A star Biotech company announced bankruptcy.

When the health points fall below the critical value, the game character will be instantly killed by a single blow. This is the so - called "execution line" for game characters.

At the beginning of the new year, a well - known Biotech (biotechnology company) has entered the "execution line": Nido Biosciences, headquartered in Massachusetts, USA, announced that its most core and painstakingly developed drug, NIDO - 361, showed no efficacy in the Phase II clinical trial.

As a result, Nido will officially close in early 2026.

This is the first Biotech company to collapse in 2026. Looking back at 2025, a number of Biotech companies have quietly left the stage. Even some of these companies once raised as much as 3 billion yuan in a single round of financing, but still failed to survive this wave of winnowing.

Amidst the sighs, the watershed has arrived, and Biotech companies are going their separate ways.

Once Raised $800 Million, Even Eli Lilly Invested

Nido was born out of a promising but arduous task.

At that time, there was a rare genetic disease in the world called spinal and bulbar muscular atrophy (Kennedy's disease), and almost all patients were male. Although the number of patients with this disease is small globally, patients suffer from progressive muscle weakness and atrophy, and the treatment demand is extremely urgent. However, there is no drug on the market that can change the disease process.

Obviously, this is a rare disease field with a scarce patient population, weak research foundation, and great challenges.

In 2020, a small team of about 20 people at Nido decided to take on the challenge. They used neurons cultured from human induced pluripotent stem cells to find new drug targets, and focused on promoting the development of the drug NIDO - 361 for Kennedy's disease. Subsequently, in 2022, Nido launched the Phase I clinical trial of NIDO - 361. In the following year, this drug gradually entered the global Phase II clinical trial stage for patients with Kennedy's disease.

Almost at the same time, investors began to flock to Nido.

In 2023, Nido raised funds in the Seed round, Series A, and Series B in succession, and received a total of $109 million in financing at one go.

Among them, the Series A financing was jointly led by 5AM Ventures, Abingworth under Carlyle, and Bessemer Venture Partners, one of the most prestigious venture capital firms in the United States. Pharmaceutical giant Eli Lilly and Osage University Partners participated in the investment. The Series B financing was led by the new investor, biotech venture capital firm Bioluminescence Ventures, with the participation of existing investors and other unnamed new investors.

For a while, Nido was at the height of its popularity and became a highly - regarded startup in the field of neuroscience. In early 2024, Nido was rated by the well - known industry media BioSpace as:

"The Most Promising Next - Generation Biotech Star".

The Death of a Biotech Company

Unexpectedly, the collapse came so quickly.

At the beginning of 2026, Springhorn, the CEO of Nido, wrote regretfully in an open letter on LinkedIn that the company would officially cease operations in early 2026.

The reason was that the highly - anticipated NIDO - 361 had failed. As Springhorn said, in the recently completed global Phase II clinical trial of NIDO - 361, this candidate drug failed to achieve the expected efficacy. After careful evaluation, the R & D of this pipeline had to be terminated.

"This is a very difficult result for all of us, especially considering the hope this project brought to patients with Kennedy's disease and their families." Springhorn admitted in the statement.

It is reported that Nido doesn't only have the NIDO - 361 project. The company also has another pre - clinical R & D platform involving directions such as autophagy, cell death, and neuroinflammation. However, with the failure of the core pipeline, these projects may also lose the financial support for further advancement.

In fact, Nido's dilemma is not an isolated case. A number of Biotech companies left the stage dejectedly in 2025.

Areteia staged a "failure on the verge of victory". Founded in 2022, Areteia's only product, dexpramipexole, is used to treat eosinophilic asthma. In the year of its establishment, it ranked on the "List of the Most - Funded Biotech Companies Globally in 2022" released by the authoritative media platform Fierce Biotech with a Series A financing of up to $425 million.

However, its core product has never been able to prove its clear value at the key clinical endpoints. In December 2025, there were reports that Areteia was about to close its operations, and the team was basically disbanded.

Also in December last year, Mythic, a startup focusing on the oncology ADC field, terminated its only clinical trial, and its R & D equipment, IP, and platform technology were successively put up for sale. The reason for Mythic's decline is even more regrettable - although the product has good scientific prospects, it couldn't stop the cooling - off of capital's enthusiasm for the ADC field, and finally the company's capital chain broke.

These former stars leading the race were the first to be affected when the capital wave receded. According to statistics from Fierce Biotech, as of November 1, 2025, more than 16 Biotech companies globally had officially announced their closures in 2025.

The Watershed

Some Burst Out, Some Leave the Stage

At this moment, Biotech is undergoing a baptism.

A medical investor talked to us about the internal strategic adjustment: "Continue to increase investment in high - quality targets; resolutely dispose of problematic enterprises." Investment institutions have become more cautious and abandoned those unproven innovations.

Thus, struggling for survival and riding the wave are happening simultaneously - companies with a single product pipeline, insufficient cash reserves, and unable to provide key clinical verification data are already struggling on the edge of a cliff. On the other hand, companies that can demonstrate clinical value, product progress, and efficient commercialization continue to receive capital favor.

Let's turn our attention to China. It is clearly visible that Biotech companies in China entered the realization era in 2025.

First of all, the Hong Kong stock IPO market was extremely lively. Insilico Medicine became the champion of Hong Kong stock biomedical IPOs by raising HK$2.277 billion. Jingfang Medicine, Ying En Biopharma, and Vistalys Therapeutics raised HK$2.093 billion, HK$1.886 billion, and HK$1.484 billion respectively. In addition, Hengrui Medicine, CSPC Pharmaceutical Group, etc. all embraced the international capital market.

At the same time, out - licensing has become the core growth strategy for Chinese Biotech companies. According to a set of data from Pharmcube, the total transaction amount of out - licensing of Chinese innovative drugs in the BD field reached as high as $135.655 billion in 2025, with the upfront payment reaching $7 billion, and the total number of transactions reaching 157. All dimensions reached historical highs.

At the beginning of 2026, with Insilico Medicine announcing a R & D cooperation worth a total of $888 million with Servier, the curtain on the new year's domestic innovative drug BD activities was officially opened.

In fact, the BD transaction, which is essentially a business behavior similar to "selling assets", is also accompanied by skeptical voices. In the view of many people, BD transactions cannot really turn the losses of innovative pharmaceutical companies into profits. The key to sustainable profitability still lies in product sales revenue.

Fortunately, excellent Biotech companies have begun to demonstrate their commercialization capabilities - emerging biopharmaceutical companies such as BeiGene and Innovent Biologics have successively announced that their profits have turned positive or are about to turn positive. The performance of a group of established pharmaceutical companies such as Hengrui Medicine and China Biopharmaceutical has generally improved.

Biomedical entrepreneurship has always been both fascinating and dangerous. The simple truth still holds - after experiencing ups and downs and reshuffling, good companies will finally emerge calmly.

This article is from the WeChat public account "Investment World" (ID: pedaily2012), author: Feng Yuchen, published by 36Kr with authorization.