The Chinese early-stage venture capital market for therapeutics is experiencing increased activity, supported by a roughly 25% rise in the Hang Seng Hong Kong Biotech Index since its lows in January 2025. This contrasts with the U.S. biotech private market, which faces challenges from trade tensions, macroeconomic volatility, and regulatory uncertainties linked to the FDA. Despite the U.S. biotech exchange-traded fund XBI declining 27% since the 2024 election, the first quarter of 2025 showed signs of stability with steady dealmaking, strong Phase 2 clinical trial payouts, and renewed interest from major pharmaceutical companies in China. Market participants note that the biotech sector has been undervalued due to tariff-related disruptions, presenting selective investment opportunities if volatility decreases. Additionally, optimism surrounds potential regulatory changes under FDA leadership by Robert Califf's successor, Vinay Prasad Makary, particularly regarding accelerated drug approvals. Overall, China’s biopharmaceutical sector is rebounding from its post-pandemic slump with active IPOs and dealmaking, while the U.S. sector remains subdued.