The Secret Behind Billion-Dollar Upfront Payments: ‘Scarcity’ Matters More Than Clinical Stage

The value of licensing deals for drug candidates is determined not by clinical stage but by the competitive landscape and scarcity of the target market, an analysis found.

Biopharma APAC, a biotech-focused media outlet, reached this conclusion in a report analyzing eight major licensing deals completed in the Asia-Pacific (APAC) region from 2025 through 2026, released on the 29th local time.

According to the report, Hansoh Pharma’s GLP-1/GIP dual agonist, which had advanced to Phase 3, received an upfront payment of $80 million (approximately 120 billion won). This was attributed to intense competition in the obesity and diabetes treatment fields, where strong competitors are already established in the market.

By contrast, Ichnos Glenmark’s trispecific antibody, which was in Phase 1, commanded an upfront payment of $700 million (approximately 1.05 trillion won). The result reflected recognition of its scarcity based on a differentiated mechanism in the multiple myeloma field.

The most direct comparison is the PD-1/VEGF bispecific antibodies developed by China’s 3SBio and RemeGen. In May 2025, 3SBio licensed its Phase 2 asset to Pfizer for an upfront payment of $1.25 billion (approximately 1.875 trillion won). Eight months later, RemeGen’s Phase 1/2 asset was sold to AbbVie for $650 million (approximately 975 billion won).

Although the drugs belonged to the same class, their upfront payments differed by nearly twofold depending on clinical stage and timing. This shows that an exclusive position in the market can play a more important role than clinical stage in valuing a drug candidate.

The case of South Korean company Oscotec is also noteworthy. Oscotec’s treatment for immune thrombocytopenia, ‘sebudoplenib,’ failed to meet its primary endpoint in Phase 2. As a result, the upfront payment in its deal with Agios was relatively small, at $25 million (approximately 37.5 billion won).

However, Oscotec adopted a strategy to preserve future value by including an ‘option-back’ clause that allows it to regain development and commercialization rights in South Korea depending on the results of future Phase 3 trials.

The report also highlighted the rise of Chinese biotechs, with six of the eight deals analyzed involving Chinese companies. It further found that approaches to defining deal territories are becoming more diverse, including ▲excluding Greater China ▲retaining India and emerging markets ▲transferring global rights while securing an option for domestic rights.

Biopharma APAC concluded that “securing a differentiated position in a less competitive field is more important for increasing licensing value than advancing a drug candidate to the next clinical stage.”