What Drives Biopharmaceutical License-Out Transactions? Evidence from Firm Characteristics, Executive Experience, and a Survey Experiment in China

The intervention is a randomized information-provision experiment embedded in a survey of senior executives at Chinese biotechnology and innovative-drug firms. Respondents are randomly assigned to a control group or to information-treatment groups.

The first treatment provides information about financing conditions facing Chinese biotechnology firms. The second treatment provides information about demand among multinational pharmaceutical companies for externally developed innovative-drug assets.

After treatment assignment, all respondents answer the same questions about their beliefs regarding financing conditions and global buyer demand, as well as their planned international cooperation, co-development, and out-licensing activities.

2026-06-18

2026-07-31

1. The respondent’s stated probability, from 0 to 100, that the firm will pursue an international partnership or out-license transaction during the next 12–24 months.
2. The respondent’s inclination to actively approach overseas pharmaceutical companies or international buyers, measured on a seven-point Likert scale.
3. The respondent’s belief about the likelihood that the firm will obtain sufficient financing from the domestic market in the future.
4. The respondent’s belief about the future strength of demand from multinational pharmaceutical companies for externally developed innovative-drug assets.

The planned probability of international cooperation or out-licensing is measured directly on a scale from 0 to 100. The active overseas-partner-search outcome is measured on a seven-point scale, with higher values indicating a stronger inclination to approach overseas pharmaceutical companies or international buyers.

Two mechanism-specific belief indices will be constructed.

The financing-constraint belief index will combine:
the reverse-coded perceived probability of obtaining sufficient financing from the domestic market; and
agreement with the statement that Chinese innovative-drug firms face financing and subsequent-development constraints.

The global-buyer-demand belief index will combine:
the perceived future strength of multinational pharmaceutical companies’ demand for external innovative-drug assets; and
agreement with the statement that global pharmaceutical companies’ demand for Chinese innovative-drug assets is increasing.

All component variables will be oriented so that higher values indicate stronger belief in the corresponding mechanism. Components will be standardized using the control-group mean and standard deviation and then averaged within each index.

The principal planned-action outcome will be the stated 0–100 probability of pursuing international cooperation or out-licensing. A supplementary planned international BD action index will be constructed by standardizing and averaging:

the probability of pursuing international cooperation or out-licensing during the next 12–24 months; and
the inclination to actively approach overseas pharmaceutical companies or international buyers.

Higher values of the index indicate stronger planned international BD activity.

The respondent’s preferred strategy for a hypothetical Phase I/II innovative-drug asset with global potential.
Whether the respondent prefers to retain global rights and continue internal development.
Whether the respondent prefers to retain China or Greater China rights while licensing overseas rights.
The respondent’s preferred transaction structure, including high-upfront arrangements, high-milestone arrangements, co-development, option-to-license agreements, equity investment combined with cooperation, or acquisition.
The importance assigned to retaining strategic control over the asset.
The respondent’s inclination to seek financing from domestic capital markets, industrial funds, or other domestic investors.
The respondent’s belief about the likelihood of obtaining sufficient financing from overseas markets.
The respondent’s overall assessment of the firm’s medium- and long-term development prospects.
Agreement that Chinese innovative-drug assets have become globally competitive.
Agreement that cooperation with a leading global pharmaceutical company can increase the firm’s long-term value.
The reasons respondents report for choosing out-licensing or co-development.
The reasons respondents report for retaining global rights and pursuing internal development.
Respondents’ ratings of the importance of CEO characteristics, overseas networks, clinical-data maturity, unmet medical need, development-stage ranking, intellectual property protection, CMC capability, investor endorsement, BD-team capability, and strategic fit with multinational pharmaceutical companies.
Open-ended explanations of the growth of license-out transactions, concerns about licensing promising assets, and the types of assets that should remain under internal development.

The study is an online survey experiment involving senior executives and other major decision-makers at Chinese biotechnology and innovative-drug firms. Before treatment assignment, the survey collects information about respondents’ professional backgrounds, their firms’ characteristics, innovation pipelines, prior BD experience, and international development experience.

Respondents are then randomly assigned at the individual level to one of three groups: a control group, a financing-conditions information treatment, or a global-buyer-demand information treatment.

Following treatment assignment, all respondents complete the same modules measuring beliefs and planned actions related to financing, international buyer demand, global partnerships, co-development, retention of global rights, and out-licensing. Treatment effects will be estimated by comparing post-intervention outcomes across the randomly assigned groups.

Not available

Randomization will be conducted automatically through the online survey platform using a computer-generated random-assignment procedure. Eligible respondents will be assigned with approximately equal probability to the control group, the financing-conditions treatment, or the global-buyer-demand treatment. The intended allocation ratio is 1:1:1.

The unit of randomization is the individual survey respondent. Each participating senior executive or major decision-maker will be independently assigned to one of the three experimental groups.

If more than one respondent from the same firm participates, assignment will remain at the individual level. Firm identifiers will be used to identify respondents belonging to the same firm.

No

300 individual respondents.

Because the intervention is not clustered, each individual respondent constitutes one randomization unit. The number of randomization units is therefore equal to the number of observations.

300 senior executives or other major decision-makers from Chinese biotechnology and innovative-drug firms.

The planned allocation is approximately equal across the three experimental groups:

100 respondents in the control group;
100 respondents in the financing-conditions information treatment; and
100 respondents in the global-buyer-demand information treatment.

Total planned sample: 300 respondents.

Minor deviations from these numbers may arise from computerized random assignment, survey noncompletion, or exclusions made according to pre-specified data-quality rules.

With 300 respondents allocated equally across three experimental arms, each treatment-versus-control comparison will include 100 respondents in the treatment group and 100 respondents in the control group. Assuming a two-sided test with a 5% significance level, 80% statistical power, no clustering, and no precision gains from covariate adjustment, the minimum detectable effect for a comparison between one treatment group and the control group is approximately 0.40 standard deviations.