence. Currently, Eli Lilly’s orforglipron is the only approved oral small-molecule, non-peptide GLP-1 receptor agonist globally. It received U.S. FDA approval for obesity treatment in April 2026. According to published data from the ATTAIN-1 study, the highest-dose (36 mg) orforglipron group achieved a mean weight loss of 12.4% at Week 72. VCT220 is the second oral small-molecule, non-peptide GLP-1 receptor agonist worldwide—after orforglipron—to complete a pivotal Phase 3 clinical trial for adult obesity. Based on these positive results from the pivotal Phase 3 trial, Wentai Pharmaceutical plans to engage with China’s National Medical Products Administration (NMPA) shortly to submit a marketing authorization application for VCT220’s obesity indication.

Obesity drug developer Corxel to go public in US via SPAC deal

1 day ago

Corxel Pharmaceuticals will go public via a SPAC merger with Amanat Acquisition Corp, raising $377 million to advance its oral obesity and diabetes drug candidate CX11 into late-stage trials. The deal is set to close in H1 2027 on Nasdaq.

reuters

2026-10-26

Obesity drug developer Corxel to go public in US via SPAC deal

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