China Biotech Deals Under Treasury’s Proposed COINS Act Rules

The US Department of the Treasury’s proposed COINS Act regulations would bring a broad range of biotechnology activities within the US outbound investment regime. Standalone licensing arrangements would generally remain outside the covered investment categories, but equity financing, NewCo structures, and development collaborations require closer examination. The implications also extend to foreign pharmaceutical companies and investment funds with US connections.

Following our July fireside chat on US-China biotech transactions, please join Morgan Lewis partners Todd Liao, David Plotinsky, and Carl Valenstein for a discussion of the proposal’s practical implications. We will examine how the proposed rules would apply to common deal structures, where important uncertainties remain, and what companies and investors should consider while transactions and development programs continue.

TOPICS WILL INCLUDE:

• The biotechnology scope: Which pharmaceutical, platform, and related activities would be covered—and why therapeutic purpose or a chemically synthesized final product does not, by itself, resolve the analysis
• Licensing and collaboration: Where standalone licensing differs from licensing with an equity component, and when co-development or co-commercialization arrangements could constitute a joint venture without a separate legal entity
• NewCo structures: How ownership, governance rights, and financial attribution affect the analysis—and why an offshore domicile or minority Chinese shareholding does not provide a complete answer
• Foreign companies and funds: How US control, US decision-makers, and US limited partners can create obligations, and where exceptions and contractual protections may be available
• Transactions already underway: How to assess existing investments, uncalled commitments, and future funding; the distinction between the rulemaking deadline and effectiveness; and how China’s parallel technology export requirements affect transaction planning

The discussion will focus on commercial consequences and structuring choices, with time for participant questions.

BACKGROUND

The Comprehensive Outbound Investment National Security Act (COINS Act), enacted in December 2025 as part of the FY2026 National Defense Authorization Act, established the first US outbound investment screening regime. The statute currently applies to artificial intelligence, semiconductors, and quantum computing, while granting the US Department of the Treasury authority to designate additional sectors—including biotechnology—without further legislation. The Treasury Department is required to issue final implementing regulations by March 13, 2027.

The Biotech Investment National Security Act (BINSA), announced on June 12, 2026, is a bipartisan legislative proposal that would amend the COINS Act to expressly bring certain pharmaceutical licensing structures within the outbound investment regulatory framework, rather than limiting coverage to equity investments. If enacted, it would represent the first legislation specifically extending outbound investment controls to licensing transactions.

INTENDED AUDIENCE

Business development, legal, corporate development, and licensing professionals at pharmaceutical and biotechnology companies, together with venture capital, private equity, and other investors evaluating transactions involving China-originated assets.

For registration information or questions regarding the program, please contact MorganLewisEvents@morganlewisevents.com.

CLE CREDIT

CLE credit in CA, FL, IL, NY*, PA, TX, VA, and WA is currently pending approval. Credit in CT and NJ is pending approval (via reciprocity). CLE credit is not available for the viewing of recorded sessions.

*This program qualifies for Newly Admitted Attorneys.

Those seeking CLE credit in any other state may be provided with a General Certificate of Attendance and may apply independently.

CLE Questions?

Please contact CLECreditRequest@morganlewis.com.